Each week take time to read these short question and answers with local lenders, builders, investors and local businesses to get different perspectives on the local real estate market. We're thrilled to have Bridget Jones, Missy Johnson, and Patty Broome from Citizens Bank in Ada as our experts this week. Let's dive into some questions to gain valuable insights into the local real estate market.
Bridget: Economists disagree on how many times the Reserve may decrease rates, but they do agree that they will decline this year. Most economists think there will be 3 decreases in the short-term rates. This will affect rates on credit cards, car loans, money market accounts, etc. Mortgage rates are tied more closely to the 10-year bond yields. They are also expected to decline and have actually already begun coming down some. Mortgage experts predict rates in the 5.25-6.75 range in 2024, with greater declines nearer the end of the year.
Bridget: Visit with a trusted mortgage lender first! An easy online application, and a review of your credit, income and asset documentation will give you an approval most times the same day so you can better know what you can buy.
Bridget: The USDA program is always a good one for those with no cash saved toward a down payment. Additionally, we offer bridge loans so you can buy your new house without selling your old one, and still take advantage of the equity in your current home. We do one-time construction loans which saves the borrower from doing two loan closings and have two sets of closing costs. There are also several Down Payment Assistance programs we offer through OHFA and REI which provide additional funds towards down payment and closing costs for qualified buyers. And of course, we offer the standard conventional, FHA and VA loan products.
Bridget: When locking a rate, borrowers can choose to pay “points” (sometimes called an origination fee or origination charge) or not. Paying 1 point = 1% of the loan amount, and generally equates to a rate about .25% lower than with NO points. On a $285,000 loan, based on today’s 30-year rates and terms, with NO points, a borrower can plan on there being about $4500 in closing costs, plus an additional $3000-$4000 for the first years’ homeowners insurance premium and setting up the escrow account. On a $100,000 loan, with no points, the borrower can expect to pay about $2500-$3000 in closing costs and $2000-$2800 for the insurance and escrow.
Bridget: 1. Do not make any significant life changes or purchases, such as changing jobs, trading in an auto and getting a new car loan, buying furniture on credit, etc. 2. It may seem like the lender wants to see SO many things, but it is all to document the file according to the FannieMae/FreddieMac/HUD/USDA/VA guidelines. Be detail-oriented and diligent about getting them the needed documentation in a timely manner! 3. Compare 2-3 lenders rates and fees, and STAY LOCAL! Local lenders not only know the appraisers, realtors and title companies to make your transaction go more smoothly, but they have a VESTED INTEREST in our community and will ensure the best service.
Sarah Jane Johnson is a local realtor associate at Gray Real Estate Elite. She lives in Ada with her husband, and has enjoyed raising her four children in the Ada. Promoting the Ada area through community involvement and helping people buy or sell properties is her passion. Buying or selling? Call Sarah Jane at 918-541-5265.
Ready to make your next move in Ada or beyond? Let Sarah Jane Johnson put her expertise, heart and hustle to work for you. Whether it's a dream home, commercial space or wide-open acreage, she's got you covered.