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Housing Inventory’s Affect on Home Prices

A recent article indicated that all-time low housing inventories and higher prices have hampered affordability both for first-time and move-up buyers. Today’s low inventories began with the 2008 housing collapse. Foreclosures reached all-time highs and investors bought up foreclosed properties at bargain-basement prices. Former homeowners became renters, thus increasing demand for rentals, and that pushed […]

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“What’s the Rate”

The question most often asked by mortgage applicants, is “What’s the rate”. But that’s not often their real concern. It’s understandable to think interest is key but it’s only a part of a transaction. The primary concern for most mortgage applicants is monthly payment. No one really wants a drill…what they want is a hole. […]

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More About Mortgage Math

Recently, I wrote about mortgage math and this article is another aspect of that math. Over the years, I’ve observed that most people, but not all, know the approximate rate on their mortgage. They know because it’s usually their largest monthly payment obligation. Fewer know their auto loan rate and fewer still, know rates on […]

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FHA Rollback of the Rollback

As noted recently, Julian Castro, the HUD (Housing and Urban Development) Secretary, announced a rollback of the FHA (Federal Housing Authority)-required mortgage insurance premiums from .85% to .60%. The change was to be effective on January 27th. The decision to reduce the premium was made partly because, for the past two years, the FHA loss […]

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Mortgages…Math Is Important!

There is more math in the mortgage process than meets the eye and most borrowers, and even many loan officers, don’t understand all potential ramifications.  It’s important to work with someone who does in order for them to present the best, most appropriate information and options to mortgage clients. Interest rate and monthly payments are […]

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How To Compute Blended Rate: The real cost of all money borrowed

A person called me today concerned that the Fed Discount, Prime Rate, etc will be rising and is considering a refinance. I computed for him the cost of ALL money that he has borrowed and this is the formula to compute blended rates. Note. Interest rates that are averaged will not work because the amount […]

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Two Kinds of Mortgage Loan Officers

There are two kinds of mortgage loan agents….those who simply want to get paid and those who want to provide truly valuable assistance to their clients. There are other valid comparisons, but an agent’s core value determines the commitment to service for a client. The mortgage industry contributed greatly to the 2008 recession. Problems therein […]

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Mortgage Interest Deduction Going Away?

The Mortgage Bankers Association (MBA) has defended the tax deduction for mortgage interest against any and all challenges. Yesterday, in the National Mortgage News, it was reported that David Stevens, head of the MBA, indicated that the agency might not oppose a reduction or elimination of the deduction. Mr. Stevens noted that if its elimination […]

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Government Regulations

For members of the lending community and, certainly, for investment professionals, ie; financial planners, stock brokers, etc., it seems like the government just delights in piling on more and more regulatory restrictions. And, for every new regulation or restriction, yet another new form requires client signatures. I know I often feel that way but I […]

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What Mortgages and Magic do for Me

I enjoy making people laugh and feel good. I also enjoy navigating the cumbersome complicated process of putting together a mortgage loan for clients.  There is satisfaction in magic and in mortgages. The joy from magic is immediate and my joy in completing a mortgage loan the best way for a client is immediate for […]

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Time Savings?….Not So Much!

When Mortgage Magic opened 26 years ago, the mortgage process was far different. Everything was done manually including loan applications, disclosures and credit reports (2-3 days to receive). Employment and bank accounts were verified by mail. When processing was completed, the appraisal and all verifications were received and the loan option chosen, two copies of […]

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What should I discuss with the Reverse Mortgage Counselor ?

You are required to attend a Reverse Mortgage Counseling session with a Counseling Agency approved by the Department of Housing and Urban Development (“HUD”). This counseling session will help you evaluate if a Home Equity Conversion Mortgage (“HECM”) is suitable for you. You are advised to discuss the following additional issues with the counselor during […]

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TRID increased Loan Costs

Below is part of an article from National Mortgage Professional Magazine written by Phil Hall. I wonder about the statement that lenders can only recover 17 of the new cost. In the mortgage world and probably in every business world the cost is ultimately passed to the consumer. When the new appraisal process was put […]

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