A question that is asked every day in the mortgage business from clients is where the interest rates are heading.

The truth is all mortgage advisors wished we had a crystal ball and could answer that question for you. With the financial markets in so much turmoil, the tradition tools to help gauge the market and mortgage interest rates have not been working. We are seeing interest rates go through as much turmoil as the financial markets. What I do advise my clients to understand is the factors that make up the mortgage interest rate that can be controlled.

Several Factors Affect Your Mortgage Rate:

Understanding the Factors affecting your Mortgage Rate

So, if you can control these factors, you will have a much better understanding of how to take advantage of the best mortgage interest rates available.

Calculating your mortgage payment can be confusing.  Some mortgage lenders briefly describe your total payment just as PITI and never really share the full details of the make up of your mortgage payment.  Your mortgage payment is made up of 4 parts:  principal, interest, taxes and insurance also known as PITI. 
 
The first part, the principal is the portion of your mortgage payment that actually pays down the mortgage balance.  The second part, the interest is the cost the lender charges for borrowing the money.  To determine this figure use the Mortgage Calculator provided.
 
The third portion of your mortgage payment represents the property taxes.  The mortgage lender will calculate your monthly tax amount by taking your annual property taxes and dividing it into 12 equal payments.  This way you are only paying 1/12 of the tax each month.  The lender holds these funds in an account called an escrow account and pays the taxes when your county, city or township requires. 
 
The last portion of your mortgage payment represents the hazard insurance or better known as your homeowners insurance.  Unfortunately no lender will allow your new loan to close until you provide proof of this insurance.  This insurance protects you and your lender in partnership in case of fire, bad weather and other incidents.  The mortgage lender will calculate your monthly insurance amount by taking your hazard insurance premium and dividing it into 12 equal payments.  Again you only pay 1/12 of the insurance premium each month.  The lender will also put these funds into that escrow account and pay the annual premium on its anniversary date. 

Yesterday, Callie Waterhouse and I taught a blogging class that was sponsored by the Groovy Title Chick at Land America.  It is so fascinating how many people want to start using a blog to attract more clients to their business and sometimes getting a blog started is the hardest part. 

This class was very basic.  We covered a lot of information in a 2 hour window that hopefully helped the newbie’s of the world with blogging.

I remember when I first started to blog that I really had no coaches.  I pretty much just read a lot of blogs and learned as I went.  However I wish I would have had a blog coach. 

So for all you newbie’s out there to the blogging world please feel free to cling to your fellow bloggers for help.  You be surprised how much we give back.  Heck I might even be willing to coach a few of you.

So the decision has been made and divorce proceedings have been started.  For many couples who go thru this chapter in their life are really not sure where they stand in terms of being able to keep the home.  Some couples just want to sell and move on and others want to stay due to the children, school districts and other sentimental reasons.  In the current state of the real estate market selling might not always be your best option.  Actually it might set you back worse than refinancing and splitting the home equity position.  This is when someone like myself can come to the rescue and help work out a plan to help both parties in distress. 

I have worked with many clients over the years who have had to make this hard decision and knowing where you stand financially can make the situation easier to conclude. 

Here are some questions to ask before putting the home up for sale.

1.  Could I qualify for the mortgage on my own?

  Most couples think that they need the other spouses income to qualify and sometimes this is just not the case.  Let the mortgage lender make this determination for you.

2.  Is this the right market to sell in?

Right now might not considering the costs to pay a realtor, moving costs, etc.  A lot of times the costs to refinance might be a cheaper option.

3.  Do my children want to move?

Moving is hard on everyone especially children.  If your children are in a school district and has friends moving them away from that environment might not be smart.  Talk to your children and ask for their guidance as well.

4.  Are there any tax benefits for moving or staying?

You will want to talk with your CPA and know this before packing the boxes.

5.  Will my departing partner cooperate with me on this decision?

Divorces can be tough, but it’s very important to get the other spouse on board with this decision.  An uncooperative spouse might not allow a refinance to happen.  Get this worked out upfront.

By asking these questions, you will know really quickly what the best decision is for your unique situation. 

We are unique people out there.  We expect better then “would you like fries with that drink”.  I just have learned to use my Midwest values and transfer them into my mortgage business.  If you are looking for something a little more unique in your next mortgage loan, please do not hesitate to get a hold of me. 

My name is Gary Miljour and this is what I do best.

Like the real estate market can not get tougher on all of us survivors, but now with the government playing God to balance market corrections, we are in for the craziest times since I road “Mr. Toads Wild Ride” at Disneyland. 

It only took 3 weeks to turn every-one’s life upside down.  Clients and consumers are running for the hills and are not in any hurry to buy property.  Why?  The Market!

The market has everyone right now a little scared and folks are wondering if they will be employed come tomorrow. 

So here is my 2 cents from the perspective of being just a small cog in a big machine. 

• The housing market right now is seeing some of the best prices it has seen in the last 5-6 years.  If you have a secure job and can afford to buy a home, I would still take advantage of this market.  
• Long term interest rates are very attractive.  The rates right now are fluctuating between 5.5%-6.5% depending on fees and costs.  These rates make the long term payment affordable.
• A house is a tangible asset.  This is not a stock or a piece of paper but rather a building that will appreciate over the long term. 
• Real Estate offers tax deductions.  The mortgage interest you pay can be tax deductible on your return. 

Take advantage of all the benefits and turn off the Jim Cramer’s of the world.  The market will correct itself.

As for my vacation it was nice to get a break from the crazy roller coaster ride called the housing market and all its implications. 

I am just a survivor and am making the best out of this market as I can.

The international markets have finally moved back in and the investor confidence is up again for mortgage backed securities since the announcement of a government bailout. 

This had a direct impact Monday on mortgage rates across the board.  What does this mean to the end consumer?

It means that you should be able to take advantage of those lower interest rates you were looking for.  It might mean you can afford more of a home and get a lower payment.  If anything this should be a wake-up call that consumers are finally in the best position to benefit from both great real estate prices and interest rates.

Well it sounds like Down Payment Assistance might be back but with changes.  Until this does take effect I have been scouring through loan programs looking for good alternatives for clients with little or nothing down. 

The USDA Rural Housing Program is another viable mortgage option to help clients with nothing down. 

Here are the Pros:  100% financing, Zero Down.  No monthly Mortgage Insurance, FHA Mortgage guidelines.

Here are the Con’s:  Home must be in a rural housing area.  This is all of Pinal County and parts of Maricopa County.  So Queen Creek is in place.  Some income restriction apply.

Again, I think the mortgage lender who has workable options to help clients get into homes will win the business at the end of the day. 

Please call me if you are looking for some of these options to discuss your unique situation.

My speciality for the last 3 years has been primarily to focus on helping 1st time home buyers make the dream of home ownership a reality.  Wow what a cliche I just said.  Anyhow my question of the week from many real estate agents is:  How am I going to help buyers who having very little or nothing down?

In the past, the answer was pretty straight forward, we would look into down payment assistance.  With Housing Bill HR-3221 doing away with my favorite pet, clients, lenders and real estate agents are scrambling to find good solutions to help these buyers get into homes. 

So here are some solutions I came up with to help buyers with little or nothing down.  Some of the cities have programs for low income housing folks and these funds if approved usually can be used for down payment and closing costs.  We have the Maricopa County Home in 5 Bond Program.  These funds come and go, but if available at the time can work out great for down payment.  HUD Homes!  Hud offers all kinds of incentives to move their inventory and sometimes they will only require the buyer to put $100.00 down on a new FHA loan with a full price accepted offer.  Also do not forget that we can still use down payment assistance from family.  So Mom, Dad, Brother or Sister can help with a gift for the down payment.  Also multiple family members can gift funds so you can pool the gift funds together.  Last do not forget about those 401K funds you have set aside with your employer.  Did you know that you can borrow against your 401K to have funds for your down payment.  Finally, we may have to just start saving money like in the good old days.  If it worked for our parents and grandparents to put money down, then why can it not work for us?

Creative solutions is now the name of the game.  By thinking outside the box and not turning to statements like “it cannot be done”, I can help many more homebuyers achieve homeownership.

After 24 days of higher mortgage rates, we are finally starting to see some relief.  This week we saw the biggest move of  mortgage rates in the last 3 weeks.  Most of this came about after oil prices and inflationary concerns are finally being put in check.  We saw mortgage rates on the 30 year fixed come down by 3/8 percent in rate.  This is now a good time to put yourself in a position to lock in that 30 year fixed.