Mortgage

How Do Interest Rates Affect My Purchase Power?
How Do Interest Rates Affect My Purchase Power? 1024 536 patrickgardner
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Nothing affects a home’s affordability more than interest rates. After all, we live with the monthly payment, not the amount of the loan. The higher your mortgage rate is, the higher your monthly payments are going to be.

Buying power, simply put, is the amount of home you can afford to buy for the budget you have available to spend. As rates increase, the price of the house you can afford to buy will decrease if you plan to stay within a certain monthly housing budget.

The chart below shows the impact that rising interest rates would have if you planned to purchase a home within the national median price range while keeping your principal and interest payments between $1,850-$1,900 a month.

Buyers Purchasing Power
4.75 $2,086 $2,034 $1,982 $1,930 $1,878
4.50 $2,026 $1,976 $1,926 $1,874 $1,824
4.25 $1,968 $1,919 $1,869 $1,820 $1,771
4.00 $1,910 $1,862 $1,814 $,766 $1,719
3.75 $1,852 $1,806 $1,760 $1,714 $1,667
$400,000 $390,000 $380,000 $370,000 $360,000
-2.5% -5% -7.5% -10%

With each quarter of a percent increase in interest rate, the value of the home you can afford decreases by 2.5% (in this example, $10,000).

Act Now! Rates are at historical lows to help make the home you want accessible.

 

Principal and interest payments rounded to the nearest dollar amount. The information shown above is for demonstrative purposes only and does not include any additional fees like property tax, insurance, mortgage insurance, or HOA dues. This is an advertisement and not a guarantee of lending.

Happy Veterans Day
Happy Veterans Day. Thank You for Your Service.
Happy Veterans Day. Thank You for Your Service. 1024 536 admin
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$500.00 Lender Credit for Veterans1

You served our country. Now it’s time for us to serve you. We are proud to offer a $500.00 lender credit at settlement to any qualified Veteran, active duty U.S. Military member, Reservists and National Guard member who locks a loan with Vellum Mortgage during the months of November and December 2019.

About the VA Home Loan
The VA home loan helps Service members, Veterans, and eligible surviving spouses achieve the American dream of homeownership. The VA home loan typically requires no downpayment mortgage with no mortgage insurance required. With a VA loan you can buy or build a home, or refinance an existing home mortgage.

If you’re thinking about buying a home or refinancing, contact me for more information. We look forward to serving you!

 

1. This product or service has not been approved or endorsed by any governmental agency, and this offer is not being made by an agency of the government. Additional qualifying requirements and restrictions apply based on specific loan type. Lender credit offer available for purchase and refinances with submission of DD-214. This advertisement must be referenced at least 7 days prior to closing to receive this promotion. Loan must be locked between November 1, 2019 through December 31, 2019 but the loan may close any time within 90 days of application. The lender credit may not result in cash back to the borrower at closing. This is not a promise to lend. 11/8/2019.

101% Financing, No Mortgage Insurance
101% Financing, No Mortgage Insurance 1024 536 nathanburch
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101% Yours.

Owning a home is the American Dream! Whether you are a first-time buyer or moving up, we’ve made it easier than ever to get into a new home…even helping with closing costs.

We are able to finance 101% of your sales price, meaning you could potentially have no down payment and an extra one percent of the sales price towards your closing costs. All of that and no mortgage insurance.

  • No Mortgage Insurance
  • Credit score as low as 660
  • Financing up to $726,525
  • DO NOT have to be a first-time homebuyer
  • Max 1% contribution (closing costs)
  • Possible financing options up to 105%
Contact us for more information and make your new home 101% Yours!

 

Income limits are specific to the area you are looking to purchase. Must be your primary residence. Program not available in all states. Not all applicants will qualify. 4% of the lessor of the purchase price or appraisal with no dollar cap for down payment and closing cost assistance. Second interest only rate matches the first mortgage rate. Maximum 105% LTV with a 3rd DPA. Terms and conditions apply and requirements can change at any time. This is not a commitment to lend.

What is mortgage insurance and how does it work?
What is mortgage insurance and how does it work? 1024 536 patrickgardner
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Mortgage insurance lowers the risk to the lender of making a loan to you, so you can qualify for a loan that you might not otherwise be able to get. 

Typically, borrowers making a down payment of less than 20 percent of the purchase price of the home will need to pay for mortgage insurance. Mortgage insurance is also typically required on FHA and USDA loans. If you are required to pay mortgage insurance, it will be included in your total monthly payment that you make to your lender, your costs at closing, or both.

There are several different kinds of loans available to borrowers with low down payments. Depending on what kind of loan you get, you’ll pay for mortgage insurance in different ways:

Conventional Loan

If you get a conventional loan, your lender may arrange for mortgage insurance with a private company. Private mortgage insurance (PMI) rates vary by down payment amount and credit score but are generally cheaper than FHA rates for borrowers with good credit. Most private mortgage insurance is paid monthly, with little or no initial payment required at closing. Under certain circumstances, you can cancel your PMI.

Federal Housing Administration (FHA) Loan

If you get a Federal Housing Administration (FHA) loan, your mortgage insurance premiums are paid to the Federal Housing Administration (FHA). FHA mortgage insurance is required for all FHA loans. It costs the same no matter your credit score, with only a slight increase in price for down payments less than five percent. FHA mortgage insurance includes both an upfront cost, paid as part of your closing costs, and a monthly cost, included in your monthly payment.

If you don’t have enough cash on hand to pay the upfront fee, you are allowed to roll the fee into your mortgage instead of paying it out of pocket.  If you do this, your loan amount and the overall cost of your loan will increase.

US Department of Agriculture (USDA) Loan

If you get a US Department of Agriculture (USDA) loan, the program is similar to the Federal Housing Administration, but typically cheaper. You’ll pay for the insurance both at closing and as part of your monthly payment. Like with FHA loans, you can roll the upfront portion of the insurance premium into your mortgage instead of paying it out of pocket, doing so increases both your loan amount and your overall costs.

Department of Veterans’ Affairs (VA) Loan

If you get a Department of Veterans’ Affairs (VA)-backed loan, the VA guarantee replaces mortgage insurance, and functions similarly. With VA-backed loans, which are loans intended to help service members, veterans, and their families, there is no monthly mortgage insurance premium. 

Second Mortgage

When using a second “piggyback” mortgage,the loans are structured differently.  For example, the same borrower might pay for the home with: a 10 percent down payment, 80 percent main mortgage, and a 10 percent “piggyback” second mortgage. In this scenario, the borrower is still borrowing 90 percent of the value of the home, but the main mortgage is only 80 percent.  The “piggyback” second mortgage typically carries a higher interest rate, which is also often adjustable. 

Contact us if you have any questions or your like to know what you what your financial situation looks like!

Source: Consumer Financial Protection Bureau (CFPB)