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Survey: Mortgage Borrowers Want Both Technology and In-Person Services

A majority of Americans (60 percent) agree that while they use online resources for research, they prefer to apply for a mortgage in person, according to a new survey from the American Bankers Association. Seventeen percent said they would prefer to apply for a mortgage online, while 23 percent were unsure. “Banks invest billions of dollars to offer their customers the latest technology,” said Bob Davis, ABA executive vice president of mortgage markets, financial management and public policy. “But at the end of the day, nothing compares to sitting across the table, face-to-face with a banker when you’re making the single most important investment of your life.”  Consumers also indicated, though, that mobile or online services are important when it comes to obtaining a mortgage or making mortgage payments. Sixty-one percent of respondents consider mobile and online services very important or somewhat important, while 23 percent said they were not important.&nb ...

Refinancing and Home Equity Loans: Tax Considerations

What are the tax considerations associated with refinancing and home equity loans? Generally, interest paid on loans to acquire an existing home or to construct a new home is tax deductible ,with certain limitations.  In addition, interest paid on refinanced mortgages is deductible (also subject to certain limitations). Can you deduct interest paid on refinanced mortgages? If you refinance the current principal balance owed on a mortgage secured by your primary or secondary residence (a no-cash-out refinance), interest on the refinanced loan will be deductible to the same extent as was the interest on the old loan. If, however, the refinanced loan is for more than you owed on the old loan (a cash-out refinance), deductibility of interest on the amount of the loan that exceeds the principal balance of the old loan is determined as follows:  If you use the excess amount to buy, build, or substantially improve your first or second residence, the excess amount is treated ...

Millennials Are Ready to Buy: Let’s help them Achieve Home Ownership!

By Dawn Laumann, First Bank Home Loan Consultant p: 314-749-4898 e: Dawn.Laumann@fbol.com Do you have a son, daughter, niece, or nephew that makes up the millennial generation (ages 18-34)? According to the U.S. Census Bureau, millennials make up the largest generation in our nation’s history; shockingly, even larger than baby boomers. As this group continues to secure gainful employment and decides it’s time to enter the home ownership stage of life, their buying power will be significant and impactful. Research suggests that millennials have chosen to live at home with parents longer than previous generations. Many factors have played into this scenario, including the post-recession employment rate, student-debt ratio, lower wages, and a reduced emphasis on reaching major adulthood milestones, like marriage and home ownership. However, as economic conditions continue to improve and change, most millennials are anticipating a bright future with homeownership just two to five years awa ...

Education Plays a Role in the Real Estate Market

It’s no secret the importance education is to families, the economy and to communities as a whole. Education also impacts the real estate market. Although many factors, including square footage, number of bedrooms, and garage size, all impact homebuyers’ decisions, there are also other contributing factors. School quality and rating, along with the academic schedule, is just as important to many buyers as is the size, price and location of the home. In fact, one out of every three homebuyers would buy a smaller house than desired, just to be in a choice school district. “Since home and resale values are both impacted by school quality, homebuyers with or without children are going to seek homes in the best school districts,” said Morgan Jerabek, a home loan consultant at First Bank. Schools may also determine when sellers list their home. “Savvy sellers  ...

Get Ready for Summer with Outdoor Home Improvements

The warmer temperatures and the smell of backyard grills are the tell-tale signs that summer has arrived in St. Louis. For many, this is a welcomed time of the year; however, if your backyard isn’t quite ready for guests, the fun may be delayed. Start now and still have time to enjoy this summer. We’re all aware that home improvements help increase a home’s value. Did you also know that outdoor enhancements can also help to increase the home’s value? Kory Kunze, First Bank Product Manager said, "Using a home equity line of credit can be a cost effective way to fund home enhancements, with rates lower than credit cards.  Borrowers can take advantage of attractive introductory rates if they plan on paying the loan off in a short amount of time.”  Outdoor Living Buyers love decks because they add outdoor living space. Excellent for entertaining, backyard decks averaged an approximate 55% return on investment (ROI). Consider the maintenance of the materia ...

Spring Selling is in the Air—Is Your House Ready?

Contributor: Dan Kraus, Home Loan Consultant Have you considered selling your home? If so, this is certainly a great time. Warmer temperatures during the spring bring more buyers out into the market to shop for a new home. According to the National Association of Realtors, homes are selling two weeks faster than they did even a year ago. Inventory is low and the local real estate market is hot, making conditions just right for a great home selling season. “In my experience, buyers are looking for value,” said Dan Kraus, a First Bank Home Loan Consultant. “The more items that are updated, the easier it is for a buyer to decide whether or not to write a contract.” Kraus said he truly believes buyers have a calculator in their heads and can add up all the things that need to be done. To help prepare your home for selling, we’re offering helpful tips to make your home more attractive to potential buyers: Half-Empty Closets: Home buyers in any market want to see ample sto ...

Keys to Home Buying: Pre-Approval Gives Competitive Edge in an Active Market

The real estate market is expected to experience extensive growth, especially within two specific buyer demographics, including millennials (ages 18-34) and baby boomers (ages 53 and 71). Also, there’s a lower-than-average inventory of homes on the market. In fact, research gathered earlier this year suggests inventory homes on the market pre-spring are down an average of 12 percent. How will such an active market scenario impact serious buyers during the home buying and selling season? Quite simply, highly-desirable luxury and family-ready, move-up homes will show and move at faster- than-normal timeframes. Homebuyers, take heed. Pre-Approvals are Key Mortgage pre-approval in this fast-moving market gives homebuyers a competitive advantage over their counterparts also in the market for a new home. Meaning, new and experienced home buyers alike can start house hunting with peace-of-mind, along with their specified budget. Truly, possessing mortgage pre-approval takes the guesswork out of house-hun ...

Get Ready Now to Buy a Home Later

As with the beginning of each year, nearly half of all Americans typically make at least one resolution. Some may include weight loss and getting in shape, while others may have made the resolution to get their finances in order and to start saving for a new home. Whatever your resolution this year, make a plan and stick with it. Although less than half of us carry our resolutions through year’s end, it’s estimated we’re 10 times more likely to achieve it if we explicitly declare, or even write down, our resolutions. We’d like to help you be a part of the elite few actually completing their resolutions when December rolls around. Although we aren’t in the fitness industry, we can certainly help flex your money’s muscles and get your finances in tip-top shape. How can we help? If your resolution is to purchase a new home soon, then setting up a solid budget and plan should be in order. Start by checking your credit score. Your credit history is an important factor ...

What Refinancing Means to A Homeowner

Typically, when interest rates drop significantly, there’s a lot of ‘buzz’ about refinancing and lowering your monthly payment. If you’re new to homeownership or a homeowner that’s been in their current mortgage for some time, you may have some questions regarding refinancing and what it means. For starters, refinancing is simply the process of financing something again. Often, this is a new loan at a lower interest rate. The decision to refinance your mortgage should be carefully considered based on your short and long-term goals. What’s more, you should always consult a qualified home loan consultant to discuss your options as well as any costs associated with refinancing your home. Why Would A Homeowner Refinance their Mortgage? Quite simply, a refinance is intended to save you money. The interest rate of your mortgage loan impacts your monthly payment, so a lower interest rate means a lower payment. Plus, it reduces the overall amount to finance your home over ...

5 Important Questions When Choosing Your First Home

Moving into your own place can be exciting and frightening at the same time. The American Bankers Association (ABA) suggests considering the following questions when choosing your own home. 1. How much money do you have saved up?​ Start with an evaluation of your financial health. Figure out how much money you have for a down payment or deposit on a rental. Down payments are typically 5 to 20 percent of the price of the home. Security deposits on rentals are usually about one month of rent and more if you have a pet. But be sure to keep enough in savings for an emergency fund. It’s a good idea to have three to six months of living expenses to cover unexpected costs. 2. How much debt do you have? Consider all of your current and expected financial obligations—like your car payment and insurance, credit card debt, and student loans. Make sure you will be able to make all the payments in addition to the cost of your new home. Aim to keep total rent or mortgage payments, plus utilities, to ...

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All First Bank blog information and content is strictly informational. It is not intended to be specific investment, tax, or legal advice. If you need detailed financial, investment, or tax advice, please contact a First Bank qualified professional. Please note, First Bank occasionally shares third-party content we find to be relevant and helpful to our audiences.