Best Realty's Lake Oroville Real Estate Blog

A Good Faith Estimate is a lenders proposal as to what closing costs and loan fees will be associated with your home loan. Real Estate Settlement Procedures Act (RESPA)  now mandates home buyers receive a standard, three-page Good Faith Estimate within three days after they apply for a  loan.
The Good Faith Estimate form requires lenders to combine all of the bank’s fees into one “origination charge,” enabling consumers to compare one lender’s fees with another’s. These mortgage fees, also called settlement or closing costs, cover every expense associated with your home loan: inspections, title insurance, taxes and other charges.  An accurate Good Faith Estimate is essential for a prospective home buyer to make a informed decision about their exact settlement or closing costs.
Lenders also are prohibited from increasing the origination fee from the estimate. Some additional charges, including title services and recording charges, can increase by as much as a combined 10 percent. Estimates for other charges, such as homeowner’s insurance and other services provided by third parties selected by the borrower,may not be subject to such limits.
It is important to have your lender fully explain your Good Faith Estimate to you. All charges typically paid for by the buyer must be disclosed on the GFE regardless of  whether the charges will be paid for by the buyer, the seller or other party. Remember, dont be afraid to ASK QUESTIONS!
For example: Lets say the seller is paying the buyers closing costs of  5% on a purchase price of $250,000 that would be a credit to the buyer of $12,500. That is now going to be shown on the buyers GFE as a buyers cost. DONT PANIC! At closing the seller will still be giving the credit to the buyer but it must show as a cost for the buyer to give the buyer a true picture of what the costs for the loan are.

New Year still Offers Great Interest Rates!
The 30-year fixed-rate mortgage  averaged 5.06 percent for the week ending January 14, 2010, down from last week when it averaged 5.09 percent. Last year at this time, the 30-year FRM averaged 4.96 percent.
Home sales in the Lake Oroville real estate market, especially for lower-priced homes, increased due in part to the home buyer tax credit and house prices appeared to have changed little.
I want to give you an example again of what the difference between a 5.06% interest rate and say 6.5% rate is on a 30 year mortgage.
Lets say on a $150,000 purchase price at 5.06, the principle and interest payment would be approx. $810.74 per month. Now take that same purchase price of $150,000 at 6.5% and the approx. monthly payment would be  $948.10. This is a difference of $ 137.36 per month, a  savings of $1648.32 a year and $49,449,60 over the life of the loan! That is almost a $50,000 difference. So interest rates play a big role in purchasing a home.
Whether your a first time buyer or looking to move up or down for that matter, you need to take advantage of this!
Speak with a Oroville Real Estate Professional to see how they may be able to help you get into a home. There are alot of programs available.
In my next post ,I will be giving you the information and links you need to get enrolled in  the Mortgage Protection Program. This is a free program that every first time buyer should be enrolled in! There are time periods so stay tuned for details.
 
 
 

Interest rates are low and prices have come down. Some buyers have decided that it is a good time to buy, even if it is a little while before the Oroville Real Estate Market fully stabilizes.
Buyers who have a house to sell face a more complicated situation than they did when they bought their first home. They may not be able to afford to buy a new house before selling the old one. And, it may be more difficult to find a home to buy because many sellers are not selling now due to current market conditions.
Despite complications, homeowners who want to trade up in a down market can benefit financially. They may sell their current home for less than it might have sold for a few years ago, but they also could pay a lot to less for the replacement home.
Let’s say your current home that was worth $300,000 two years ago is now worth $200,000, or 20 percent less. Even though you would sell for $100,000 less today, if you buy a $1 million house that two years ago was worth $1.25 million, or 20 percent more, you come out $150,000 ahead.
Interest rates are still at an all time low! Even edging up this week, they are 4.81 on a 30-year fixed. On a $200,000 mortgage the principle and interest payment at todays average rate would be about $1049, compared to $1,199 a year ago. A savings of $150.00 per month.
Combine those two major factors and add the $8000 tax credit to first time buyer and the $6500 credit to move up buyers and you have a win win situatuion!