Utah Home Mortgage Specialist

But don’t want to refinance?

Homeowners looking to lower their monthly mortgage payments and also save some on interest may be able to do so without refinancing. 

By using a little-known strategy, called “recasting,” or “re-amortization,” that may be available through some mortgage lenders and servicers. It involves paying off a lump sum of the principal amount and asking to have the monthly payments reset according to the original interest rate and loan terms. The lump sum reduces the principal, so your new monthly payments decrease slightly and you save on interest paid over the life of the loan.

One of the primary appeals of recasting is that it typically involves a small fee ($150) and doesn’t require the credit requirements of refinancing.

Edward Ades, the owner of Universal Mortgage in Brooklyn, says recasting can be especially useful to recent buyers, for whom it makes little financial sense to refinance but who expect to receive a tax refund or other substantial money after closing on their property, like proceeds from a relative’s sale of property, stocks or other assets.

If your interest rate is 5 percent or lower, Mr. Ades added, it may not make sense to recast a loan, because the extra cash could be put into an investment with a higher return. “At the end of the day,” he said, “I always tell people they have to do whatever makes them sleep better.”

To learn more about recasting and if it right for you give me a call.  801-815-5802

Even if you can’t afford an interior designer, you can decorate successfully. Before starting a project, determine your style preferences. If you have trouble coming up with great ideas, check out decorating shows and collect tear sheets from magazines. For best results, create a budget and focus on one room at a time. Here are top designer tips to help turn your home into a haven:

1. Before beginning a project, have a plan;
2. Mix high-end & affordable pieces;
3. Purchase well-made furniture with interesting details or classic lines;
4. Splurge on furniture that gets a lot of use;
5. Avoid being too trendy;
6. Don’t over-accessorize;
7. Use accessories that draw the eye to a room’s focal point;
8. Don’t let furniture hug the walls;
9. Angle sofas to make rooms appear larger;
10. Arrange furniture for easy access & movement;
11. Add the illusion of space by keeping part (or all) of the floor visible;
12. Everything doesn’t have to match;
13. When mixing styles, choose pieces that visually balance each other;
14. Paint can refresh, revitalize or completely change a room’s look;
15. White is classic but color creates depth & interest;
16. Choose a hue that suits you, your family, and lifestyle;
17. Blue and green rooms are calming & relaxing;
18. Dark colors make a room seem smaller;
19. Light colors make a room seem larger;

Paint ceilings two shades lighter than walls for small rooms to feel airy & spacious.

Exciting News for Veterans!

The First Time Home Buyer and Long-time Resident Tax Credits have been extended for Military Personnel and certain Federal Employees.   Here are the basics:

• You must have been on active duty outside of the US for 90 days during the period beginning after Dec. 31, 2008, and ending before May 1, 2010.
• The home needs to be under contract by April 30, 2011
• You need to be closed by June 30, 2011
• You must been either a First-Time Home Buyer or Long-Time Resident 

Those are the basics of this new law.  If you have any other questions feel free to go to the IRS website and see the all the rules and restrictions.

I’ll see you at closing!

Interest rates have enjoyed record lows during the last few years allowing many people to refinance and enjoy lower home mortgage payments. Now, interest rates are beginning to move in the other direction. 

Why would anyone refinance when rates are going up? With cash-out refinancing, you refinance your mortgage for more than you owe and keep the difference.

1. Pay off home equity credit lines. Most HELOC loans have variable rates that go up when the Federal Reserve raises short term interest rates. Recently, the Federal Reserve announced its first rate increase and they sent out a strong message they will continue the short term interest rate increase. Using a refinance to pay off a HELOC not only will lower your existing HELOC interest rate, but you can stop worrying about the Fed …for your second mortgage at least.

2. Consolidate your mortgages.  Unless you put 20% or more down on your home, there is a good chance you did a combination (or piggyback second mortgage) loan to avoid PMI (Private Mortgage Insurance) which is required on loans with less than a 20% down payment. Second mortgages typically carry higher interest rates and a cash-out refinance may allow you to consolidate these loans into one lower monthly payment. Even if you need to pay PMI it may be a less expensive monthly payment overall.

3. Secure A Fixed Rate Mortgage. Rates for adjustable mortgages, which are sensitive to Fed moves, may rise faster than fixed rate mortgages. Borrowers with loans close to a rate adjustment are facing an increase in monthly payments and the possibility of even higher rates down the road. Many borrowers who plan to stay in their homes are fending off the higher rates and potential future increases by refinancing into fixed rate mortgages.

4. Improve Your Home. Home Equity Lines of Credit and fixed rate second mortgage rates have been rising. A cash-out refinance can prove to be a cheaper way to finance your home improvement, especially as the cost of the improvement increases.  Improvements made after the refinance may lead to even greater increases.

While many people will no longer be interested in refinancing for a lower rate, there are many reasons to consider refinancing even as interest rates increase. If you have an existing second mortgage, need cash to consolidate credit card debt, or want to do some home improvements, refinancing your current home mortgage may be the best financial move for you. For more information regarding current rates contact me now.

Mortgage rates are rising as the markets believe the Federal Reserve will raise the interest rates higher.  Rates on 30 year mortgages are predicted to raise 0.50 to 1%  by the end of this year.  This is the highest rates we have seen in the last couple years.

Some analysts believe that new home sales will decline as the interest rates rise.  But as economic conditions improve and business activity improve we are also susecptible to inflation. Kansas City Fed President Thomas Hoenig argued at the Fed’s most recent meeting last month that the promise of low rates risks creating new bubbles in financial markets and lays the groundwork for unacceptably high inflation. He suggested that raising the federal funds rate “modestly higher” soon would lessen those risks.  But raising these rates will put pressure on home mortgage interest rates.

Leading economists are upbeat about the U.S. recovery, forecasting steady growth over the next two years as businesses grow and jobs return.  Manufacturing is improving at a slower pace.  Retail Sales have steadily increased.  Economists believe improvement in sales and profits will cause companies to put out the hiring signs relatively soon.

As jobs return, so will consumer spending, which should rise by 2.2% in 2010 and then climb 2.8% in 2011. These relatively small gains can be attributed to the fact that Americans are still feeling financially conservative.  Overall, economists believe we are on a fairly healthy growth track and there will be no double dip recession.

I am hoping the market recovery continues and we avoid more economic slowdown and inflation.