Scott Steadman

The 3.5% down payment on FHA loans could be more expensive for buyers than expected. Beginning April 1, 2013, the mortgage insurance premium will go up by .1% to 1.35% which may not even be noticeable to most would-be homeowners.

The staggering increase will occur on 6/3/2013 when FHA’s policy on the duration of the required mortgage insurance will be increased for the life of the mortgage. It basically doubles the amount of total MIP if the loan is paid to term.

(Regarding the current MIP duration: When the unpaid balance reaches 78% LTV of original purchase, the MIP can be released. In any event though, the minimum time must be five years.)

Currently, the MIP is required for approximately 9 years 9 months with normal amortization. The new program would require the MIP for the life of the loan. In this example, the initial monthly MIP is $196.88 which decreases based on amortization.

There are buyers that qualify on income and credit who may not have the necessary additional down payment required for 80% and 90% conventional loans. The 3.5% FHA program has provided a great vehicle to get into a home with a minimum amount of cash.

For homeowners that expect to stay in their home for ten years or less, the new changes might not have much financial impact. Homeowners who expect to be in their home long term can refinance with a conventional loan without mortgage insurance once the equity has increased due to amortization and appreciation.

For buyers to avoid these increases, they will need to act now to get the FHA commitment issued prior to these change dates.

Source: http://www.kcmblog.com/2013/02/19/fha-more-expensive-than-expected/

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November Market Update

by Scott Steadman

I can’t help but continue to notice all the positive things I am reading about our local housing market. We are now at a 4.5 month supply of inventory (This means if no new homes were listed, it would take us 4.5 months to sell our current inventory. 4-6 is considered a sellers market). Median housing prices for Salt Lake County are up 11% from the same period last year. The number of homes sold is up 12% from last year. The number of days on the market decreased from 120 days to 81. For buyers, rental prices remain high. Interests rates remain around 3.25%! I feel like I could go on and on…

So what does all this mean? Housing recovery is here. Ground breaking on new construction continues to increase. Utahns are regaining lost equity as more mortgages come out from being under duress. Many would be buyers are entering the market. 18-34 year old buyers who have been renting or living at home have bought or are looking to buy in 2013. Low rates continue to make home ownership affordable.

Nevertheless, I realize that there many been many out there who are still facing different issues. From still not being “above water” on their mortgage, struggling to come up with enough for a down payment, to complicated and frustrating short sales on both ends of the transactions. It takes having a Realtor who is committed to your goals and knows the current market conditions. Working daily in the industry and staying afloat on the current issues, I am committed to doing everything I can to help my clients achieve their housing goals/needs.

2013 SunCrest Pool Hours

SunCrest Market Update – May

SunCrest Market Update – April

SunCrest Market Update – March

SunCrest Market Update – February

Big Changes to FHA Loans

SunCrest Market Update – January

November Market Update

SunCrest Market Update – November

Cost of Waiting a Year