RTS Orlando Homes

Is a Refinance Necessary?

I have fielded a number of calls recently from homeowners who are seeking my opinion regarding their needs to refinance.  In the majority of cases, these people are distressed by what they are reading about mortgage woes.  For most of them, no refinance is necessary. 

If you are wondering if refinancing is right for you or would just like some peace of mind, call me for a brief review of your mortgage terms and the perils, if any, that face you.  In most cases, the homeowners that have called me are running from something that is not even chasing them.  They just need to hear it from a professional.

Mickey Carlton
Thomas Mortgage
(one of the preferred vendors of RTSOrlandoHomes.com)
407-788-5100

NOTE:  Please tell Mickey that you heard about him from RTSOrlandoHomes.com.  If you are a past or current client of David Gallup or Len Hardison, please let Mickey know that as well.

"No-Doc" Loans

I recently consulted with a prospective home buyer who had sold his business, taken a year off from work and, just recently, opened a new business. This borrower obvously could not verify income or current employment (meaning a two year uninterrupted history).  He needed a true "no-doc" loan.  The current furor over mortgage financing has resulted in the withdrawal from the market of most such loans. I was able to find two "no-docs" after an extensive search among my many wholesale providers of mortgage financing. These two identical products (from the borrower's perspective) featured widely disparate pricing. The experience suggests how few "non-conforming" products remain in the market and how carefully such products need to be researched by an experienced mortgage specialist.

Mickey Carlton with Thomas Mortgage
(one of the preferred vendors for RTSOrlandoHomes.com)

New FHASecure loan program - will it help me refinance?

One of my former clients e-mailed this morning and asked whether the new FHASecure loan program would be appropriate for her to use in refinancing her ARM.  I expect that many Realtors will get similar questions from clients who've purchased homes with them as this new program gets more exposure in the media.  And it WILL get more exposure as politicians try to convince the public that steps are being taken to alleviate the "mortgage mess". 

This program will help a few people but will not be the silver bullet that solves all problems.  In fact, most people who are in trouble with their ARM loans will not even qualify for the program.   In the case of my client mentioned above, she does not need, nor does she even qualify for the program because her loan has not started to adjust (as required by the current guidelines).  In addition, as is the case with all FHA programs, this one carries upfront mortgage insurance plus a monthly ongoing mortgage insurance.  My client is not currently paying mortgage insurance of any kind so this loan would actually increase her monthly housing expenses. 

In addition to being exposed to the media coverage of this loan, homeowners are going to get all sorts of direct mail and telephone solicitations offering refinances.  As a mortgage consultant, I continue to take steps to ensure that the clients who trust me are not "taken" by people who are just trying to make a quick dollar.  This loan, while being salvation for a few, will not be appropriate for most people. It's best to talk with a trusted mortgage expert about your specific situation for advice in this matter.

-- Mickey Carlton, Mortgage Consultant with Thomas Mortgage (a trusted vendor of RTSOrlandoHomes.com)

Solutions that Save

There are a number of things you can do to lower your electric bill.  But to save the most energy and money, FLP (Florida Power & Light Company) recommends these top 10 tips:

1. Cool your home at 78 degrees or warmer with the thermostat fan switch on 'auto.'  For additional, savings, raise your thermostat to 82 degrees or warmer when you're away from home.
2. Heat your home to 68 degrees or cooler with the thermostat fan switch on 'auto.'  To save, even more, lower your thermostat to 65 degrees or cooler at bedtime or when you're away from home.
3. Install a programmable thermostat to adjust the temperature automatically and maximize your energy savings.  It also helps to maintain a comfortable temperature when you wake up or return home. 
4. Clean or replace your A/C filter every month to trim your cooling costs and help your unit run more efficiently.
5. Turn off your ceiling fan when you leave the room.  A fan that runs all the time costs about $7 a month. 
6. Avoid pre-rinsing dishes before putting them in the dishwasher.  It can save up to $70 per year.
7. Limit the time you run your pool pump:  Summer - 6 hours a day, Winter - 4 hours a day.
8. Adjust the water level on your washing machine to match the load size, especially when using hot water.  Always use a cold rinse.
9. Clean the lint filter in your dryer before every load to dry your clothes faster and save money.
10. Use the auto sensor function on your dryer, if you have one, to conserve energy by not over-drying your clothes.

Closing Date Advice for People Relocating to Central Florida

One of our mortgage lender partners, Mickey Carlton with Thomas Mortgage, recently financed a college professor who was moving from Texas Tech to Florida Atlantic.  She wanted to close on her Florida home several weeks before she was to start teaching at Florida Atlantic.  This presented a problem with underwriting guidelines.  He worked with the underwriter and managed to arrange for the longest possible "lead" time for closing vs. the first qualifying paycheck. 

Mickey suggests that home purchasers should be aware of the possible problems involved when people execute contracts that are to close before their first paycheck. This typically happens with out-of-town buyers and can cause quite the issue if a problem is discovered late in the game.  You don't want to get stuck with storing everything you own and live in a motel for two weeks because an underwriter said "no" to a closing date. 

So if you are moving to the greater Orlando area from out-of-town, particularly if you are starting a new job,  check with your loan officer to find out what an appropriate closing date would be for your situation and communicate with your Realtor about your job situation before you and your Realtor sit down to write a contract on a home. 

Mortgage Rates as of 7/2/07

A report from one of our Mortgage Lender partners, Mickey Carlton with Thomas Mortgage:

Mortgage rates remain mostly steady for the third week in a row.  We seem to have settled into a quiet trading range in the underlying bond market.  Next big influence could be Friday’s employment figures from the Department of Labor.  More likely, the next major move will come from a swing in the stock market.  Strength in stocks will likely result in higher mortgage rates; weakness in stocks should improve our pricing. 

30 Year Fixed Rates

Loan amount $417,000 to $650,000 -- 6.875% No pts. or Orig Fees
Loan amount $300,000 to $417,000 -- 6.75% No pts. or Orig Fees
Loan amount $200,000 to $299,999 -- 6.875% No pts. or Orig Fees
Loan amount $150,000 to $199,999 -- 7.00% No pts. or Orig Fees
Loan amount <$149,999 --------------- 7.125% No pts. or Orig Fees

15 Year Fixed Rates

Loan amount $417,000 to $650,000 -- 6.75% No pts. or Orig Fees
Loan amount $300,000 to $417,000 -- 6.375%   No pts. or Orig Fees
Loan amount $200,000 to $299,999 -- 6.5% No pts. or Orig Fees
Loan amount $150,000 to $199,999 -- 6.625%  No pts. or Orig Fees
Loan amount <$149,999 --------------- 6.75%  No pts. or Orig Fees

3/1 ARM

6.5% + .5  Price adjustments for loan amounts.   

5/1 ARM

6.625% + .5  Price adjustments for loan amounts.   

Want to Save $5 a Week?

If you want to save $5 a week, adopting any one of these tips is a great way to start. When you’re saving, you have to pay attention to the small stuff:

• Instead of going to a restaurant, organize a lunch swap. One day you make and bring lunch for a coworker or fellow student. The next day, he or she does the same for you.
• Brew your own coffee and bring your own soda. You’ll save money if you’re not putting it into Starbucks’ cash register or the soft drink machine.
• Always use your own bank’s ATM – avoid those fees.
• When your favorite shampoo or other personal items go on sale, stock up so you won’t have to pay full price in the future.

Down Payment Assistance

If you or someone you know is interested in looking into down payment assistance for help in purchasing their first home, please take a look at the following programs and resources, compiled by Randy Martin, the 2007 Orlando Regional Realtor Association President:

Seminole County Assistance Program

• Down payment assistance of $40,000 for very low-income and $20,000 for low-income households.
• Maximum purchase price is $160,000
• Buyer must have a two-year history of steady income and sufficient income to pay mortgage and bills.

Orange County Assistance Program

• Down payment assistance of $30,000 for very low-, $20,000 for low-, and $10,000 for moderate-income households.
• Maximum purchase price is $211,500
• Total first mortgage and count’s second mortgage may not exceed 105% of appraised value.
• Buyers must attend a post-purchase counseling session within 90 days of closing.

Some other resources for down payment assistance:

• Orange County – 407. 836.5171
• Seminole County – 407.665.7384
• City of Orlando – 407.246.2303
• Housing and Neighborhood Development Services of Central Florida (HANDS) –407.896.0805
• Metropolitan Orlando Urban League – 407.841.7654
• Mortgage and Credit Center – 407.654.7509
• Golden Rule Housing Community Development Corporation – 407.647.4047
• Orange County Cooperative Extension – 407.836.7572
• Homebuyer Counseling Collaborative – 407.872.7773
• Consumer Credit Counseling Services – 407.895.8886
• Latino Leadership – 407.384.2929
• Orange County Housing Finance Authority – 407.894.0014

Even more opportunities can be found through the Federal Housing Administration, Veterans Administration, HUD 203(k) Rehabilitation Loans, and the USDA Rural Development Housing Service.

You should apply for a mortgage through a lender (many, such as SunTrust, offer their own assistance programs) to obtain a qualifying amount.  Since some down payment assistance programs may require it, you should also be prepared to attend a homebuyer education course, which guides you through the home buying process and ensures that you are aware of the ongoing costs of maintaining a home.  Housing and Neighborhood Development Services of Central Florida (HANDS) is an excellent place to start.  They can be reached at 407.447.5686.

Latest Interest Rates & 'No Closing Cost' Mortgages

Mortgage interest rates continue to ratchet upward.  Strength in the stock market is pulling investment funds from bonds.  Currently, thirty-year fixed rates are hovering around the 6.25% to 6.75% range (without discount points).  A borrower's actual rate depends upon loan size and the borrower's creditworthiness.

One of our Lender partners just closed a loan for a couple who had originally planned to use their long-time bank. The bank was running a special on "no-closing cost loans". He advised them to ask about third party fees such as state taxes, recording fees, etc. The borrowers' queries resulted in the discovery that "no-closing costs" did not really mean "no closing costs".  They still had to pay the third party fees.  He closed their loan on Tuesday at an interest rate that was much better than what their bank had offered. There is no such thing as a "no closing cost mortgage".