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Mortgage & Financing

NJ Mortgage News: Fewer homes for sale pushes up US house prices in December

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Summary of the Article

Home prices are rising faster than most Americans’ wages, slowing sales even as hiring strengthens, consumer confidence grows and mortgages stay …

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Article

By CHRISTOPHER S. RUGABER

AP Economics Writer

WASHINGTON (AP) – U.S. home prices rose in December at a faster pace than the previous month, likely because of a much smaller number of homes for sale.

The Standard & Poor’s/Case-Shiller 20-city home price index, released Tuesday, increased 4.5 percent in December compared with 12 months earlier.

Culled From

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Categories
Mortgage & Financing

NJ Mortgage News: US new home sales fall slightly in January

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Summary of the Article

WASHINGTON (AP) – Sales of new U.S. homes were basically flat in January, evidence that recent job gains and relatively low mortgage rates have …

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Article

By JOSH BOAK

AP Economics Writer

WASHINGTON (AP) – Sales of new U.S. homes were basically flat in January, evidence that recent job gains and relatively low mortgage rates have yet to spur the real estate market.

The Commerce Department said Wednesday that new home sales slipped 0.2 percent last month to a seasonally adjusted annual rate of 481,000.

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Mortgage & Financing

NJ Mortgage News: Rossi: Home buying mistakes to avoid

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Summary of the Article

Remember, you cannot rely on a bank to determine how much home you can afford. Despite the tightening of lending standards since 2008, mortgage …

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Article

Economy-vital SignsBill Sikes/AP file photo

Low interest rates and a stronger job market continue to fuel growth in housing. While the number of national home sales declined slightly in 2014 (3 percent) to 4.93 million, home prices have continued to rise. In fact, according to the National Association of Realtors, the national median existing home price was up 5.8 percent in 2014 to $208,500, the highest level since 2007 ($219,000).

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Buying Home Mortgage & Financing NJ Real Estate News

Record High Housing Affordability Index

According to National Association of Realtors:

  • According to Housing affordability conditions have reached the highest since recordkeeping in 1970.
  • NAR’s Housing Affordability  rose to a record high 206. 1 in January 2012, based on the relationship between median home price, median family income and average mortgage interest rate.
  • The higher the index, the greater the household purchasing power.
  • An index of 100 is defined as the point where a median-income household has exactly enough income to qualify for the purchase of a median-priced existing single-family home.  (20% down payment and 25% of gross income devoted to mortgage principal and interest payments).
  • For first-time buyers making small down payments, the affordability levels are relatively lower.
  • Latest data underscores buyer opportunities in today’s market. 
  • Good news for buyers who can qualify for a mortgage.
  • NAR projects the affordability index for all of 2012 will be at an annual high, with little movement in mortgage interest rates or home prices during the year.
  • Housing inventory levels have declined.
  • When the access to credit improves, there will be stabilization in home prices.

 

Ask Rosy at 609-915-9665 how first-time buyers making small down payments can buy homes in Mercer, Middlesex or Mercer Counties of New Jersey.

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Mortgage & Financing

Reverse Mortgage in a Nutshell

  • The biggest change is the introduction of a new reverse mortgage, the Home Equity Conversion Mortgage Saver option, or HECM Saver.
  • It has a cheaper upfront mortgage insurance premium, or MIP, compared with the traditional HECM reverse mortgage, now known as the standard option.
  • Mortgage insurance protects lenders from loan losses, though borrowers pay the cost.
  • New options empower seniors to tap smaller amounts of equity in a more affordable way, according to Peter Bell, president of the National Reverse Mortgage Lenders Association. The Washington, D. C. , organization represents lenders and investors. he says.
  • The biggest change is the introduction of a new reverse mortgage, the Home Equity Conversion Mortgage Saver option, or HECM Saver.
  • It has a cheaper upfront mortgage insurance premium, or MIP, compared with the traditional HECM reverse mortgage, now known as the standard option.
  • Another change is that many lenders have reduced or eliminated their origination fees on reverse mortgages, according to Barbara Stucki, vice president of home equity initiatives at the National Council on Aging, a nonprofit service and advocacy group for older Americans, based in Washington, D. C.
  • Borrowers may be tempted by the fixed-rate option, but Susanna Montezemolo, vice president of federal affairs at the Center for Responsible Lending in Washington, D. C. , says the adjustable rate may be a smarter choice because the fixed rate requires that the borrower tap the full amount of equity upfront. she says. s still a loan against the value of a house.