|For the Week Ending December 7, 2018|
Please enjoy this quick update on what happened this week in the housing and financial markets.
|The yield on 5-year Treasury bonds slipped below the rate on 2-year Treasuries, called an 'inversion.' Inverted yield curves could be a sign of a future recession.|
|Mortgage rates improved this week as stocks tumbled and bonds rallied. Concerns the economy is cooling off could help rates continue to improve.|
|The trade deficit widened more than forecast in October to the highest in a decade. This underscores continued fallout from the China-U.S. trade dispute.|
|CoreLogic reports homeowners with negative equity declined by 81,000 in the 3rd quarter. The average homeowner gained $12,400 in home equity year over year.|
|Luxury home builder Toll Brothers reported its first decline in quarterly orders in more than 4 years. It's thought rising interest rates and home prices were to blame.|
|Buyers are spending more time trying to find the perfect home, often 3 months or longer. However, most buyers say they refuse to give up and will keep looking.|
Rate movements and volatility are based on published, aggregate national averages and measured from the previous to the most recent midweek daily reporting period. These rate trends can differ from our own and are subject to change at any time.
PUT YOUR HOME IMPROVEMENT PLAN INTO ACTION!
When shopping for a home, you may come across properties that aren’t quite what you’re looking for, but have the potential to be your dream home with some repairs or renovations. With a renovation loan, you can roll the cost of financing or refinancing a home and repairs into one loan – saving you time and money.
Whether your home improvement projects are large or small, a home renovation loan can help you get the job done!
What are the benefits of a Renovation Loan?
Home improvements such as adding an extra room or replacing the roof not only makes a difference in how much you enjoy your home, but it can improve its overall value as well. If you aren’t happy with some features of your house, or want to purchase a home that needs work, consider using a home renovation loan to transform a house into your very own dream home.
Although you may be able to pay for home improvements with a personal loan or other types of financing, these methods have higher interest rates and monthly payments.
Instead, you can combine the purchase price plus the renovation costs into one mortgage payment or refinance your existing mortgage plus construction costs into a new mortgage. Our renovation programs make it easy for you to improve your property by including the extra financing in a purchase or refinance loan.
Some of our Renovation Loans Include:
- FHA 203 K Program
- Streamlined 203K
- Standard 203K
Greenway Mortgage understands that home renovations of any size can be a huge undertaking. They’re exciting, but they can be a bit challenging and even inconvenient, depending on the degree of your renovations and the timeframe estimated until completion. Remember, a renovation can increase the value of your home or simply make your home more comfortable to live.
A renovation mortgage could be the right loan product for you. If you're looking to purchase a home or renovate your existing home, you should consult Erin the Expert about your plans. She will be able to explain the different options available.
In this video, Erin tells us about the two types of FHA 203k renovation mortgage programs - how they are different, what they can be used for and the process for getting one.
Below are some notes, details and examples from this episode.
- Can be used to
- Purchase and repair a home that needs TLC
- Finance the renovation of your existing home
- 203k renovation loans are an FHA product which means 3.5% down payment (96.5% max LTV)
- Can borrow against 110% of the after improved (end) value (see example)
- Renovations can be up to 50% of after improved (end) value
- Can be used to finance the cost of
- Additional closing costs.
Types of 203k Renovation Loans
- Limited 203k
- $35k max renovation
- Good for roof, windows, bathrooms, kitchens
- 203k standard
- Projects over $35k
- Good for comprehensive and structural repairs: additions, rebuilds, multi-room
You will need a 203k Consultant
- Independent 3rd party
- Reviews plans and pricing - Ensures financially feasible
- Inspects work - Makes sure end result is safe and livable
Max Loan Amount Example
- Value before renovations: $150,000
- Renovation costs: $50,000
- End value: $200,000 ($150,000 + $50,000)
- 110% end value: $220,000 ($200,000 x 110%)
- Max loan-to-value (LTV): 96.5% (3.5% down payment)
- Max mortgage amount:
- $220,000 x 96.5%
- Minimum down payment (equity) required: $7,700
- $220,000 x 3.5%
- Erin's First Renovation Video - Process and Documentation
- Greenway's $100 Down Payment Mortgage with Renovation Financing
- Our 203k Loan Product Page
- Get Erin's Mobile App
Are you a first time home buyer?
Consider downloading our FREE homebuying guide specifically for those new to the process. It's packed with useful information, checklists and tip sheets to get you off on the right foot.
Are you ready to take the next step?
It's time to get pre-approved with Erin the Expert!