The Honest Broker: Real Estate Questions of the Week
BY: DIANE LOTT, BROKER PARADISE FOUND REALTY
Why can’t I find something affordable?
Currently the laws of supply and demand are in full display. There are minimal properties entering the market, shrinking the pool of available homes, which in turn, are causing the prices to skyrocket. The fact is that multiple buyers are trying to purchase those few homes on the market, making it virtually impossible to find affordable homes because it strongly is a seller’s market.
What are the predictions for mortgage rates in the next few weeks?
Mortgage experts mostly expect rates to hold steady in the week ahead (Sept. 23-29). In response to Bankrate’s weekly poll, 66 percent said rates will stay put, and the remaining 33 percent said they would fall. None of the experts predicted higher rates for next week.
Do I have to escrow for taxes and insurance?
Banks generally use the loan-to-value (LTV) ratio to determine if your mortgage loan will require an escrow account, and borrowers whose mortgage amount represents 80% or less of the home’s value typically may avoid escrow if they so choose. However, if you have less than 20% equity as a buyer, you are required to have an escrow account.
What is the lowest down payment I need to place for a mortgage?
In most cases, the lowest possible down payment for a conventional loan is 3%, because that is the minimum requirement used by Fannie Mae or Freddie Mac. Some conventional mortgage products may require 5% down, particularly for those buyers who have lower credit scores.
What is PMI?
Private Mortgage Insurance, PMI, is insurance paid by the borrower that protects the lender from default of payment. It is not in any way “homeowners” insurance.
Diane Lott, Broker
Owner: Paradise Found Realty
Paradise Found Realty, Inc. of Palm City
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