Category Archives: Lending

FHA Mortgage Insurance Rates in 2017

If you’ve recently been on the market to purchase a home or secure a mortgage, you are probably very familiar with FHA Mortgage Insurance rates. It had recently been in the works that the FHA was going to be reducing FHA Mortgage Insurance rates in the near future, but the FHA has since backtracked. Here’s what you need to know, and how it will affect you as a homebuyer:

The FHA, a sector of the Department of Housing and Urban Development, is a government agency that insures loans on homes and protects lenders in the case of default by collecting fees owed to reimburse lenders when necessary. The FHA usually insures first-time home buyers that may not have the best credit. In the past, the avg. credit score was 679. There have also always been limits on the price of a loan the FHA will back.

In late January, the Trump administration stopped a rate cut that was proposed by Obama just a week before he left office. The Obama administration originally proposed the cut because the FHA could withstand the cut to premiums that would in turn save homebuyers extra money, which they argued would be the best thing to do since the FHA has improved vastly since its bailout in 2013. If implemented, the premium rates would drop a quarter of a percentage point, which would restore rates back to what they were before the housing crash.  The Trump administration suspended the cut with the concern that if the FHA was unable to cover the losses from reduced premiums, taxpayers could end up paying.

So what does this mean? While nothing has officially changed, it has been a HUGE headache for the industry. Approximately 40,000 people are estimated to be priced out of home ownership, while another 800,000 will have to pay more than anticipated. When it comes down to it, if you had originally planned on using the FHA-backed loan with lower insurance rates, all this news really means is that you will just still have to pay the same rate required since January 2015- unless of course, you have to adjust your home-buying plans altogether. While the cut hasn’t been totally eliminated, nobody is certain if this cut will get back on the table for approval anytime soon.

To keep up with all things mortgage, housing, and real estate, be sure to subscribe to our blog! Here at Alpha Mortgage, we’re proud to be North Carolina’s #1 mortgage company. Contact us today to make owning your dream home a reality.

 

 

Happy Holidays!

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Happy Holidays from your friends and family here at Alpha Mortgage! Can you believe it is almost 2017? As we reflect on this past year, we have seen a lot of changes. One thing however has stayed constant- our incredible clients in the Wilmington, Jacksonville, Fayetteville, New Bern, Greensboro, and Cary area. We are so proud to serve you in this great state of North Carolina, and look forward to another year of helping turn your home dreams into reality.

If you will be on the coast this holiday season, be sure to join in on the fun! Check out these last minute activities to take part in before the new year in Wilmington:

UNCW Men’s Basketball vs. East Carolina     

December 20, 2016
6:30 PM

The UNCW men’s basketball team (record: 10-1) tips off against East Carolina (7-4) in a non-conference game at Trask Coliseum in Wilmington. The Seahawks are 7th in the country in points per game with 89.6. Kids under 16 get in for $10.

Nights of Lights 

December 19, 2016 to December 20, 2016
4:00 PM to 7:00 PM

Bellamy Mansion Museum in downtown Wilmington, NC, presents Nights of Lights, a chance to view the historic property decorated for the Christmas season.

Holiday Lights Trolley Tour

December 15, 2016 to December 23, 2016

The Wilmington Tolley Company offers Holiday Lights Trolley Tours in historic downtown Wilmington, NC, at 6 and 7:30pm featuring music and narration in an enclosed and heated environment, and a great view of illuminated neighborhoods. Boarding at 101 Water Street.

Holiday Lights Cruise 

December 23, 2016
6:30 PM to 7:30 PM

Wilmington Water Tours presents a Holiday Lights Cruise, a chance to see the waterfront come alive in the holiday spirit.

Holiday Wine Tasting & Charcuterie Demo

December 21, 2016
4:00 PM

Tidal Creek Co-op in Wilmington, NC, presents a Holiday Wine Tasting & Charcuterie Demo featuring a selection of our wines just in time for the holiday weekend, and a sampling local meat, cheese, and other accoutrements to create a charcuterie platter.

Christmas Caroling with Santa and His Reindeer

December 16, 2016 to December 24, 2016
6:00 PM to 10:00 PM

Horsedrawn Tours in downtown Wilmington, NC, presents Christmas Caroling with Santa and His Special “Reindeer.” Free candy canes for the kids.

We hope you all enjoy this holiday season with your friends, family, and loved ones. On behalf of all of us at Alpha Mortgage, we wish you all a safe and a happy end to 2016. Let’s make 2017 the best year yet!

Housing For The Holidays

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With Thanksgiving, Black Friday, and Cyber Monday under our belts, the holiday season is officially in full swing and we couldn’t be happier about it! 2016 has been a whirlwind of a year, and on behalf of everyone at Alpha Mortgage, we are glad that we were able to make so many dream home ambitions a reality. So what’s going on in the housing world? We’re here to update you on what’s happening now, what to expect, and the best gifts to give your home the extra love it deserves this holiday season.

What’s happening- A Recap

As many of you know, mortgage rates have stayed relatively low for the past few years, and the market has favored sellers. Why? Recently, the housing market has been in high demand with very tight supply across the nation, which led to a new peak in home prices nationally in September 2016, according to CNBC. You know the deal- sellers can list as-is, and usually, drive up the price of the sale due to multiple offers because demand is so high.

Here’s the update- in early November 2016, mortgage rates raised for the first time since January from about 3.94 to close to 4.10. Why? A little thing called the United States of America’s Presidential Election. Don’t panic, the rates were the same at the beginning of 2016.

The FHFA also raised their conforming loan limits from $417,000 (which has been in place since 20016), to $424,100 which will be effective January 1st, 2017, and that means that house prices are going up enough to qualifies you to borrow more money starting in the new year.

Oh, and tiny homes are still a thing.

What to Expect

A holiday housing freeze- it is normal for sales and prices of homes to drop in the Winter months, following in suit of dropping temperatures, as well as increased spending on other things (hello holiday shopping). Longtime Realtor Kim McElroy explains to Realtor.com that “Typically, sales do slow down somewhat in the winter just because the focus is on the holidays and a lot of people do take their houses off the market,” says longtime Montgomery, AL-based Realtor Kim McElroy of Keller Williams Realty. “But I see a spike of interest and calls right after the holidays.”

Longforecast predicts that the 30-year mortgage rate for December 2016 will increase by 1.41% averaging a rate of 4.33, and also predict that January 2017’s average rate will be 4.28 or a -1.15% from December.

Expect the housing market to swing in the favor of buyers in the next 2-3 years due to increased supply from builders taking advantage of the lack of homes available.

Top 5 gifts under $250 to make your house a home

  1. Satechi iPhone Charging Stand – $25- Amazon- This is a great stocking stuffer for anyone who Facetimes, Cooks and uses their phone for recipes, or multitasks in general! It comes in 4 different finishes that match each phone color.

81ls-p3a3ul_sl1500_2. Ring Video Doorbell Pro– $249 – Amazon- See, hear, and speak to anyone at your door from your smartphone, tablet, or PC and get instant alerts when visitors press the doorbell.

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  1. Nest – Learning Home Thermostat– $249 – Amazon – Nest automatically adapts to your life, as well as when the seasons change. All you have to do is use it for a week, and it programs itself!61kyuqogkl-_sl1000_
  2. August Smart Lock– $229 – Amazon- Use your smartphone to lock, unlock, and monitor traffic on your doors.

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  1. Kohler Moxie Showerhead and Wireless Speaker– $92.50 – Amazon -Stream music playlists, news, and other audio in the shower.

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TRID – A Year Later

On October 3rd 2015, history was made in the mortgage industry when the TRID Rule, or the “Know Before You Owe” Rule was implemented in the United States. TRID was created in order to bridge the gap of transparency between borrowers, regulators, and lenders through more consumer-friendly documents and additional time restraints in the lending process with the hope of creating a more informed, and therefore better protected consumer. In the two years leading up to the implementation of TRID, those in the lending industry feared that additional paperwork and time would deter potential buyers. Once TRID was implemented, there were a few hiccups in the road, but the mortgage industry has been changed forever.

With a year of the implementation of TRID officially under America’s belt, we want to take a look back on the up’s, down’s, and still-to-come’s.

THE TRID TRAIN, A TIMELINE:

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November 2013: TRID unveiled to the lending industry with the proposed roll-out date to take place August 1st 2015. Cue industry-wide panic attacks due to the copious amounts of work they will have to do in order to adhere to the new rule (think technology and work process overhauls).

November 2013- June 2015: Everyone freaks out about the implementation of TRID, concurrent with an “administrative error” prompting the CFPB to change the start date to October 1st, 2015.

June 24th 2015-  A proposed amendment to TRID is released where the official start date of the “Know Before You Owe” rule will be October 3, 2015.

October 3, 2015- TRID goes into effect, and companies are mandated to comply. Many express concern and complaints that the CFPB is vague in some sections of TRID and the lack of guidance offered in the following months.

January 2016- Ellie Mae’s Origination Insight Report shows that total time to close has reached a high of 51 days, an indicator that the 6 days added in the process were being added to the total time instead of integrated in. Lending companies continue to complain about vagueness and lack of education from the CFPB regarding TRID.

July, 2016- The CFPB responds to concerns by lending companies and other businesses impacted by TRID and put some new changes into place regarding the secondary market to better help and inform lenders. The proposed changes include: tolerances for the total of payments, expanding the number of housing assistance loans that would qualify for exemptions, including cooperatives in the rule, and clarifying how a creditor could provide separate disclosure forms to the consumer and the seller.

August 2016- NAR surveyed 2,500 REALTORS to get their perspective of how the TRID rule was working which revealed that the majority saw no changes through the implementation of the rule.

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TRID IN 2017

While there were a few up’s, down’s, and hiccups in the past year for the lending industry (as expected with any major industry overhaul), it is apparent that TRID has been a mostly beneficial and much needed industry update for the consumer. As Pete Mills from the Mortgage Bankers Association stated, “TRID was a massive undertaking from a systems and business processes standpoint,” Although many anticipated the rule would significantly disrupt the closing process for consumers, the impact of TRID on consumers was mitigated because lenders and other participants in the closing process dutifully prepared for the final rule.”

Many lending companies are still making adjustments in their strategy with the implementation of the new rules, but with a year of adhering to TRID under their belt, lending companies are now analyzing ways to better streamline processes and resources to better serve their clients and integrate the additional 6 days in the process instead of adding them. Ready to own the house of your dreams? We’re here to help you from the beginning steps of your planning period all the way until you step through the doors of your new home. Contact us today at Alpha Mortgage!

 

August Update

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One of the hottest months of the year in Wilmington, NC is almost over, but the housing market is still on fire! According to recent NC Regional MLS statistics, home sales in New Hanover, Brunswick, and Pender counties combined have seen an 18% increase in home sales compared to last July’s home sales, and the median price of homes dropped about 3%. Similarly, Fannie Mae recently announced that it will maintain it’s forecast for 2016’s GDP at the same 1.8 percent forecasted in July after the second quarter growth was more than 1 point lower than predicted. So why didn’t America hit the predicted mark? According to the source, there was slowed growth in residential, non-residential, government and inventory investment in August. Fannie Mae is confident that August and September’s results will be different.

Now Trending: Roof Decks 

What is one of the most popular trends we’ve seen this summer with real estate development? Rooftop decks in urban areas. As demand for rentals rises and space for outdoor yards decreases in more heavily populated areas, roof decks have become a very popular and sought out addition for renters and those searching for their next purchase. Not only do they provide tenants with a private area to enjoy the sunshine, but they are also usually combined with luxurious amenities like pools, incredible views, fire pits, grills, and most importantly of all- fresh air that many millennials look for when searching for a space to inhabit. So what’s to come with this trend? Expect it to stay for a while. We predict that rooftop decks will become even more popular and expected in urban areas. We also predict to see the trend start popping up in areas that have landscaping for added value.

8 Reasons to Move to Wilmington, NC

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There’s never been a better time to relocate to ILM and its surrounding beaches. Between the bustling downtown river walk scene, the breathtaking beaches, the strong and connected community, as well as and the incredible year-round climate – Wilmington and its surrounding beaches welcomes and has something to offer everyone. What are your reasons to relocate?

  • Beaches- Once you visit North Carolina’s coast, your life is changed forever. Wrightsville Beach, Carolina Beach, Kure Beach, and beaches surrounding Wilmington, NC all offer spectacular views of the Atlantic paired with relaxed southern feel that makes anyone feel at home.
  • Downtown- The bustling downtown scene provides Wilmingtonians with a taste of the city life, with incredible shopping, dining, and nightlife opportunities for people of all ages to enjoy. Take this and combine it with downtown Wilmington’s rich history and landmarks, and you are armed with activities to partake in for years!
  • Community – Wilmington is home to both Cape Fear Community College and UNCW which gives locals opportunity to support the colleges in activities like Midnight madness, cheering on sports teams, and more! The tight-knit Wilmington community also provides many festivals downtown during the year, houses incredible music talent at spectacular venues like Greenfield Lake Amphitheater, and Azalea Fest itself is a great look into Wilmington’s amazing community!
  • Incredible Shopping + Dining- From shopping centers, to one-of-a kind boutiques, Wilmington is an amazing shopping hub for the south east. Whether you are strolling down shops in The Forum, browsing at boutiques downtown, or hitting up one of the local surf shops, ILM loves fashion. Another thing that Wilmington loves is great dining. Fresh seafood and breathtaking views make Wilmington a desirable place for any restaurant to open, but Wilmington houses some of the best restaurants in the state.
  • Proximity- Wilmington is close enough to bigger NC cities like Raleigh and Charlotte for an easy weekend trip, and just far enough to provide the perfect getaway from your friends. When you live in Wilmington, you’re never too far for friends and family to visit! (And once you move to the beach, they’ll want to visit all of the time!)
  • Furry Friends are always welcome- Wilmington loves your four-legged friends! From the loop at Wrightsville Beach, to the many dog parks in the city, your pets are an extension of your family in Wilmington and are even welcomed at many outdoor restaurants! Bring your pup on the dog-friendly beaches, or Java Dog Coffee shop downtown- ILM knows your pets should enjoy the beautiful city as much as you do!
  • Healthy Lifestyle- Wilmington loves being active. From stand up paddle boarding, or running clubs, to yoga on the pier, and everything in between, Wilmington loves supporting healthy and active lifestyles that take advantage of the amazing climate and views the town and surrounding beaches provide.
  • Home Affordability – Not only does Wilmington and its surrounding beaches have a steady real estate market, but the options are endless. Wilmington has high-end homes and communities as well as more affordable options that are still in incredible locations.

Your dream house is waiting for you in Wilmington, NC, and once you find it, Alpha Mortgage  will help you turn your dream house into a reality! Contact us today!

Recent Changes in USDA Rates

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If you’ve been in the market for a mortgage lately, you’ve undoubtedly heard a lot of commotion about the recent changes in USDA rates, and are probably wondering what this means for you, a person who is looking to purchase or refinance a home. On May 16, 2016, the USDA recently announced a series of changes that will make it cheaper and faster to refinance a USDA loan. We’re here to break it all down for you.

To begin, it’s important to understand what a USDA loan is. USDA loans are mortgages backed by the US Department of Agriculture as a part of its USDA Rural Development Guaranteed Housing Loan program. USDA loans have increased in popularity over the past few years due to their 100-percent financing program that helps approved lenders provide low to moderate-income households with an opportunity to own a home in a rural or semi-rural area (to buy it, refinance it, build it, rehabilitate it, improve it, or relocate another dwelling) with no down payment, reduced mortgage insurance premiums, and an attractively low monthly interest rate. No, you don’t have to be a farmer to obtain the loan, you just have to meet the following criteria:

  • Meet income eligibility
  • Agree to personally occupy the dwelling as your primary residence
  • Be a US Citizen, US non-citizen national, or qualified alien
  • Demonstrate the willingness to meet credit obligations in a timely manner
  • Purchase a property that meets all program criteria including location as defined by the USDA

The loans were created in 1991 to encourage homebuyers to live in rural and suburban areas in hopes of boosting the local economies and growth through more affordable housing options. So what do the new changes mean? Nothing but good news for those who qualify!

Starting June 2nd, 2016, homeowners current on their mortgages for the past 12 months will no longer be required to secure an appraisal, provide a credit report, or undergo a debt-to-income calculation when they refinance for a 30-year term, saving applicants both time and money.

Average savings are expected to be around $150 per month, with some borrowers saving up to $600 per month. When it comes to the changes, Rural Housing Service Administrator Tony Hernandez says “These changes reaffirm the Obama Administration’s commitment to middle-class Americans, and I am pleased that we continue to provide affordable housing to support thriving economies in rural communities. Helping homeowners refinance their homes to reduce their monthly payments and take advantage of low-interest rates will bring increased capital to rural residents and the communities where they live and work.”

Interested in seeing if you qualify for a USDA loan or refinance? Contact us today!

Alpha Mortgage – April Recap

It’s officially May, and the housing market is heating up just like the weather in Wilmington,NC! This month’s blog will cover the updates on the CFPB’s decision to revisit TRID, the hottest smart-home technology to keep an eye out for, as well as the 20 hottest markets in the US for April. Enjoy!

http://www.constructiondive.com/news/20-hottest-housing-markets-in-april/418340/

http://www.constructiondive.com/news/20-hottest-housing-markets-in-april/418340/

Revisiting TRID– You all recall the four letters that started to cause chaos in the real-estate industry late last year- TRID. TRID, also know as the ‘know before you owe’ rule was put into place to help the borrower be better informed and protected during the lending process. The process was expected to transition seamlessly into the lending community, but unfortunately, the rule has run into a few hiccups and many complaints. The biggest? Lack of understanding.

TRID is extremely complex, and many mortgage officers and investors have had a difficult time understanding if they are complying with such a large and intricate rule. Industry groups also have asked for guidance on many other issues like curing errors, accounting for lender credits, and calculating cash-to-close transactions.

7 months after its implementation, the Consumer Financial Protection Bureau (CFPB) has announced that it would reopen rulemaking, with a notice of proposed rulemaking expected to be released by late July to provide greater certainty and clarity to the mortgage industry.

According to Dodd Frank, the new rulemaking, governing what also is known as the Know Before You Owe mortgage disclosures, would incorporate some of the bureau’s existing informal guidance as well as provide adjustments in the regulatory text and commentary, CFPB Director Richard Cordray said in a  letter to the industry.

The industry is pleased that the CFPB is being so receptive of their concerns and complaints. Cordray gives more peace of mind writing “We will continue to work with industry, consumers, and other stakeholders to support a smooth transition for the mortgage market. As we do so, we and other regulators are all agreed that our oversight of the implementation of the Know Before You Owe mortgage disclosure rule in the months ahead will continue to be sensitive to the progress made by those entities that have squarely focused on making good-faith efforts to come into compliance with the rule.”

-Top 5 smart home features– While some people may have thought that by 2016 we would be living in a world of flying cars and homes that would virtually do everything we needed them to and more on their own, we aren’t quite there yet. Take your home to the next level this year by investing in these 5 smart-home features that are guaranteed to make your life easier and your home’s value increase as written by US News.

1. Keyless entry systems. With these replacements for standard locks, homeowners don’t have to worry about carrying keys. They can also give instructions to others on how to get into the home when they’re not there.

2. Smart thermostats. Thermostats have grown beyond a mechanism that you can program to raise and lower the temperature. Today’s smart thermostats can be controlled via your computer or smart phone and will even learn habits such as when you’re usually at home and if you raise or lower the temp when you get up or at certain times of day, like when you go to bed.

3. Alarm systems. Today’s home security systems include controls for thermostats and lighting and have features that allow you to arm and disarm them remotely, using a computer or a phone. Security cameras also have fallen in price and grown in popularity among homeowners.

4. Hidden or unobtrusive built-in speakers. Wired speaker systems are still popular, but the speakers are smaller and there may be more than two to a room, Galante says. That makes it easier for homeowners to customize sound for, say, a party.You can expect to see more of these four smart home innovations in the future:

5. Smart building materials. Shingles will be able to notify you of leaks, drywall will detect moisture and wood framing will report termite infestations. “That’s the stuff that’s coming seven to 10 years down the line,” Galante says.

Realtor.com’s 20 hottest markets for April featured many of the same cities from March (we’re talking about you, California), however, there was a spike in popularity around the mid-west that it is important to take note of. So why is this important? Jonathan Smoke, realtor.com’s chief economist explains. “The Midwest region is representative of the status of the broader U.S. recovery. When Columbus, Ohio, is the 10th hottest market in the country, you know that the Midwest – and the U.S. overall – is back and doing well.”

Also on the list? Raleigh, NC at number #15, showing the US that North Carolina is definitely an area to watch in terms of quality of life and property. Check it out:

1. San Francisco

2. Vallejo, CA

3. Denver

4. Santa Rosa, CA

5. San Jose, CA

6. Dallas

7. Santa Cruz, CA

8. Sacramento, CA

9. Ann Arbor, MI

10. Columbus, OH

11. Boston

12. Colorado Springs, CO

13. San Diego

14. Stockton, CA

15. Raleigh, NC

16. Lafayette, IN

17. Fort Wayne, IN

18. Oxnard, CA

19. Modesto, CA

20. Sioux City, IA

As we move into the Summer months, we invite you to stay tuned to the latest in mortgage and real estate news. We are proud to serve the Wilmington, Charlotte, Jacksonville, Winston-Salem, Greensboro, Fayetteville and Asheville areas with the most competitive mortgage and lending services at the lowest rates. Let us help make getting your dream home a reality!

NC Housing Loans – The Basics

Signing document for new home.

Owning a home is an integral part of the achieving American Dream. But where do you begin the process? This blog will teach you the basics of NC Housing Loans and what you need to do to prepare for your first home purchase.

Step 1: Start Early

The first thing that you need to do when you have decided to purchase a home is determine the negotaibles and non-negotiables involving where you will reside and start your research. What do you want in the house? Where do you want to live? Most importantly, what is your budget and can you afford a house? After you figure out the necessities your new home needs to make you happy, start your research.

Subscribe to newsletters, read magazines and newspapers with real estate listings, and research websites that have listings as well. Note how long homes that interest you stay on the market in the area you’re moving to, price, and size that you can afford in the area. Also be sure to watch changes in price over time.

 

Step  2: Get Preapproved

It’s always a good idea to get pre-approved for a mortgage if you can. You may have a basic idea on how much you believe you’ll be able to spend on a home, but until you get prequalified or approved for a mortgage, you won’t know for sure. To get preapproved, meet with your mortgage banker. They’ll tell you the price range of homes you should be looking at.

Step 3: Find your Dream Home

Once you get preapproved for a mortgage, you need to find your home. Find a real estate agent that you can trust, and who is easy to communicate with, and goes above and beyond to provide you with insight about properties you are interested, as well as the areas that these properties are located in. Tour the homes, take notes, take pictures and videos, and be as transparent with your likes and dislikes as possible with your agent!

When you find your home, have your real estate agent negotiate an offer that is fair based on location, size, and value of comparable houses. When you reach an agreement with the seller, the home goes into escrow.

Be sure to get a home inspection within a few days of your agreement to make sure that everything is A-OK with your home, and to make sure that any issues found are can be dealt with through renegotiation, withdrawal without penalty, or understanding what else needs to be done. If there are issues with the home that you want to discuss with the seller, know your options! Ask the seller to fix issues before closing the sale.

Step 4: Find an amazing Loan Officer + CLOSE!

You’ve settled on “The One.” Congrats! The next thing you need to do is find a loan officer that will help you navigate the waters of financing your home through an NC housing loan. A loan officer should be many things, especially transparent, passionate, and accountable on top of other traits. Be sure that you choose a great loan officer, and that you discuss any eligibility you may have for special types of loans like (VA Loans, Jumbo Loans, etc.). You will also need to discuss whether a 15-year or 30-year mortgage works best for you. Once you and your loan officer find a payment plan that best suits your needs, they will arrange for an appraiser to ensure that you will be paying a fair price for the home.

Following an appraisal, the paperwork begins. Your loan officer will coordinate everything and ensure that all rules, ordinances, and laws are met with your home purchase. Once this step is complete, you can close the sale and enjoy your new home!

Alpha Mortgage is a full service mortgage banker offering in-house processing, underwriting, closing and funding. In addition to new purchase loans, Alpha Mortgage specializes in home refinances with various programs and the lowest rates. Our mortgage professionals are well versed in all aspects of how the refinance process flows and can look at your previous loan package and find the best way to make your new mortgage work best for your financial goals.

Difference between Modular, Manufactured, Hybrid, and Stick-Built Homes

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So you’re looking into building a home. Great choice! There are many benefits of choosing to build over buy, including total control over customization, special features, low maintenance costs, warranties, amenities, home-site selection, energy efficiency, and more. However, before you begin the actual building process, it is important to understand a few construction terms. The first thing you’ll need to understand is the differences between manufactured, hybrid, stick built, and modular homes so you can choose the best option that suits your home’s needs. Let’s break it down:

The main points of differentiation you should note when it comes to manufactured, modular, stick-built, and hybrid homes are the locations in which home construction occurs. Other differences include guidelines, price, materials, as well as time to build. Take a deeper look into each below:

Stick-Built Home: A stick-built home is the most common & traditional building method of home construction in America, and refers to a home that is built 100% on-site from the ground up in complete accordance to all local, state, and regional guidelines. All materials are delivered to the job site, and the building happens through various subcontractors and 3rd party vendors. All of the work happens on-site as opposed from in a factory. While Stick-Built homes may be the most popular due to the option of complete customization, they normally take a little longer to construct due to weather delays, high moisture content in lumber, coordination issues, inspection delays/rework due to failed inspections, and typically cost more as well. However, Stick-Built homes tend to appreciate in value.

Manufactured Home: Also known as a “Mobile Home,” the manufactured home is built entirely in a factory. These homes are built according to specialized guidelines set out by the HUD instead of building codes at the desired location, and ensure that all areas of the manufactured homes meet strict guidelines. A big difference between manufactured homes opposed to other options is that they are transported by a vehicle and once at the desired location, the wheels are removed, setting the home in place. They are permanently attached to a black, steel chassis, which acts as floor system support. They are generally less expensive and take exponentially less time to build than Stick-Built or Modular Homes, however some communities do not allow manufactured homes in their area and tend to depreciate over time.

Modular Home: There is no true “definition” of a basic modular home since they can range in size, complexity, and price. However, one main point of distinction is that modular homes are built in sections in a factory setting, and are then transported and put together by a builder or contractor on your building site. Modular homes are built according to local, state, and regional building codes for the destination site. Modular homes have been gaining popularity due to their inexpensiveness, construction time, and tendency to appreciate in value, paired with the many options to customize and that they don’t “look” like they were made in a factory setting.

Hybrid: Hybrid homes are also known as “on-frame” modular homes. They aren’t exactly a true manufactured home or a true modular home, but a blend of the two. They’re typically built to the minimum requirements of state, local, and regional guidelines like a modular home, with the black steel frames like in a manufactured home. They are considered real property; however, they’re typically built with lower quality materials. They cannot be two stories, but they can come in one to three section ranch style houses.

There you have it! Once you decide which type of house you would like to build, the true fun begins. Let Alpha Mortgage help you in your home building purchase by contacting us today.

 

2016 Housing Market Predictions

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New Year, New Housing Market? Not so much. According to many housing predictions, 2016 will bring a whole lot of the same to the table. But is this a bad thing? Absolutely not. While 2015 was known as the best year for housing since 2007 due to many factors such as increased employment rates, implementation of TRID, and more, 2016 will also continue the housing market’s upswing- just not as exponentially.  We’ll start to secure a ‘normal’ in 2016. Remember that word?!

Here are our 2016 Housing Predictions:

  1. Increased Interest Rates– The Federal Reserve is expected to continue to raise interest rates in the short term between now and 2016’s end, & homeowners who have adjustable-rate mortgages or home equity loans will most likely see their interest rate rise as a result.  Housing wire goes as far to say that Fixed-rate mortgages will also rise, perhaps up one-half of a percentage point between now and the end of 2016, reaching 4.5% for 30-year loans. Despite this increase in interest rates, mortgage rates will remain historically low. If the rates do start to rise in 2016, as gradually as they may, we could see slightly lower home-buying numbers next year. But these changes will be minimal due to the continued increase in economic expansion and employment numbers- meaning more people are becoming able to afford houses.
  2. Evolving Mortgage Process – Mortgages may be in reach for more Americans in 2016 due to legislation that would allow Fannie Mae and Freddie Mac to take into account new ways to measure creditworthiness like evaluating rental history and utility bill payments instead of just the FICO credit score. More loans may also allow buyers to include income from room rentals, etc. More lenders are continuing to ease credit standards, and don’t see that changing in the future.  This is good news for potential homebuyers!
  3. Increased Housing PricesReverse Mortgage Daily reports that appreciation in national home price indexes will likely continue at a faster pace than inflation, but grow more moderately than last year. The CoreLogic Home Price Index was up about 6% over the last 12 months, and CoreLogic anticipates a rise of 4-5% during 2016. This increase in home sales and prices can be attributed to the improved economy, which has brightened the financial outlook for many families and enhanced their overall financial security. Prices may be higher, but they will still be affordable to most.
  4. More first time buyers– We expect first-timers to make up a bigger portion of the market than they did this year. The reason is simple: The market will be more welcoming to them thanks to the aforementioned slowing price growth and easier access to loans. It is important to note that Millennials & Young Gen X’ers are expected make up the largest demographic of home buyers in 2016 because they have recovered from the financial crisis, are entering their prime professional years, as well as their prime family raising years.
  5. Rental Homes & Millennials– According to a recent analysis by the Federal Reserve, outstanding student loan debt now totals more than $1 trillion. Student loan debt can create additional hurdles for mortgage shoppers. It increases the borrower’s total debt-to-income ratio, which can cause problems during the underwriting and approval process, and excessive debt can lower a person’s credit score. All of this makes it harder for Millennials to qualify for home loans.  This is why we predict rental homes will continue to increase in popularity- Millennials simply can’t afford homes. Rental vacancy rates for both apartments and houses are at, or near, their lowest levels in 30 years, and rents are rising quicker than inflation.
  6. Smart Homes/ Housing Tech – Smart homes and houses with more technological features available at time of sale will continue to become more popular. Features like beacon technology, security tech, VR and more will make homes more appealing. Smart home features will start to be expected by consumers in 2016.

We can’t wait to help you own your dream home in 2016! On behalf of all of us from Alpha Mortgage, we wish you a very happy New Year!