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Buying a House on Lower Income

Ways to Beat the Loan System

If you have a dream house in your sights, you’re probably on the look-out for a mortgage. However, it doesn’t look like your income requirements can satisfy the mortgage. There are simple ways to achieve the dream on a low budget and get the dream sooner.

You can impress the loan officer with a history of working more than one job. Show you have the ability of tackling a regular job with a part-time job to augment income. And if you are enrolled in a public assistance program, it means you are receiving additional income as well. This works well if such assistance is shown to run for the next 3 years or so. Consider also capital gains income, long-term disability income, interest and dividends, retirement, government annuity and pension income, Social Security, unemployment benefits, among others. Each of these can help boost your income profile.

Include a co-borrower who also lives with you and which allows you to qualify for a bigger mortgage. Opt for a subprime mortgage instead of a prime mortgage. You will be able to get your house sooner, however, though, your interest rates and closing cost and fees may be higher. Try also to boost your approval chances by showing proof of your savings, no default on your credit dues, low use of debt, or that you have great prospects at your current job.

Seek Expert Advice

One of your best chances of fast-tracking a loan application, even if you feel your credit score is below par, is to see David Haley, your Lynnwood mortgage expert. We have lots of experience helping people with dreams of owning a home on a low budget or even with low income prospects. Drop by to see David some time.

Source

The Rise of Consumer House-buying Power

Good News for House-buying Consumers

The First American Real House Price Index (RHPI) measures price changes of single-family homes across the nation down to the metropolitan level. Changes are adjusted for the impact of income and interest rate changes on the house-buying power of Americans. It serves as a measure also of housing affordability. First American reported that more people now seem to better afford their dream homes.

While house prices are expected to increase by 5% in July, they’re still below what they were before the housing boom. First American noted that 86% of the metropolitan areas tracked, the real house prices declined as household incomes went up and mortgage rates decreased. This only means that majority of these metro areas are experiencing growth in house-buying power. So, when you are in the market for a house, your increased buying power will impact on the amount you are to borrow.

American home buyers are going to take advantage of this development and many will be scouring the market for new homes. This is a positive for both markets – the buyers and the sellers.

Mortgage Loans within Your Power in Lynnwood

If you’re now house-hunting in Lynnwood, consider dropping by David Haley, your mortgage company in Lynnwood. We’ve had a long and expansive experience in the intricacies of home loans, having helped many Washingtonians in their quest for new beginnings. We will familiarize you with available loan options best suited to your needs and lifestyle and breakdown everything that intimidates you about the real estate market. Be guided and be informed by one of the best in the mortgage business in Lynnwood.

Mortgage Availability Continues to Decline

According to the Mortgage Bankers Association, mortgage credit access has continued to decline in May. Their latest Mortgage Credit Availability Index (MCAI) came in at 121.4, representing a decrease of 0.8% from April’s figure. The MCAI reached a peak of 128.5 back in October of 2015 and has been moving fairly steadily downward ever since. May represents the third consecutive month of decreases in this index.

When the MCAI goes down, it means that mortgage lending standards are tightening. An increase in the MCAI indicates a loosening of credit. Though mortgage giants Fannie Mae and Freddie Mac have been rolling out their low-down payment programs to increase the availability of credit, these improvements have been offset by tightening in government loan programs designed to serve borrowers in the nation’s high-cost regions.

The Jumbo MCAI experienced the greatest decrease, at 1.3%. This is followed by the Government MCAI, which was down 1%, the Conventional MCAI, which was down 0.8%, and the Conforming MCAI, which was down 0.3%.

Seattle Home Values Rise at Nation’s 2nd Fastest Rate

Looking back at March of 2015, we find that single-family homes in the Seattle area jumped up by 10.8%, according to the most recent data from S&P/Case-Shiller. The jumps in prices have been particularly strong in recent months, with a 2.4% increase from February to March. At present, the average price for a single-family home in April was $637,250 in Seattle. Such prodigious price gains can be attributed to increases in employment, low mortgage rates, and continued low inventory.

These figures place Seattle above any major American city outside of the Pacific Northwest in terms of fast-rising home prices. Within the Pacific Northwest, only Portland-area homes are beating the Seattle rate. It is here that home prices have experienced an increase of 12.3% over the past year. Nationally, the average price increase has only been 5.2%.

On top of this, March was the first time the value of Seattle-area homes rose above the peak we experienced back in the summer of 2007. This is after a 50% increase following the low point in early 2012.

New Home Construction Up in April

A lack of inventory has been plaguing the housing market for some time now. Fortunately, builders are rising to the challenge of supplying demand for new homes. After a weak start to the construction season, new construction experienced a healthy rise through April. Last month, according to the Commerce Department, housing starts jumped up by 6.6%. This puts them at a seasonally adjusted annual rate of about 1.17 million houses. Applications for permits to construct new homes went up by 3.6%.

Unfortunately, the news is not as good as it could be. There is still a ways to go before the market fully compensates for the 9.4% drop in March. Meanwhile, through groundbreakings are beating last year’s rate, not much of this is going on here in the Lynnwood area. Starts were up by 22.2% in the Midwest and 14.1% in the South, but they actually declined by 10% in the West and 7.6% in the Northeast.

National builder sentiment for May has held at 58 for the fourth month in a row, telling us that we can likely expect further strong construction activity in the future.

Rates Remain Low, but Washington Home Prices Continue to Rise

As we entered May, mortgage rates inched slightly lower. This is happening in spite of activity in the bond markets that generally drive mortgage rates. In part, this is probably due to the fact that lenders hadn’t fully adjusted their rate sheets to reflect last Friday’s gains. We may therefore expect to see slightly higher rates as the week continues. It would seem that the market is fairly stable, though, and we can likely look forward to another month of low interest rates.

Meanwhile, though mortgage rates remain attractively low across the country, some areas are experiencing such great increases in home prices that homebuyers are actually paying more each month than they were back in the end of 2015. The problem has been most pronounced here in Washington, where the monthly principal and interest payments are averaging almost $15 higher for median-range homes, compared to December. Oregon and Colorado have been experiencing similar problems, while the rest of the country has been enjoying an average monthly payment decrease of about $20.