Why You Should Meet With Your REALTOR Before House Hunting

It happens ALL the time:  I get a call from a new buyer client, and they've found a house online and they want to go see it immediately.  I completely understand why - they've found something exciting, and it's piqued their interest enough to start house hunting seriously.  However, I always try to get my clients to pump the brakes and hold off on house hunting until I have a chance to sit down with them. 

In my opinion, particularly if it's your first home purchase ever, it is absolutely critical to meet with me so we can discuss the process, some of the issues we might encounter, and set some ground rules/expectations for the home buying process.  Buying a home is a huge investment, and it's crucial to know what you are walking into instead of just "winging it".  As a REALTOR, it is very hard to guide the process and educate my clients when we are out looking at houses - it just never seems to work out like it should.

Most of my initial appointments are 75-90 minutes, and we cover a lot of ground.  We talk about the reasons buying a home is a good investment, what the current status of the housing market is, what the step-by-stop process is that you'll encounter, a little bit about mortgages, a timeline of when you will be expected to spend your money during the process, and a bit about my experience/real estate background.  Many loan officers do something similar to this - in the homebuying process, knowledge is power!

Quick T.R.I.D. Update

A few months ago, major changes took place in the lending world.  These changes, referred to as T.R.I.D. (TILA-RESPA Integrated Disclosure, for those curious), ignited a lot of fear and uncertainty in the real estate environment.  How would lenders react and adapt to the changes?  Would closings go smoothly after changing the forms that had been in place for 20-something years?  What would the new rules mean for REALTORs and their clients?  A lot of questions were raised, and nobody really knew what to expect.

Well, we are a few months into T.R.I.D and we have (at least a little bit) of clarity.  I obviously don't get to see the behind-the-scenes at mortgage companies, but my impression thus far is that most companies were well prepared for the changes and the transition has been mostly smooth!  Of the closings I've had since T.R.I.D. took effect (using multiple mortgage companies) there have been no noticeable issues and each file has closed on time!  And some mortgage companies have backed-off of their requests for REALTORs to write purchase agreements with 60 day closings.  I've had multiple transactions that closed in 45 days, which was (kind of) the standard prior to T.R.I.D. taking effect.  I think it's safe to say at this point that the fears about T.R.I.D. were just a tad overblown.

Something to ponder for the future, however - with major changes, there are inevitably going to be minor tweaks and changes that take place over time.  I have not heard of anything specific at this point, but it would not surprise me to see things change and improve over time.  It is hard to say how any of these changes might effect things going forward.

If you have specific T.R.I.D. or mortgage-related questions, reach out to me and I'll put you in touch with a loan officer!

A New Place to Search for Homes!

Tired of looking for houses on Zillow and Trulia and Realtor.com?  I recently rolled out a new website that is fantastic for searching for homes in the Twin Cities - www.joshpeltohomesearch.com!  This website feeds directly from the MLS system that REALTORs use, allows you to create your own account so you can save listings you are interested in, and has an easy to use built-in mortgage calculator that allows you to roughly estimate what a monthly mortgage would cost.

Of course, if you want to search a little more seriously, contact me and I can set you up on a custom home search directly through our MLS system - just shoot me an email!

Happy home searching!

Will the Feds Finally Raise Interest Rates?

Time to get a little wonky, guys!

This Thursday marks the beginning of a very important Federal Reserve Open Market Committee (FOMC) 2-day meeting.  What is at stake is something that's been discussed for a couple of years now - will the Federal Reserve finally raise the overnight rate?  The overnight rate is the interest rate at which banks can borrow money from the Federal Reserve, and has not been raised in over 9 years.  This overnight rate has huge implications on the U.S. and global economies, and will directly affect mortgage rates.

As I already mentioned, analysts and bankers have been anticipating a raise in the overnight rate for at least a couple of years, and yet it has not happened.  REALTORs and loan officers have been on pins and needles, worried that an uptick in rates would derail a housing market that has improved markedly since the collapse in 2007.

This is the Fed's last meeting of 2015, and whatever they decide to do will certainly be an indication of what they plan on doing in 2016.  We all know that mortgage interest rates at 4% is not sustainable long-term, and it's just a matter of time before the Fed's start to "correct" what has been the status-quo for nearly a decade.

I think the key takeway is that even if the FOMC decides to raise rates on Thursday/Friday, they will almost certainly go about doing so in a cautious and conservative manner.  So barring something economically catastrophic, we should continue to see VERY affordable mortgage rates for the time being. 

Planning to Sell Your Home in Spring 2016?

As winter sets in and the snow arrives, the real estate market definitely does experience a downturn in activity.  Real estate is an inherently cyclical business, particularly in cold-weather states like Minnesota.  However, selling a home requires preparation and planning - in fact, a lack of preparation and planning leads to longer market times and worse offers from buyers.

With that in mind, it is definitely NOT too early to start preparing and planning if you intend to sell your home in 2016.  Whether your plan is to list in spring, summer, or fall, contact me TODAY for a no-cost and no-obligation consult.  I will walk through your home with you, identify items that should be addressed for the quickest sale at the best price, and put together a game plan with clear goals and objectives.

You can reach me a number of ways - call me at (763) 213-4617, email at josh.pelto@remax.net, or send me a message on my Facebook Business Page!