Boca Raton real estate

Benefits of Energy Efficient Homes

A recent survey from the National Association of Home Builders (NAHB) found that energy-efficient features are among the most sought-after “must-haves” among homebuyers. Among those surveyed, 83% desired Energy Star-rated windows, 81% wanted Energy Star-rated appliances and 80% preferred energy-efficient lighting.

Though eco-conscious sensibilities compel millions of homeowners to make their homes more energy-efficient, that’s not the only reason to upgrade your home. The following are a handful of the many benefits of energy-efficient homes.

Save money: The U.S. Department of Energy indicates upgrading to energy efficient appliances products can help homeowners reduce their energy costs by as much as 30%. The Environmental Protection Agency (EPA) estimates you can save 11% on average on your total energy costs by air sealing your home and adding insulation in the attic and crawl spaces.

Improve resale value: Being able to market your home as energy-efficient when it comes time to sell it may help your resale value, especially as energy-efficient homes become better-known and more in-demand.

According to several studies, energy-efficient homes and apartments garner anywhere from 2% to 8% more in sales prices than their traditional counterparts. Research from the mortgage lender Freddie Mac found that homes with energy-efficient ratings sold for nearly 3% more on average than homes without such ratings.

Live healthier: The benefits of energy-efficient homes aren’t just economic, though health-related benefits certainly produce an economic incentive as well.

Energy-efficient homes boost your comfort level by also enhancing the indoor air quality by reducing pollen, dust, insects, and humidity, which leads to better quality of life.

Energy-efficient appliances are typically quieter than traditional models, as well, making their operation less intrusive to your daily life.

To learn more and find out how to perform some of these improvements yourself, visit DOE’s Energy Saver website.

Tools and Calculators for Homes:

Air Seal and Insulate with ENERGY STAR

Information, tools, and resource to help consumers seal and insulate their homes, including a DIY Guide to Sealing and Insulating with ENERGY STAR.

Assess Your Home with ENERGY STAR

Information, tools, and resources to help consumers assess their home’s energy use, including the ENERGY STAR Home Advisor and the ENERGY STAR Home Energy Yardstick.

Building Energy Software

List of building energy software packages, some of which are available for free or a small fee.

ENERGY STAR Refrigerator Retirement Savings Calculator

A tool that allows a consumer to determine energy savings and costs associated with replacing non-ENERGY STAR-rated refrigerators.

Heat & Cool Efficiently with ENERGY STAR

Information, tools, and resources to help consumers increase the efficiency of their home’s heating and cooling system.

Roof Savings Calculator

A tool developed as an industry-consensus roof savings calculator for residential and commercial buildings using whole-building energy simulations.

Filed under: 2024 real estate, Blog, Boca Raton real estate, Energy efficiency, Energy efficient homes, Exclusive Buyer Agency, First Time Homebuyers, Florida Real Estate, home automation, Home Buyer Advice, Home Buyers, home safety, Homebuyer Advice, new home construction, Real Estate, real estate news, Real estate trends, smart home, South Florida Real Estate by Kim Bregman
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Home Buying Strategies for 2024

For now, economic signals suggest more positive news for buyers in 2024 though no experts are forecasting a return to 3% rates anytime soon. More likely, we will see the 30-year mortgage rate decline closer to 6% according to forecasts from the Mortgage Bankers Association and the National Association of Realtors.

Mortgage rates and housing prices are both high while the housing supply is running low. The current market has a 3.6-month supply of unsold home inventory. A balanced market has a supply of five to six months. Despite larger shortages, 92% of markets have seen modest inventory growth over the last three months, according to a November 2023 report from ICE Mortgage Technology.

Until supply catches up to demand, prices are unlikely to fall. Realtor.com estimates prices will fall less than 2% next year and that is a nationwide forecast. Prices in the South are not expected to fall with over 2000 people a month moving to Florida.

More than one in four homes are still selling for above list price, according to October 2023 data from the NAR: 28% of homes sold for above list price that month. Homes for sale spent a median of 23 days on the market and saw an average of 2.5 offers, a sign that competition remains tough.

Don’t let high rates keep you on the sidelines for too long. When rates go down, competition goes up — another reason there’s no time like the present to start house hunting.

How do you compete in this market?

1. Adjust your criteria and expectations. No one gets 100% of what they want in a home. Decide the features that are your top priority and compromise on the rest. Plan on adding or changing features you can control in the future and shop for those you cannot such as location, community amenities, school districts, and more.

2. Consider the option to refinance in the future if rates do fall significantly. Nothing in the economy is suggesting that this will happen anytime soon. Waiting around for rates to drop only means that there will be more competition for the homes you can afford while home prices continue to rise. Consider getting into a home that you can afford and leave open the option to refinance in the future to ease your monthly expenditures and invest in home improvements. Should rates not fall, then you are already building equity and are way ahead of where you would be if you waited.

3. Consider new construction, some developers are offering below market mortgage rates if you use their financing company and often include incentives towards closing costs. You start off with a brand-new roof, appliances, a home warranty, and more so the future expenditures you need for a resale can be applied to your down payment or décor.

Filed under: 2024 real estate, Blog, Boca Raton real estate, Exclusive Buyer Agency, Exclusive Buyer Agent, First Time Homebuyers, Florida Real Estate, Home Buyer Advice, Home Buyers, Homebuyer Advice, new home construction, Real Estate, Real Estate Investment, real estate news, Real estate trends, South Florida Real Estate by Kim Bregman
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2024 Real Estate Forecast

NAR economist Yun predicts home sales will begin to rise next year – by 13.5% compared to 2023, and the median home price will reach $389,500 – an increase of 0.9% from this year. “Metro markets in southern states will likely outperform others due to faster job increases, while markets in the Midwest will experience gains from being in the most affordable region.”

Yun expects rent prices to calm down further in 2024, which will hold down the consumer price index. He predicts foreclosure rates will stay at historically low levels in 2024, comprising less than 1% of all mortgages.

Yun forecasts the U.S. GDP will grow by 1.5%, avoiding a recession, with net new job additions slowing to 1.7 million in 2024 compared to 2.7 million in 2023, and 4.8 million in 2022. After eclipsing 8% in late 2023, he expects the 30-year fixed mortgage rate to average 6.3% and for the Fed to cut rates four times – calming inflationary conditions – in response to slower economic activity.

Yun also foresees 1.48 million housing starts in 2024, including 1.04 million single-family and 440,000 multifamily.

Florida is home to over 22+ million people—a number that is growing every day. In fact, Florida is the fastest-growing state in the country, adding an average of 1,000 people per day. These new residents are congregated in just a handful of counties. According to an analysis by the Tampa Bay Times, a third of Florida’s new residents wound up in just five counties: Orange, Hillsborough, Lee, Polk, and Palm Beach. These five counties are all located in the state’s southeastern region, known for its warm weather and beaches.

Florida’s growth is largely fueled by migration. Over the last two years, 616,000 new residents have come to Florida from other parts of the country, and 175,000 from other countries. In fact, without migration, Florida would not have grown at all. Its 567,881 deaths exceeded its 478,834 births. And according to projections, by 2030 Florida will have more than 25 million residents.

Florida’s statistics will be greatly influenced by available inventory for sale. The South Florida real estate market still has a significant shortfall or inventory relative the the migration to the area and demand for housing. Southeast Florida’s housing market is poised for a rebound in sales and sustained price appreciation in 2024.

Filed under: 2024 real estate, Blog, Boca Raton real estate, Exclusive Buyer Agency, Florida Real Estate, Home Buyer Advice, Home Buyers, Homebuyer Advice, new home construction, Real Estate, Real Estate Closings, Real Estate Investment, real estate news, Real estate trends, South Florida Real Estate by Kim Bregman
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Should You Buy A House Now Or Wait Until 2024?

Many prospective homebuyers have been left wondering when the time will be right for them to enter the housing market. The average 30-year fixed mortgage rate hit 8% this week, the highest level since 2000 but a very moderate rate to the 16.5% I paid for my first home in 1980.

Daryl Fairweather, Redfin’s chief economist, said waiting for rates to fall before entering the housing market could be a mistake. “The second that happens, buyers will rush back into the market, and we will see a return of bidding wars,” she said.

For homebuyers who are financially prepared to buy a home, locking in a high interest rate now — and refinancing at a lower rate down the road — could be a wise move, Lawrence Yun, stated chief economist at the National Association of Realtors.

Over the next 12 to 18 months, Yun expects mortgage rates to fall from the near-8% they’re at now to below 7%, perhaps even close to 6%, he said. Remember, the real estate adage of ‘Marry the house and date the rate.’ To put it another way, you can always refinance later. I always advise my buyers to plan on staying in the home for five or more years if you plan on owning a home. If your short term situation involves moving, then perhaps it is best to rent for the time being.

Many factors will change rates in the future and the housing market is directly influenced by mortgage rates. Many of these factors are unknown at this time. Inflation, world unrest and economic conditions, GDP, and more.

The volume of existing home sales was down more than 15 percent from August 2022 to August of this year, according to the National Association of Realtors. However in South Florida though the volume of sales where down homes prices have continued to increase month to month due to a lack of inventory with both resale and new construction.

Cash Buyers should get into the market sooner than later since there are no forecasts that predict that home prices will be lower in South Florida in 2024, just the opposite.

No matter which way the real estate market is leaning, though, buying now means you can start building equity immediately. It also means avoiding the potential for additional mortgage rate increases later.

The decision to buy a house in 2023 or wait till 2024 is multifaceted, depending on market conditions, economic forecasts, personal finances, and lifestyle factors. While it’s essential to consider all these elements, remember that a home is not just an investment—it’s a place to live, grow, and create memories. Whether you choose to buy now or wait, ensure it aligns with both your financial goals and personal needs.

Filed under: 2024 real estate, Blog, Boca Raton real estate, Exclusive Buyer Agency, Exclusive Buyer Agent, First Time Homebuyers, Florida Real Estate, Home Buyer Advice, Home Buyers, Home Financing, Homebuyer Advice, Mortgage Information, Real Estate, Real Estate Investment, real estate news, Real estate trends, South Florida Real Estate by Kim Bregman
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Tips to Reduce Home Insurance Costs in South Florida?

Are you a home buyer in Florida looking to save money on your insurance costs? Here are some expert tips to help you reduce your home and wind insurance expenses.

Shop Around: Don’t settle for the first insurance quote you receive. Take the time to compare prices from multiple insurers. By doing so, you can find the best coverage at the most competitive rates.

Increase Deductibles: Consider raising your deductibles to lower your premium. While this means you’ll pay more out of pocket in the event of a claim, it can significantly reduce your monthly insurance costs. Make sure you take on a deductible that won’t leave you financially overwhelmed when you need to make a major claim.

Improve Home Security: Installing security measures such as alarms, deadbolts, and smoke detectors can make your home safer and lower your insurance premiums. Insurers often offer discounts for homes with enhanced security features.

Bundle Policies: If you have multiple insurance needs, consider bundling your auto, umbrella, home and wind insurance with the same provider. This can lead to substantial savings on your premiums.

Maintain a Good Credit Score: Believe it or not, your credit score can affect your insurance rates. Pay your bills on time, keep your credit utilization low, and regularly check your credit report for errors to maintain a good credit score and potentially lower your insurance costs.

Consider Wind Mitigation Measures: Living in Florida means being prepared for hurricanes. By fortifying your home against wind damage with measures like impact-resistant windows and reinforced roof trusses, you can qualify for wind mitigation discounts.

Avoid Making Small Claims: While insurance is designed to protect you from significant financial losses, making multiple small claims can lead to higher premiums. Consider handling minor repairs out of pocket to avoid impacting your insurance rates.

Look for Discounts: t’s easy to miss a discount you’re eligible for. Homeowners often have the stress of the home-buying process in the background when they get coverage, meaning insurance could be one thing hurriedly checked off the list. You can qualify for discounts if you:

Have a residence with no smokers
Pay your premium upfront
Pick paperless billing
Sign up for automatic payments

Remember, every insurance policy is unique, so it’s essential to speak with a qualified insurance agent to find the best ways to lower your home and wind insurance costs in Florida. Don’t let high premiums take away from the joy of homeownership – take action today and start saving!

Filed under: 4 Point Inspection, Blog, Boca Raton real estate, Exclusive Buyer Agency, Exclusive Buyer Agent, First Time Homebuyers, Flood Insurance, Florida Real Estate, Home Buyer Advice, Home Buyers, Home Maintenance, home safety, Homebuyer Advice, Homeowners Insurance, Hurricane Preparedness, Insurance Claims, Real Estate, real estate news, South Florida Real Estate by Kim Bregman
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Why Use an Exclusive Buyer’s Agent for New Home Construction?

Because the builder’s agent’s job is to convince you to buy only their homes at the highest price. Your Exclusive Buyer Agent’s job is to even the odds and negotiate for the lowest price and best terms for YOU!

If you’re building what you buy, you might think, “Why would I need an agent?” However, new construction is a complicated and expensive process. The advantages are many; aside from the obvious ones. The fact that having buyer agent representation is often FREE cannot be repeated often enough. So too, should the misconception that not using a buyer’s agent will save money be constantly repeated – that simply doesn’t happen.

A seasoned agent with experience in new home construction can give you invaluable insight during the process. Whether they’ve done business with those particular builders, or are aware of other comparable communities in the area, they can provide a wider context to your transaction. They might have an existing relationship with your builder, easing any tensions that might arise.

Remember that that site agent represents the builder/developer. Most real estate agents are sub-agents of the Seller or Transactional agent. In neither case do they have a fiduciary responsibility to the Buyer.

The site agent is an employee of the builder and is obligated to represent the best interests of the builder, not the homebuyer. They are expected to work to secure the builder the best deal.

The further you get into the home shopping process, the more challenging it becomes to bring in an agent. In fact, if you’ve already registered with a community, it might be too late.

Benefits of Using an Exclusive Buyer Agent for New Home Construction:

Compare and evaluate builders’ reputations and history of their construction quality and service.
Help you compare and evaluate advantages and disadvantages of new construction homes vs. resale homes.
Provide information about the community.
Help buyer with evaluation and selection of a building lot and options. Lot location and certain options have a very real bearing on resale value.
Help buyer evaluate which options should be done by the developer during construction and which are more affordable to be done by an outside vendor post closing.
Truly negotiate on behalf of the buyer. Many builders are offering “free” options and upgrades, but some are also making additional price concessions.
Review the Agreement of Sale (PA) prior to buyer signing. This is not a legal review (only an attorney can do that), but an experienced agent will be able to spot terms and conditions that are atypical and of potential concern to the buyer. The agent may then be able to negotiate terms and conditions that are more favorable to the buyer but still acceptable to the builder. Keep in mind most new construction contracts are written by attorneys that represent the builder and these contracts are therefore heavily weighted in favor of the builder.
Recommend a real estate attorney for final contract, title commitment and to hold your escrow funds.
A buyer’s agent serves as an extra set of ears as a witness at court or arbitration– When the builders sales representative is familiar with all rules, features and prices and it’s all new to buyer – it is good to have experienced person on buyer’s side listening with buyer and taking notes, a lot of information is verbalized in short period of time.
Attend the signing of the Agreement of Sale
Assist with the buyer’s financing and review financing paperwork. This is especially important if the builder is tying “free” options and upgrades to the use of a builder-affiliated lender.
Check on the property during construction and keep a photo record at different stages.
Assist in options selections to optimize budget and maximize resale.
Be your leverage with the builder as problems arise during construction.
Keep everything in writing– Sometimes even the very nicest builder makes verbal promises that later become a point of contention. An experienced buyer’s agent is conditioned and trained to “put it in writing” even though at the time it doesn’t seem necessary.
Arrange for a final inspection with a license building inspector and generate a “punch list” to be completed before final closing.
Document and help resolve any issues with construction, financing, title, etc. throughout the process.
Attend a pre-settlement walkthrough with the buyer to make sure that all items are satisfactorily completed or that a proper punch list is established to assure completion after settlement.
Obtain and review a preliminary HUD-1 settlement statement to be sure it is accurate and advise the buyer of the amount needed for settlement.
Assist buyer with utilities, security and HOA requirements, decorators, service professionals, schools, et. al.
Attend settlement with the buyer.
A buyer’s agent will be there even after the home closes. It is routine for issues to arise during the first year of a new home. Site agents tend to forget a buyer’s name after the contract is signed.
NO ADDITIONAL COST TO YOU!

Read My Reviews from New Home Construction Clients!

Filed under: Blog, Boca Raton real estate, closing costs, contracts, Down Sizing, Exclusive Buyer Agency, Florida Real Estate, Home Buyer Advice, Home Buyers, Home Financing, home Inspections, Home Maintenance, Homebuyer Advice, International Home Buyers, Jupiter FL Gated Communities, Mortgage Information, new home construction, Real Estate, Real Estate Investment, Relocation, Retirement, second home, South Florida Real Estate, vacation home by Kim Bregman
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2023 Florida Jumbo Loan Limits

A jumbo loan is a type of mortgage loan that’s used to finance loans that exceed the conforming loan limit. In the United States, the Federal Housing Finance Agency (FHFA) sets loan limits for conforming loans each year.

If the home you’re purchasing will require you to borrow more than the conforming loan limit (CLL), you’ll need to apply for a jumbo loan. But because of the larger loan amounts and increased risk for lenders, Florida jumbo loans often come with higher interest rates and stricter requirements than conventional loans.

In 2023, the conforming loan limit for most U.S. real estate markets is $726,200. However, the jumbo loan limit in Florida depends on what county you’re planning to buy a home in.

· $726,200 is the conforming loan limit in most Florida counties.

· $874,000 is the maximum limit in Monroe County

The amount being borrowed is what determines whether you will need a jumbo loan, not the price of the home.

The requirements for a jumbo loan are much more stringent than a conforming loan. Each lender may have different requirements or processes, but below are the typical requirements for borrowers seeking a jumbo loan.

Higher credit score: When it comes to obtaining a jumbo loan, credit score requirements are typically stricter than for conventional mortgages. While some lenders may be willing to accept a lower score, a credit score of at least 720 is generally required to qualify for a jumbo loan.

Larger down payment: When applying for a jumbo loan, keep in mind that down payment requirements are generally more substantial than for traditional mortgages. While the specific amount will depend on the lender and the borrower’s financial situation, many jumbo loan lenders require a down payment of at least 10%, and some require as much as 20% or more.

More assets: During the asset review process, lenders typically request that jumbo loan borrowers provide evidence of sufficient liquid assets or savings to cover the equivalent of one year’s worth of loan payments.

Lower debt-to-income ratio (DTI): Whether you’re applying for a traditional mortgage or a jumbo loan in Florida, lenders evaluate your spending habits and creditworthiness by analyzing your debt-to income ratio ( DTI) The DTI is determined by dividing the total of your monthly debt payments by your gross monthly income. While some lenders may accept a DTI as high as 50% for a conforming loan, those applying for a jumbo loan should aim for a DTI under 43% and ideally closer to 36%.

Additional home appraisals: For a jumbo loan, lenders may require an additional home appraisal to ensure that the property’s value is accurate. This is particularly true in places where there are few comparable home sales. The additional appraisal acts as a second opinion and helps the lender to mitigate their risk. It’s important to note that the cost of a second appraisal may be higher than a typical home appraisal, particularly in areas with fewer sales.

Filed under: Blog, Boca Raton real estate, closing costs, Exclusive Buyer Agency, Exclusive Buyer Agent, First Time Homebuyers, Florida Real Estate, Home Buyer Advice, Home Buyers, Home Financing, Homebuyer Advice, House Closings, Jumbo loans, Mortgage Information, Real Estate, Real Estate Closings, Real Estate Investment, real estate news, Real estate trends, Refinancing, South Florida Real Estate by Kim Bregman
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Benefits of Home Automation

Home automation is increasingly popular as technology improves and devices become more affordable. Smart home automation works by connecting various devices in your home to a central hub or directly to a network. These devices can then be controlled remotely through a smartphone app, voice assistant or web interface.

Smart home components like security or climate control can be integrated with other smart devices, like your home entertainment system. This allows you to create a comprehensive and integrated smart home system that can automate many different tasks.

There are tons of reasons you may want to invest in home automation, but they generally fall into four categories.

Convenience. This is one of the primary reasons people start down the smart-home path. It just makes life a little easier when your home automates all the mundane tasks you used to have to do on a day-to-day basis.
Safety. A lot of smart-home technology is centered around your home’s security system, and there’s a good reason for that. No one piece of security equipment will protect your home comprehensively, but a network of pieces of equipment all working and thinking together can.
Sustainability. A lot of energy is wasted when you leave the lights on or keep your AC running when you’re gone for the weekend. A truly smart home will adjust itself to your habits and make sure your environmental impact is a little lighter.
Savings. You waste a lot of money when you leave things running unnecessarily. Your smart home will improve your economic efficiency by helping you remember to turn things off or down when they’re not needed

Here’s some of what the marketplace currently has to offer:

Detectors – Smart detectors provide peace of mind, so you aren’t left worrying that you forgot something. Smoke and carbon monoxide detectors are vital additions to any home. Gas and water leak detectors are good additions as well.
Heating and Cooling – With the initial success of 2011’s Nest Learning Thermostat, this product category is most associated with home automation.
Lighting – With the ability to control lights through your tablet or phone, intelligent lighting has become the initial step many take in setting up smart home technology.
Security Systems – This area has taken home automation to the next level. A lot of the newer, more advanced smart home tech is in this category, with keyless entry, camera equipment, and more. D
Hubs – Hubs, for the most part, are what tie your systems together. .
Appliances – Get a text message from your washer when a load finishes. Have your fridge create your grocery list for you. Shut the coffee pot off from work. Smoke a brisket for a few hours while remotely controlling its temperature. All possibilities with smart appliances.
Energy Management – Track your energy use and make changes in real time, from any location.
Lawn and Landscape Care – Control your pool cleaner, mow your lawn or set the irrigation system, all via smartphone app.
Window Coverings – Automatic shades and blinds timed to open or close with your bedtime or wake up call.

Technology experts say that tomorrow’s smart homes will have more seamless smart home device integration, more intelligent home appliances and gadgets, movement into the virtual world, and increased customization, efficiency, and control.

Filed under: 2022 Real Estate, Blog, Boca Raton real estate, Exclusive Buyer Agency, First Time Homebuyers, Florida Real Estate, home automation, Home Buyer Advice, Home Buyers, Home Maintenance, home safety, Homebuyer Advice, Real Estate, Real estate trends, smart home, South Florida Real Estate, Uncategorized by Kim Bregman
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Beware of “Too Good To Be True” Lenders

Homeowners beware.

With the potential of a recession and rising mortgage rates; lenders are seeing fewer loan applications and many buyers are not able to qualify for legitimate loans. Homeowners are often coerced into using the equity in their homes to pay off debt, finance unexpected expenses and to cover job losses, etc.

Lenders that over promise are likely to be ones to stay away from. If you cannot qualify for a mortgage with a reputable financial institution if is best to wait to purchase a home until you can.

What Is Mortgage Fraud?

Any misrepresentation of information on a home loan application can be considered mortgage fraud, classified under Financial Institution Fraud (FIF). Mortgage fraud is typically carried out for profit or for housing.

Mortgage scams for profit: Those who attempt mortgage fraud for financial gain are typically lenders, brokers and other entities that make false claims to obtain monetary compensation or equity from lenders and homeowners.

How To Spot Mortgage Scams

In cases of mortgage fraud for profit, scammers most commonly promise victims to save their homes from foreclosure with term modifications and debt management, or to entice buyers with free services and reduced interest rates. Scammers prey on vulnerable homeowners and prospective homeowners who lack education or financial security.

Predatory mortgage lenders will often use tactics to make their offer seem like a good deal. You may be getting scammed. The following signs may indicate mortgage fraud.

‘Too Good To Be True’ Interest Rates

Mortgage rates that are noticeably lower than market interest rates are typically a sign of various hidden fees or even a bait-and-switch tactic. Predatory lenders may try to tell you that you no longer qualify for the advertised rate, or tack on additional fees after locking in the original rate if they think they can get away with it.

Your Loan Estimate Isn’t Honored

Your Loan Estimate gives basic loan information in a standardized format from the U.S. Department of Housing and Urban Development. It includes itemized costs of a loan, including fees, and is sent within 3 business days of a mortgage application. Lenders aren’t allowed to charge fees outside of the credit report fee prior to accepting the terms.

Mortgage Payment Scams

A mortgage payment should remain under 28% of your monthly income. The higher your debt-to-income ratio (DTI), the riskier you are for a mortgage lender. If your lender is recommending a type of home that requires a loan larger than 28% of your disposable income, be wary.

Homes Overvalued

Overvalued property creates risk for legitimate mortgage lenders by generating an inaccurate resale valuation or an inflated borrower income that will be difficult to pay off with existing income.

Penalties For Prepayment

A prepayment penalty is charged for paying off your mortgage too quickly or for refinancing. While prepayment penalties can offer lower overall interest rates, oftentimes, they’re hidden in the fine print of agreements. As a result, many borrowers don’t realize the stipulations of the penalties and are hit down the line with fees. Generally, these penalties are included as a way for lenders to make money on interest payments at the expense of the borrower.

Your Credit Score Doesn’t Matter

Your credit score will always affect your mortgage rate, without exception. If you’re being offered a home loan that states this score won’t affect the mortgage, be wary. These tactics are typically scams that prey on low-income borrowers and generally come with undesirable terms.

Deceptive Marketing

Victims of predatory lending frequently describe being subjected to a flood of phone calls and letters from brokers and lenders, encouraging them to take out a home equity loan.

Red flag: Lenders who engage in high-pressure tactics, telemarketing, cold calling, and deceptive advertising campaigns.

Excessive Fees

Predatory lenders routinely charge borrowers fees totaling as much as 15% to 20% of the loan amount. Fees alone can have a ruinous impact on a homeowner’s equity. But add them to prepayment penalties and you’re locked into a high-rate, financially disastrous loan.

Red flag: You inquire about fees and charges, but you can’t get the facts. They insist there are no “upfront” fees.

Equity stripping

You need money. You don’t have enough coming in each month to cover your expenses. You have equity in your home. A lender tells you that you could get a loan. This is a big shock because you know you will have difficulty keeping up with the payments. The lender encourages you to “pad” your income on your loan application to help get the loan approved.

Equity stripping is particularly dangerous for people who find themselves in financial trouble. Scammers target people who are facing foreclosure or other financial hardships and make false promises of relief. Beware of anyone who pops up at what seems like the perfect time promising to let you cash in the equity you’ve built up without any consequences. Falling for this scam could end up with you losing your home and all the equity you’ve accumulated.

Red flag: Any suggestion that you can qualify for a loan when you know the truth is you cannot reasonably make the payments.

Balloon payment

You’ve fallen behind in your mortgage payments. Another lender offers to save the day by refinancing your mortgage and lowering your monthly payments. But beware. The payments may be lower because the lender is offering a loan on which you repay only the interest each month.

Red flag: Unrealistically low payments.

Loan churning

Senior homeowners who are asset-rich, but cash-poor are prime targets for this scam. A mortgage company contacts you offering to refinance your loan and throw in some extra cash along with it. The problem is, each time you refinance, the fees and interest rates are going up. Red flag: Lenders that contact you and any suggestion that a loan is the way to get your equity to start “working” for you.

Not all lenders are predatory. The best way to protect yourself against those who are is to be keenly aware of their tactics and always on the lookout for the red flags. If you need an explanation, talk to someone you can trust who has nothing to gain or to lose by the decision you make. Be careful how often you refinance your mortgage. Talk to a HUD-approved housing counselor (hud.gov/counseling) if you have questions or concerns about any mortgage loan transaction. Then consider all the costs of financing and repayment before you agree to a loan.

Filed under: Blog, Boca Raton real estate, cash out refinance, Exclusive Buyer Agency, First Time Homebuyers, Florida Real Estate, HELOC, Home Buyer Advice, Home Buyers, home equity, Home Financing, Homebuyer Advice, House Closings, Mortgage Information, peer to peer lending, private money lender, Real Estate, real estate news, Refinancing, Reverse Mortgage, Seller Financing, South Florida Real Estate by Kim Bregman
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Planning for 2023 As Mortgage Rates Rise

If you’ve been house-hunting in recent years, you’ve really been through it. Maybe you were waiting out the market, hoping the rocketing prices would start to flatten. Now, of course, they have — but between 2021 and 2022, mortgage rates have more than doubled, from less than 3 percent to more than 7 percent.

If you are renting and trying to save for a down-payment, the cost of your rental has likely increased as well.

Sellers who are sitting on low mortgage rates are not listing their homes for sale and supply shortages, cost of land, and cost of lending, along with higher labor and building costs have slowed down new construction.

All these factors contribute to a continued shortage of desirable inventory and home prices are staying propped up and not decreasing as one would expect.

Buyers need to adjust their expectations…Every buyer needs to do a gut check on how much house they can afford now. That might seem daunting, but higher mortgage rates don’t have to derail your dream of buying a home. In fact, historically, today’s rates are not considered particularly high.

Review your Budget: When you review your budget, keep in mind that newly built homes typically come with builder and manufacturer warranties and new energy-efficient appliances. Those advantages of a new home can lower your monthly housing costs. That’s especially true if you currently own an older home that needs repairs and has inefficient appliances.

Raise More Cash: Another option to buy a home with a higher rate is to spend more cash up-front. You can use cash to increase your down payment as a percentage of your loan amount, pay for builder upgrades in cash, or buy down your loan’s interest rate. You should work with your lender on the best use of your cash to achieve the lowest ongoing expenses to home ownership.

Evaluate Loan Options: A third strategy is to get a hybrid loan. This type of mortgage has a fixed rate that resets at the end of a specified period and is then fixed or adjustable for the remainder of the term. An example is a 7/1 hybrid adjustable-rate mortgage (ARM). This type of loan has a lower fixed rate for the first seven years. After that, the rate is adjusted annually (that’s the “1” part) for the remainder of the 30-year term.

Hybrid loans can be more affordable since the initial rate is usually lower. But there’s a risk: If you don’t refinance or sell your home before the rate resets, your payment could rise significantly for the rest of the term. If you can’t afford the higher payment, you could lose your home.

Rethink Your Needs and Wants: Buying a less costly home is another way to cope with higher rates. Less costly doesn’t have to mean a home you don’t like or that doesn’t fit your needs.

Reconsider Your Timing: Interest rates fluctuate, sometimes dramatically, over time. If you postpone buying a home, rates might be lower in the future, making the home you want more affordable. Or they could be higher, putting the home you want further out of reach. Experts are predicting the latter. The question for homebuyers is whether waiting and hoping makes sense. The answer is never as clear as a crystal ball.

Experts recently polled project average 30-year mortgage rates to fall between 5-9.31%in 2023. No one is expecting a move downward in the next 5 years. Several factors could lead to unexpected rate movements in the coming year.

Owning a home has certain benefits that renting doesn’t offer. Renting means no control over future [home price or interest rate] increases, no accumulation of equity through price appreciation, no tax deduction for property taxes and mortgage interest if you itemize your deductions, and no benefit for improvements you make to the property. Waiting to buy while you hope rates move lower means forgoing those benefits.

The lost opportunity of not buying due to a fear of higher rates far outweighs the benefits of homeownership. It’s best to take advantage of what the rates are today and build equity sooner rather than later.

Filed under: 2022 Real Estate, Blog, Boca Raton real estate, cash out refinance, Exclusive Buyer Agency, Exclusive Buyer Agent, First Time Homebuyers, Florida Real Estate, Foreign Home Buyers, Home Buyer Advice, Home Buyers, Home Financing, Homebuyer Advice, House Closings, International Home Buyers, International investors, Mortgage Information, peer to peer lending, private money lender, Real Estate, Real Estate Closings, Real Estate Investment, real estate news, Real estate trends, Refinancing, Relocation, Retirement, second home, Self Directed IRA, Seller Financing, South Florida Real Estate by Kim Bregman
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