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Prepare Your Home for Fall

by Kynzy Lowe

The resurgence of everything pumpkin spice means that fall is upon us once again. You are probably as excited to pull out that box of fall décor as we are. If you live in a building (a house, duplex, apartment, condo, etc..) then there are some other important tasks that should be added to your to-do list to make sure your home is well prepared for the change of season.

  • Have your furnace inspected

Don’t get left in the cold. Fall brings cooler temperatures, shorter days, and earlier sunsets. Ensure that your home stays nice and cozy by having your furnace inspected. Contact your preferred local HVAC company to get your furnace checked out and maintenance, if needed.

  • Clean your gutters

Gutters safely carry water from your roof away from your home’s foundation. Blocked gutters can prevent this water from flowing, causing damage to your home, so it is important to clear out any debris that has built up. You can hire someone to do this, or you can do it yourself. Consider getting gutter guards so that water will flow smoothly without your gutters getting clogged with leaves or other debris.

  • Properly insulate your home

Combat the drop in temperature by making sure your home is properly insulated. The most effective way to keep your home warm is to invest in extra insulation, and there are many different options that vary based on your type of home and specific layout. This can be pricey, but will save money on energy bills in the long run. You can also reduce heat loss by covering windows with blinds and curtains.

  • Check outdoor faucets

Make sure all outdoor faucets are turned off. It might be worth doing now, before winter, to avoid water freezing and bursting pipes. Don’t forget to use insulated covers for exterior water spigots.

  • Bring in outdoor items

Depending on the weather, it may be best to pack up outdoor furniture and other patio items that could get damaged. If you have a pool, it might be time to cover it so that it stays clean until next summer.

Following these tips can help you avoid common problems in the fall and winter. By making sure that your home is well prepared, you can relax and enjoy all that this season has to offer.

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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Is Buying A Home Really More Expensive Than Renting?

by Jason Haeger

If you rent, you probably have good reasons. I bet that “paying my landlord’s mortgage”, “noisy neighbors”, or other caveats aren’t among them. Look, we know that owning isn’t right for everyone. As much as we write about why owning a home is better than renting, there are legitimate reasons for choosing to rent. For one thing, while renting may require a deposit, it doesn’t require a down payment. Renting is often the first choice for someone who wants or needs to be able to move with minimal hassle, or for someone whose focus is too occupied to be concerned with managing repairs and maintenance.

Whatever your reason, there is little doubt that most people probably want to eventually own their own home, even if not yet. If your reason is financial, you may think that buying is more expensive than renting. On one hand, you may have a point. On the other hand, the long view casts a long shadow of doubt on that assumption. Even if you plan to rent for awhile longer, educating yourself is always a good idea, especially if you plan to one day own, rather than rent, your own home.

Let’s talk about it.

Costs of Buying and Owning

Let’s talk about equity.

Before we jump into the actually costs of buying and owning your own home, It would be shortsighted to not discuss how equity plays into the equation. For starters, if you don’t know what equity is, it is just the portion of a whole asset that you own. It can be calculated by subtracting the remaining loan balance from the total value of the home. This is a major reason why a Self-Made Millionaire Told Millennials To Buy A Home three years ago.

With every mortgage payment, a portion of it goes toward the principal balance of the loan. (See: Why Buying Is Investing) This means that, without any extra effort on your part, your net worth grows by the amount of the principal portion that you pay each and every month. How much of your rent adds to your net worth? Oh.. sorry, I didn’t mean to make you feel bad. When you rent, you add to your landlord’s net worth, not your own net worth. Hey, at least your money is helping someone, though, right? Let’s move on.

Do you need a lot of cash for a down payment?

That depends. How much how do you want to buy? How much do you consider to be a lot? The truth is, you don’t need as much as traditional wisdom may have led you to believe. In my last article, Owning A Home May Already Be Within Reach, I talk a little more about that. There are conventional loan programs that require as little as 3% down, depending on your particular scenario. Assuming a $250,000 purchase price, 3% amounts to $7,500. However, a down payment is just putting your own investment dollars into the transaction. A down payment reduces your liability, and while you will no longer have the cash in hand after the transaction, it will not reduce your overall net worth. On the contrary, it could be the vehicle that gets you on your way towards a higher net worth than you would have access to otherwise. See a previous article we published, called Homeowner Average Net Worth 3,600% Higher Than Renter.

What about closing and other transactional costs?

Ah, closing costs. Sometimes surprising first-time home buyers, the purchase of a home requires a lot of moving parts, and many parties who work together to make this transaction of real estate possible. Apply the economic principle of “There is no such thing as a free lunch” to the purchase of a house, and it’s logical, really. So how much are they? That all depends.

Generally speaking, home buyers will pay roughly 2-5 percent of the purchase price in closing and transactional costs. These can be seen as true costs, as they do not translate to equity in the purchased home. There is almost always room for negotiation on these, so it’s worth talking to your loan officer about this ahead of time. It is their job to put together a mortgage package that fits nicely with your own personal financial situation and goals.

There will be other costs of ownership.

When the plumbing needs work in your apartment, you know what to do. You either call your landlord, a property manager, or the maintenance number. At some point, someone will come to your apartment to do the necessary repairs. Simple.

When you own your home, you are on the hook for arranging the repairs yourself. Sure, there are home warranty packages you can purchase that cover certain repairs, but you’re on the hook for setting that up, too. Don’t be intimidated by this, though, because home warranty sellers are anxious to trade their promises for your hard-earned money. The debate about whether a home warranty is worth it or not is for another post.

Another option is to find your own contractor. This sounds like more work, but this is actually a huge advantage. Want to upgrade? Go for it. Find a killer deal? You’re free to call whoever you like. Depending on the repair, you may be able to DIY and learn a new skill while saving your money.

No matter which way you go about it, repairs and maintenance costs will come directly from your pocket. Do not gloss over this fact when considering how much house you can afford, or you might find yourself “house poor”. Remember, however, that homeownership is not a quick win. It is a long game of wealth accumulation. That’s probably not even the top reason why people buy homes. What’s your motive?

Opportunity Costs

Like every other decision you make, there is an undeniable opportunity cost to buying a home. When you buy a home, you’ve lost access to the money that you used as a down payment. Maybe you wanted to use that money to pay for college, start a business, or save for a rainy day. Then again, maybe you recognize that the better option for you is to put it into a real asset like a home.

Another factor to consider is flexibility. You lose the opportunity to move in a hurry. If location flexibility is important to you, it can be beneficial to only have to pay a fee to break the rental contract and go at your convenience. If you own a home,  you will either need to keep paying the mortgage for a home you’re not living in while paying for rent or a new mortgage for a home in your new location, or you will need to coordinate the sale of your home with your planned move. When you sell, you are taking the equity you’ve accumulated in the home in cash, which is difficult to see the down side of. You can also potentially keep your previous home, and make it available to rent to someone who could then help pay the mortgage for you with your asking rent price.

Your situation is your own, and it’s your responsibility to decide what is best for you. I sincerely hope you find this article helpful when you make that decision.

Costs of Renting

There is no such thing as a free lunch, and there is also no such thing as a free home.* When you rent, the most obvious cost to you is just that: rent. Whether you think your rent is a good deal, or whether you think it’s too high, the rent must be paid. Your rent helps pay for your landlord’s mortgage, adding to his (or her) net worth. Unfortunately, there is no long term fiscal benefit to the rent payment. It especially doesn’t help when the rent price goes up.
* Unless you live with family.. or other less common exceptions.

Lack of Privacy

Since your home is not your own, you are at the mercy of your landlord, their property management, and local laws for your personal safety and security. Have you ever heard your neighbors arguing through the wall? Has a party gone on in the unit above you until well past a reasonable hour? Do the neighbors’ kids not understand what ‘courtesy’ means?

See: Owners Enjoy More Privacy and Security.

I’m not saying that buying means you get to choose your neighbors, but you can at least choose your neighborhood, and buy a single family home with no attached neighbors, if that’s what you want to do. If you buy a house with a yard, you have a green space to enjoy without having to go to a public park or courtyard just to enjoy the fresh air.

No Personalization

If you rent, you give up the option to really make your (well, your landlord’s) home your own. Do you want to change the paint color, wallpaper, tile, or carpet? You have to either get permission, do the work yourself, or both. With the costs involved, you probably won’t want to invest in your landlord’s equity with your own cash. I don’t blame you, especially since one of the benefits of renting is its transient nature.

Opportunity costs

Renting means giving up any future possible financial gains on your residence, because it’s not yours.  (see: This New Year, Reach Your Dream of Homeownership for a little math on this). It’s possible that you can see any of the previous costs as opportunity costs as well. With a financial stake in your community, you will be more invested in the culture and politics of your neighborhood and your hometown. This is not to say that you cannot also be personally invested if you rent, but that may come from owning or operating a local business rather than renting a home.

The Answer Is Ultimately Subjective

“Expensive” is relative. Expensive compared to what? Does buying a home come with a lot of cost, including upfront costs? Yes. Is it cheaper to pay rent, without gaining equity, for decades? No. However, is the cost worth it to you? Ultimately, that’s the question, isn’t it? I don’t know your particular life circumstances, goals, or timelines. However, you do. This is an answer you will need to arrive to on your own, based on your own priorities.

More recommended reading: Rent or Buy? A Fool, Do Not Be

If you are curious to see specific numbers to bring clarity, you will want to talk to one of our mortgage professionals. At Benchmark, our loan officers specialize in tailoring the best matching loan arrangement for your personal goals and financial situation. Find your branch, and contact them for more information.Contact us today. It would be our honor to help you decide what’s best for you.Please call me or request a call. I would be honored to be part of helping you decide what’s best for you.

 

Benchmark brings you home.

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Owning A Home May Already Be Within Reach

by Jason Haeger

Have you told yourself that you’re too _____ to buy a home? The blank could be almost anything. Whether you think you’re too broke, too poor, or your credit score is too low, are you allowing an invisible script to prevent you from attaining your dream of owning your own home?

Just a side note: You may also be interested in Top 5 Myths About Home Buying in 2020

You don’t have to be rich. You don’t have to have a 750+ credit score. You don’t need $50,000 in savings. Don’t believe me? Sit back, grab a cold drink, and hear me out.

Big Down Payments Are Old Hat

If you can scrounge up ~$10k for a down payment, I wager that you can probably buy a home. It’s not a sure thing, of course, but hear me out. While a 20% down payment is excellent wisdom, it isn’t a requirement. Depending on the loan type, and where you buy, you could be required to pay less than 5% down to get into it. FHA loans require 3.5% down, which is less than $10k, assuming the median sales price of $248,867*. There are some conventional loans that require as little as 3% down. That’s ~$7,500, assuming a sales price of $248,867.

Let’s assume you don’t have the full ten grand lying around in a checking or savings account. Some, or even all, of your down payment can come from gifts from family, depending on certain restrictions. The point is that you maybe shouldn’t let your savings dictate your eligibility. Even if you haven’t been prioritizing your savings, how long do you think it would take to save up? I don’t pretend to know or understand your financial situation, but it may come down to something as simple as organizing your priorities.

* https://www.zillow.com/home-values/

Your Credit Is Probably Fine

The average FICO credit score in the United States as of September 10, 2019 was 706**. In fact, as of January 13 of this year, 59% of people in the US have a FICO credit score greater than 700, and only 18% have a credit score that is considered subprime***. For everyone else, there is probably a mortgage product or program that suits your needs. I don’t pretend to know you or to know about your finances, so take that with a grain of salt. None of this is a guarantee, but I’m guessing based on averages.

Even if your credit isn’t where you want it to be yet, there are such things a conditional approvals. To learn more about this, it’s best to contact a mortgage pro. I might have a suggestion about how to find one at the end of this article.

** https://www.fico.com/blogs/average-u-s-fico-score-ticks-706
*** https://www.experian.com/blogs/ask-experian/consumer-credit-review/

Your Personal Debt Balance Isn’t That Important

The total balance of your personal debt isn’t a very important factor in qualifying for a new home loan. Once again, I don’t pretend to have a clue about your personal finances, so forgive the section title. Your debt balance is important, but probably not when it comes to buying a home.

If you are worried about your student loan debt, don’t be. This kind of debt is a little more complicated, but it can be based on your monthly minimum due or 5% of the balanced divided by 12 months, unless you’re in deferment for more than a year past the closing date. Like I said, it’s complicated, but it’s probably not preventing you from buying a home. The only way to find out how your particular student loan arrangement affects your ability to buy a home is to talk to a mortgage pro. Don’t worry, we’ll get to that soon.

If you have any other kind of personal debt, only the minimum payment as listed on your credit report matters. No matter your debt, this is what you need to know. The equation is called the “debt to income” ratio, or DTI. This is a ratio of your monthly financial debt obligations and your monthly income. That helps determine how much house you can afford, when coupled with your down payment and creditworthiness.

Asking Never Hurt Anyone

If you dream of owning your own home, like I once did, the only way to really know what your options are is to talk to a mortgage pro. If you only remember one tip from this short article, this is it. Nervous? I understand. So do the pros here at Benchmark.

Find your local Benchmark branch, and reach out to them.Contact us however you want to find out more.Give me a call, or request one from me to explore your options.

Even if the answer is “not yet”, you’ve made the first step towards achieving your dream, and your Benchmark loan originatorwemy team will be with you every step of the way.

Benchmark brings you home.

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Good News is Coming sign posted on light post

This New Year, Reach Your Dream of Homeownership

by Jason Haeger
Good News is Coming sign posted on light post
Photo by Jon Tyson on Unsplash

Every year begins with renewed hopes and bright aspirations embodied by the shared cultural vow we all seem to take: the New Year’s Resolution. If your Resolution involves any aspect of ‘home’ or financial strategies, purchasing your first home and homeownership may be on your mind.

You Are Not Alone

Among renters under the age of 50, 72.7% reported a preference for buying, with 52.5% reporting that they strongly prefer buying, and the remaining 20.2% reported a normal preference. If you are like most other renters under the age of 50, the odds are good that you would prefer to own a home, even if you currently rent. Is homeownership right for you?
(source: https://www.newyorkfed.org/microeconomics/sce/housing#indicators/Renters/g42)

Is Housing A Good Investment?

Attitudes toward housing as a financial investment became more positive than they already were: 65% of all respondents think that buying property in their zip code is a “very good” or “somewhat good” investment, compared to 60% in 2016. Only 10.6% think housing is a “bad” investment. Enthusiasm about housing as investment is particularly pronounced among younger, more educated (Bachelor’s degree or more), and higher-income (annual income of $60,000 or more) households. – source: https://www.newyorkfed.org/newsevents/news/research/2018/an180418

While it is not our (Benchmark) place to recommend any investment strategy, Americans seem to view homeownership as a favorable investment overall. You can read these posts from our archive for more information on this:
Renting vs Buying a Home and Accumulating Wealth
Buying Still Cheaper Than Renting
Homeowner Average Net Worth 3,600% Higher Than Renter
Why Buying Is Investing

Can You Afford To Buy?

One of the biggest hurdles in a market where property values have been on the rise is having enough cash for a down payment. The median listing price in the United States is $276,000 (retrieved from https://www.zillow.com/home-values/ on January 4, 2019 at 4:12pm). So, how much down payment is required?

Related: Nervous About Buying? Here’s A Dose of Confidence

Most people tend to believe that you need 20% of a home’s price for a down payment. ApartmentTherapy.com created the following table based on the assumption of the median home price for each state, 20% of the down payment, and how much one should save each month for six and a half years. (If you are just starting in January 2019, you won’t be ready with your 20% down until the buying season is in swing in 2025.
State Median Home Price Down Payment Monthly Savings Plan
Alabama $171,500 $34,300 $440
Alaska $267,404 $53,480 $686
Arizona $225,000 $45,000 $577
Arkansas $156,000 $31,200 $400
California $462,000 $92,400 $1,185
Colorado $331,000 $66,200 $849
Connecticut $253,500 $50,700 $650
Delaware $210,000 $42,000 $539
Florida $218,000 $43,600 $559
Georgia $193,000 $38,600 $495
Hawaii $442,500 $88,500 $1,135
Idaho $349,000 $69,800 $895
Illinois $212,000 $42,400 $544
Indiana $190,843 $38,168 $490
Iowa $157,000 $31,400 $403
Kansas $187,649 $37,529 $482
Kentucky $170,000 $34,000 $436
Louisiana $232,610 $46,522 $597
Maine $275,717 $55,143 $707
Maryland $379,000 $75,800 $972
Massachusetts $150,000 $30,000 $385
Michigan $164,000 $32,800 $421
Minnesota $240,000 $48,000 $616
Mississippi $195,390 $39,078 $501
Missouri $204,506 $40,901 $525
Montana $314,959 $62,991 $808
Nebraska $178,000 $35,600 $457
Nevada $249,300 $49,860 $640
New Hampshire $245,000 $49,000 $629
New Jersey $290,000 $58,000 $744
New Mexico $254,798 $50,959 $654
New York $430,000 $86,000 $1,103
North Carolina $210,000 $42,000 $539
North Dakota $226,863 $45,372 $582
Ohio $154,900 $30,980 $398
Oklahoma $150,000 $30,000 $385
Oregon $315,000 $63,000 $808
Pennsylvania $191,000 $38,200 $490
Rhode Island $256,000 $51,200 $657
South Carolina $181,500 $36,300 $466
South Dakota $177,500 $35,500 $456
Tennessee $190,000 $38,000 $488
Texas $320,067 $64,013 $821
Utah $440,946 $88,189 $1,131
Vermont $325,000 $65,000 $834
Virginia $297,500 $59,500 $763
Washington $332,719 $66,543 $854
West Virginia $136,500 $27,300 $350
Wisconsin $197,000 $39,400 $505
Wyoming $291,855 $58,371 $749

table and data copied from: https://www.apartmenttherapy.com/home-down-payment-cost-by-state-2018-261916

The Cost of Waiting

When looking to put 20% down, consider the cost of waiting six years. Since January 2012 until January 2019, the national home price index has inflated by 53.56%.

Federal Reserve Economic Data (St. Louis Fed) Home Price Index chart

source: https://fred.stlouisfed.org/graph/?g=mA5v

If you have owned your home for a few years, this is wonderful news! If you have been saving for a 20% down payment on a home that was listing for $134k in 2012, it is now likely going for $206k, and your 20% down payment has gone from $26.8k up to $41.2k. How would this factor into your savings plan if you took the advice of the table provided above?

Will home prices continue their upward climb? No-one knows. If it does, you could miss out on equity gains and purchase opportunities while saving for a 20% down payment. Is there an easier path to homeownership? What if you didn’t have to put down 20% to get a mortgage?

You Don’t Always Need 20% Down*

If you qualify for a Conventional mortgage loan (based on a variety of factors, including credit score, income, debt, and financial history), there are products available for as little as 3% down!*

For first time home buyers, an FHA mortgage requires as little as 3.5% down, and require a minimum credit score of less than 600!*

Let’s take a look at this practically.

Assuming a list price of $276,000.00, 3% down equates to $8,280. If you were following the 6.5 year plan towards 20% down, you would be saving $707.69 every month for 78 months. BUT, if you plan to put 5% down instead, you could get there in only 19.5 months following the same savings plan. That makes you a homeowner ~5 years sooner!*

0% Down Programs

If you are a Veteran who qualifies for a VA Mortgage Loan, it is possible to buy with 0% down.
USDA loans are also candidates for 0% down qualification.*

Down Payment Assistance

Down payment assistance programs may be available in certain counties and states. Ask your Benchmark loan officer if there are any available in your area.

This Year, Make Your Dream A Reality

Even if you don’t have enough for a down payment, if you think your debt is holding you back, or if you don’t think your credit is good enough, let’s chat.

Find your branch, and contact them today. If you are ready, you can click to Apply Now. We look forward to helping you reach your goals!Call or email us, or Contact Us today. If you are ready, you can Apply Now. We look forward to helping you reach your goals!Call me, Email Me, or Contact Me today. If you are ready, you can Apply Now. I look forward to helping you reach your goals!

* Ark-La-Tex Financial Services, LLC NMLS ID #2143 (www.nmlsconsumeraccess.org) is not a law firm, accounting firm, tax firm, or financial planning firm. This advertisement is for general information purposes only. Anyone relying on particular details contained herein does so at his or her own risk and should independently use and verify their applicability to a given situation. All loans are subject to borrower qualifying and meeting appropriate underwriting conditions. This not a commitment to lend. Some products may not be available in all licensed locations. Information, rates, and pricing are subject to change without prior notice at the sole discretion of Ark-La-Tex Financial Services, LLC. Other restrictions may apply. (https://benchmark.us)

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Benchmark Never Quits with Team Never Quit

Benchmark Partners with Team Never Quit for the 2018 Patriot Tour!

by I Am Benchmark

Benchmark Never Quits with Team Never Quit

Benchmark Mortgage is proud to announce our partnership with Team Never Quit.

This year, we will be hitting the road with the 2018 Patriot Tour! Our Team is proud to have changed the way VA lending is done, and we take a “never quit” attitude with our veterans and their dreams.

NO MORE will the veteran be taken advantage of. We have a heart and passion for our veteran community, and we pride ourselves in making the home financing experience amazing. Setting the industry standard for 20 years, we are proud to have helped make the American Dream of home ownership become a reality for more than 100,000 Americans. Home ownership has always been the American dream and we believe that no one is more deserving than those who have served our country.

The Patriot Tour features retired Navy SEAL Marcus Luttrell, author of the New York Times bestseller “Lone Survivor” ,a riveting tale of the heroic sacrifices made by Marcus and fellow SEAL Team members assigned to Operation Red Wings in Afghanistan;  Taya Kyle, author of ‘American Wife’, Executive Director of the Chris Kyle Frog Foundation, and wife of the late U.S. Navy SEAL Sniper Chris Kyle; retired U.S. Army Capt. Chad Fleming; and retired Navy SEAL and ultra-marathon runner David Goggins.

The Patriot Tour brings together things worth protecting, and things worth celebrating: Family, Service, Sacrifice, and Community. We are excited to be joining the Patriot Tour with these amazing heroes. Stay tuned for more exciting updates as we tour the country, coming to a city near you!

 

The Patriot Tour 2018

young couple unpacking in their new home

2018 Homeownership Profiles: Millennial Buyers

by I Am Benchmark

young couple unpacking in their new home

In 2017, Australian millionaire Tim Gurner famously attempted to blame millennial homebuyer obstacles on their inability to avoid frivolous spending on $19 avocado toast, in comments that were widely mocked throughout the internet.

Many commentators are still quick to point the finger at extravagant spending to explain why homeownership among younger adults has declined compared to previous generations. However, the more likely culprit is soaring student loan debt and a limited supply of homes causing rapidly inflating prices, which is making it more difficult for millennials to afford homes.

Despite what you hear, it’s not all doom and gloom for aspiring millennial homebuyers. According to the National Association of Realtors (NAR) latest study, millennials continue to be the largest generational cohort of buyers, making up 36% of the purchase market.

Check out the latest statistics and trends among this influential bloc of homebuyers.

Stats About Millennials

 Many people still think of millennials as teenagers, instead of young adults in their 20’s and 30’s who currently make up the largest generation in the workforce. NAR’s study defines millennials as buyers age 20-37.

Of this group:

  • 22% of millennial buyers are age 20-27, while 78% are age 28-37. The median age was 31.
  • 66% were married couples, 18% were single, and 15% were unmarried couples
  • 65% were first time homebuyers
  • Prior to buying, 56% rented an apartment or house, 18% lived with parents/relatives/or friends, and 24% owned a previous home

Millennials As Homeowners

  • 89% purchased previously built homes and 11% purchased new homes. Better price was cited as the number one reason buyers purchased previously owned homes.
  • Quality of the neighborhood, convenience to job, and overall affordability of homes were the top reasons millennial buyers chose their neighborhood.
  • The median purchase price was $220,000
  • 44% paid asking price or higher for their home

Millennials and Home Financing

  • 98% of millennials financed their home purchase, compared to 88% overall
  • 75% used savings for the down payment, 23% used gift funds, and 21% used proceeds from the sale of a primary residence (respondents could select more than one source)
  • 53% reported that student loans delayed saving for a home
  • 55% reported that they made sacrifices to non-essential items like entertainment and vacations to save for a home
  • 67% found the mortgage application and approval process not difficult or easier than expected.
  • Only 6% of millennial buyers had a previous mortgage application denied. The number one reason was for debt-to-income ratio, followed by low credit score.
  • 46% of buyers had student loan debt. The median amount was $27,000.
  • 55% used a conventional loan, 27% used an FHA loan, and 10% used a VA loan.

After analyzing their demographics and buying habits, it is clear that millennial buyers have become a powerful force in the housing market. As it turns out, avocado toast is not preventing millennials from buying homes.

Source: https://www.nar.realtor/research-and-statistics/research-reports/home-buyer-and-seller-generational-trends

 

Are you ready to buy? To get started, Find your Benchmark branch!Call or Contact Me to kickstart your homeownership journey!Meet our team, and find your loan officer to get started!