Connecticut Financing Update and Today's Mortgage Rates 2/24/12

Rates and costs continue to operate near all time best levels
Current levels have experienced increasing resistance in improving much from here
There are technical reasons for that as well as fundamental reasons

 Lenders tend to get busier when rates are in this "high 3's" level  and can throttle their inbound volume by raising rates or costs.
 While we don't necessarily think rates are destined to go higher there seems to be more risk than reward regarding  floating
 But that will always be the case when rates operating near historic lows
 (As always, please keep in mind that our talk of  Best-Execution always pertains to a completely ideal scenario.  There  can be all sorts of reasons that your quoted rate would not be the same  as our average rates, and in those cases, assuming you're following  along on a day to day basis, simply use the Best-Ex levels we quote as a  baseline to track potential movement in your quoted rate).

 

Apart from the slightly more favorable rate environment, little has changed between yesterday and today.  Since Best-Execution is by no means firmly back to 3.875%, the question remains whether or not this will prove to be a brief foray into  4.0%.  The tone of news surrounding the Greek bailout seems to have shifted in favor of "forays remaining brief" as the skeptics have emerged, calling attention to the unsustainability of the agreed-to austerity measures, among other things. 
 
Treasury Auctions--another market event on our radar--haven't done any additional damage to mortgage rates' chances of returning to previous levels, but they haven't significantly helped either.  Still, the absence of a negative is a positive in this context.  For now, bond markets, including MBS (the "mortgage backed securities" that most directly influence mortgage rates) seem to suggest that their default stance is one of strength, and detractors will have to prove their case in order for that to change.

Today's Mortgage Rates

Today's BEST-EXECUTION Rates
 30YR FIXED -  4.0% more prevalent.  Some 3.875%'s remain

 FHA/VA -3.75%

 15 YEAR FIXED -  3.25%

 5 YEAR ARMS -  2.625-3.25% depending on the lender

 

Jumbo-

 

7/1 ARM3.375%

5/1 ARM 3.125%

30 year fixed 4.250%

Jennifer Buchanan

jhvb51@aol.com

Connecticut Homeowners Insurance: Replacement Cost vs. Market Value

When you purchase a homeowners insurance policy, you’ll make a number of decisions about your coverage. One of the most important is whether to insure your home for its replacement cost or its market value. Understanding each option will help you make an informed choice that safeguards your home and your family’s financial future.

What Is Replacement Cost?

Replacement cost is the cost necessary to repair or replace your entire home. When you insure your home for its replacement value, your insurer will reimburse you for the cost of rebuilding or repairing your home, based on the size and structure of the home that was lost or damaged.

The most accurate way to determine the replacement cost of your home is to hire a building contractor or other building professional to produce a detailed estimate. Only the cost of the property’s structure and its associated systems, fixtures, and finishes will be included in the estimate; land value is included in a home’s market value but should not be included in the amount of insurance you buy.

Benefits

In the event of a loss, replacement cost coverage will help your family return to their home and usual quality of life with minimal financial interruption. For the best protection, experts recommend that you insure your home for at least 100 percent of its replacement cost.

Risks

Replacement value can change over time, so you should review your policy annually to make sure its coverage meets your needs. Inform your insurer if you have upgraded or improved your home, because these alterations may increase your home’s estimated replacement cost. Also, you’ll want to stay informed about changing market conditions in your area. Rising labor, materials, and transportation costs can directly affect your home’s replacement value. For maximum protection, consider a policy that includes an inflation clause that automatically adjusts coverage and premiums to account for changes in construction costs.

What Is Market Value?

Market value is the amount that a buyer would pay to purchase your home and its land in its current condition. Unlike your home’s replacement value, its market value is influenced by factors beyond the material and labor costs of repairs or reconstruction, such as proximity to good schools, local crime statistics, and the availability of similar homes. Also, the land itself will be included in the home’s market value, although it will not be covered by the homeowners policy.

Benefits

In some cases, market value coverage may be the most practical option. Take the example of an ornate older home. In today’s market, the cost of rebuilding or restoring artisanal woodwork, masonry, and plastering to their original condition may be much higher than the home’s purchase price. Therefore, the replacement policy premiums for the home would be high. (Special policies are available for some historic homes, but these also come at a higher price.) For a cash-strapped homeowner, buying a policy based on market value offers the best chance to recoup at least partial expenses after a loss.

Risks

When you insure a typical home for its market value, you are at risk of having incomplete coverage. For example, imagine that a family buys a home for $175,000 and takes out a homeowner’s policy for the same amount. The replacement cost for the home, though, is $225,000. If a fire or other insured event destroys the house, the insurance settlement would be $50,000 less than the actual replacement cost of the home. The family would either have to make up the difference themselves or build a new, less expensive home.

Article submitted by Brennan Purdy of State Farm Insurance

My vision is to be an insurance professional whose actions are driven by keeping the customer's best interest as my primary goal. My staff will treat all my customers in a caring, friendly, and professional manner. My office will provide warm, efficient, and seamless services to our customers at all times. I expect my business to be comprised of knowledgeable, multiple-line customers who see my office as their first and best choice for all their insurance and financial service needs

For more information on these and other home safety tips, stop by my office or visit www.brennanpurdy.com. My office is conveniently located in downtown Bethel. 203-798-7300.                   211 Greenwood Avenue , Bethel, CT 06801

And a note From Judy: If you have a question about buying or selling Real Estate in Fairfield County, and are in need of an Realtor to represent you, I invite you to contact me, and if you have an idea for a topic that you would like to see on The CT Realty Blog, please include it in the "Post a Comment" section link below this post. We appreciate the feedback and look forward to providing you with the best real estate content, advice and service in Fairfield County, Connecticut.

Would You Rather Have an Agent Lie to You or Tell You the Truth?

The truth, right?

I hope your first reaction to this question is  for your agent to tell you the truth.  Do not let your emotions about getting the highest price for your property get in the way of listening to reason, especially when there is evidence to support it.

Telling the truth to homeowners who are interviewing a few agents to list their home for sale sometimes costs me business- because it's not exactly what these homeowners want to hear.

There are, however,  plenty of agents who would rather lie to you,  give you false hope on a suggested list price that is over and above what the market will bear. It's an awful sales tactic- so be on the  lookout.

And why do real estate agents  lie to you about how much your home is worth?

Certainly one reason is lack of market knowledge, or the inability to price homes correctly, and that may not even be an overt lie on their part.

The second reason is that this is a sales tactic that is purely intentional. The agent gives you a price above what they know is appropriate, so that you think that they really love your home and can sell it at that high price.

These agents intentionally give you an inflated price  just to get you to  sign the listing contract- and once you are signed up, they will get you to reduce the price- sometimes even within the first week to ten days. This type of agent induced  "analysis paralysis" causes the homeowner to  dismiss an appropriate price and choose the highest price an agent gives them, even though the analysis says differently.

You should never start any type of relationship on a lie, let alone a business transaction. What will happen  next? What will the next lie be about? This is just a nasty,  shamelessly unprofessional and selfish business tactic, and unlawful in my opinion as well.  

Insist on a detailed Market Analysis- that's called a True Market Analysis.

A  market analysis is just that. Take the time to review it. Are the comparables on the other side of town or are they close by? Are the comparables of similar square footage? How many comparable properties are included in your analysis? Is the price obvious to you by looking at what's in front of you? It should be.

Without any exceptions, the analysis should be detailed enough that it should suggest a price to you, and sometimes you may not like that price. It is important to control your emotions enough to look at what's in front of you, and  as much as you may not like it, understand that analyses don't lie. Agents do.

Trust your gut when you meet an agent. Ask for testimonials. Hopefully, you should be able to spot  the less than truthful agent and remember that when you  get to the pricing part of the presentation.

Consistently telling my clients the truth allows me to sleep peacefully  at night, and I wouldn't have it any other way. If you need a price opinion on your home, and are ready to sell, call me, or email me. I'd love to hear from you- and that's the truth, too :)

And a note From Judy: If you have a question about buying or selling Real Estate in Fairfield County, and are in need of an Realtor to represent you, I invite you to contact me, and if you have an idea for a topic that you would like to see on The CT Realty Blog, please include it in the "Post a Comment" section link below this post. We appreciate the feedback and look forward to providing you with the best real estate content, advice and service in Fairfield County, Connecticut.

What Should You Include with your Offer to Purchase?

When you decide to make an offer on a home that you intend to purchase, think about what accompanying information or documentation that might be a good idea to include. It might make the difference between you getting the home of your dreams and having the sellers overlook your bid, whether it's for an offer on the table  that seems "better on paper", or  the anticpation of a better offer to come.

Of course, there is certain information that is standard on any Offer to Purchase Agreement, but that shouldn't mean that you stop there.

Standard Information to be  included in your offer besides the property address and the buyer(s) and seller(s) name:

What personal property is to be included in the sale, and excluded for that matter-if anything.
One percent earnest deposit, and details on when  the remainder of the deposit  is to be paid.
Mortgage amount and contingency date.
Closing date.

Most agents, including myself will insist on a mortgage pre-approval letter that either has a dollar amount noted that is sufficient for the property, or tailored to the property address itself.

There are times when an introductory letter to the seller (that is prepared by either the buyer or buyer's agent) can be KEY to getting an offer accepted.

For example- If you are in a multiple bidding war (and it does happen , even in a buyers market)  then a short introductory letter to the seller that is included with your offer can set you apart from the competition- just because you or your agent took a few minutes to write it. What you would put in that letter is entirely up to and certainly ust be geared to that particular home and specific to the seller. Trust me, they all appreciate the thought.

Another example is when there is an absent seller who is unaware of the condition of the property. A few pictures say a thousand words, and so does your willingness to work with homeowners who have a property that is in need of repair. The same works with a price adjustment. That is something that I have done, and will continue to do for my buyer clients.

It can really boil down to the little things which can make all the world of difference when it comes to buying or selling a home successfully.

Leave no stone unturned, and no opportunity wasted.

And a note From Judy: If you have a question about buying or selling Real Estate in Fairfield County, and are in need of an Realtor to represent you, I invite you to contact me, and if you have an idea for a topic that you would like to see on The CT Realty Blog, please include it in the "Post a Comment" section link below this post. We appreciate the feedback and look forward to providing you with the best real estate content, advice and service in Fairfield County, Connecticut.

Connecticut Financing Update and Mortgage Rates February 17, 2012

Mortgages Rates improved again this week as domestic economic data failed to inspire markets to move in either direction and optimism over today's conference call between Greece and its creditors deteriorated.  In general, economic optimism tends to coincide with interest rates moving higher.  Mortgage rates began the week fighting back against this generality as anticipation for today's conference call weighed on bond markets and MBS (the "mortgage-backed-securities" that most directly influence mortgage rates).

 

This weeks improvements are small on average, but continue bringing the prevailing 3.875% Best-Execution rate for conventional 30yr fixed loans close to 3.75%.  Some of the most aggressively priced lenders in the market already have feasible pricing at 3.75% (for 100% ideal scenarios), while the average of all the lenders in our survey remains at 3.875%.  Current averages are very close to the lowest we've ever recorded.  To quantify that, if rates were to experience 2-3 more days of similarly modest improvements, averages would likely match or surpass historic lows.

 

According to the latest poll by the National Association of Realtors (NAR), housing affordability conditions improved in most metropolitan areas from softer existing-home prices and record-low mortgage interest rates in the fourth quarter, with rising sales and lower inventory creating more balanced conditions. The median existing single-family home price rose in 29 out of 149 metropolitan statistical areas (MSAs) in the fourth quarter from a year earlier; two were unchanged and 118 areas had price declines.

 

There is a great article - Want that Creidt Card? .... it also applies to Want that mortgage.  There is good solid advice here.    http://www.creditcards.com/credit-card-news/10-things-not-to-do-before-applying-for-credit-card-1270.php?a_aid=ec5dff24

 

Today's Mortgage Rates

 

                    30 Year Fixed 3.750       0 points for rate  

                    15 Year Fixed 3.250       0 points for rate    

                   

                    FHA 30 Year Fixed 3.375  0 points for rate      

                    
                    Jumbo30 Year Fixed 4.125   0 points for rate     

                            

                    5/1 Jumbo ARM    3.250     0 points for rate          

                                   

Jennifer Buchanan

jhvb51@aol.com