We may not be comparing real apples and oranges, but we’re coming pretty close in the home financing industry. And if you’re at all interested in using your home’s equity to access cash, then this comparison is for you.
As we discussed in our last email, there are two common ways to get cash from your home—a Home Equity Line of Credit (HELOC) or a cash-out refinance.
In the current environment, many people want to keep the great interest rate they already have on their home loan, so they automatically choose a HELOC over a refinance. But wait—there’s a big difference that can make the benefits hard to compare at a glance. HELOCs have adjustable interest rates, whereas most home loans are fixed.
Take a look.
If you’re interested in exploring your options more or you have questions about home financing, please reach out. I’ll be happy to help.
Good news! When it comes to documenting income, self-employed borrowers can get back to normal.
What does this mean?
Borrowers who rely on self-employment income may now submit their most recent tax returns, so long as they are no earlier than 2020, in typical scenarios.
How does this help?
Under previous Covid-era rules for certain government-backed loans, self-employed borrowers had to submit recent P&L statements, asset account statements and more. It’s much easier for most to supply tax returns instead.
We can now offer conforming loans to higher limits!Previously, conforming loans were available up to $548,250. With recent changes, that limit has increased to $625,000.What can this mean for you?
If you have questions about this change, please reach out. And if you have friends who may benefit from the news, please pass it along. I’ll be honored to help them too.
AND THE FACTORS THAT INFLUENCE IT
Length of Credit History
Amounts Owed
Types of Credit in Use
New Credit
Payment History
Timeliness of your payments is the single biggest contributor to your credit score. It's important not only to make your payments, but also to make them by their due dates.Tip: Have a system in place to assure your bills are always paid on time. Set up automatic withdrawals where appropriate.Tip: Keep a cash reserve account to cover payments during possible interruptions to your income.
Jason, this is the last communication in my series about HELOCs. Thank you for allowing me to send you information these last several weeks. I hope you’ve found it valuable.
Today’s rates
New Home Purchase
Conforming Interest rate
30-yr fixed 3.20%
Rates are not static, they often change throughout the day.
If another lender offers a lower rate, there's a buy-down involved.
Often not mentioned when quoting the lower rate
Actual rates vary based on Loan Amount, Middle Credit Score, DTI, Term
Today’s rates based on a purchase 760 middle score, conforming loan, detached, primary residence, non-self-employed, detached, primary home
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