For Buyers, It Helps To Have A Jumbo Mortgage Contact
National Association of REALTORS® data shows that the typical home is selling in 30 days, which doesn’t leave buyers much time to think; today’s mortgage rates across conventional, FHA, USDA, VA, and jumbo loan products; how mortgage loan limits affect consumer home loan choice.
NAR: Median Days On Market Drops To 30 Days
There aren’t homes for sales for all the buyers that want them.
New data from the National Association of REALTORS® shows a seven percent drop in U.S. home inventory as compared to a year, lowering the number of MLS-listed homes to 1.67 million nationwide.
The few homes that are listed are selling more rapidly, too.
In March, Median Days on Market, which measures the number of days homes are listed for sale before they’re bought, dropped seven days and now sits at 30 days nationwide.
This is the fewest Median Days on Market reading for a March since NAR has tracked such data. It confirms what today’s home buyers have already figured out: there’s less time to shop, less time to compare, and less time to think about the home you’re about to buy.
Some buyers are using mortgage pre-approvals to turn the market to their advantage.
A mortgage pre-approval is your dress rehearsal for the home loan application you’ll give when you finally find your house. Using a sample house and sample purchase price, lenders collect income and credit information and whatever else they’ll need to approve your request for the sample, theoretical home.
Lenders treat pre-approvals like actual loan applications.
Getting a pre-approval means your financing is likely to be approved. And, in a tight housing market, where multiple-offer scenarios are common, having a pre-approval from a lender is a competitive advantage over other non-approved buyers.
Most sellers won’t even accept an offer unless a pre-approval letter comes attached so get ahead of the competition and connect with a lender for mortgage pre-approval.
When homes are selling quickly, it’s an excellent tool in negotiation.
Today’s Mortgage Rates
Mortgage rates are down to start the week. You’ll find lower mortgage rates today as compared to Friday, April 27, 2018.
Here’s a quick look at today’s mortgage rate movement:
- Conforming mortgages: Lower
- FHA mortgages: Lower
- VA mortgages: Lower
- USDA mortgages: Lower
- Jumbo mortgages: Lower
Remember that mortgage rates are unique to you and your home; and the rate you’re quoted by a lender will be different from the rate assigned to your neighbor, friend, or family member.
There are about a dozen traits that determine go into your mortgage rate quote including your credit score, your loan size, and your state of residence.
Whether you choose to comparison shop your mortgage rate matters, too.
Studies shows that talking with two lenders is better than talking to one, and can lead to savings of up to $2,000. And, getting a third quote increases the statistical savings. And, again, when you talk to a fourth.
It’s up to you to choose how many lenders you should shop with, but make sure to shop with more than one.
When you’re looking for your best mortgage rate, chop for your preferred combination of rates, fees, and service.
Get Today’s Mortgage Rates
800,000 Home Buyers Need Jumbo Loans
When you’re buying an expensive home, your typical mortgage options may not apply. You may be relegated to the world of jumbo mortgages.
A jumbo mortgage is a mortgage too large to be supported by the government groups that back the U.S. market.
Those groups — Fannie Mae, Freddie Mac, the Federal Housing Administration (FHA), the Department of Veterans Affairs (VA), and the U.S. Department of Agriculture (USDA) — impose mortgage loan limits that vary by property type and geography.
The mortgage loan limits for a one-unit home are lower than for a 2-unit home; the loan limits for a 2-unit home are lower than for a three-unit home; and, so on.
Loan limits are also higher in “high-cost” cities such as San Francisco, San Jose, and Los Angeles as compared to cities where housing is often more affordable, including Philadelphia, Chicago, and Denver.
According to the March Existing Home Sales report from the National Association of REALTORS®, fourteen percent of this year’s home buyers will exceed their local limits.
That’s 800,000 buyers annually.
For buyers whose loan sizes exceed local mortgage limits, financing falls to jumbo loans which are both abundant and specialized by lender, which is a combination that proves a challenge.
Here are three jumbo loan types that exist:
- Doctor loans allowing a 100% mortgage with no mortgage insurance
- Purchase loans up to $3 million with ten percent down payment
- Cash-out refinance loans to 90% of the home’s value
These loans aren’t nationally-advertised, though, and your current lender may not offer them. You wouldn’t even know they exist except by accident.
And, this is what makes jumbo mortgage borrowing such a challenge. As a home buyer, you don’t know what you don’t know, and neither does your lender. It’s one more reason to talk with multiple loan officers before locking in a mortgage rate.
You may get better, more suitable mortgage options from a jumbo mortgage loan specialist.