Buying and selling real estate in the communities of Long Island
BloggersValerie Kellogg Kristin Lavin Taveira Maura McDermott Lisa Doll Bruno
Mortgage rates hit another low
Mortgage rates continue to break records, hitting new all-time lows this week. Nationally the 30-year fixed-rate mortgage averaged 3.79 percent with an average 0.7 point for the week, down from 3.83 percent last week.
Last year at this time, the average was 4.61 percent. The 15-year fixed-rate home loan is also down a notch at 3.04 percent with an average 0.7 point this week compared with 3.05 percent last week. A year ago at this time, the 15-year loan averaged 3.80 percent.
“Rates have never been lower and home prices are still very low, so anybody who is in the market for a home is going to get a lot of home for their money,” says mortgage broker Bryan Smith of Quality Financial Solutions in Commack. However, it’s important to find out what kind of budget you’re really working with -- so shop around and get preapproved ahead of time, he says.
“That’s something you should deal with right away,” to avoid pitfalls when you’re ready to make an offer, Smith says. Lenders will require you to have more than just the down payment in hand. “Let’s say somebody is putting down 10 percent for a new mortgage. They still have to have closing costs and reserves after closing.”
Reserves are a cushion of funds you’ll be required to have available -- above and beyond the down payment and closing costs -- to show you’ll really be able to afford to pay the bills. “Most of the time they look for a few month’s of principal interest, taxes and insurance in reserves.” Part of that can be held in a retirement fund, but not all of it, he says.