Issue link: https://www.ifoldsflip.com/i/1389758
whorefinanceintoanew 30-yearfixed-rateloanare $270to$525permonth. Othersareshavingan averageofeightyearsoff theircurrentterm." Indeed,lower monthlymortgagepay- mentsaren'ttheonly reasonborrowerspur- suearefi.Manyseek topayofftheirloan soonerbychoosinga shorterterm—suchas goingfroma30-year loantoa15-yearloan, whichcangeneratetens ofthousandsinsavings overtheloan'slife. "Othersrefinance, assumingtheybuilt upenoughequity,to eliminatemortgagein- surancethatuptothis pointhasbeenrequired bytheirlender,"Malo- neyadds."Manybor- rowersfindthattheir homehasincreasedin value,possiblyallowing themtotakecashout whentheyrefinance topayforahomeim- provementproject,pay downdebtorfunda majorpurchase.And othersswitchfroman adjustableinterestrate toafixed-rateloan, whichprovidesstability infuturepayments." Thebestwaytode- termineifarefinance isrightforyouatthis timeistocrunchthe numberscarefully. "Closingcostsusu- allyrangefrom2%to 5%oftheloanprin- cipal,whichmeans theygenerallyaverage severalthousanddol- lars,"saysPeterZomick, seniordirectorofcon- sumerdirectlending forSilvertonMortgage inCharlotte,North Carolina. Ifyouareaimingto loweryourpayments, youneedtodetermine yourclosingcostsand break-evenpoint,sug- gestsElizabethWhit- man,anattorneyand realestatebrokerinPo- tomac,Maryland,who suggeststhefollowing scenario: Sayyoucurrently owe$200,000ona mortgageloanwith a4.0%fixedinterest rate.Youopttorefi- nanceata3.0%interest rate,whichwillsetyou backroughly$5,000 inclosingcosts(2.5% ofyourmortgageloan amount).Thedifference betweenthesetwoin- terestrateswillsaveyou 1.0%interestannually —equatingtoabout $2,000peryear.So, youwouldneedtore- maininthehouseforat least2.5yearstocover the$5,000closingcosts (thebreakeven)onthis transaction. "Inthisexample,if youexpecttostayinthe houseforseveralyears, thisrefinancemakes sense.Butifyouplan tomoveintwoyears, itprobablyisn'tagood idea,"Whitmannotes. Worriedthatyou maynotqualifyforthe lowestinterestratepos- sible? "Takethetimeto checkyourthreefree creditreports,atan- nualcreditreport. com,andyourcredit score,throughyour bankorcreditcard,to seeifthere'sroomfor improvement.Afew quickfixesmayhelp yousecurethebestpos- siblerateforyourrefi," advisesAnthonySher- man,CEOofNewYork City-headquartered Simplist. Thegoodnewsisthat ifyourcreditscorehas improvedsinceyoulast closedonyourhome, "youmayfindyourself eligibleforamoreat- tractiveinterestrate," Shermanpointsout. RightTime frompage1 Q: My wife and I have four older brothers and sisters. Each received $1,400 tax-free from the government in April because of President Biden's COVID-19 relief bill. They, along with our parents, have gotten together and are willing to give us the money to help us buy a first home. That's six checks. Will lenders allow this? A:Thisisavery nicegestureandshows howfamilymembers canhelponeanother. Sixchecksat$1,400 eachtotal$8,400.If youbuywith3percent downthroughthe HomeReady(Fannie Mae)orHomePossible (FreddieMac)programs youcanborrow $280,000ifotherwise qualified.Youcould alsodowellthrough theFHA(3.5%downif yourcreditscoreis580 orabove)andtheVA (0%down). Lendersarevery concernedthatdown paymentmoneyiswell documentedandcomes directlyfromborrow- ers.Thebigexception isthattheyallowgifts. Programrulesvary, butgenerallyfunds fromfamilymembers arefineandmoney fromfriends,employ- ers,laborunions,and nonprofitgroupsmay alsobeallowed.For specifics,speakwitha loanofficer. Whatlendersdonot wantarehiddenloans, financingnotdisclosed tothem. Hiddenloansrepre- sentseveralproblems. First,theymean theborrowerhasmore debtandhigherrepay- mentcoststhanloan applicationsshow. Thatisahugeno-no.It meansdebt-to-income (DTI)calculationscan bewrongandthatcan createaliabilityfor thelenderwhenthe financingissoldor guaranteed. Second,ifyou cannotsaveenoughfor adownpaymentthere areoptionstohelpyou. Giftsareonepossibility butnoteveryonecan getafinancialgift.An alternativeistogethelp fromadown-payment assistanceprogram. DownPaymentRe- source.comtracks severalthousandassis- tanceprograms,and youcansearchthesite byZIPcode. Third,lenderswant toprotectborrowers againstfutureclaims. Todothistheywill requiredonorsto provideagiftletter. Thislettertypicallylists theamount,thesource ofthefunds(thebank account),yourrelation- shipwiththedonor, thepurposeofthegift (typicallyshowingthe addressoftheproperty beingpurchased)anda plainstatementsaying themoneyisagiftand thatnorepaymentor interestisrequired. Fourth,somepoten- tialgiftsourcesarenot allowed.Giftsfromsell- ers,realestateprofes- sionals,lenders,loan officers,buildersor anyoneinvolvedinthe transactionarebanned. Fifth,andimpor- tantly,buyingahome requiresmorethana downpayment.Youalso needmoneyforclosing, moving,fixingup,etc. Speakwithyourreal estatebrokertoesti- matelocalclosingcosts andotherexpenses. Thebottomline: Documentedgiftsfrom allowabledonorsare welcomedbylenders. Yourloanofficercan explaindocumentation andotherrequirements foryourparticularloan. Therulesforlenders areonething,therules for gif ts and taxes ma y be another . I n g ener al, gif ts in 2021 of not more than$15,000from individualdonorsare tax-exempt.Asalways, speakwithataxprofes- sionalforspecifics. Emailyourreal estatequestionsto PeterMilleratpeter@ ctwfeatures.com. Using stimulus payments to fund a home MarketWatch By PeterG.Miller Over 21 yearsexperience and 5star Yelp reviews BayviewResidential Mortgage 51E.Campbell ave #110 Campbell,CA95008 CABrokerDRE#01498198/ NMLS#329189 Call today for rate quote! RobHeath 408-482-8080 CA DRE#01241953/NMLS#319548 Apply at my personal secure loan application at www.excellentmortgageloan.com Product Rate Points Fees % Down APR 30 Yr Conf. Fixed 15 Yr Fixed 5 Yr Jumbo ARM 30 Yr Conf. Jumbo 3.125 2.75% 3.25 3.50 0.000 0.000 0.000 0.000 $0 $0 $0 $0 20% 20% 20% 30% 3.125% 2.75% 3.67% 3.50% JUMBO REVERSE MTG, 5* Yelp reviews. NO CLOSING COST LOANS are available. 3.125% 30yr Conf Fixed 2.875% $0 UW $0 UW $0 UW $0 UW 2.875% 2.875% 3.00% 3.375% 0.00 2.375% 2.375% 40% 20 Yr. Conf. Jumbo 15 Yr Conf. Fixed 30 Yr Fixed APR 3.00% 40% 40% 2.875% Product Rate Points Fees % Down APR 2.875% 30 Yr Fixed APR Reverse Mortgages Available up to $3 million Local News Advertising Audience Targeting Content Marketing Search Marketing Social Media Email Marketing Learn how 26+ home builders are currently benefiting from the Quantum Adtaxi campaigns Formoreinformationcontact: SandyLek at (925) 847-2135 or slek@bayareanewsgroup.com today! in partnership with We Simplify Digital Marketing for Home Builders Everywhere. Our solutions include: Website Building For more info, visit NewHomeFinder.news H2 BAYAREANEWSGROUP 111 Homes | Advertising Section