• Characterized by bright colors, woven fabrics and handcrafted pieces, southwestern-style decorating takes influences from Native American, Spanish and Mexican art. Whether you live out west and want your home to reflect your surroundings, or you simply want to incorporate colorful or handmade items into your existing decor, here are some tips to help you...

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  • A new phenomenon is affecting the mortgage and real estate industries. People who bought a home or refinanced in the last few years have such a ridiculously low mortgage rate that they don’t want to move and have to accept a new mortgage with a higher rate. But the reality is that these people...

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  • This post is for all the gardeners out there! This time of year, we’re excited about combining our love of gardens with our love of prize giveaways. Whether you’re new to the gardening game or have years of experience in the backyard, this contest is for you.

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How the Fed Funds Rate Affects Mortgage Rates

How the Fed Funds Rate Affects Mortgage Rates

The Fed Funds Rate and its Effect on Mortgage Interest Rates: Mystery Revealed. The Fed Funds Rate. Mysterious as it is shifty. To most of us it’s a term we hear often but aren’t sure exactly how it relates to our wallets. So when we hear about the Federal Reserve changing the Fed Funds Rate, what does that mean? Are credit card rates going down? Should we flood the retail stores with credit card charges? Or are mortgage rates plunging? Should we buy a home(and fast)? Here we’ll shed some much needed light on this shadow jumper of sorts, by giving you the basic info you need to take the mystery out of the Fed Funds Rate. What is the Fed Funds Rate? The Fed funds rate is the rate at which banks loan money to each other. (Yeah, and..?) I know. We promised light… not a Bic in a black hole. I’m getting there. What do changes in the Fed Funds Rate affect? The big answer? Short-term rates. But let’s expand on that. Credit Card Interest Rates. Chances are you have a card with an interest rate that’s tied to prime. Prime is simply three percentage points greater than the Fed funds rate (If the Fed Funds rate is 4.25, the Prime Rate would be 4.25% + 3.00% = 7.25%), so a lower Fed Funds Rate would make the interest rate on your credit card decrease. Savings Accounts, Money Market Accounts, CDs. The Fed Funds Rate is directly related to…

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Private Mortgage Insurance (PMI)

Private Mortgage Insurance (PMI)

What Is Private Mortgage Insurance (PMI)? Private Mortgage Insurance (also referred to as mortgage protection insurance on the West Coast) is a costly insurance premium that the borrower pays to protect the lender in case he defaults on the loan. As part of the loan qualifications set out by Fannie Mae and most secondary market investors, a borrower is required to pay private mortgage insurance (PMI) when they don’t put down at least 20% of the home’s purchase price as a down payment. But with the right loan, it doesn’t have to be an obstacle. In fact, your home lender may allow you to buy it down, just like points buy down a mortgage. Just How Costly Is Private Mortgage Insurance? Mortgage protection insurance increases your monthly payment and may be tax-deductible (please check with your tax advisor). The cost of private mortgage insurance varies, but generally it calculates to about one-half percent of the total loan amount. Let’s say you buy a home for $200,000 and put 5% down or $10,000. The annual cost of PMI on your $190,000 mortgage might run $950 a year, adding an extra $80 to your mortgage payment each month. However, this doesn’t necessarily mean your payment will be $80 cheaper if you can avoid PMI. How Can I Avoid Paying PMI? If your home lender doesn’t offer any options to avoid paying PMI, there are other ways to help you avoid it. You could buy a home that allows you to pay for…

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Holiday Home Safety Tips

Holiday Home Safety Tips

Don’t create an opportunity for criminals to pilfer the plethora of gifts from under your tree, and avoid unexpected and tragic events that can ruin the joy of the holiday season. Here are a few holiday home safety tips to help keep you and your family safe from grinches and enjoying the holidays worry free.

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Home Loans for First Time Home Buyers

Home Loans for First Time Home Buyers

Now that you’ve found a home, you need to find a way to finance it. But how do you know what kind of mortgage you need to get? Well, traditional thinking says that you should always get a traditional 30-year amortizing fixed rate mortgage. But everyone has different needs and no lender should put everyone in a “one size fits all.” These days, there are several mortgage loans that fit many different people for various reasons. But there are three basic types of mortgages that you should be aware of: fixed-rate, adjustable rate, and interest-only. Fixed-Rate Mortgages As the name suggests, a fixed-rate mortgage has a fixed interest rate over the life of the loan. They are commonly available as 15- and 30-year terms, though they are also available with 10-, 20-, 25-, and 40-year terms. Your loan balance is amortized over the life of the loan which means your payment is fixed for the life of the loan. So, for example, if you had a 30-year fixed-rate mortgage, you would make 360 equal principal and interest payments – one payment a month for 30 years-to pay off your loan. The most obvious advantage to a fixed-rate mortgage is that your rate and payment never change. If you plan to stay in your home for 10 years or more, a 30-year fixed-rate mortgage might be right for you. But you might choose a different mortgage term depending on your goal. If your goal was to pay off your mortgage faster,…

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Mortgage Interest Rates

Mortgage Interest Rates

Interest rates can have a substantial impact on your life. Your mortgage, car, credit card payments, and investments – like stocks and bonds – are all based on interest rates. Lower interest rates allow you to purchase a larger home or refinance to take advantage of lower monthly payments. How Do Changes in Interest Rates Affect Home Mortgages? Interest rates directly affect home mortgage rates. If interest rates are high, your loan payments will be greater. If you are looking to buy a home, this means you will probably not get as much square footage per dollar. On the other hand, high interest rates can help to curb inflation. This means the price of goods like food and gasoline will stay relatively low, and your paycheck will go further. If you’re locked into a fixed-rate mortgage at a low interest rate, your income will stretch even further. And if you’re able to save that extra cash, you’ll be prepared to shop for a larger home when interest rates go down. When interest rates are relatively low — especially if they drop to record lows — it is an ideal time to consider refinancing your home, particularly if you have an adjustable rate mortgage (ARM) that is set to increase soon. With a 30-year fixed mortgage, you could lock in the low rate and never have to worry about your payments increasing, no matter what happens to overall interest rates. How Does the Federal Reserve System Affect Mortgage Interest Rates? The U.S.…

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Mortgage Lenders and Home Loans

Mortgage Lenders and Home Loans

When you’re buying a home, you’ll most likely need financing and as with anything you buy, it’s wise to shop around for the right one. You probably wouldn’t buy the very first house you looked at; you’d look around at others to compare and see what’s available. In the same vein, you should shop around for the right mortgage lender. Talk to at least three or four lenders. Remember: the best lender may not always have the best interest rate or get you the lowest payment. For example, if one of your needs was to save money by paying less in interest over the long term, you might choose a 15-year mortgage with a higher rate rather than a 30-year mortgage with a lower rate. A good mortgage lender will: Ask lots of questions about your personal financial situation Be readily available to answer any and all questions you have Be committed to finding the most appropriate loan for you, not getting you into a “one size fits all” type of loan Never ask you to do anything that you feel uncomfortable with Return your calls and emails promptly Tips on Finding a Lender: Ask your friends and family which lenders they’ve used and what their experiences were like with their mortgage lenders. Find out who they would recommend. Do your research. An easy way to research many mortgage companies is to go online; there are more lenders at your fingertips than you can count. Visit each lender’s Web site…

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FHA Loan Refinancing

FHA Loan Refinancing

What is an FHA loan, you ask? Good question. In all truthfulness, there really is no such thing as an FHA loan. The FHA (Federal Housing Administration) doesn’t really fund your mortgage at all. In fact, the FHA doesn’t even buy or underwrite loans. The FHA provides mortgage insurance to help consumers become homeowners. To put it another way, the FHA insures mortgage companies from losses so on the slight chance a buyer defaults on their mortgage, the home loan lenders will get their money. This encourages lenders to give mortgages to people who might not otherwise qualify for a loan. That’s pretty much it. To keep things simple, we (and nearly all other mortgage lenders), call any loans insured by the FHA, “FHA Loans.” Should I get an FHA loan? Do you want a lower mortgage payment? If so, Quicken Loans now offers FHA Streamline, the easiest way to refinance your FHA loan. With FHA Streamline, you could refinance an FHA loan with no appraisal and no income/assets verification. Not sure if an FHA Streamline is right for you? Find out if you qualify for an FHA Streamline refinance in just a few easy steps! Do you want to refinance out of an ARM? Is your ARM payment rising? Would you like to refinance to a lower rate or even do a cash-out refinance up to 85%? If so, the FHA loan may be the answer to your mortgage problems. Now, refinancing with an FHA loan is easier than…

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Closing Costs and Fees Explained

Closing Costs and Fees Explained

Mortgage closing costs are fees charged for services that must be performed to process and close your loan. At the time you apply for a loan, lenders are required by law to disclose to you, in writing, what the estimated mortgage closing costs will be. This is known as the Good Faith Estimate. Closing Costs and Fees Associated with Your Home Purchase Closing costs can vary by mortgage option and amount, so the costs on a 30-year fixed or a 15-year fixed may not be exactly the same as a 5-year ARM mortgage. And some loans, such as an FHA loan or a VA loan actually allow a seller to cover all or some of the closing costs. But what exactly are the closing costs, regardless of whether you or the seller pays them? The most common closing cost is the down payment. In addition to making your down payment, there are other costs and fees associated with your home purchase. Average closing costs generally range from $2,500 to $5,000 or about 6% of your loan – a sizable amount of money when you consider this is paid upfront at closing. But where exactly does it all go? A common misconception about mortgage closing costs is that they all go to the lender, when in reality, many of the costs are related to services performed by others. Mortgage closing costs cover expenses associated with getting a home loan, from inspections and appraisals to title insurance, taxes and more. It is…

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Jumbo Loans for Larger Home Loans

Jumbo Loans for Larger Home Loans

In some real estate markets, a house in the $400,000 range is little more than a starter home. So why is it that a home loan in the mid $400s is considered a Jumbo Mortgage Loan? Good question. While the rest of us may see the term “jumbo” as relative, Fannie Mae and Freddie Mac, two government sponsored mortgage entities, have definite opinions. Each year, a new “conforming loan limit” is published by these organizations. What is the Conforming Loan Limit? The conforming loan limit is the maximum loan size eligible for purchase by either Fannie Mae or Freddie Mac, who purchase the underlying securities from mortgage originators. Those funds are then reinvested in new mortgages, and the flow-of-funds cycle continues. The conforming loan limit, or “Jumbo Loan amount” is set every January. This year, the limit for single-family homes and condominiums is $417,000. Quicken Loans conforming loan limit has also been raised to $417,000. When a Loan Becomes a Jumbo When a loan amount is higher than the conforming limit, it becomes a Jumbo Loan – or non-conforming loan – with slightly higher interest rates. Jumbo Loans, compared with historically low mortgage rates, can bring greater flexibility for some home buyers to purchase the house they want and make the payment they want. What Jumbo Loans are available? With Jumbo Loans, you do have options. Jumbo loans can be 30-year fixed, adjustable rate mortgages, or FHA loans with up to 97% financing and new higher loan limits. Talk with…

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