Utah Real Estate & Mortgage Blog

Confused about how to start making your home more comfortable & energy efficient?
Wondering how to prioritize your home improvements?

There is a special State of Utah program that is subsidizing 80% of the cost for a Home Performance Assessment!  For $100 (this assessment is normally $400-$500) you can find out how efficient your home is and take advantage of The Utah Home Performance Program with ENERGY STAR®.  This program offers a comprehensive, whole-house approach to home improvement that results in better energy efficiency, greater comfort and lower energy bills.

The Utah Home Performance with Energy Star program will pay up to $2,000 toward those improvements if you agree to choose the most cost effective options to reduce your fuel usage by 20%.

How Efficient is Your Home?

Analysts certified by the Building Performance Institute (BPI) visit your home to perform a Home Performance Assessment and provide a customized energy- and cost-saving action plan. If you choose to make energy efficiency improvements that achieve 20% energy savings using a program partner you may qualify for cash back on a percentage of the job cost, in addition to utility rebates and tax credits!

Here are 7 ways you might improve your home with this program.

1. Improve attic insulation

2. Improve air tightness of home “air sealing”

3. Properly use programmable thermostat

4. On demand tank-less water heater

5. 95% efficient furnace

6. New Energy Star rated fridge or dishwasher

7. New Energy Star rated windows

Participation Requirements

• Your home must be built prior to 2000
• Your home must be owner-occupied
• A 20% energy savings must be achievable in your home

Benefits of Making Energy Efficient Home Improvements

• Save money. Leave a smaller energy footprint.
• If you are selling your home, a favorable performance assessment might help you sell faster and for more money.
• Increase comfort. By making your home work as a system, you can stay cooler in summer and warmer in winter, and help eliminate drafty rooms.
• Get cash back. The Utah Home Performance Program offers cash incentives to help offset the cost of energy-saving home improvements. Based on your income level you could receive back either 50% or 80% of the job cost, up to $2000, after utility incentives have been deducted. You may also be eligible to receive state and federal tax credits on qualifying improvements.

Assessment Costs

The initial assessment is offered at a subsidized cost of $100 which is an out-of-pocket expense that you will pay the Analyst at the time of the assessment. When you receive the Final Assessment you will be expected to pay the fee up front but the Program will reimburse you for the cost, up to $400. This rebate is separate from the Program rebate.

Contact us at 801-792-5040

HUD recently removed the $100 down incentive to buy a HUD house.

Did you know that?    There’s no news of this on the internet.  No public announcement that states it no longer exists via any HUD website or any announcements to our local mortgage lenders and or Realtors.    I recently attended a HUD Home training course and learned of the change in person.

What is a HUD home?  It is a single family residence, 1-4 units, that had an FHA loan to secure the mortgage.  When these types of properties are lost to the bank in a foreclosure, they become HUD Homes.  You do not have to be a first time buyer to buy a HUD home.

Local mortgage lenders and Realtors®  probably believe this program is available.  Some Realtors® will begin to find out that their offers might be denied due to the recent change.  Do your homework, each state is different and other states may offer the program.   I had a client that was looking to purchase a home with this program.  I emailed him during the HUD training class to break the news.   Does your agent or loan officer know about this change?

The conversion of the HUD marketing and management contract had recently allowed the $100 down incentive to promote buyer interest for several years.  Now that HUD has transitioned to a new 2010  contract, they have decided to remove this incentive  in the state of Utah.

DON”T DESPAIR!   You can still buy a home with No Down Payment through our local Utah Housing Program.  HUD homes are still fantastic deals and in some cases ready to move in with little or no repair.  Also, my preferred lenders offer a 30 yr fixed rate loan that can include the rehab costs to fix or update the home.  You can make energy efficient changes, fix the leaking roof, replace the windows, etc with the same loan you use to purchase the property.

Contact me today if you would like to learn more about buying a HUD home OR if you have questions about the FHA rehab and energy efficient loan programs.

801-792-5040

Zoom Real Estate

Last month I wrote an article about interest rates.  On November 4th, 2010…my best lenders were offering 3.75% rates on a 30 year loan.  Six week later, rates are now 5% to 5.25%.  Keep in mind, that a 1% change in rates is almost equal to a 10% change in the price for a home.  Call me today if you are ready to get off the fence, and buy a home.

Before you do, you should check out the recently released Remodeling Cost vs. Value survey, done in partnership with the National Association of Realtors (NAR).

In general, anyone planning a home remodeling will pay a lot more for the job than they will get back in return when they sell. Only 60% of remodeling costs in 2010 would be recouped by homeowners, the report said.

Exterior improvements mostly performed better than interior ones, owing to the necessity of maintaining a home’s “curb appeal.”  Here are some of the highlights from the report.

HOW?

Three different lenders I work with contacted me today about home loan rates.  All three of them are able to do a 30 yr fixed rate FHA or VA  loan at 3.75% (apr 3.99%).  WOW!  With the loan rates getting even better today, you can save an estimated $72 a month (see example below).

Saving $72 a month on your Utah home payment is great, but how does $72 a month = $25,000 in savings?  Look at the total interest paid over the life of the loan as given in the example below.  In addition to the lower payment, you will save thousands in total interest paid.  What a great day to buy a home.

Interest Rate: 3.750% (3.99% APR)

Loan Amount: $250,000.00 ~

Term of the Loan: 30 years

Monthly mortgage payments: $1,157.79 ~

Total interest paid over the life of the loan: $166,804.04

VS.

Interest Rate: 4.25% (4.49% APR)

Loan Amount: $250,000.00 ~ Term of the Loan: 30 years  

Monthly mortgage payments: $1,229.85

Total interest paid over the life of the loan: $192,745.91

Buy more home today than yesterday.  Contact me today to find out more about these rates and loan programs. 801-792-5040

November Update on Utah Home Lending:

• There is money available as of November 4, 2010 for Down Payment Assistance (up to $10,000) throughout Salt Lake County.
• 100% financing programs available.  NO DOWN PAYMENT!
• $100 down payment HUD homes are available throughout Utah.
• Special Loan deferral programs are available in Salt Lake County (up to $20,000!)  No payment/No Interest on select homes.
• FHA rehab loans that allow you to buy a home through FHA and receive the money to rehab/repair a home at the same time.
• FHA  Energy Efficient Mortgages that allow you to update windows, appliances, furnace, hot water heater, insulation when you purchase a home.

If you have a steady job and decent credit, you may be a home owner before the end of the year.

801-792-5040

Look Up Your Loan

If your mortgage is owned by Freddie Mac or Fannie Mae, you could qualify for a Making Home Affordable Refinance and take advantage of the lower interest rates offered by the Making Home Affordable Program. Only mortgage loans owned or guaranteed by Freddie Mac or Fannie Mae are eligible. You can contact Freddie Mac or Fannie Mae directly by clicking on the links below and completing the forms for each company.

For Utah families in these current economic times, the dream of owning a home seems to be moving farther away. With expensive closing costs, a high down payment and other fees, some families don’t have the extra cash to get into a home. That’s when the Community Development Corporation and the Own in Murray program steps in to help.

In 2009, Murray City approved $25,000 from Community Development Block Grant funds to assist people who want to purchase a home in Murray. Qualified applicants received between $5,000 and $7,500 to help cover those extra out-of-pocket costs. For the current fiscal year, $49,000 has been set aside for Murray’s down payment assistant program.

Funding for the program is limited, so applicants are being encouraged to apply as soon as possible. Applicants must submit all required documentation, meet eligibility requirements, have a good debt-to-income ratio and meet income requirements depending on the number of family members working and living in the home. A chart listing income eligibility as well as a link to the application packet can be found on the Murray City website at www.murray.utah.gov.

Most down payment assistance loans have a zero percent deferred interest rate and for residents who stay in the home for 15 years, half of the loan is forgiven.

“I think we will be able to do seven loans this year,” Harper said. “If someone is looking to purchase a home, they should contact a Realtor with Zoom Real Estate for more information.”

In addition to the Murray City program, there are programs to help buyers in Utah County, Davis and Salt Lake County.  The money will not last long.  Contact Kris today at 801-792-5040 to learn more.

Is this a realistic headline?  No.

Everybody is looking for a deal, so there’s a lot of competition in purchasing distressed or bank owned properties.  Good deals often average less than 7 days on the market because they have been priced to sell fast.  There are many buyers who are pre-approved or have cash in hand, waiting for new home listings to be announced.  Don’t miss out because you are not prepared for what homes are selling for in the zip code you are searching.

What do I mean?

Let’s talk about unrealistic home buyers.

Naturally everyone wants to get the most home they can for the least amount of money. This is in opposition to the home seller, who wants the most money for their home. This conflict is one of the things that make real estate sales challenging at times.  When the market starts a shift in an opposing direction, this conflict stands out.  Starting back in 2006 the shift in Utah real estate was starting to occur.  It has been almost four years and it has been our experience that home sellers in Salt Lake, Utah, Davis, Weber, and Washington counties are becoming much more realistic.

While it used to be quite common to hear sellers say things like, “But my neighbor’s home sold for “x” dollars last year!” sellers seem to be getting more realistic when it comes to their home’s value.  They are letting go of the attitude that their home needs to sell for what their neighbor sold for the year before.  A year is almost an eternity in the Utah real estate market.

Home buyers on the other hand seem to be losing their grip on reality.  Yes, there was a time when buyers were able to get significant savings off of the list price. While there is room to negotiate, we have not seen low-ball offers succeed in our local markets.   We often negotiate price discounts up to 10% – 20%, anything more is unrealistic in Utah.   Our market has stabilized from past volatility.

Here are some examples of recent conversations we have had with Utah buyers:

* We’d like to offer $40K under list price on a $175,000 home.

* We just short sold our home last month and are looking to buy now.

* The bank is out of state and doesn’t  know what the property is worth, let’s offer $100,000 less.

* I need a smoking deal on a bank owned home or short sale. I’m willing to pay 60% of list price.

* I refuse to pay a dime over list price on a short sale or bank owned home.

The answer for all of those comments above is “you can’t do/get/buy that”.  You might be asking yourself “why would I pay more for a short sale or bank owned home?”  Because there are multiple offers from buyers who are all looking for a good deal.  These homes are typically priced below market value to induce multiple offer situations.    This is why these homes often sell for more than list price.

Much of this type of thing comes from simply not understanding what is happening in the real estate market. And by “the real estate market” I am not talking about what you hear on network news or even your local evening news / newspaper. You need to understand what the market is doing in the specific area you are interested in. The term “real estate market” is just too broad and real estate is local.

Our agents at Zoom would be happy to provide you at no charge, specific pricing statistics on local Utah zip codes or a specific property.

As a home buyer, you may not know the details and current trends about your local real estate market. Most people buy a home every 7 – 10 years. We are up to our necks in this stuff every single day. This is what we do for a living and helping people understand the details of their local real estate market is what we get paid for.

Give us a call today to discuss your local market. 

You may reach Kris, Zoom Real Estate Realtor at 801-792-5040

While 3.5% down is still available to home buyers who use FHA financing, the  Federal Housing Administration has announced changes to the popular home buying program.  The changes are being implemented to increase the FHA’s income and reduce the agency’s risk on these loans.   There was talk before this week’s announcement that the minimum down payment would be increased to 5% down.  For now, the minimum down payment will remain the same.

Announced FHA Policy Changes:

Mortgage insurance premium (MIP) will be increased to build up capital reserves and bring back private lending.
Up Front Mortgage Insurance is currently 1.75% of the loan amount.   After April 5th 2010, this is going to increase to 2.25%.  For a $180,000 purchase, this would cost a home buyer about $900 more.  In addition, FHA may increase the monthly mortgage insurance premiums later in the year.

Reduce allowable seller concessions from 6% to 3%.
Buyers that want a seller to pay their closing costs will be limited to a maximum concession no greater than 3% of the sales price.  This change is expect to occur by Summer 2010.

Update the combination of FICO scores and down payments for new borrowers.
Home buyers that do not have the required minimum FICO score may increase their down payment to 10% to compensate for the lower score.

If you have questions please call 801-792-5040