Mortage rates fell again...

While it seems to be old news that 30 year fixed rate mortgages are hovering around 5%, it should still be impressive! After seeing a slight increase a month ago, the rates have now fallen over the last 4 weeks. Thirty year fixed rate mortgages are right around the 5 and 1/8th mark, while 15 year fixed rates are a little over 4.5% per Bankrate.com. This trend continues to make it a great time to consider a move or a refinance, depending on your circumstances. A 5% mortgage is still an amazing deal... even after the newness of that figure has worn off!

Is It Better to Buy or Rent?

Many prospective homeonwers want to know the answer to one question: Is it better to buy or rent?

If you are interested in comparing the costs of renting and buying equivalent homes, check out this site. (Be sure to click CALCULATE each time you change an entry.)

http://www.nytimes.com/buyrent

However, don't forget the great tax incentives that this table does NOT factor in. Right now you could qualify for the $8000 tax credit AND a deduction for the year's interest on the payments... which totally changes the real picture!!

For more information, call 208-750-JUDY. We will see if it is time for you to get moving!

What can a buydown do for you?

This article was sent to us by Laynie McClain at Bank of America Home Loans. We enjoyed it and think it will benefit you as well. If you have further questions, give us a call, or you can reach Laynie at 208-743-0549.

Assumptions:

$200,000 Sales Price
Borrower has $40,000 to put down

Scenario #1
Seller drops price $5000 to move the house
1. $160,000 Loan amount= $858 PI
2. $155,000 Loan Amount= $832 PI
**Saves the borrower $26 per month

Scenario #2
Seller keeps price at $200,000 and markets a seller paid 2/1 buydown (assuming today's interest rate is 5%)

Year One: 3% rate= $672 PI = $184 monthly savings
Year Two: 4% rate=$763 PI= $95 monthly savings
Year 3-30: 5% rate= $858 PI

What is the Cost?
Year One Savings= $184 per month x 12 months = $2208
Year Two Savings = $95 per month x 12 months = $1140
Total Savings= $3348= Cost


Benefits:
1. Borrower: Substantial savings for two years;

2. Realtor: Sells a home that has been sitting
Keeps commission at the highest possible

3. Seller: Sells home that has been sitting
Saves $1652 ($5,000 price reduction vs.. $3348 for buydown)

4. Market: Keeps the values as high as possible

Buydown programs are a great tool to market and sell homes!