Chad Goldstein - Gold Key Realty LLC



Posted by Chad Goldstein on 5/13/2019

Mortgage interest rates have a remarkable effect on the overall long-term cost of buying a property through financing. Mortgage borrowers are looking for the highest possible rates while lenders have to manage their risk by charging interest rates. Borrowers with good credit histories and stable finances are those who can access a mortgage with lower interest rates. The financial status of borrowers has a significant impact on the interest they can get; government fiscal policy and other economic factors can affect mortgage rates on a global level. Below are some of the factors that can affect your mortgage interest rates:

Inflation 

Inflation causes the price to rise gradually. It is a critical factor in the overall economy and an essential element for mortgage lenders. It reduces the purchasing power of dollars. And, mortgage lenders manage the interest rates such that it will be able to withstand the reduction of purchasing power through inflation to make sure that there is a real net profit on their interest returns.

The Level of Economic Growth

The gross domestic product and the employment rates are the economic growth indicators that have a remarkable effect on mortgage rates. When economic growth rates increase, there is higher income, and there is an increase in the level of consumer's spending which translates to a rise in consumers seeking mortgage loans. 

Federal Reserve Monetary Policy

The monetary policy of the Federal Reserve Bank is one of the essential factors that affect mortgage interest rates and the overall economy. The Federal Reserve Bank does not stipulate a specific price in the mortgage market, but the establishment of the federal funds' rates and the adjustment of money supply upward or downward have a pronounced effect on the mortgage interest rates that are available to borrowers.

Generally, a rise in the supply of money pressures rates downward while a reduction in money supply puts upward pressure on rates.

Housing Market Condition

The conditions and trends in the housing markets can influence mortgage rates. When there is a decrease in the number of new constructions, there is will a reduction in home purchases which automatically leads to a decline in demand for mortgages. This situation makes the interest rates to reduce. Another trend that affects the mortgage rate is the number of consumers renting an apartment instead of buying a home.

The rise and decline of mortgage interest rates operate based on the basic rules of demand and supply. All the factors mentioned above have a pronounced influence on mortgage rates. Most importantly, your financial standing affects your mortgage rate. It is essential to speak to a financial advisor before deciding on starting a home purchase and mortgage process.





Posted by Chad Goldstein on 5/6/2019

Most people that obtain a mortgage loan against another property usually plan to buy a second house. This means that they are not ready to sell or move out of their existing place of residence, but they wish to have a second house that they can occupy later, use as a vacation retreat or as an income property. A mortgage loan secured against another property is known as a second mortgage. 

A second mortgage on another property is also a long-term loan in your name against the home you intend to buy. It is worth noting, however, that this mortgage differs from a secured charge mortgage or remortgage.

Benefits of securing a mortgage loan against another property 

- The advantages of going for a second mortgage is that it is separate from your current mortgage. Therefore, your existing property is not at direct risk.

- A second mortgage could be a cheaper loan when compared with second charge mortgage or secure loan 

Drawbacks of securing a mortgage loan against another property

- One of the disadvantages of acquiring a second mortgage is that it requires a second deposit.

- Paying for two mortgages at a time can be quite expensive.

- Affordability checks of the second mortgage are stringent.

- Going for a second mortgage may put your current apartment at an indirect risk. Meaning that you might have to sell your existing home to cover the repayment of the second mortgage. 

How to secure a mortgage loan against another property 

You must be aware of the fact that you will be subjected to stricter affordability checks when applying for a second mortgage. A second mortgage is much harder to approve because of these measures. You have to get all your documents ready, especially those that will prove that your income can cover the cost of two mortgages.

Apart from getting your documents ready, try to minimize spending well before tendering your application for a better chance. Also, it is essential that you make a comparison across the market to know the right deal for you. Another trick to improve your chances of getting your second mortgage approved is by repaying the first mortgage as quickly as possible. Decide on what you want to do with your second home as this will affect your mortgage.

Are you planning to secure a mortgage loan against another property? Check out the tips given above. They will help you get your application approved whenever you decide to go for a second mortgage. Your real estate agent may have special relationships with mortgage brokers or lenders in your area, talk to them for additional advice.




Categories: Mortgage   Financing   second home  


Posted by Chad Goldstein on 10/1/2018

For those who want to acquire a house, it helps to get your finances in order. That way, you can quickly and effortlessly navigate the homebuying journey without having to worry about how you'll afford your dream house.

There are many quick, easy ways to straighten out your finances before you embark on the homebuying journey, such as:

1. Assess Your Credit Score

Your credit score ultimately can play a major role in your ability to secure a great mortgage. If you understand your credit score, you may be able to find ways to improve it prior to conducting a home search.

It is important to remember that you are entitled to a free copy of your credit report annually from each of the credit reporting agencies (Equifax, Experian and TransUnion). Request a free copy of your credit report today, and you can take the first step to evaluate your credit score.

If you find that your credit score is low, there is no need to worry. You can always pay off outstanding debt to improve your credit score over time.

Also, if you identify any errors on your credit report, you'll want to address these mistakes immediately. In this scenario, you should contact the agency that provided the report to ensure any necessary corrections can be made.

2. Look Closely at Your Monthly Expenses

When it comes to buying a house, it generally helps to have sufficient funds for a down payment. The down payment on a house may fall between 5 and 20 percent of a home's sale price, so you'll want to have enough money available to cover this total for your dream residence.

If you evaluate your monthly expenses, you may be able to find ways to save money for a down payment on a house.

For example, it may be beneficial to cut out cable TV for the time being and use the money that you save toward a home down payment. Or, if your dine out frequently, cooking at home may prove to be a substantial money-saver that could help you speed up the process of saving for a down payment.

3. Get Pre-Approved for a Mortgage

With pre-approval for a mortgage, you can enter the housing market with a budget in hand. Then, you'll be better equipped than ever before to narrow your search to houses that fall within your price range.

To get pre-approved for a mortgage, you'll want to meet with banks and credit unions. These financial institutions can teach you about different mortgage options and help you assess all of the options at your disposal.

Furthermore, don't hesitate to ask banks and credit unions about how different types of mortgages work. This will enable you to gain the insights that you need to make an informed decision about a mortgage based on your financial situation.

If you need extra help as you prepare to pursue a house, you may want to hire a real estate agent as well. In fact, a real estate agent can help you find a high-quality house at a budget-friendly price in no time at all.




Categories: Buying a Home   Mortgage   Financing  


Posted by Chad Goldstein on 8/13/2018

If you’re ready to buy a home, you probably have done a lot of research. One thing is sure: You know you need to get pre-approved for a mortgage. It’s perhaps the most critical step in the process of buying a home for a variety of reasons. There’s down payments and debt-to-income ratios, and other financial issues to worry about. You need to know what type of mortgage you should get. To help you understand what kind of mortgage you need, you should get pre-approved.


Understand The Pre-Approval Process


There are many misconceptions about pre-approvals. First, buyers need to understand that there is a difference between a pre-qualification and a pre-approval. A pre-qualification merely scrapes the surface of your financial state, while a pre-approval goes through everything a mortgage company will need to grant you a loan. You may be pre-qualified for a much higher amount than you can actually afford, for example.


Pre-Approval Defined


A pre-approval is a lender’s written commitment to a borrower. The approval states that the lender is willing to lend a certain amount of money for a home. The lender obtains the following from the buyer:


  • Employment history
  • Credit report
  • Tax returns
  • Bank statements


The time and effort that it takes to get a pre-approval is worth it because everything will be ready for the lender to grant the mortgage once an offer is made on a home. It also gives the buyer an upper hand in finding the home of their dreams. Many sellers require a pre-approval with an offer.


When To Get A Pre Approval


As soon as you know you’re serious about buying a home and are ready to start the house hunt, you should get pre-approved. Pre-approvals do expire after a certain amount of time, but lenders can renew them with proper notice. 


The Importance Of The Pre-Approval


Many buyers feel that they can skip the pre-approval process altogether. It has many benefits. Besides giving you a better look at your finances and how much house you can afford, pre-approvals can:


  • Give you the insight to correct your credit score and help you correct credit problems
  • Help to avoid disappointment when you find a home you love
  • Allow first-time buyers to see all of the costs involved in buying a home


A pre-approval is a handy thing to have, and it’s not just because the experts say it’s essential. Getting pre-approved for a mortgage can help you to be more on top of your finances going into one of the most significant purchases you'll ever make in your life. 

 




Tags: Buying a home   Mortgage  
Categories: mortgage lender  


Posted by Chad Goldstein on 4/23/2018

If you’re hoping to buy your first home in the near future, you’re likely wondering about the different types of mortgages that you may qualify for. Since the 1930s, the Federal Housing Administration (FHA) has been insuring home loans for first-time homeowners across America.

This program helps people achieve homeownership who typically wouldn’t be able to afford the down payment or pass the credit score requirements to secure a traditional mortgage.

In today’s post, we’re going to answer some frequently asked questions about FHA loans to help you decide if this is the best option for your first home.

Does the FHA issue loans?

Although they’re called “FHA loans,” mortgages are not actually issued by the FHA. Rather, they’re issued by mortgage lenders across the country and insured by the FHA.

Will I have to make a down payment?

With an FHA loan, your down payment can be as low as 3.5%, significantly lower than traditional loans at 20% down payment. However, you will be required to pay private mortgage insurance (PMI) in addition to your monthly mortgage payments until you have paid off 20% of the home. So, the best case scenario would be to save as much as possible for a down payment to reduce the amount of mortgage insurance you have to pay.

What are the benefits of an FHA loan?

The three main reasons to secure an FHA loan are:

  • You can qualify with a low credit score

  • You can make a smaller down payment than traditional mortgages

  • Your closer costs will be less expensive

Where do I apply for an FHA loan?

You can apply for an FHA loan through a mortgage lender. You can also work with a mortgage broker to help choose a lender.

Is an FHA loan the only loan option for low down payments?

There are multiple loan programs offered at the state and federal level to help individuals secure a mortgage with a lower down payment. They can be provided by the Department of Veterans Affairs, the USDA, or state-sponsored programs. Lenders also often sponsor their own programs to attract potential borrowers. However, always make sure you compare these programs to make sure you’re making the best long-term financial decision.

Do all FHA loans offer the same interest rates and costs?

No. Since the loans are only insured by the FHA, it’s up to the lender to determine your interest rate and fees. So, it’s a good idea to shop around for the best lender.

How high does my credit score have to be to qualify for an FHA loan?

You can secure a mortgage with a down payment as low as 3.5% with a credit score of 580 or higher. However, if you can afford to make a larger down payment, you can secure an FHA loan with a credit score as low as 500.

If your score is in the 500-600 range, it’s typically a better idea to spend a few months building credit before applying for a home loan.

What information will I need to apply?

You’ll need to gather all of the same information that you would for a typical mortgage. This includes W2s from your employer(s), two years of submitted tax forms, your current and former addresses from the past two years, and your gross monthly salary.

I’ve owned a house before, can I still qualify for FHA loans?

Even if you’re not a first-time homebuyer you can still qualify for an FHA loan. However, you cannot qualify if you’ve had a foreclosure within the last three years or have filed for bankruptcy within the last two years.




Categories: Buying a Home   Mortgage   FHA Loans  




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