FHM logo white
Apply Now

Category: Real Estate Advice

Categories
Home Selling Advice Real Estate Advice

5 Ways to Increase Your Home Price in Northern Virginia

African Professional Chartered Accountant Woman Doing Tax

When you make the monumental decision to sell your home, the preparation phase is crucial. You’ll want to explore every possible avenue to maximize your value. Avoid the pitfall of setting an unreasonable listing price. Instead, there are steps you take to organically increase your home price in Northern Virginia. Each strategy can be utilized during the home prep process. Always give yourself adequate time to complete them. With these five methods, you’ll have a better chance of selling your home for more.

1. Kitchen Remodel

When making any attempt to increase your home price in Northern Virginia it is important to consider the return on investment. For example, if your kitchen remodel comes at a cost of $20,000 but only raises the value of your home by $10,000, it will not be worth it. Kitchen remodeling is, however, a great way to add value to your home if done correctly. Start small and keep in mind that your purpose for remodeling is to add value and not to please personal preference. Making small changes and modernizing kitchen equipment such as faucets, cabinet hardware, LED lights, etc. are proven methods of increasing the value of your kitchen without breaking the bank. Updating outdated cabinetry or countertops will cost more initially but will cause the value of your home to increase. If you don’t want to replace the cabinetry or countertops, a fresh coat of paint can go a long way.

2. Usable Square Footage Additions

Home price in Northern Virginia is determined by a variety of factors with one of the main considerations being how much livable square footage the home contains. Real estate appraisers will factor the square footage into their home value equation. The square footage factor is more important than other aspects of the home appraisal and will go much further in increasing your home’s worth. While home additions are far from the most affordable option, they can significantly increase the value of the home. Based on your financial standing, you can consider adding a room addition, an extra bathroom, a deck, or even an entire guest suite. 

3. Energy Efficiency Improvements

Energy-efficient improvements save money by reducing the homeowners’ monthly energy expenditure. This added feature can entice prospective buyers that know that their monthly energy bill will enjoy a reduction based on the features that you installed. These upgrades can be affordable as well, meaning your return on investment is protected. To boost your home’s energy efficiency, consider buying a smart thermostat, a renewable energy water heater, or energy-efficient lighting. Beyond these more substantial upgrades, you can make a relatively inexpensive upgrade by resealing or replacing leaky windows, adding insulation, or adding weather stripping to doorways.

4. Maximize Curb Appeal

Being the first thing that an appraiser sees, the curb view of your home should be curated to please the eyes. Your home’s external appearance plays a major role in your home’s value and should not be overlooked. To increase your curb appeal, upgrade your landscaping, maintain your lawn, keep the paint on your home fresh and powerwash or replace your front walkway. 

5. Bathroom Upgrade

One of the safest investments you can make when attempting to increase the value of your home is the bathroom. Similar to the kitchen remodel, make smart changes that are not overly expensive. New lights and faucet fixtures go a long way in modernizing your bathroom. Putting in new grout is simple and can easily be a D.I.Y. The same is true with a fresh coat of paint. If you want to increase your home price in Northern Virginia, but are hesitant to invest a relatively large amount of money, the bathroom is a great place to start.

Get The Most Out Of Your Home Sale

At Federal Hill Mortgage, we strive to make the mortgage process benefit you and will proficiently guide you toward getting the most value out of your home sale. Our mortgage experts will offer transparent advice every step of the way and ensure that you take advantage of every value-increasing opportunity available. Enjoy comprehensive mortgage services from one of Northern Virginia’s highest-rated mortgage brokerage firms, Federal Hill Mortgage. Call or contact us today to get started!

Categories
First-Time Buyers Real Estate Advice

How to Choose the Right House as a First Time Home Buyer in VA

Roadside farmhouse house in countryside rural road highway in West Virginia, USA by mountain forest with colorful autumn fall trees foliage at sunrise morning

Purchasing a new house is an exciting experience that marks a major accomplishment a for first time home buyer in VA. This excitement can easily lead an inexperienced buyer into a home that seems great but, in reality, is far from the right choice. Buying a home is a long-term investment and to preserve that investment, one must find a balance between wants and logical, realistic needs. By going over several key factors that are easily overlooked, first time home buyers in VA stand to make a decision on a home that will be the right one for them.

Location

downtown Richmond VA

Location is by far the most important factor that should be considered by a first time home buyer in VA. As the most valuable asset in a home purchase, the location of the home is one that the buyer does not have as much control over improvement as they would with the actual home. When looking for a beneficial location, evaluate the local schools, the neighborhood, and any taxes, dues, and fees associated with the location of the home. If these categories check out then it is a solid indicator that the land value will not decrease. 

Size & Space to Expand

When considering a home’s size for long-term residence, try to imagine any expansions you might want down the line. For these expansions, you are going to need to have the space for them. This can be space for furniture such as dining tables or beds or a garage for storage. If you have other people living with you or if are expecting to have more in your home, you are going to want to make sure that the available space is appropriate for the number of residents. In short, make sure all of your things fit and if you plan on making future expansions, make sure you have the space to expand.  

Renovations

If you are planning on purchasing a home, it is very important to consider the renovations that will be required to bring the home up to your preferred standard. Try to imagine yourself living in the home and take notice of anything that would bother you or that you would like to be updated. It is crucial to be able to know what renovations you will be able to do yourself and which renovations you would have to hire a professional contractor for. Also, be sure to have realistic expectations for the true potential of the home, and don’t let your imagination consume this reality. Renovations can raise a home’s value and make the resident happier with the home but, if the resources and money required to make these necessary renovations outweigh the worth it adds, it might be best to look at other options.

Luxuries to Consider

Luxuries are things that come with a home that is not necessary for occupation and instead add a level of convenience or comfort to a residence. For some, certain luxuries might be a necessity. Being able to determine if a home feature is a luxury or a necessity will assist you in deciding if that home is right for you. For example, some first time home buyers in VA must have adequate parking while some view it as an unnecessary luxury that just boosts the sales price of a home. When deciding if a residence will be able to make a good home for you, be sure to contemplate if the luxuries that come with the home are important to you.

Purchase Your First Home With Federal Hill Mortgage

First time home buyers in VA have a lot to consider when deciding on their first home. Finding the right balance between a solid investment and a home that you are comfortable in is key in choosing your first home. With it being your first experience in purchasing a home, having a team of mortgage professionals guiding you through the process serves as an invaluable asset. If you are a first time home buyer in VA, contact the team at Federal Hill Mortgage to get expert real estate guidance and the professional assistance you need to get an advantageous deal on your new home. Want to learn more? Check out our reviews.

Categories
Home Buying Advice Mortgage Education Mortgage Rates Real Estate Advice

Learn With Mortgage Brokers in Bethesda: Should You Lock in a Mortgage Rate Right Now?

happy couple moving into home
Young mixed ethnicity couple taking a break on moving day into new home sitting on floor in lounge drinking coffee surrounded by removal boxes

In 2022, we are currently experiencing unusually high mortgage rates. As a result of a multitude of factors, high-interest rates greatly affect buyers in the long term. Several avenues exist to mitigate risk with this jump in high-interest rates such as an interest rate lock. Being nearly impossible to predict, interest rates could rise in favor of the lender or decrease benefiting the borrower, meaning that the risk of an interest rate lock is present for both parties. When working with mortgage brokers in Bethesda, be sure to understand all of the factors that go into a mortgage rate lock and conduct thorough research into whether a rate lock is right for you.

What is a Mortgage Rate Lock?

A mortgage rate lock is when your rate is locked in between the time you make your offer and closing. If you close within the rate lock period, you should incur no charges. A rate lock can secure you a good rate if one to your standards is available at that time, but a rate lock will also prevent you from securing a better one should the rate decrease. Interest rates rapidly fluctuate, therefore, locking in an interest rate can help you better plan for future mortgage costs. A rate lock can be a useful tool or a financial risk, depending on how they change during the course of your mortgage.

Common Questions About Mortgage Rate Locks

What is the Rate Lock Period?

Typically, mortgage lenders in Bethesda will offer a rate lock period between 15 and 60 days. If you require a longer rate lock period, it will end up costing more and only some lenders offer this option. Closing before the rate lock period ends prevents this additional charge. 

What is a Float-Down Option?

A float-down option allows borrowers to access lower rates if they decrease during the rate lock period. Float-down options are only offered by some mortgage brokers in Bethesda and may only be applicable if rates drop considerably. There is no way of telling which way rates will change so this option can be an extremely beneficial option or a wasteful expenditure. Deciding on a float-down option should reflect your individual financial situation.

Are Their Fees Associated with a Mortgage Rate Lock?

Depending on the lender, short-term rate locks should be available with no fee if you close within the allotted time. What does come with an additional cost is extending the time that your rate is locked in. Typically, this fee is based on a percent of the loan.

Benefits of a Mortgage Rate Lock

Lower Cost

If you are satisfied with your current mortgage rate, locking in your rate usually comes at no extra cost, depending on the lender. 

Risk Reduction

Interest rates are far too common, especially in recent years. Locking in your rate reduces the chances that you will be subject to a jump in interest rates. While a rate lock avoids rate hikes, they also avoid better interest rates if you don’t have float rate provisions in place.

Risks of a Mortgage Rate Lock

Stuck with a Relatively High Rate

The biggest risk of interest rate locks is missing out on lower interest rates, should they decrease. While some options are available for mitigating this risk, not all lenders offer them. Discuss your options with your Bethesda mortgage broker before you finalize any plans to lock a rate.

Fees for Locking Rates

Fees differ between lenders but typically you can expect to pay a rate lock fee for terms longer than 30 days. Rate lock extensions are also usually available, also with a fee attached. These fees can be considerably lower than the overall cost of ending a rate lock term within 30 days.

Rates Dropped After You Locked in Your Rate, Now What?

Mortgage brokers in Betheda using pen to for client to sign document.

Go Over Your Options With Your Lender

If rates decrease well below what you locked in at, don’t panic. The first thing you need to do is to discuss your options with your Bethesda mortgage broker. There are routes you can take to decrease your interest rate such as changing to a shorter loan term but the rates will still be calculated off of the rate that you locked in at. Before you lock into a rate, discuss these potential options with your mortgage broker in order to have a plan in place should this occur.

Allow Your Rate Lock Term to Run Out

This option greatly depends on the seller of the home you are trying to purchase. If they are inclined to delay closing until the rate lock runs out then your broker would take your new rate based on the current one and not the one you locked in at. Allowing your rate lock to run out is tricky to navigate as it greatly depends on the willingness of the seller and the lender to accommodate your requests. 

Find a New Lender

If all else fails and the new rate is low enough to justify the costs, switching to a new lender might be your best and only remaining option to avoid your locked-in interest rate. This will inevitably cause a delay in closing and potentially mean you lose out on that particular home. Additionally, all appraisal fees paid to the original lender are lost. While this can be a difficult route to pursue, it can be a saving grace if conducted properly.

Experience the Difference of Working with Expert Mortgage Brokers in Bethesda MD

Locking in your mortgage rate should be a decision based on a variety of factors unique to your individual situation. Because it is nearly impossible to predict the trends of interest rates, deciding to lock in a rate comes with as much risk as it does security. Deciding if you should lock in or not depends on your available options should interest rates decrease. If you are satisfied with your current interest rate, a rate lock would work in your favor. If you are anticipating and hoping that interest rates fall within the time of your mortgage, an adjustable rate might be better for you. It is highly recommended that one becomes familiar with all of their potential options before taking on a locked rate mortgage.

When taking on a mortgage, having a professional broker on your side can prove to be invaluable. The team at Federal Hill mortgage will be by your side through every step of the process and ensure that you are aware of every possible option at your disposal. Apply now to get started!

Categories
Mortgage Education Mortgage Rates Real Estate Advice

Learn With Mortgage Brokers in Rockville MD: Is the Sellers Market Cooling Off?

Luxury Home Exterior at Night: Beautiful New House with Green Grass and Landscaping at Twilight.Has Covered Porch and Glowing Interior Lights.

It’s no secret that the economic crisis resulting from the COVID-19 pandemic has wreaked havoc on the global economy. One of the consequences of this economic turmoil has been the massive effect it has had on the domestic housing market. Since the lockdown began at the beginning of 2020, housing prices have consistently increased and those selling have enjoyed a seller’s market. While many people have sold their homes for a large profit, many people looking to buy are left asking when it will end? Learn with mortgage brokers in Rockville MD to find out where the housing market is now and where it is predicted to head in the coming months.

Sellers Market vs. Buyers Market

A seller’s market is when the housing market has ideal conditions for someone to sell their house and a buyer’s market is when the market sits at a place where buyers benefit. Typically, a seller’s market comes with high-interest rates, and when houses sell for more than they were previously worth. In our current seller’s market, homeowners selling their homes almost always receive more than the asking price. Not only are they selling for more but they are selling quicker. On average, homes last only 20 days on the market. A buyers market, on the other hand, is when the supply is greater than the demand, interest rates are low and homes can be negotiated for below the asking price. The market swings back and forth meaning that due to the conditions of the seller’s market, a buyer’s market will begin to emerge.     

Current Stats

By looking at the current statistics of the housing market, we can develop a much better understanding of where it stands now and where it can be predicted to go. Rockville MD mortgage brokers are always breaking down the statistics to gain an idea of where the market is heading.

  • Total New Net Listings: 4.2% Decrease versus 52 weeks prior
    • A net listing is when the owner sets a minimum amount that they wish to receive for their unit and allows the broker to collect a commission if the unit were to sell for a higher price.
  • Monthly New Net Listings: 11.6% Decrease compared to May 2021
    • How many new net listings there are by the month. Tracking this by the month allows for Rockville MD mortgage brokers to get a better understanding of where trends are heading.
  • Monthly Contract Volume (Single Family Detached Homes): 10.9% Decrease year-over-year
    • The monthly contract volume is how many homes are sold in that specific month. In this case, there was a 10.9% decrease in the number of homes sold that month compared to the years prior.
  • Median Listing Price: 12.7% Increase year-over-year
    • The median listing price is in the middle of the range of house prices currently available. When this number rises it means that homes have gotten more expensive.
  • Median Closing Price: 14.4% Increase year-over-year
    • A 14.4% increase in median closing price is evidence that homes are closing at a higher price than they did in previous years.

Mortgage Rates 

When the pandemic occurred, lenders dropped interest rates to attract more buyers. Since then, this trend has done a complete 180. In a move to combat rising inflation, the Federal Government has raised interest rates by 0.75%, the largest rise since 1994. This has caused the average interest rate to rise to just under 6% for a 30-year fixed-rate mortgage. The last time that interest rates were above 6% was during the 2008 housing crisis. The mortgage rates are expected to remain high in the coming months and may even continue to rise.

Inventory 

Typically, an increase in mortgage rates would deter buyers and thus increase the available inventory. However, the available inventory is yet to show any signs of increasing, indicating that the inventory levels will remain low for some time. New listings are down 7% since last year marking their 21st consecutive annual decline.

Home Prices 

The median home sale price has increased 17% year-over-year and homes are consistently selling for more than the asking price. This year homes only stayed on the market for a median of 18 days as opposed to the 26-day average it took last year. Hopefully, as interest rates rise, home prices will decrease. Already, mortgage brokers in Rockville MD have seen 13% of homes dropping their listing price in the past four weeks, an indicator that the seller’s market is cooling off. 

Where is the Market Headed? 

Before the pandemic, these observations would leave a well-versed Rockville MD mortgage broker optimistic about the housing market’s future and lead him or her to believe that the seller’s market is cooling off. Now, in the post-pandemic economy, it is a lot harder to make these assumptions and estimates due to the unprecedented nature and irregular fluctuation of the market. The biggest indication that the seller’s market is ending is that home prices are beginning to show signs of decline in the spring months which would normally see an uptick in price. While irregular, it does not make up for the severe lack of inventory. Without an abundance of homes, the competitiveness of pricing is lost. The disparity between supply and demand continues to exasperate the seller’s market and with the anticipation of rising mortgage rates, the time for a buyer’s market is still well off. 

Mortgage Brokers in Rockville MD Here for You In a Challenging Market

While the market is ripe for sellers to make a healthy profit on their homes, it has yet to sway in favor of buyers. The market constantly fluctuates and with new governmental implementations on the way, a lot is bound to change over time. The best thing that a homebuyer can do in a seller’s market is to find a Rockville MD mortgage broker that will use their expertise to assist in finding the best deal and rates available. At Federal Hill Mortgage, we use over a decade worth of experience to grant our clients the absolute best mortgage possible. Contact the #1 mortgage broker on the east coast, Federal Hill Mortgage and see the difference.

Categories
Home Buying Advice Real Estate Advice

Learn With Mortgage Brokers in Columbia MD: Tax Advantages and Fees

Buying a home is a major financial endeavor that can turn into a valuable investment or a costly expenditure. Finding your range of affordability means so much more than simply just comparing income to the listing price. There is a long list of factors that affect the cost of owning a home. Some of these can save you money if properly utilized while others can quickly become a burden if not fully understood. Correctly using tax rebates and advantages grants homeowners easy financial relief. Understanding these expenses proves to be just as crucial in reducing how much you are spending. Professional mortgage brokers in Columbia MD should go over these costs with you if prompted but it always helps to know more as a homebuyer. 

Tax Rebates

Tax rebates and deductions are a fantastic way to save money when purchasing a home. There are a variety of available options that have specific credentials needed to qualify. By claiming these advantages on your annual tax returns, you can significantly reduce your financial expenditure. Work with your Columbia mortgage broker to explore all of the tax rebate options that apply to you.

Mortgage Interest Deduction

With a mortgage interest deduction, a homeowner has the ability to deduct the interest they pay on their mortgage every year from their taxes up to the first $1 million of their mortgage debt. In addition to the mortgage interest deduction, there are a variety of options available for first-time homeowners such as grants and down payment assistance programs.

Mortgage Insurance Deduction

New homeowners that earn up to $100,000 annually can deduct their mortgage insurance premiums from their tax returns. There is a reduced deduction amount for those who make from $100,000 to $109,000 however if your annual income is over $109,000 you will not qualify for a mortgage insurance deduction.

Tax-Free Profits

If you are able to sell your home for a profit, your capital gains are safe from taxes if you qualify. The profits gained are tax-free up to $250,000 for those registered as single and up to $500,00 for a married couple. The only catch is that the home you sold must have been your primary residence for 2 out of 5 years before the sale date in order to qualify.

External Expenses

Now let’s take a look at some of the external expenses and fees that come with a mortgage agreement outside of the principal and interest payments.

Property Taxes

The average Maryland property tax rate is 1.06% of your home’s assessed market value and is to be paid monthly. The amount you pay will remain relatively consistent but should always be calculated into your monthly spending. The amount of property tax paid depends on your house’s size, construction type, age, location, and means of use. 

Homeowners Insurance

Homeowners’ Insurance is one of the most important expenses when buying a home. Paying the monthly insurance premiums can become tedious but when disaster strikes you will be more than happy to have your bases covered. Homeowners’ insurance can be used as a valuable asset to leverage certain situations. The levels of homeowners insurance range from HO-1 to HO-8. HO-3 is the most common homeowners insurance used today and has a broad range of coverage. HO-5 is the most comprehensive and second most common for single-family dwellings. The other levels of homeowners insurance are specialized for specific situations and different types of residences such as condominiums and rentals. Be sure to discuss with your Columbia Maryland mortgage broker as to which homeowners insurance is a proper fit for you.   

Other Expenses

When you are planning out your monthly expenses it is important to consider everything possible and allocate financial resources to accommodate. Along with mortgage payments, homeowners insurance and property taxes are the day-to-day expenses of owning a home. Homeowners associations could charge a monthly fee. Routine maintenance is key to maintaining the property in order to avoid letting small problems grow into costly repairs. Monthly utilities such as HVAC, water, and electricity should all be considered with room for error left due to the fluctuating nature of these bills.

Work With Expert Mortgage Brokers in Columbia MD

Having someone in your corner who is educated in mortgage brokering proves to be an invaluable asset that will guide you through a beneficial and successful homebuying experience. By using all of the available advantages such as tax deductions and rebates, home buyers can save large sums of money and in turn make the whole process much more affordable. At Federal Hill Mortgage we work closely with our clients to ensure that money is saved wherever applicable.  Contact us to get in touch with Maryland’s top mortgage broker service, Federal Hill Mortgage.

Categories
Home Buying Advice Real Estate Advice

Renting vs. Buying: Why Buying is Better

Bowie MD home
A perfect neighbourhood. Houses in suburb at Summer in the north America. Luxury houses with nice landscape.

At first glance, a mortgage might seem like a daunting and expensive option. A basic monthly payment could appear to be the simple and stress-free solution to finding a residence. One may not know anything or very little about how a mortgage works. Perhaps they retain the false notion that they would be better off in the long run if they avoid the alleged complexity attached to mortgaging a home. The truth is, a mortgage is a much more valuable and affordable option in the long term as opposed to renting. The extra “complexities” quickly change to potential benefits when working with a professional mortgage broker who explains and formulates an appropriate plan specific to the client’s financial status. Having a mortgage provides you with credit options and a potentially generous return on your investment. Renting will give you an immediate residence but leave you empty-handed when you decide to leave. In preparing for future financial stability, it is important to consider renting vs. buying, and which is the wisest decision for the long term. 

Long Term Investment

It is vital to understand the value of the long-term investment that comes with taking out a mortgage. With options such as refinancing and equity, a mortgage is a flexible and highly useful tangible financial resource in procuring long-term gains. While property values constantly fluctuate, over long periods of time, they have steadily increased across the country. With the most common type of mortgage being a 30-year fixed-rate loan, the value of the home has a large foreseeable increase by the time the mortgage term ends. Also, with consistent monthly payments and stabilized interest rates, this option comes with a reliable level of predictability. Consistency is crucial when considering renting vs. buying. 

 Once the initial loan is paid off, homeowners have the ability to use their home as a tangible asset. Home equity can be used to finance remodeling projects or even as credit for business investments. The benefits of building equity can prove to be crucial in gaining a sustainable and progressive financial situation. Home equity is built and increases as payments are made and the amount reflects the property’s market value. It can be utilized as an invaluable source of funds when establishing long-term financial health, making it easier to get a future home loan or a loan on a vehicle. These options are simply nonexistent with renting. At the end of a rental period, monthly payments that you have exhausted remain with the landlord, leaving you with no equity built and no residual finance options. While the mortgage is still active, several financial resources and lines of credit attached to the mortgage exist should the necessity arise. 

Credit & Loan Options

A widely accepted misconception about mortgages is that the average monthly payments are more expensive than rent. In reality, monthly mortgage payments can actually come out to be less than rent when working with a broker. They will assist in securing a rate that is within their client’s budget and, depending on the property and loan term, can easily fall under the average monthly cost of rent. Having a mortgage can prove to be more financially beneficial than renting due to the array of options for lines of credit. Refinancing is a useful resource for shortening the remaining loan term and lowering overall monthly payments. Alternatively, refinancing can be used to tap into your home equity should a financial emergency arise. A home equity line of credit, otherwise known as HELOC, are loans that are derived by calculating equity value on a mortgage and are typically used in large home renovation projects, thus increasing the overall value of your home. These can also be used as a basic loan to get cash on hand. Having these options at your disposal can prove to be invaluable to establishing financial stability. Renting comes with none of these options and should you not be able to pay your rent, there seldom exists options to alleviate the situation and you are left at the mercy of your landlord. This is one of the biggest downside for renting vs. buying.

Control Over Your Residence

Owning a home is a major step in our lives and is typically seen as a monumental achievement and it is only appropriate to attach a level of pride to homeownership. With a mortgage and subsequent ownership of a home, you are free to control the appearance of your residence at your will. This includes design choices, additions and alterations. You have the option to mold your home to your liking while at the same time increasing its value. Renovations can be paid for using a home equity line of credit. Home renovations can also qualify for tax exemptions so long as they are itemized. These personalizations can hold immense personal value as well as an increase in financial value. With renting, if the landlord decides to make renovations that you aren’t fond of, your input rarely gets considered. There is also a chance that there are restrictions in place limiting renters from conducting renovations that could be necessary to the integrity of the property. The landlord also holds the right to change the monthly payments with enough notice and decides who can stay and who can go. It is standard to only require a written notice 30 days prior to the date of eviction unless otherwise specified in the lease agreement. There are local laws in place that differ between counties in reference to caps on price increases. For example, Landlords in Maryland must provide a written notice only 60 days prior to the rent increase for residents on a month-to-month tenancy. On a fixed loan, you will be paying the same reliable monthly rate, unless you decide to refinance and lower it. The standard fixed loan is predictable and comes with a reasonable and guaranteed monthly rate.  

Another option is an adjustable-rate mortgage, which has a stable rate for 3 – 5 years and then goes through an annual adjustment period, where it is raised or lowered to match the market rate.

Current market rates and trends can be used to your advantage by giving you more control in the rates you pay based on the timing of the mortgage. Mortgage rates are much more foreseeable, stable and are not subject to the single controlling factor of the landlord.Maryland experiences one of the highest rates of rent hikes in the country, with some cities averaging as much as 21% in one year. Ultimately, renting leaves the tenant with few options on customizing their home and minimal say on their continuity of monthly rates. 

There is a wide range of methods available that cater to future homeowners. When it comes to renting vs. buying, we think the choice s clear. Here at Federal Hill Mortgage, we consider all of the options available and work to find what best fits their situation in order to create a pathway to a financially stable future. To get started, apply now.

Categories
Home Selling Advice Real Estate Advice

Preparing Your Home for a Spring Sale

You’ve probably heard that we’re currently experiencing a seller’s market. What this means is that as a seller, you have a lot of leverage when it comes to negotiating prices, fees, repairs, and more. In a seller’s market, you may be able to get above market rate for your home. And this prospect may only improve in spring when the seasonality of home buying kicks into full swing. If you’re ready to sell and move on to your next home, here are our tips to get your home ready for a spring sale.

Tip 1: Start Now

You don’t have to wait for the flowers to bloom and the weather to warm up to get your home ready for sale. In fact, one of the most important things you can do is get started right now so you stay ahead of the curve. Too many sellers wait until the last minute to begin taking care of their properties for sale. We recommend starting early, so you can be first on the market when the season kicks into full swing.

Tip 2: Depersonalization

One tip sellers sometimes struggle with is depersonalization. This is the process of removing or limiting personal effects you have around the house, including family photos or sentimental items that don’t necessarily add to the overall aesthetic of the home. The reason this recommendation is made is that buyers want to be able to imagine themselves making a life within your home. Person effects can negatively inhibit this desire. When preparing your home for a spring sale, depersonalization is a great starting point.

Tip 3: Weigh the Pros and Cons of Repairs

Typically when selling your home, it’s important to conduct all necessary repairs. We recommend you weigh the pros and cons of individual repairs and how they could affect your sale price. Minor fixes such as a leaking sink, chipping paint, or a drafty door may be in your best interest to replace if the price is right. However, within a seller’s market, larger ticket items may not be necessary if buyers are willing to eat some of the cost to get a home off the market faster. Meet with your real estate agent and weigh the pros and cons of the decisions and how they affect the marketability of your home for a spring sale.

Tip 4: Great Landscaping and Other Touches

One of the best things about selling in the spring is that you can lean into the natural beauty of the season to help boost the hominess and attractiveness of your home. Boosting the curb appeal of your home helps set the right expectations of buyers when coming in. Hiring professional landscapers can be more than worth the money, especially in spring when you’ll likely be competing with other well-landscaped homes. You can really lean into the seasonal theme once buyers move inside. For instance, using fresh spring flowers within the home and other botanical decorations can go a long way to bring the splendor of the season inside.

When preparing your home for a spring sale, it’s always important to start early, set your expectations, and be ready to work with buyers to achieve your mutual goals. When you’re ready to move on to your next home, contact the team at Federal Hill Mortgage for fantastic rates and an unbeatable team that will help you through every step of the process.

Categories
Mortgage Advice Mortgage Rates Real Estate Advice

A Look At The Maryland Housing Market 2022

Cockeysville MD neighborhood

Since the start of the pandemic, the housing market has been a chaotic buying environment, especially for first-time buyers. Early on, low rates led to an extremely competitive market where bidding wars and homes going far above the asking price were not uncommon. With the new year well underway, we wanted to take some time to analyze the state of the Maryland housing market and help you make your buying goals for 2022.

How Did We Get Here?

When the pandemic was first felt, there were concerns that a market crash may follow as buyers employ caution during uncertain times. However, that was quickly proven wrong as low-interest rates contributed to a run on the limited housing market in Maryland. If you’ve been hoping to buy over the last year, you may have encountered the challenges that come with a limited market, especially in hot buying areas such as Frederick or Columbia. Low rates can feed into bidding wars, cash transaction incentives, buyers taking on additional fees, and other challenges. If you were seeking to buy over the past year, you may have encountered these scenarios. The good news is that we may have a more accessible market on the horizon.

Where The Maryland Housing Market is Today

The housing market across the state remains hot according to both our experience and the available data. In 2021, homes only spent 7 days on average on market, as opposed to the 11 days spent in 2020. As that article by Norada highlights, buyers may still be stepping into competitive markets due to lower inventory across the state. As such, the median home price in the state rose 9.4% in 2o21, from $330,000 in 2020 to $361,000 in 2021. The situation gets more difficult when we look at active inventory, with only “6,447 units whereas in 2020 it was 10,385 units for sale.” These challenges have discouraged some homebuyers, however, there may be help on the horizon in the form of stabilizing mortgage rates that make for a more fair market for buyers.

Current Rates in the Maryland Housing Market

The average 30-year fixed-rate mortgage has risen to over 4.0% for the first time since the pandemic began in March 2020. On the surface, this may seem counterintuitive for buyers who would like the get the most affordable rate when purchasing a home. But low rates can help contribute to the situation we’ve seen over the last two years with high competition making it more difficult for average buyers to get in on the housing market. When rates stabilize, they can help cool off buying booms. What this means for you is that you may be able to find houses with fewer bidding wars or special conditions such as more down. This overall makes for a fairer houses process for buyers of all means.

What’s the Outlook for 2022?

As of now, it’s still difficult to determine exactly. The hope is that as rates continue to stabilize, the market will follow suit. However, in an era where pandemic fluctuations still persist and have the potential to create substantial slowdowns for the building material industry, it’s hard to know for certain. Another hope is that the price hike for home prices that was experienced in markets across the country will slowly begin to taper out as demand evens. Recently, the chief economist of Realtor.com predicted a price rise of 2.9%. While this is still an increase in price, it pales in comparison to the raise of over 9% Maryland saw in 2021.

As of now, it’s important to keep home buying expectations in check and be a prepared buyer. A great way to do that is by working with the right mortgage brokers to help you break into a competitive market. Being pre-approved, for instance, is a great way to help you appeal as a buyer. The team at Federal Hill Mortgage wants to help you get there. Apply today to get started.

Categories
Home Buying Advice Real Estate Advice

Home Buying Advice from Mortgage Companies in Frederick MD

Montgomery home
DCIM100MEDIADJI_0066.JPG Processed with VSCOcam with a10 preset

The Maryland housing market is known for its competitive regions. But few places are currently as hot as Frederick. Currently, the hottest market in the state, getting a home in Frederick can be tough. But with some great advice from mortgage companies in Frederick MD, you can stand a better chance of securing the home you want.

The Current Situation

The rapid growth of Frederick has made it a prime destination for new home buyers in Maryland. A rapidly-developed downtown, proximity to Baltimore and DC, as well larger plots of land than other nearby suburbs make it an attractive area to live, work, and raise a family. The pandemic surge of low-interest rates has only served to make the area more competitive. Currently, the average home only lasts on the market for 6.8 days, and is selling 61.4% above market value. Bidding wars, short buying periods, and more are making what’s already a stressful process all the more frustrating. 

Steps You Can Take

There are several steps you can take to better prepare yourself for a competitive market, straight from mortgage companies in Fredrick straight to you.

Get Your Finances in Order

First, ensure all of your finances are in order. Any type of missing document, slow credit report, etc. can cause a general slowdown in the process and cause the seller to go in another direction. Efficiency is key, so ensure that you’re not shopping for homes until your finances are all in order. 

Adjust Your Expectations

Remember what you’re buying for. If it’s the area, you may have to make concessions to find a home that works at your price range. Make a list of your wants, and needs. Have a discussion with your agent or partner about where you’re willing to make sacrifices and where you’re not willing to budge. Having flexibility may make you a more attractive buyer and help you score a home more easily. 

Find an Outstanding Agent

Not sure how to even start navigating the market? Well, you should find an outstanding agent to help you through it. Local real estate agents will have inside knowledge of the market and will be able to take your home buying needs and steer you in the right direction. Additionally, many real estate agents have relationships with mortgage companies in Frederick MD, and will help you facilitate the loan process quickly. 

Get Pre-Approved

One of the most important steps you can take is getting pre-approved. Pre-approval helps fast-track the loan approval process, having you submit the necessary documentation and allowing a mortgage broker or lender to assess your finances and estimate a loan amount. You will then be given a Pre-Approval Letter, which essentially works as a vote of confidence that you can show sellers so they know you will likely be able to afford a loan for their home. 

Work With One of the Top Mortgage Companies in Frederick MD

If you want to get a great home at a great rate, Federal Hill Mortgage is here for you. Our team works to help families throughout Frederick finance their dream homes. With an expert team and lightning-quick results, we can help you stay ahead in a competitive market. Apply today to get started.

Categories
Mortgage Rates Real Estate Advice

A Look at Current Maryland Mortgage Rates

Jarrettsville neighborhood

Like many states across the country, mortgage rates are on the rise in Maryland once again. However, the higher mortgage rates have not yet corresponded with a less competitive, more-affordable market yet. The opposite is in fact true. Competition in the market is still present across the state. Let’s take a look at the current mortgage rates in Maryland and the state of the housing market in general. 

An Overview of the Current Rates in Maryland

As it stands today, at the outset of November, the current 30-year fixed rate mortgage is going for an interest rate of 3.125%. That’s up from 3.07% for the month of October. Maryland is following a trend that’s being observed across the country: rates are going back up. The pandemic and the uncertainty it created plateaued rates to historic lows, falling all the way down to 2.69% in December of 2020. While the rate is climbing back up, it still remains lower than pre-pandemic numbers, where in February 2020 the rate was hovering around 3.47%. What this shows is that slowly but surely, mortgage rates are regressing back to the mean over pandemic levels. 

The Housing Market Remains Competitive

While current mortgage rates in Maryland are stabilizing, they have had little effect thus far on the current housing market. Competition remains supreme in areas across the state. Buyers are going to drastic lengths to acquire homes, including paying transfer fees, over-appraisal, not requiring any fixes after inspection, and of course, bidding well above the asking price. Right now, it is a seller’s market.  The rate of overbidding varies by area. For instance, in Frederick, Maryland’s hottest housing market, 61% of homes are being sold over asking price. 

What’s Causing The Competitive Market?

There are several factors still at play that are driving the competitive market. The pandemic led to lower mortgage rates, which drove an uptick in home buying as consumers desperately tried to take advantage of great rates. However, that home buying craze still hasn’t come down to earth. The single greatest factor is likely a low housing stock, as builders struggle to keep up with demand for housing. This low inventory is leading to buyers having to fight for the same homes in certain areas.

What’s The Outlook?

While the market remains hot, there is some indication that things may start to normalize soon. Data compiled by Bright MLS showed that interest in home buying dropped by about 6% over the period of a month across the Baltimore metro area.. While that’s not huge, it could foreshadow a slow cooling of what remains a very hot market. While home sales tend to slow down in winter, it appears that the slowdown is less pronounced than in the pre-pandemic era. 

What Steps Can You Take to Prepare Yourself?

Don’t be discouraged by the competitive market, as the best way you can prepare yourself to be the most qualified buyer possible is by working with an expert mortgage team. At Federal Hill Mortgage, we help you secure pre-approval, so you can be an attractive shopper to prospective sellers. If you want your best chance of scoring the home of your dreams, apply today.

Call Now