S&P Case-Shiller reports homes prices up in Seattle

April 30, 2013 by Leave a Comment

The  S&P/Case-Shiller Home Price Index was released this morning showing that home prices across the country are up 9.3% year over year through February based on the 20-City Composite. All 20 cities in the composite have reported increases in home prices over the last two months.

Some cites are experiencing double digit increases. Seattle’s home prices are up 9.3% year over year per this report.

SP Case Shiller Apr30
 

From the report:

“Home prices continue to show solid increases across all 20 cities,” says David M. Blitzer, Chairman of the Index Committee at S&P Dow Jones Indices. “The 10- and 20-City Composites recorded their highest annual growth rates since May 2006; seasonally adjusted monthly data show all 20 cities saw higher prices for two months in a row – the last time that happened was in early 2005….”

If you are considering buying a home in Seattle or anywhere in Washington state, I strongly recommend that you meet with a licensed mortgage originator and start the preapproval process early. I’ll often meet with home buyer six months to a year before they’re planning on buying a home. If I can help you, please let me know!

Filed Under: Economy, Residential Purchase Tagged With: , ,

Buying a Duplex to live in with an FHA mortgage

April 26, 2013 by 4 Comments

mortgageporter-seattle-duplex-1One of my favorite blogs to follow, Get Rich Slowly, recently published Reader Stories: I bought a duplex to save money on rent. The author of the post describes how he used an FHA mortgage to buy a duplex and with renting out the unit he was not living in, he wound up paying less for his housing than when he was renting.

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Filed Under: Mortgage Programs, Investment Property, Residential Purchase Tagged With: , ,

House Key Opportunity – Washington State Bond Mortgage Program

April 17, 2013 by 5 Comments

UPDATE MAY 1, 2014: FUNDS ARE BACK FOR HOUSE KEY ARE BACK – AND ARE LIMITED.   

House Key Opportunity is a mortgage program offered by the Washington State Housing Finance Commission. House Key Opportunity is probably the program you’ve heard about when someone mentions “state bond” mortgages. This program offers below market mortgage rates for a select group of home buyers and is often combined with a WSHFC second mortgage for down payment assistance. The rates are only available until the funds reserved for the program run out.

Here’s a quick review of House Key Opportunity:

  • Borrowers must be first time home buyers (or have not owned a home in the last three years) unless you’re buying in a “targeted area”.
  • Income limits apply based on the size of the household with the first mortgage. Additional income restrictions may apply with the DPA (down payment assistance) second mortgage.
  • Maximum acquisition cost applies based on county.
  • Home buyers must attend a WSFHC approved class.
  • Property must remain owner occupied or recapture tax applies.
  • Properties must have an inspection unless a 1 year warranty is provided by the builder.

The House Key Opportunity Program with down payment assistance programs are available to borrowers who meet specific program requirements. Amounts and terms of the DPA vary with each program. The second mortgage programs listed below may also be used with a Home Advantage first mortgage and are provided based on need. Not all of the DPAs listed below have constant funding so availability may be limited.

  • The HomeChoice Program: eligible borrowers must have a qualifying disability or have a family member with a qualified disability living with them. Maximum DPA is $15,000.
  • House Key Schools: borrower must be an employee of an accredited or state recognized K-12, public or private school including community and technical schools. Max DPA is up to $10,000.
  • House Key Veterans: eligible borrowers are veterans who received an honorable discharge and include members and honorably discharged former members of the Washington national guard and reserve or never remarried spouses and dependent/children of deceased veterans. Max DPA is $10,000.
  • New Home for You: available to first time home buyers (or targeted area) meeting criteria and buying a never occupied new construction home. This program is only available with a House Key first mortgage and requires credit scores of 680 or higher. Max DPA is $10,000.
  • House Key Plus ARCH: first time home buyers must be purchasing a home in designated areas of east King County. Max DPA is up to $30,0000.
  • Home Advantage Rebound: the home being purchased must be bank owned, foreclosed or a short sale. Max DPA is up to $10,000

Home buyers seeking down payment assistance, who do not want to buy in a targeted area or who are not first time home buyers or who do not meet the specific needs criteria, may opt for WSFHC Home Advantage Program.

For current rates on House Key Opportunity and more information about this program, click here.

As a Washington State Housing Finance Commissioned trained Loan Officer, I’m pleased to offer both House Key Opportunity and Home Advantage mortgage programs. Here as a list of WSHFC classes where I will be one of the instructors.

If I can help you with your home purchase or refinance on property located anywhere in Washington, please contact me.

Filed Under: Down Payment Assistance, Home Advantage Program, House Key Opportunity, Residential Purchase Tagged With: , , , ,

Home Advantage Mortgage with Down Payment Assistance

April 11, 2013 by 4 Comments

2013-03-07_0746Home Advantage is a program that is offered through the Washington State Housing Finance Commission.  Home Advantage is typically combined with a Home Advantage second mortgage that can finance closing cost and the down payment. Unlike the House Key program (state bond), this program has unlimited funds available for qualified Washington home buyers.

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Filed Under: Mortgage Programs, Down Payment Assistance, First Time Home Buyer, Home Advantage Program, Residential Purchase Tagged With: , , , ,

Median Home Prices up 18.5% in King County

March 6, 2013 by Leave a Comment

A few days ago, I shared an article about how the greater Seattle – Bellevue – Everett area is one of the top 5 places in the country to be a home seller.  Yesterday’s article in the Seattle Times appears to back that up.

A record-low inventory of homes for sale in King County, very low interest rates and a growing Puget Sound economy combined to push the median price of houses sold in February to $365,000, an 18 percent jump over a year ago.

Only 2,947 homes were listed for sale in King County last month, down from 5,178 a year ago, according to Tuesday’s report by the Northwest Multiple Listing Service.

I’m currently working with several pre-approved buyers who are ready, able and wanting to buy a home in this area. What they need is more inventory.

If you have been considering selling your home, now could be the time. You may find that you have an advantage being listed before other homes plan to go on the market for Spring.

If you are planning on buying a home, I cannot stress enough how important it is to be prepared for competition. It’s crucial to be fully preapproved with a local, reputable mortgage professional.

If you’re considering buying a home in King County, or any county in Washington state, I’m happy to help you with your mortgage needs. 

Filed Under: Residential Purchase Tagged With: ,

The biggest issue with buying a home today in Seattle

February 6, 2013 by Leave a Comment

Yesterday I met for coffee with one of my clients who is hoping to buy a home in a Seattle area neighborhood for around $600,000. They have already taken one of the most important steps in the home buying process by getting preapproved for a mortgage.

The preapproval process required they complete a loan application and provide me with documentation that supports the information provided on the loan application (such as W2s, paystubs and bank statements). After having a complete application, I am able to run their credit reports and run the scenario through automated underwriting, which provides us with an approval and conditions to that approval.

Here’s a bit from our conversation with a few of their questions.

Is it challenging to qualify for a home in Seattle?

It’s really not that hard to qualify. Presently our underwriting guidelines will allow:

  • a low-mid credit score of 640 for FHA
  • a minimum down payment of 3.5%, which can be gifted by a family member. NOTE: FHA Jumbo’s will soon have a minimum down payment of 5%. In the greater Seattle area, FHA Jumbo’s are loan amounts from $417,001 to $567,500
  • VA home buyers can have a low-mid credit score of 620 with zero down payment up to $500,000. A $600,000 sales price would have a down payment of $25,000 with a VA Jumbo.
  • Home buyers need a two year employment history (sometimes your college education may count as an employment history)
  • Income must be documented and consistent. NOTE: if your self-employed, paid commission or hourly (vs. salary), you will need a two year history and income will be averaged.  NOTE: If you are planning on using your 2012 income, you may want to consider filing your income taxes as soon as possible.
  • Down payment and funds for closing must be documented with complete asset account statements. 

What are the biggest “hiccups” in a transaction?

  • borrowers need to continue providing paystubs and bank statements. Do not toss or shred anything that has to do with your assets or income.
  • large deposits (typically this is anything over $1000) must be documented…so if your Great Aunt Nelly is giving a wad a cash or a check for a birthday present at the time you’re getting ready to buy a home, keep documentation or proof of where the cash came from.
  • if you are planning on using 2012 income for qualifying, you need to file your 2012 tax returns as soon as possible. Lenders re-verify income (beyond W2s or 1040 – tax returns) with tax transcripts from the IRS via Form 4506. As we near “tax season” it takes the IRS longer to process and provide this information.
  • days prior to closing, employment is re-verified. If there are changes to employment or the employer is difficult to reach, this may cause a delay.
  • a “soft” credit pull is done prior to closing as well to make sure no new debts have been acquired by the buyer. If there are new debts, the buyer will need to be re-approved factoring in the debt payments.
  • If the credit report is getting ready to expire prior to closing, a new credit report will be obtained. This may have additional impacts to the transaction if there are changes to debts or credit scores. 

What is the BIGGEST issue with buying a home today in Seattle?  INVENTORY!  

This probably comes to no surprise to Seattle area home buyers in the $300,000 – $700,000 price range hoping to find a non-distressed home to make an offer on. 

If you have been considering selling your home, NOW could be an excellent time to consult with a real estate agent…and I’m happy to recommend one to you! 

As always, if you’re looking to buy a home or refinance your mortgage on a home located anywhere in Washington state, please contact me. I have been originating mortgages at Mortgage Master Service Corporation since April 2000 and I’m happy to help you!

Filed Under: Residential Purchase, Underwriting and Qualifying Tagged With: , , ,

How much home do I qualify for with a $70,000 down payment?

January 24, 2013 by Leave a Comment

I’m working with a couple in Seattle who would like to buy a home. They have excellent credit (scores of 740 or higher) and are planning on using $70,000 for their down payment and closing cost. They want to know how much home they can buy based on their down payment.

The following rate quotes are effective as of January 24, 2013 at 12:20 pm. Rates change constantly, for your personal rate quote for a home located in Washington state, click here.

Conforming High Balance allows them to buy a home priced at $576,000.

The conforming loan limit in Seattle/King-County is currently $506,000. Using a conventional mortgage, they could buy a home priced at $576,000. 

Current mortgage rates for a 30 year fixed conforming high balance ($417,001 – $506,000) based on this scenario is 3.750% (apr 4.094).  

3.750% is priced as close to “par” as possible meaning there is as little rebate credit or discount points priced with the interest rate. We could adjust the rate slightly higher to create more rebate credit to help pay for closing cost or we could reduce the rate by paying more in discount points. 

The loan to value based on a sales price of $576,000 and loan amount of $506,000 is 87.874% which means the Seattle home buyers will have private mortgage insurance (pmi). For this client, we’re opting to include the pmi in their mortgage payment instead of paying it as an upfront additional closing cost or doing “split premium” mortgage insurance.  

The principal and interest payment is $2,343.36 plus private mortgage insurance of $282.52 gives us a “PIMI” payment of $2,625.88. Property taxes and home owners insurance are additional.

The Seattle home buyers will negotiate the seller paying for remaining closing cost and prepaids/reserves estimated at $7900, leaving their amount due at closing very close to $70,000.  If the sellers opt to not pay for closing cost and prepaids, the buyers can use rebate pricing (slightly increasing the mortgage rate) to offset the cost.

FHA allows them to buy a home priced up to $637,500.

FHA mortgages in the Seattle/King County area have a loan limit of $567,500. With a down payment of $70,000 they could buy a home priced up to $637,500. The big difference between FHA and conventional financing is the mortgage insurance. FHA has both upfront and monthly mortgage insurance. 

The current mortgage rate I’m quoting for their FHA scenario is 3.375% (apr 4.059%).

This rate is priced with a little more rebate to help reduce closing cost. If the Seattle home buyers want a lower rate with less rebate credit, they certainly can opt for that. Mortgage rates are not locked until we have a bona fide contract and the rates will be “floating” while they shop for a home.

The principal and interest on this rate and loan amount is $2,552.80 with mortgage insurance at $562.43 providing a PIMI payment of $3,115.23. Property taxes and home owners insurance are additional.

After the rebate credit, if the buyers negotiate the seller paying the remaining balance of their closing cost, prepaids and reserves in the amount of $4,000, the buyers will need around $70,000 for funds due at closing.

VA loans allow them to purchase up to $780,000 with a “VA Jumbo” loan.

The VA zero down loan limit in Seattle is $500,000. When a loan amount exceeds the limit, eligible Veterans can have a down payment based 25% off the difference between the sales price and loan amount.  

For example, a sales price of $780,000 less $500,000 loan limit = $280,000. $280,000 x 25% = $70,000 down payment.

The current rate I’m quoting for this VA Jumbo 30 year fixed loan is 3.250% (apr 3.379).

The principal and interest payment on this loan is $3,136.31. There is no mortgage insurance on a VA loan. Property taxes and home owners insurance are additional. 

If the seller pays for $4500 of the Veteran’s closing cost and prepaids, then the amount due at closing will be around $70,000.

USDA loans are not eligible in the Seattle area because it’s not a rural area.

If you are interested in buying a refinancing a home located anywhere in Washington state, I’m happy to help you. I’ve been originating residential mortgages at Mortgage Master Service Corporation since April 2000. 

Filed Under: Mortgage Programs, Fannie, Freddie and FHFA, Residential Purchase, VA Mortgage Loans Tagged With: , , , , ,

The ABC’s of Preparing to Buy Your First Home

December 13, 2012 by 1 Comment

ABCs of Buying First HomeNOTE: This post has been updated for 2026. 

Borrowers getting ready to buy their first home are often surprised…for different reasons. I find that some are surprised to learn that they do qualify for a home in their price range and some are disappointed to learn that they have a little work to do before they can buy a home.

Getting preapproved with a mortgage professional helps to take some of the “surprise” out of the process.

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Filed Under: First Time Home Buyer, Residential Purchase Tagged With: , , , , , ,
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