There are some important factors that are coming up that you will want to be aware of if you are looking to purchase Real Estate in 2014. Below are three important points that were made by Deanna Lawley in a blog on HomeFinder.com.
Avoid rising rates roulette: Mortgage interest rates, while still attractive, are up 1 to 2 percent over this time last year. It’s possible to lock in a 30-year fixed rate mortgage at about 4.5 percent, says Shari Cashman (Gencor Mortgage). According to the Mortgage Bankers Association’s forecast, mortgage rates will likely rise to about 5 percent in 2014. If you buy now and the rates drop, you can always refinance. If you wait and the rates rise, you are stuck, says Todd Huettner (Huettner Capital).
New Year, new lending rule: Lending rules will change on January 1, 2014 and it could be harder to get a loan. 2014’s rules will allow you to borrow less, at your same level of income, says Huettner. 2013’s current mortgage rules allow for a 45% total debt to income ratio (DTI); in 2014, the DTI will go down to 43%. What does this mean? You need to make or reduce your debt in order to buy the same house!
Easier financing: If you are waiting for home prices to decrease, don’t. 2014’s mortgage changes could make it harder to get financing, says Robert J. Spinosa (RPM Mortgage). So if you are looking to save a few dollars by waiting for home prices to drop, you could miss your window to secure a mortgage entirely.
If we can answer any questions, or be of any assistance in helping you with your purchase, please contact our office.
Don Ricedorff, Broker Associate, GRI, CRS, CCIM, ABR, RSPS, CDPE
The Wells Group Real Estate Brokerage