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If you've been following the news lately, you've heard about rising inflation. Today, inflation is at a 40-year high.  According to the National Association of Home Builders (NAHB):

“Consumer prices accelerated again in May as shelter, energy and food prices continued to surge at the fastest pace in decades. This marked the third straight month for inflation above an 8% rate and was the largest year-over-year gain since December 1981.”

As prices go up for gas, groceries and more, your wallet is likely feeling the impact. If you're thinking about purchasing a home this year you may have hesitated a time or two. Is now the right now? That depends on your current situation. Homeownership is a great hedge against the impact of rising inflation. Here's how homeownership can help you combat rising costs. 

Are you protected?

With all the talk of rising prices, there's one tool that has proven time and again to serve as a hedge—or protection—against inflation:

Owning a Home.

Real estate prices have been rising along with everything else. There are the usual factors of supply and demand, but inflation itself is impacting values too. Given rising labor and material expenses, it now costs more to build a home or replace one that's been damaged. That contributes to making existing properties more valuable too.

Here are some ways homeownership serves as a hedge against inflation.

  1. As your home appreciates in value, you gain more in equity, yet your costs remain relatively stable.

  2. For most homeowners, the increases in home values far outpace the increased costs of other goods. For example, you may be spending $4,000 for gas this year instead of the $2,000 it cost last year. Yet if you own a home that was worth $300,000 last year, it may be worth $360,000 this year as values are up more than 20% nationally.

  3. Increases in value are not money in your wallet, though you may be able to access cash through a home equity loan or line of credit. Otherwise, you can realize the benefits when you sell or refinance your home.

  4. Many owners reduce their housing costs through tax deductions. (Always consult with a tax advisor.)

  5. Homeowners often avoid capital gain taxes, and even for real estate investors, taxes on gains are deferred until sale.

If you're not yet hedging your purchasing power with a home of your own, there may still be time to act before costs increase further.

Please reach out if we can assist you or someone you know.


Have you ever played Chess, the game of life, before? Chess requires you to plan and think about strategy, it’s a game about making strong moves and sticking by them. Every decision made has an impact on the rest of your game. Well, the same can be said about buying a home; planning and thinking about strategy ahead of time is extremely important from the very beginning stages.

Economists expect the 2022 housing market to be a tad gentler to home buyers. However, the homeownership dream will still require strategy and stamina. Have no fear! We’ve got a few good tips to ensure your home buying plan is as strong as possible when you begin your home search.

#1: Best Opening Move is Getting Preapproved

Getting pre-approved by a lender should always be step number one.  Getting an upfront loan approval will help you beat out the competition, negotiate with power and let you know how much you can afford.

Benefits of Getting Pre-Approved

  1. A pre-approval tells you the maximum amount you are qualified to borrower.

  2. A pre-approval allows you to look for a home with greater confidence and it demonstrates to the seller that you’re a serious buyer.

  3. A pre-approval letter signals that you’re a serious, interested buyer.

#2 It’s a Team Game, Not A Single-Player Experience

Every step you take to create your game-plan strategy as a buyer is important especially in today’s hot housing market. Why? Mortgage interest rates are still low by historical standards; however, they're increasing. Prices are going up and there is a limited supply of homes for sale. Don’t let this stop your search for your dream home.

What do we mean by “It’s a team game”? That means leaning on expert guidance as you plan every move is very important. Having a team of professionals like your trusted Real Estate Agent and Greenway Mortgage Loan Officer is important to ensure you make the right moves every step of the way.

#3 Set Realistic Expectations, Know What You Want and Can Offer

  • The best way to avoid getting discouraged is to manage your expectations.

  • Consider homes that need cosmetic updates.

  • Be prepared for bidding wars. Before shopping around, know the maximum offer you’re willing to make.

  • Target houses that are priced under what you’re pre-approved to buy so you have room to negotiate.

  • Decide what you need and what you can live without in a home.

  • Consider a fixer upper. You’ll likely face less competition!

  • Be vigilant and be patient.

The Housing Market in 2022 – What to Expect:

  • Home prices are expected to increase at a slower pace than in 2021. The National Association of Realtors projects home prices will increase just 2.8% in 2022, far less than the estimated 14.7% gain in 2021.

  • Mortgage rates will likely rise in 2022. However, even if they go up, they will still be low. The National Association of Realtors projects the 30-year fixed mortgage rate to rise to 3.7% in coming months. The Mortgage Bankers Association projects an increase to 4%, while Fannie Mae and Freddie Mac project the 30-year fixed will average 3.3% and 3.5%, respectively.

Bottom Line:

If you’re serious about buying a home in 2022, contact a Greenway Mortgage Loan Officer to get pre-approved first or click here to get started.

Remember, getting a pre-approval letter isn’t just good strategy, it can a game changer! It allows you to get a full understanding of what you can afford, and it signals to sellers that you’re serious.

Connect with your trusted real estate agent and loan officer so ensure you’re playing chess and being strategic throughout the entire home buying process.


If you’re wondering how much home loan you may be able to qualify for, you need to know about DTI—Debt to Income Ratio.

What Is A Debt-To-Income Ratio?

Your proposed monthly housing expenses are added together. These include principal, interest, taxes, insurance, mortgage insurance (if required) and any applicable homeowner’s association or similar fees. This total is combined with your regular monthly debt payments, such as those for credit cards or car loans. Your DTI is the percentage of your gross monthly income represented by this total.

Example:

Monthly Housing and Debt Payments = $2,000

Monthly Income = $6,000

DTIR = 33%

In most instances, this ratio should not exceed approximately 43%.

What Other Factors Are Involved in Qualifying For A Home Loan?

While your DTI is the primary basis for determining a maximum loan amount, there are other factors involved in qualifying for a loan. These factors include but are not limited to loan program parameters, credit, employment history and available funds to close.

Would you like to see how all of this translates price-wise for your income? Reach out, and we'll be happy to help!


Why bother with escrow accounts?
Escrow accounts provide for the timely payment of taxes and insurance on your home. This prevents tax liens, loss of property and any lapse of insurance coverage. 

As part of your regular mortgage payment, 1/12th of the annual cost is collected. These funds are held and paid out as bills come due. If taxes are $5,000 and insurance is $1,000 for a total of $6,000, you’ll pay $500 into escrow each month. The balance will build until an outgoing payment is made.

The minimum required balance is usually a two month cushion to assure that sufficient funds are in the account even if payments are interrupted. 

The minimum is different from the starting amount to make sure sufficient funds are available to make the first tax or insurance payment when due. 

So how does an escrow account help you?

  • You have a consistent monthly expense instead of large bills a few times per year.
  • The money in the account is always yours. You receive any remaining balance at sale or refinance.
  • You might enjoy more competitive interest rates. Loans without an escrow account will often incur a price adjustment. 

If you have questions about escrow accounts or mortgages in general, please give us a call. We’re here to help.


There are a lot of moving parts when it comes to buying a home and it can be confusing (especially for first-time home buyers). One frequently misunderstood area is closing costs. Many homebuyers think that saving for their down payment is enough to buy the house of their dreams, but what about the closing costs that are required to obtain a mortgage? 
 
How do you find out what your closing costs will be?
 
By law, a homebuyer will receive a loan estimate from their lender 3 days after submitting their loan application and they should receive a closing disclosure 3 days before the scheduled closing on their home. The closing disclosure includes final details about the loan and the closing costs. Make sure to double-check they (closing disclosure and loan estimate) are what you agreed to.
 
But what are closing costs anyway?
 
According to Trulia: “Closing costs are lender and third-party fees paid at the closing of a real estate transaction, and they can be financed as part of the deal or be paid upfront. They range from 2% to 5% of the purchase price of a home. (For those who buy a $150,000 home, for example, that would amount to between $3,000 and $7,500 in closing fees.)”
 
Keep in mind that if you are in the market for a home above this price range, your costs could be significantly greater. As mentioned before, closing costs are typically between 2% and 5% of your purchase price. Trulia continues to give great advice, saying that: “…understanding and educating yourself about these costs before settlement day arrives might help you avoid any headaches at the end of the deal.”
 
What do closing costs include?
 
By now we know that when it comes to buying a new home there are many costs involved. But, what exactly do closing costs cover? They pay for expenses when buying a home that are charged by a myriad of vendors, government entities and your lending institution — all of which played some key role in securing you your new home. In addition, closing costs are payable with your down payment, but they are separate fees. The list of closing costs fees is lengthy. Some fees included are:
 
  • Appraisal
  • Attorney
  • Closing
  • Credit report
  • Title
  • Underwriting and processing fees
  • Private mortgage insurance (PMI)
  • Property tax
  • Recording fees
  • And much more
Be sure to ask your Loan Officer for a detailed list.
 
Will there always be closing costs?
Yes, there are always closing costs. Whether you're the buyer or the seller or even refinancing, you're going to have closing costs.
 
Learn More About Financing Your Closing Costs in this video here with Erin The Expert. 
 

 

Beware of the Pre-Loan Worksheet
Sometimes, a loan officer will use pre-loan worksheets to their advantage. Why? Using this form is a way in which a Loan Officer can pitch fees before the loan estimate and early on in the mortgage process to their borrower. In turn, they often put unrealistic fees on the pre-loan worksheet, making it look attractive to the borrower. At this point, the borrower is far into the mortgage process and hooked with the Loan Officer.
 

 

Bottom Line
Closing costs may not be the most attractive part of buying a home or refinancing your current mortgage, but it's a small price to pay for the benefits that a home loan provides. Speak with Erin the Expert early and often to determine how much you’ll be responsible for at closing. Finding out that you’ll need to come up with thousands of dollars right before closing is not a surprise anyone is ever looking forward to.
 
Find out how much you qualify for by applying for home loan with us today. It only takes a few minutes!
 
 

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