Preparing for your Home Loan

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As home prices and mortgage interest rates continue to increase some first time home buyers have delayed their decision to purchase a home.  However, waiting to buy can be an opportunity to prepare for a bigger or better home.  Here are some suggestions to improve your home buying opportunity.

1.      Keep your credit in good standing. You can save thousands of dollars by having a good credit score, which will help you save money in closing costs and loan fees. 

2.      Payoff, consolidate or paydown debt.  Consolidating and decreasing your debt improves your credit score, as debt directly impacts your ability to purchase a home.  Do not co-sign or take out new loans.

3.      Save for a down payment and closing costs.  A down payment can improve your interest rate and give you more loan options to choose from.

4.      Set a budget you can live on and begin doing it.  A budget will enable you to put into motion a real picture of the how much you earn and spend.

5.      Stay employed for 2 years in the same line of work full time.  This is the standard guideline, although there are exceptions. 

Borrowing is not “one size fits all”, however, the above suggestions can help home buyers position themselves for success.

If you have any questions regarding home ownership please feel free to contact me. 

Sincerely,

Ed Smith

NMLS 327781

ed@urockloans.com

808-255-7498

National Home Prices Up Despite Sales Slowdown

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Article via National Mortgage Professional Magazine

by Phil Hall

February saw the third consecutive month of year-over-year declines in home sales, according to new data from RE/MAX. Nonetheless, home prices continued to soar.

Last month saw a relatively 0.2 percent decline in home sales from one year earlier, although sales were up 3.5 percent from January. In the 52 metro areas tracked by RE/MAX, 26 markets recorded year-over-year sales increases, most notably Billings, Mont., with a 59.2 percent spike.

In February, the median sales price was $228,700, up 2.3 percent from January 2018 and up 8.1 percent from February 2017. Only two metro areas saw a year-over-year decrease in the median sales price—a 0.2 percent dip in Albuquerque, N.M., and 5.2 percent drop in Burlington, Vt.—while 18 metro areas increased year-over-year by double-digit percentages. February marked the 22nd consecutive month of year-over-year price increases.

The average number of days on the market for homes sold in February was 62, up two days from the average in January but down six days from the February 2017 average. The number of homes for sale in February was down 1 percent from January and down 13.7 percent from one year earlier. The inventory supply fell to 3.1 months from January’s 3.4 months; one year earlier, the rate was 3.6 months.

 

Homeownership is Within Reach

For many, owning a home in Hawai’i is a dream and may appear difficult, if not impossible. However, I can assure you that owning a home is possible and one of the best investments you can make, especially in Hawaii with steady appreciation, especially within the past 7 years.

                        Data from  http://www.hicentral.com/oahu-historical-data.php    

                       Data from http://www.hicentral.com/oahu-historical-data.php   

My name is Ed Smith and I am a mortgage broker with Solid Rock Home Loans. We have over 20 years experience in Hawaii’s mortgage industry and we have helped many homebuyers reach their dream by purchasing a home in Hawaii. 

 

·        Solid Rock Home Loans is a locally owned mortgage company who understands Hawaii’s culture and real estate industry.

·        We provide excellent interest rates and exceptional service.  Our local and national wholesale lenders compete for your business!

·        We will personally guide you step-by-step through the home buying process and answer any questions you may have along the way.

 

If you are interested in purchasing a home or have any questions, please contact me at (808) 255-7498 or ed@urockloans.com. You can also visit our website, urockloans.com, for more information. 

 

Ed Smith

Sr. Loan Officer

Solid Rock Home Loans, Inc.

Ed@urockloans.com

Cell 808-255-7498

eFax 866-780-8558

Neighborhood Profile: Kaka'ako

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As Oahu’s real estate market continues to expand, today we are profiling one of the up and coming neighborhoods in Metro Honolulu- Kaka’ako.

Condominiums and high-rises are popping up left-and-right in Kaka’ako, a neighborhood near the South shore of Oahu. Here’s more information if you are interested in living in the area:

Location: Kaka’ako is located minutes away from Blaisdell Arena, downtown Honolulu, and Ala Moana Shopping Center. Kaka’ako Waterfront Park is along the ocean, and there are many beaches nearby, including the Ala Moana and Waikiki. There are many restaurants and shops within Kaka’ako, including SALT and Ward Village.

SALT Kakaako

Atmosphere: Kaka’ako has a hip, artsy feel. On nearly any street one can find large murals painted by POW! WOW! Hawai’i. There are restaurants and coffee shops aplenty. Located in metro Honolulu, it is a busy neighborhood given the area’s condensed population.

Cost: Because of the location and newer development, you will need to pay a premium to live in Kaka’ako. The area has condominiums and apartments ranging from $200,000 affordable housing studios to $5 million+ luxury condominiums.

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Although living in Kaka’ako at face value seems pricy, the Hawaii Housing Finance and Development Corporation (HHFDC) has set aside affordable units for low-median income Hawaii residents who meet specific guidelines.

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Summary: Kaka’ako is best for young professionals looking to be nearby to all Honolulu has to offer. The location can’t be beat with restaurants, shops, and beaches located within minutes. However, in Kaka’ako you receive location at a cost for space and price. Majority of available housing are studios, apartments, and condominiums and many of these are luxury units although there are some affordable options available.

For  information on buying or refinancing a home in Hawai'i, please contact Solid Rock Home Loans at (808) 255-7498 or by e-mail at ed@urockloans.com.

7 Refinancing Options That Benefit You

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There are many benefits to refinancing your mortgage.

Refinancing provides the opportunity to save money, pay off your loan faster, and even provide significant cash. Read below to find out the different ways refinance can benefit you:

1. Lower interest rate

Refinancing allows borrowers to lower their original interest rate, resulting in lower monthly payments and saving thousands of dollars over the life of the loan.

2. No Mortgage Insurance

If your first mortgage an FHA-backed loan and you have mortgage insurance, you can get rid of the monthly insurance payment by refinancing to a conventional loan.

3. Shorter term

A shorter loan term allows you to save thousands on interest. The most common shortened loan terms are 15 and 20 year terms. 

4. Ability to Prepay

When refinancing, if you have a lower interest rate but choose to pay the same monthly payment, you will actually be paying off more money on the principal.

5. Fixed rate

If you have an adjustable-rate mortgage, a refinance with a fixed rate allows you to secure a low interest rate as well as keep your monthly payments fixed over time.

6. Cash-out

A cash-out refinance allows you to borrow enough money to pay off closing costs and leave with some cash, in addition to paying off your old mortgage. This is done by taking out equity from your home. People use this extra cash in a variety of ways including to pay off consumer debt.

7. Cash-in

A cash-in refinance allows you to add to your equity by putting down a larger down payment. This will lower monthly payments and save money on interest.

For more information on buying or refinancing a home in Hawai'i, please contact Solid Rock Home Loans at (808) 255-7498 or by e-mail at ed@urockloans.com.

*Info from www.frameworkhomeownership.org

 

Happy New Year!

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Happy New Year!

Each year the market changes and this year will be no exception.  I have already experienced a slight increase in interest rates (expected to continue through 2018), buyers being more cautious to enter the real estate market (one reason being the increase in home prices), and a larger share of cash out refinancing to consolidate debt.   However, we have the loan programs to overcome and help your buyer(s) with many loan options plus very good interest rates plus very good service.

Solid Rock Home Loans is an experienced mortgage broker company with a proven track record in Hawaii.  You have the distinction of being able to access a menu of loan programs with good interest rates and be confident we will close your loan on time.  

Solid Rock Home Loans provides the following loan programs:

-Conventional, all products.  High Balance, 3% down payment

-Portfolio, condotel, Jumbo, unwarrantable condos, land

-FHA, includes Hawaiian Home Lands

-VA, 100% financing, borrowers closing can be paid for.

-USDA, 100% financing, borrowers closing cost can be paid for.

-MCC for Conventional, VA and USDA loan products.

-HELOCS (fixed rate or ARMs)

If you have any questions or need help with a potential buyer being pre-qualified please feel free to contact me at ed@urockloans.com or (808) 627-5391.

Ed Smith

Sr. Loan Officer

Solid Rock Home Loans, Inc

 

 

 

Oahu Homes Reach New Records in 2017

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In 2017 housing prices and sales reached record marks. In June the median price of single-family homes reached $795,000, and in July, the median price of condos hit $425,000, both record highs. During the summertime homes were also selling rapidly, with an average of 12 and 13 days on the market for single-family homes and condos respectively.        

In December, the median price of single-family homes was $750,000. Sales were up 5.9% from the same time in 2016, with 361 houses sold. For condos, sales were actually down 12.2% from 2016, with 461 units sold. Nevertheless, each market experienced overall growth in 2017 with sales increasing 6.3% and 6.9% for single-family homes and condos respectively.

For more information on buying or refinancing a home in Hawai'i, please contact Solid Rock Home Loans at (808) 255-7498 or by e-mail at ed@urockloans.com.

**Data from Honolulu Board of REALTORS®

Lenders' Outlook on the New Year

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Mortgage lenders continue to have a negative profit outlook, and view competitors as the biggest barrier to profit. Demand for both refinances and purchases has decreased.

" On net, lenders said they view competition from other lenders as their biggest hurdle to profitability. This sentiment, which has driven profit concerns for five consecutive quarters, reached its fourth straight survey high with 75 percent of those with a negative outlook naming this as a reason. Among those expecting profits to improve, increased operating efficiency was cited most often.

...

More lenders reported seeing declining demand for refinancing over the previous three months.  This continues a trend that started in the first quarter of 2017. The net share of lenders who expect to see refinancing demand grow in the first quarter of 2018 fell to the lowest reading in a year across all three loan types.

Demand for purchase loans was also lower for all loan types compared to the previous quarter and was the lowest for any fourth quarter over the past three years.  The net share of lenders who expect an increase in purchase mortgage demand over the next three months was about the same as it has been for recent fourth quarters."

Read more here.

Quotations from Mortgage News Daily "Mortgage Lenders' Biggest Fear: Other Mortgage Lenders"

 

Five Simple Ways to Save Money & Increase Your Credit Score

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Merry Christmas and I hope you and your family are well.

One of the most common questions I receive from our clients is “How can I improve my credit score?” A good credit score can be the White Knight that saves you thousands of dollars by receiving a lower interest rate and reduced loan fees. In contrast, a lower credit score can be the kiss of death which may result in your loan not being approved or receiving a higher interest rate and additional loan fees.

I have listed below five simple ways to save money and improve your credit score.

 

1. Pay your creditors on time.  A significant portion of your credit score is weighted on your payment history.  Mortgage credit history is weighted the highest due to the size of the loan.

 

2. Keep credit card balances below 50% of the credit card limit.  As an example, if your credit card limit is $1000 your credit card balance will be below $500 or less.  The lower the balances the better. The best scenario is to pay off the balance each month.

 

3. Limit the amount of charge cards and loans.  Excessive open credit cards with balances greater than 50% of the credit limit and large amounts of installment debt (i.e. auto loans) will reduce or limit your credit score from increasing.

 

4. If you are applying for a loan limit the amount of credit inquiries made.  Each time you apply for a loan the bank or lender will complete a credit inquiry. Too many credit inquiries in a short period of time may reduce your credit score.

 

5. Avoid co-signing for loans.   Co-signing for a loan means you take on the risk the lender does not want.  The person who has applied for a loan does not qualify and the lender is requesting for additional support from a co-signer.  When you co-sign for a loan you become equally responsible for the loan repayment and your credit score will be impacted as mentioned in above #1-4. 

 

In conclusion, I use the analogy of your credit score being similar to having children.  Your credit score will be with you until you die (so will your children) and effort must be made to make sure your credit score is protected.  Neglecting your credit can cost you thousands of dollars when you decide to obtain a mortgage loan.

If you have any questions or would like more information on credit or maybe thinking of purchasing a home or refinancing your mortgage loan, please feel free to contact me. 

 

Mele Kalikimaka!

Debunking the VA Home Loan Appraisal Process

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Solid Rock Home Loans helps Veterans by using the VA Home Loan to help Veterans purchase and finance their homes.  The appraisal process plays an important role in the mortgage process to determine the market value of the property.

While there are differences in Conventional (non-government) and VA Home Loan appraisal processes, there are similarities and in some cases the VA appraisal process can be a better experience.

  1. VA appraisers are licensed appraisers who can also complete conventional appraisals.  The qualifications for a VA appraiser are equal or better than a Conventional appraiser, as VA appraiser must know additional government lending guidelines.
  2. VA and Conventional appraisals completion times are similar.  In Hawaii, VA and Conventional appraisal completion times is approximately two to three weeks or depending on how busy the housing market is. 
  3. The cost for VA appraisal in Hawaii is better or comparable to Conventional appraisals.  The cost for a VA Home Loan appraisal in Hawaii is $650 for residential single-family homes, not including additional fees for extension travel.
  4. VA appraisals allow lenders and mortgage brokers to communicate directly with the VA appraiser.  In contrast, loan officers and mortgage brokers are not allowed to communicate with Conventional appraisers. The advantage to communicating to the appraiser is the free flow of communication and information from the Loan Officer to the appraiser and vice versa.
  5. VA appraisals provide the opportunity for the borrower or realtor to assist the appraiser if the appraisal value is less than the purchase price.  Prior to the completion of the appraisal report the VA appraiser will contact the lender or mortgage broker to request additional information that can help with the final property valuation such as sales comparables or current market data. 

As home prices continue to increase and homes become less affordable to homebuyers the VA Home Loan will be a good option for Veterans.  The VA loan provides 100% financing, competitive interest rates, and flexible underwriting guidelines.  VA Loans can be used to purchase and refinance homes.

Honoring Our Veterans

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We celebrate Veterans Day on November 11, and it is with great honor I am in a profession that enables me to help veterans through the VA Loan Program. 

Our team at Solid Rock Home Loans has supported veterans in Hawai’i for the past 12 years.  In honor of our veterans, we will be posting the mighty warriors who served or are currently serving in our great US Armed Forces.

Our team was privileged to help Retired Army Veteran 1st SG Samuela become a first time home owner this year!  Thank you Mr. Samuela for your service to our country! 

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Pictured with Mr. Samuela is his family and the team at Realty Dynamics.

Quarter 3 Housing Market Update

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Home prices rose both in most metropolitan areas and nationally in quarter 3 of 2017, according to the National Association of Realtors.

The median price of a single-family home nationally was $254,000, which is a 5.3 percent increase from the same time last year. In urban Honolulu the median price is nearly triple that of the national price at $760,200. In fact, this median price makes urban Honolulu the fourth most expensive housing market of Quarter 3. The following are the top 5 areas with the highest prices:

1. San Jose, CA $1,165,000,

2. San Francisco $900,000

3. Anaheim-Santa Ana, CA $790,000 

4. Urban Honolulu $760,200 

5. San Diego, CA  $607,000

In Quarter 3 housing markets were competitive as a result of strong economic growth in jobs and in the stock market, as well as low mortgage rates under 4 percent. Quick sales created little inventory, forcing home buyers to outbid others with the limited homes available. Affordability of homes went down.

For more information on buying or refinancing a home in Hawai'i, please contact Solid Rock Home Loans at (808) 255-7498 or by e-mail at ed@urockloans.com.

Data via mortgagedailynews.com

Oahu Property Tax Exemption due THIS FRIDAY!

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As a reminder, for the island of Oahu, the Property Tax exemption filing deadline is Friday, September 29.  In order for you to qualify for the standard $80,000 tax exemption for primary residence you can either complete the attached form or go to https://www.realpropertyhonolulu.com/ to complete an online form.

The tax exemption will enable you to save money and pay less property taxes!

Click the button below to access the form.

What To Do After the Equifax Data Breach

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On September 7, major credit card reporting agency Equifax announced a data breach affecting over 143 million Americans. Sensitive information such as Social security numbers and birth dates were exposed to hackers from mid-May to July of this year.

Anyone with a credit report from Equifax could be affected.

What should consumers do to recover from this data breach, as well as protect themselves in the future?

Read here for suggestions on how to move forward after this potentially devastating financial breach.

Why Refinancing May Be Right for You

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Refinancing can be beneficial for consumers! Below is a list of some of reasons why refinancing may be the right option for you.

Refinancing gives the opportunity to:

1. Save Money by reducing your interest rate and reducing your monthly mortgage payment.  If you are going to live in your home 5-7 years refinancing may be a good  option to lower your monthly payments.  However, if you are planning to move and sell your home in the near future refinancing may not be a good option.  You may not be able to recovered your closing fees from the refinance.

2. Reduce the term of your mortgage from 30 years to 15 years.  Shortening the mortgage term can save you hundreds of thousands of dollars by accelerating the payoff of your loan and reducing your mortgage interest cost.  However, your mortgage payments will be larger.

3. Cash out to consolidate your bills, payoff your HELOC, home improvement, or fund college tuition.  Under the current tax code mortgage interest for owner occupants are tax deductible.  Taking advantage of the tax deduction on mortgage interest for consolidating credit cards or other bills may be a great way to save.   

Refinancing is not a one size fit all benefit.  Each benefit needs to be analyze to assure the cost savings and benefit. 

For more information on buying or refinancing a home in Hawai'i, please contact Solid Rock Home Loans at (808) 255-7498 or by e-mail at ed@urockloans.com.

Consider Buying a Condo in Hawaiʻi

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Condominium sales are increasing across Hawai’i. On the Big Island, sales are up 60% and on Oahu, sales are up 7% compared with the same time last year. 

Why are condominiums becoming more and more popular in Hawai’i? Much of it has to do with the affordability of condos compared to single-family homes.

“Condos are especially popular in places with high property values - vacation hotspots and urban settings are both places where you can expect to find them on the market,” writes Jonas Elmerraji of Investopedia.

As Hawai’i is one of the most expensive real estate markets in America, buying a condominium is a way for many to not only own a home but to be able to invest and get into the market.

In addition to costing less, condos are also attractive for the lifestyle they provide. Those living in condos generally pay maintenance fees thus aren’t responsible for a yard or the upkeep of the building as they would be as a single-family home owner. They also provide added convenience, with some condos featuring amenities such as a dog park, pool, and fitness center.

If you’re interested in buying a condo, here are some things to look for:

·       Management of Building- Is the condominium well-run? Do the rules allow you to live the lifestyle you’re seeking (do they allow pets? If so, how many?) Is the building/complex experiencing any problems that could hurt its value in the future?

·       Maintenance fees- What are the monthly maintenance fees? What are the fees specifically used for? How much do they increase on average each year?

·       Location- Is the location desirable to your work vicinity and easily accessible to schools, shopping, and your places your frequent?

If you are interested in purchasing a home in Hawai’i, feel free to contact Ed Smith at Solid Rock Home Loans at (808) 255-7498 or ed@urockloans.com.