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Why insurance is so expensive now.

by I Am Benchmark

The insurance industry has experienced significant changes over recent years, with homeowner’s and auto insurance rates increasing rapidly. The reasons behind these trends are numerous, involving a combination of economic, environmental, and market-driven factors.

Homeowner’s insurance on the rise

Homeowner’s insurance rates have risen notably, driven by several unrelated critical factors:

  • Rising Rebuilding and Replacement Costs: Between 2019 and 2022, the costs associated with rebuilding and replacing homes climbed by 55%1. This increase is a principal driver behind higher premiums as insurers recalibrate to cover these escalated costs.
  • Extreme Weather Impacts: A rise in natural disasters, including severe storms and wildfires, has heavily impacted the insurance sector2. The increase in these catastrophic events have lead to more large claims, driving up costs for insurers. Costs which, in turn, get passed on to homeowners.
  • Market Pressures and Area Exits: Worsening financial performance has caused property insurance market to experience significant strains, which are partly due to economic inflation and changes in exposures3. These pressures have resulted higher premiums and, in some cases, insurers exiting certain markets (no longer writing polices in certain regions) or reducing their policy offerings4.

Accelerating auto insurance premiums

Auto insurance has also experienced rate increases, with overlapping and unique factors to blame:

  • Rising Inflation and Repair Costs: Similar to homeowners insurance, auto insurance is impacted by inflation. The cost of repairs, labor, and parts has increased, leading insurers to raise premiums to cover these higher expenses5.
  • More Natural Disasters: Auto insurance companies were also impacted by natural disasters, which can lead to a higher volume of claims. Vehicles damaged by storms, floods, or fires contribute to the overall risk insurers need to manage5.
  • More Technological Complexity: Modern vehicles come equipped with advanced technology, making repairs more expensive. This novel complexity adds to the overall cost insurers need to cover, contributing to premium increases.

Common themes and relationships in insurance

Analyzing the causes behind the steep rise in both homeowners and auto insurance rates reveals common themes:

  • Impact of Weather Extremes: Both sectors are significantly affected by climate change, leading to an increase in natural disaster-related claims. This trend underscores the growing importance of environmental factors in insurance pricing.
  • Economic Factors: Inflation plays a crucial role in both contexts, impacting the cost of repairs, replacements, and labor. Economic conditions directly influence insurance rates, reflecting broader market dynamics.
  • Technological and Material Costs: Just as the cost of modern vehicle technology impacts auto insurance, the rising costs of building materials and construction technology affect homeowners insurance. These factors contribute to the overall increase in premiums.

Looking ahead

Understanding these trends is critical for consumers looking to navigate the changing insurance landscape effectively. While external factors like climate change and inflation may be beyond individual control, there are steps consumers can take to mitigate the impact on their insurance rates. Regularly reviewing policies, improving property resilience, and shopping various insurance providers can help secure more favorable terms.

Given the complex interplay of factors driving insurance rates up, it’s evident that both homeowners and auto insurance sectors are navigating through a period of adjustment. Awareness and proactive management of insurance policies become even more crucial to adapt to these changes.

What’s a future homeowner to do?

It’s no secret that inflation has taken a bite out of the average worker’s spending power. The general cost of living is, on average, higher than it used to be. See the chart below of the latest 5-year trend of the Consumer Price Index in the United States using data from the US Bureau of Labor Statistics:

United States Consumer Price Index: Last 5 Years


source: tradingeconomics.com
 

If you currently rent your home, you may also have noticed that the average cost to rent has risen as well. Below is a chart of Rent Inflation for the past 5 years, again, using data from the US Bureau of Labor Statistics:

United States Rent Inflation: Last 5 Years


source: tradingeconomics.com
 

If you are feeling the pinch of inflation and rent increases, you may be tempted to believe that the American Dream of homeownership is slipping away. Headlines have emphasized the increase in mortgage rates, and it’s no secret that demand has buttressed home prices, as indicated in the chart below using data from the Federal Housing Finance Agency (FHFA):

United States FHFA House Price Index: Last 5 Years


source: tradingeconomics.com
 

What if you could do something now to help prepare for a more expensive future? What if homeownership is more than just a foundational part of the American Dream, but a tool to leverage a better financial future for family, or just for yourself?

Fight rent increases: Fire your landlord. (and become your own)

Maybe you love your landlord. Maybe you really dislike your landlord. Either way, the odds are good that your rent is higher than it was 2 years ago (Remember the rent inflation chart above?).

You know what isn’t higher? The principle and interest monthly payment for a mortgage that started 2 years ago. That’s the magic of a mortgage loan: the monthly payment doesn’t change for the life of the loan. Sure, this doesn’t account for insurance rates, taxes, or HOA fees, but every dollar you pay on the principle is equity in your home that you now own, and your lender doesn’t. You can’t say that about rent.

Your home as a financial asset

As the property you own increases in value, you own every bit of the new value, and your monthly payment (principle and interest) stays the same. Maybe you have a growing family, or you want a bigger garage, office, space to entertain, or whatever you have your heart set on. If you want to get a bigger house, you can take the equity of your existing house, and use it to help pay for your next house.

Over time, as your equity grows (and your monthly principle and interest payment stays the same), your net worth and economic resilience grows with it. In fact, if you want an even lower monthly payment, you may be eligible to refinance your remaining debt into a new mortgage, if rates are favorable. You could also use a portion of the equity in your home for other expenses. (These are referring to various loan products, and the best product for your situation may not be the same the best option for someone else.) The point is, becoming a homeowner gives you options that are not available otherwise.

Know your options

If you firmly believe that homeownership is out of reach, we encourage you to explore your options anyway. There are a variety of programs, and a variety of properties that can work together to help you start building home equity. If qualification is a problem, there are steps you can take to work towards qualification.

The point is, don’t let your own limiting beliefs hold you back. Our team of loan experts thrive on helping buyers overcome challenges to help you fire your landlord, become a homeowner, fight back against rising rents, and start building equity.

If you are ready to get started, fill out our no-obligation form, and your mortgage loan expert will contact you to help you determine your best path forward.

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After all, Benchmark brings you home.

1 CNN, 2023
2 CNBC, 2024
3 Financial Research Government, 2023
4 Money.com
5 NPR, 2024

Benchmark Delivers A Christmas Homecoming Miracle

by Jason Haeger

Benchmark could just be another mortgage lender, but we’re not. Sure, every company has their ‘core values’, but there is something tangible and special about ours.

Our core values didn’t exist until after they were identified in the soul of the company years after it was established. These values not only inform how we do things, they defined what was already at work. They support an existing culture, rather than being the rules for mandating it. First and foremost, Benchmark is about relationships.

We recognize, and experience, the reality that it is people just like you who make what we do worthwhile. It’s not about money, fame, or pride; in the end, it’s about having the privilege to serve so many people in financing their dreams, while care for their future.

There are many client stories that remind us why we do what we do, and validate our mission. Stories like this one from our branch in Imperial, CA.

Good evening team, I wanted to thank you again for an incredible job getting the Rosales home for Christmas. They were homeless for 6 months, and living in a friend’s room with 2 kids.

We knew we could close for New Year’s but for Christmas we needed a miracle, and today when I give them the news that the house was recorded under their name, the first thing they told me was,

“Please thank everyone on your team because we knew we needed a Miracle and that Miracle is Benchmark. For the last 3 days every time I give Mom an update she will cry and I kept telling her don’t cry because you will make me cry.”

I was lucky to be present when they got the keys, and seeing her kids choosing their rooms and wanting to move all their furniture from storage tomorrow was the greatest gift I could have received as a Loan Officer. 

My client knows I’m the face of Benchmark, but without any of you this will never be possible. 
Valentina Estes, NMLS# 810063
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At Benchmark, we are committed to listening to your goals and setting you up for future success. To learn more, Contact your local Benchmark branch. Contact us today for personalized information. Call me yourself or request a call from me. WeI would be honored to provide you with our famous excellent service.

 

Benchmark brings you home.

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VA Loan: National Guard VA Loan qualifications 2022 update

by Austin Cox

Featured photo credit: https://www.nationalguard.com/careers/ground-forces

Photo credit: https://www.nationalguard.com/careers/ground-forces

The VA loan is one of the most powerful home buying tools available to those who qualify. A few benefits of the VA home loan are an option for ZERO down payment, no Private Mortgage Insurance, and lenient credit qualifications.

There are specific criteria to qualify for the VA home loan, one of which is the Minimum Service Requirement. This is essentially a baseline for service qualifications.

The Minimum Service Requirements for The Army, Navy, Air Force, & The Marine Corps:

  • Served 90 consecutive days of active service during wartime.
  • Served 181 days of active service during peacetime.

Recently, the VA has revised their qualifications for those who serve and have served in the National Guard, which has opened the VA loan to thousands of National Guard members.

National Guard updated VA Loan qualifications are as follows:

  • If you’ve served for at least 90 days (minimum 30 consecutive days) of active duty under Title 32 orders, you meet the minimum service requirement.

Over recent years, thousands of National Guard members were activated under Title 32 Orders, meaning many of them are eligible for a VA Home Loan.

Have you served or are currently serving in the National Guard? Reach out to one of our branches today to learn about the VA home loan and find out if you are eligible today!

Get Your COE!


    At Benchmark, we are dedicated to serving veteran clients and providing them with a world class home buying experience. We have changed the way VA lending is done. That is why Benchmark never quits.

    Contact your local Benchmark branch. Contact us today for personalized information. Call me yourself or request a call from me. WeI would be honored to provide you with our famous excellent service for your new loan.

     

    Benchmark brings you home.

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    Is waiting for lower interest rates a mistake?

    by Jason Haeger

    With mortgage interest rates at a level not seen for over a decade (see chart below), the question of whether to wait for interest rates to fall is creeping in. This is not unreasonable, however, it does beg the question.

    Are rates actually high?

    If you take a look at the chart below, you can get a pretty good idea. At first glance, you may be tempted to think, “With rates THIS high, they’re bound to come back down before too long.” You may think this looks like an economic blip; that things will calm down back to normal soon.

    10 Year chart of mortgage interest rates

    But a longer view may give you a different perspective.

    Looking over the past ten years means we are looking back on a housing market recovering from the 2008 crash (the conditions of which do not exist today). This is a short-term view; A view that includes a lot of market manipulation intended to encourage buying through various means, including keeping interest rates low.

    To see more clearly, we need to take a look at a much longer time frame.

    25 year chart of interest rates

    The longer view gives a sobering realization. Current rates do not appear to be high at all, in the long term. The reality is that the lower rates we’ve been experiencing are a strange occurrence, fueled by quantitative easing. The rising rates we see now are the result of a slight reversal of this practice. To better understand what this really means, take a look at the chart of the Federal Reserve’s Balance Sheet over the last 10 years below.

    10 year chart of Federal Reserve balance sheet

    The Federal Reserve was buying investment securities (including mortgage debt securities) to help prop up the economy, and to bring mortgage interest rates down. The fact that the strategy worked is a clear sign that its reversal means that rates have, and will probably continue to drift back up to natural market levels. As we have discussed before, a rising interest rate means a rising cost of homeownership.

    However, it’s clear that interest rates are not the only thing going up.

    Inflation is a value killer

    Inflation is on everyone’s minds as of writing. The Consumer Price Index shows a fairly sharp climb since the COVID-19 pandemic began, and the Federal Reserve’s increase in interest rates (not the same as mortgage interest rates) was intended to alleviate inflation. Oh, you want a chart to show inflation? See below.

    5 Year chart of Consumer Price Index

    The rising prices means that your money is worth less. Everything costs more than it did, which can eat into what you can afford for a monthly mortgage payment. It may seem like a good idea to wait: for your money to be worth more, for the economy to stabilize, and for mortgage interest rates to return to their senses.

    As discussed previously, however, there is no solid basis for anticipating mortgage rates to come down any time soon, if at all. If this is true, though, does it even make sense to buy a home? Is real estate really the right place to put your money if the cost of living goes up?

    Rising prices mean cash held in hand is losing value, while investments that rise with it are, at the very least, holding value.

    “Real estate is one of the time-honored inflation hedges. It’s a tangible asset, and those tend to hold their value when inflation reigns, unlike paper assets. More specifically, as prices rise, so do property values.”

    Mark Cussen, Financial writer at Investopedia

    Higher cost (rates) means less competition

    We have seen a cooling of demand in the housing market since rates have started rising. The sellers’ market has become more equitable, favoring buyers in many locations. There have been fewer multiple-offer scenarios, and even when there are multiple-offers, there have been fewer offers to compete with.

    If you live in a competitive market, Benchmark can give you an edge. If you don’t live in a competitive market, this could be your opportunity to get your offer accepted on the best possible terms. Again, this is what we do best. Contact us get more information about how you can win with Benchmark.

    Housing prices tend to climb

    The financial world is full of commonly repeated advice. Invest early and invest often. The best time to plant a tree is 20 years ago; the second best time is today. Add this one to the list: Buy now to buy more.

    Even if we find ourselves in a recession, as some predict, this does not guarantee falling home prices. The exception being the notorious 2008 recession due to the collapse of real estate debt-based investment schemes, the conditions of which do not exist, and have not existed since.

    Buying a home is not just about building family wealth. Owning your own home comes with other benefits. Owners Enjoy More Privacy and Security, for example.

    Will interest rates come down?

    There is no indication that they will come down any time soon. Even if you do suspect that rates will be reduced in the future, you should weigh the cost of waiting. Of course, you may be able to refinance at a lower rate in the future, while taking advantage of current home prices now.

    Either way, your rent payment will become at least a partial investment into a physical asset you own. The principal portion of a mortgage payment directly reduces the amount you owe on your home. When you pay rent, the only equity you are building is your landlord’s.

    Not to mention, rent also rises.

    10 Year Rent Inflation Chart

    The chart above is not plotting rent prices. The chart is plotting rent price inflation. See the dip caused by the COVID-19 pandemic starting early 2020? This isn’t really a dip; it’s just a reduction in the annual inflation rate of rent prices. Inflation never reversed within the last decade.

    How do you escape the squeeze?

    It would do no good to lie to you and tell you that there is an easy way out of the rising cost of housing. We have published a short list on How to Get Ahead When You Can’t Get the House You Want, but the wisest words I’ve ever read on housing were these: “Welcome to California. Buy a house immediately.” This is less about California, and more about how to live with rising housing prices. This was advice given to someone who moved there for a job in the tech industry. The advice holds true now: the sooner you buy, the better your chances of being able to buy.

    Related: Top 5 Myths About Home Buying in 2020

    If you think you might want to become a homeowner, I encourage you to contact us. Even if you think you cannot afford a home yet, or if you don’t know what you need to do to get started, we specialize in helping people just like you achieve the American dream of homeownership. Benchmark has been helping people get into their own home since 1999, and we’ve learned a few things along the way.

    Contact your local Benchmark branch. Contact us today for personalized information. Call me yourself or request a call from me. WeI would be honored to provide you with our famous excellent service for your new loan.

     

    Benchmark brings you home.

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    How To Make Your Interest Rate Hold For Longer

    by Kynzy Lowe

    Searching for a home? That’s great! It’s a good time to buy! We know that it can be stressful, as interest rates could go up during your search. What if it didn’t have to be that way? What if you could be certain that your interest rate wouldn’t change while you searched for your next home? With Benchmark’s Lock and Shop program, you don’t have to worry about rising interest rates. Lock and Shop by Benchmark allows you to lock in your interest rate while shopping for your home!

    Get More Time To Shop

    75 days. The Lock and Shop program will lock your rate for 75 days, giving you more time to search for your home. Enter the market with a pre-approval and a locked rate from Benchmark to give you the confidence to succeed in a competitive market.

    In a highly competitive market, making several attempts to land a deal is the challenging reality. The more prepared you are, the higher chance you have of your offer winning acceptance. Our branches provide many helpful tools to our clients, so you can be prepared when it’s time to make an offer.

    Three steps for how Lock and Shop can help you succeed

    Step 1: Get Pre-approved.

    Step 2: Lock your rate with our Lock & Shop program.

    Step 3: Identify a few different properties you are interested in, and make an offer. If your offer doesn’t win, move to the next. Do this for 75 days from date your rate was locked.

    Just imagine how it could help you.

    Tom’s family is moving to a new state due to his job. They are unfamiliar with the area, and have a lot to consider. Buying a home is a big decision, and they don’t want to rush the process and end up regretting their choice. Wisely, they contacted Benchmark and spoke about their concerns of rising interest rates. Understanding their challenges, their loan officer recommended the Lock and Shop program to them. Relieved to be able to lock in their interest rate, Tom and his family searched for their perfect home with confidence.

    Get in touch today to learn more about the Lock and Shop program from Benchmark!

    Contact your local Benchmark branch. Contact us today for personalized information. Call me yourself or request a call from me. WeI would be honored to provide you with our famous excellent service for your new loan.

     

    Benchmark brings you home.

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    Your mortgage application was denied. Now what?

    by Kynzy Lowe

    If your mortgage application has been denied, you don’t have to give up on your home ownership dreams. There are steps you can take to improve your ability to get approved for a loan.

    First, it is crucial to get in contact with your lender. There are a multitude of reasons as to why an application can be denied. Learning why your application was denied will give you the chance to resolve any issues.

    Let’s go over some common reasons an application may be denied.

    Credit Score

    There is a minimum credit score that borrowers will need to meet in order to receive a home loan. If your credit score does not meet the minimum requirement, your application could be denied, but you can work to improve your score. Although it takes time to improve a credit score, the benefit is worth the effort.

    To maintain a good credit score, be sure to always pay your bills on time. Also, try to pay down debt to reduce your debt to income ratio. It is also best for your card balance to be low in relation to your credit limit. Even if you no longer use an account, do not close it, because your credit score is also affected by how long your accounts have been open. You should also limit credit inquiries and opening new credit lines; too many in a short period of time can lower your score.

    Inconsistent Employment

    There are certain employment requirements that borrowers will need to meet when applying for a home loan. It is favorable to have consistent employment; any gaps in your job history will be considered. Check to see if your income meets the minimum amount required for the loan you are applying for. Make sure that all of your income has been accounted for, including freelance, investment accounts, inheritances, and savings accounts.

    Missing Paperwork

    Carefully look over your loan application paperwork. Be careful that the information you provided is complete and correct. Ensure that you have provided all required documents. Missing or incorrect information can be a reason for a denied application.

    Don’t Give Up!

    It may take some time, but it is possible to come back from a denied mortgage application as a stronger applicant. At Benchmark, we take our job of helping you secure the dream of homeownership seriously. Even if you are not approved, you will be armed with the knowledge to do something about it courtesy of your Benchmark loan officer.

    If you are serious about getting approved for a mortgage, contact us: we are here to help.

    Contact your local Benchmark branch. Contact us today for personalized information. Call me yourself or request a call from me. WeI would be honored to provide you with our famous excellent service for your new loan.

     

    Benchmark brings you home.

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    Is it still a good time to buy?

    by I Am Benchmark

    Better late now than never later.

    It’s the question that’s buzzing around real estate offices, mortgage companies, backyard barbecues, water coolers and passing conversations with neighbors.

    The short answer is — we think so.

    Yes, it is still a good time to buy.

    The long answer is more complicated. Consider these four trends to help you as you make your housing buying decisions.

    Higher home prices show no signs of reversing course.

    Even before the pandemic, the supply of the housing market couldn’t meet the demand. In 2020, COVID-19 affected the housing market just like it did every other industry. However, we’d soon find out that the real estate market was a double-sided coin.

    Let’s set the record straight. If you’re expecting the trajectory to result in a housing bubble ready to burst, reminiscent of 2008’s Great Recession, this isn’t that. The market variables that resulted in the 2007-2008 housing market crash don’t exist now. If higher home prices cause are causing you to hesitate, keep in mind that prices will likely continue to rise. Home prices were rising already before the virus, and multiple variables from the pandemic created greater demand in an already competitive market.

    With the introduction of social distancing measures, many began to conduct the majority of their lives inside their homes and, unsurprisingly, wanted or needed more space. Many also sought financial security, preferring a traditional equity purchase that still carried relative liquidity amid the health crisis uncertainty. What better way to adapt to the new world than investing in your home: the very place you planned to ride out the epidemic? Many see it as a timely investment vehicle.

    Buying gained popularity.

    However, many other Americans had the same idea. Additionally, the COVID-19 pandemic affected the ability and access for individuals to go to work. Companies in the housing industry suffered, as workers were absent due to new mandates among other pandemic-related challenges. As the pandemic wore on, labor and building materials supply chains struggled further.

    Earlier, I wrote that, before the pandemic, as well as in its beginning, housing demand had exceeded supply. The difference now is that the supply of home options is extremely low1 due to the factors mentioned above, which have resulted in climbing home prices. In fact, Zillow projects a 17% year-over-year rise in home valuations for 20222.

    The effects of the pandemic only added more fuel to a white-hot market. Home prices aren’t going down any time soon, even if their rise slows.

    1 https://www.nytimes.com/2022/01/20/upshot/home-prices-surging.html
    2 https://www.zillow.com/research/home-values-sales-forecast-jan-2022-30667/

    Interest rates have started correcting to higher levels.3

    At the beginning of the pandemic, in the face of a developing national health crisis, the Federal Reserve took action. They pledged (and proceeded) to buy debt and mortgage-backed securities (MBSs) in an effort to help the economy.4 This resulted in an artificially high demand for MBSs, driving down mortgage interest rates. For a time, this helped add stability to the economy. It made it easier access financial resources, investments, and loans — such as mortgages. It’s not surprising that so many individuals decided to pursue homeownership during the pandemic. Demand was already outpacing supply. The lower interest rates made a home purchase that much more attractive, tipping the balance further.

    As inflation has risen, so too has the labor market. The Federal Reserve has noticed, and has claimed that they will begin selling some of their balance sheet. This move serves to correct mortgage interest rates back up to normal market levels.5

    A more balanced market is good for the economy, in general. However, higher interest rates will only decrease buying power for home buyers. Additionally, home buyers who have waited for prices to fall just may see prices at least hold, if not increase.

    See also: Buy Now To Buy More: What Interest Rates Mean For You

    The later you buy in 2022 and beyond, the greater your chance for a higher mortgage interest rate.

    3 https://www.forbes.com/sites/billconerly/2022/01/27/what-rising-interest-rates-mean-for-business/?sh=14586c3e23a1
    4 https://www.brookings.edu/research/fed-response-to-covid19/
    5 https://www.federalreserve.gov/newsevents/pressreleases/monetary20211215a.htm

    Rent price increases are breaking records6 and making headlines.

    It is well-known that rent prices rise over time. This is due to a variety of factors: inflation, rising utility costs, location value, and the list goes on. With reduced supply of homes and renter instability during the height of the pandemic, rent prices are up 14% year-over-year, with some up over 30% in many major metro areas.7

    Renting is a great option for those who want to stay flexible. But for those looking to optimize their finances, it’s helpful to remember that 0% of your rent payment builds your own equity. Since it’s not part of a home investment, you’ll never see any of that money again!

    Although a down payment may sting at first, a fixed rate mortgage payment does not increase over time. Compare that to rent, as it continues its daunting upward climb. Renting gives no net worth gain, and leaves you at the mercy of your landlord and binding lease agreement.

    In some cases, after the down payment, a mortgage payment may be lower than rent for a comparable space. Be mindful where your money is actually going. You may be able to gain some equity for your housing costs.

    See also: Is Buying A Home Really More Expensive Than Renting?

    6 https://www.forbes.com/advisor/mortgages/rent-prices-all-time-high/
    7 https://www.redfin.com/news/redfin-rental-report-december-2021/

    The cost of waiting may be higher than you expect.

    For many home buyers, the down payment is the hardest obstacle to overcome. With the home price index rising8, it will become increasingly difficult to save enough for a down payment. Down payments are measured as a percentage of home pricing, and are often tens of thousands of dollars. It can be quite a challenge!

    Upward trends in demand, interest rates, rent prices, and the Consumer Price Index (CPI) means saving could become more difficult. If accounting for normal expenses and goals wasn’t enough, you will also be contending with market forces beyond your control. Should these trends continue, It will be harder to save for a ~12%9 down payment.

    See also: Owning A Home May Already Be Within Reach

    Depending on your situation, you may need less for a down payment than you think. Building your equity sooner means you could actually benefit from rising home prices. Even in a sellers’ market, getting into a home you can afford now may benefit you in the long run. However, we’d still advise that you exercise due diligence as you determine the best real estate investment for your situation.

    8 https://www.spglobal.com/spdji/en/indices/equity/dow-jones-us-real-estate-index/#overview
    9 2021 median down payment: https://www.nar.realtor/sites/default/files/documents/2021-home-buyers-and-sellers-generational-trends-03-16-2021.pdf

    In the current housing climate, the cost of waiting to make a move in the real estate market will most likely cost you more in the long run.

    Buying a home is a long-term decision that should be made with careful consideration. Financial decisions should be strategic. At Benchmark, we provide education to hopeful buyers regarding trends in the market and how they could affect future plans. We are committed to listening to your vision, and getting you the right mortgage for your future success. 

    Contact your local Benchmark branch. Contact us today for personalized information. Call me yourself or request a call from me. WeI would be honored to provide you with our famous excellent service for your new loan.

     

    Benchmark brings you home.

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    15 Tips For An Easy Mortgage Process During The Holidays

    by Holly Taylor 
    ‘Twas a crisp, cold, clear night, when we hoped for a house. 
With my hot cocoa stirring, I looked at my spouse. 
We’d mapped out our assets and budget with care, 
In hopes that our offer would not catch a snare. 
The children were nestled all snug in their beds, 
While dreams of new bedrooms danced in their heads. 
My spouse in their slippers, and I in my cap, 
Had just settled down for a long winter’s nap. 
When from my cell phone there arose such a clatter, 
I sprang from my bed to see what was the matter. 
Seeing the name, I answered in a flash;
Our offer was accepted, with a loan, not of cash.
What a gift to receive, our hearts were aflutter — 
In the morning we'll celebrate with hot scones and butter. 
When what to my wondering eyes did appear, 
A little less worry and a little more cheer.
With the offer accepted, I hung up the phone.
Knowing that we were approved for the loan,
What should we do now? We were happy as larks!
The news was like light after uncertain dark,
I feel joy for the mortgage we have with Benchmark!

    Your housing timeline may have you moving right in the middle of the holiday season. It can be a crazy time, but that’s no reason not to seize the day and make some holiday memories in a new home.

    However, it’s also a season when personal budget planning often gets neglected to make room for extra joy and memories — sometimes with an expensive price tag.

    Benchmark is here to help.

    As you assess your financial situation, be mindful of your spending. Be aware of your normal budget, and pay careful attention to your holiday expenses.

    At Benchmark, we are committed to delivering a smooth and easy mortgage process. Keep these lists handy as you start your home buying process this holiday season:

    DO’s:

    • Keep an eye on your holiday budget — remember not to make big purchases that might affect your credit score.
    • Keep in mind that interest rates are sometimes lower during holiday months.
    • Let family and friends know that you have moved addresses so they know where to send your housewarming gifts!

    DON’Ts:

    • Don’t make any large purchases that require credit checks or open new lines of credit. This can affect your credit score and change your loan status.
    • Don’t wait until the last minute to complete and send the required documents to your loan officer. Doing it in a timely manner will ensure a smooth loan process.
    • Don’t rush putting an offer on a house just so you can close before the holiday season. Remember, this is a long-term decision.
    • Don’t use your entire down payment on holiday gifts. Save as much money as you can.
    • Don’t accept monetary gifts from relatives (e.g., accepting down payment assistance) without consulting your loan officer first.
    • Don’t open, transfer, or close any asset accounts without first discussing any plans with your loan officer.

    This holiday season may look a little different. Maybe you forego large Christmas gifts and stick to a budget to keep your credit score on target and your mortgage process on track. But, your new home will likely be the best gift you receive this season — and we’d say that’s more than worth it.

    “Home for the holidays” takes on a whole new meaning!

    At Benchmark, we are committed to helping you with your home loan needs and decisions for future success.

    Contact your local Benchmark branch. Contact us today for personalized information. Call me yourself or request a call from me. WeI would be honored to provide you with our famous excellent service for your new loan.

     

    Benchmark brings you home.

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    Can You Pay Off a 30-Year Mortgage Early?

    by Holly Taylor

    Whether you’re buying your first home or have owned several houses over the years, you’ve heard of the 30-year fixed rate mortgage. Many people choose the traditional, 30-year loan for the financial flexibility it provides.. Like most things in life, there are pros and cons.

    A Fixed Rate 30 Year Mortgage…

    ✓ Offers a lower payment amount than similar loans with shorter periods, allowing other income to go toward necessities, retirement accounts, college savings, etc.
    ✓ Requires more interest in the long run in exchange for the lower payments over time.
    ✓ Provides the opportunity to own more property than a 15-year mortgage would allow due to the lower payments.

    Whatever the reason you chose a 30-year mortgage loan, it may someday occur to you to consider paying off the loan early.

    So, the short answer is yes. You can pay off the loan early. However…

    Consider these two questions:

    • Should you pay off the loan early?
    • If the answer to the first question is yes, what is the best way to do that?

    The answers to these questions depend on the reasons behind your payoff decision. Your highest priority could be one or more of the following.

    1. Do you want to be debt-free?
    2. Are you looking to save money on interest?
    3. Do you need your income for other needs?
    4. Do you want to reduce your monthly expenses?

    Once you understand your financial motives, you will be able to make the best choice for you.

    Should I pay off the loan early?

    First of all, congratulations for even reaching the point of considering paying off a loan early. That’s an accomplishment in itself!

    Many people who pay off their mortgages early are motivated by the peace of mind that comes with lowering debt, and saving thousands of dollars of interest payments.

    Before you take action:

    • Find out if there is a prepayment penalty on the mortgage.

      A prepayment penalty is a rare circumstance — but it is possible.

    • Consider any other debt first.

      Should your money pay off something more time-sensitive first or another loan that has a higher interest rate?

    • Remember your other financial goals.

      Do you need to put money toward your retirement savings, emergency funds, college savings account, etc.?

    • Consider whether your extra payment amount would serve you better elsewhere.

      Sometimes the potential for earnings in another opportunity exceeds or offsets interest payments.

    • Find out how long you have left to pay off the loan.

      See if the interest amounts you save would be worth lowering your monthly usable cashflow.

    It’s a good idea to evaluate your current financial situation, as well as what you want your future to look like, before making any decisions.

    What are some smart ways to pay off a mortgage early?

    Once you have determined that it would be wise to pay off your mortgage, there are multiple ways to do so and become free of housing debt!

    It is also good to remember that paying off a mortgage early doesn’t mean you have to pay it off all at once or immediately.

    Taking baby steps toward a goal is often better than taking a giant, unsteady leap! It’s vital to choose what works best for you.

    Here are some options you might want to consider:

    • Make extra monthly payments.

      Extra monthly payments are the baby steps that can get you to your goal!

      If most of the value of your latest monthly payments go to principal, timing your extra payments is less impactful; you’ve made it past the maximum opportunity to save the most on interest.

      However, if most of the value of your latest monthly payments go to interest, we’d recommend waiting toward the end of the month — as this will reduce your interest payment a little on your next pay period. This method takes patience, but your overall savings will build up to a large amount over time!

    • Make an extra annual payment.

      Although this won’t make your payoff date come as quickly as making monthly payments, every little bit counts! And, the advise to make the payment toward the end of a month still stands.

    • Put bonuses and unexpected income toward your loan.

      Occasionally, you’ll receive extra during the holidays or through a special turn of events. Why not invest in yourself and your financial situation by putting it toward your mortgage? Your future self will thank you!

    • Refinance the loan with a shorter-term mortgage.

      Shorter term loans typically come with lower interest rates. If this is a solution you would like to explore, let’s see if we can come up with a creative option that meets your needs. Contact your local Benchmark branch to discuss your options.

    • Pay off the mortgage completely — evaluate your financial position with a financial planner or loan officer.

      Benchmark would welcome the opportunity to talk with you about this. We want you to make the best decision possible for you and your financial goals! Contact your local Benchmark branch to learn more.

    Ultimately, everyone’s situation is unique, which means everyone’s method to a mortgage payoff will be different. But with some hard work and financial strategy, it is possible! We’d love to help you move toward better financial well-being overall.

    At Benchmark, we are committed to helping you with home mortgage loan needs and decisions that set you up for future success. To learn more, contact your local Benchmark branchcontact us todaycall me or contact me today. We would be honored to provide you with our famous, excellent service!