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Buyer Tips

Mortgage Rates Drop to 2-Year Lows

Good news for homebuyers: The June 6th results of Freddie Mac’s Primary Mortgage Market Survey® (PMMS®) show that the 30-year fixed-rate mortgage rate has fallen to 3.82 percent, the lowest level since September 2017, and these rates are holding this week.  If you are considering buying, now is the time to take advantage of these low rates.

Freddie Mac Primary Mortgage Market Survey

Sam Khater, Freddie Mac’s chief economist, says, “While the drop in mortgage rates is a good opportunity for consumers to save on their mortgage payment, our research indicates that there can be a wide dispersion among mortgage rate offers. By shopping around and getting a single additional mortgage rate quote, a borrower can save an average of $1,500.”

  • 30-year fixed-rate mortgage (FRM) averaged 3.82 percent with an average 0.5 point for the week ending June 6, 2019, down from last week when it averaged 3.99 percent. A year ago at this time, the 30-year FRM averaged 4.54 percent. 
  • 15-year FRM averaged 3.28 percent with an average 0.5 point, down from last week when it averaged 3.46 percent. A year ago at this time, the 15-year FRM averaged 4.01 percent. 
  • 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 3.52 percent with an average 0.4 point, down from last week when it averaged 3.60 percent. A year ago at this time, the 5-year ARM averaged 3.74 percent.

Average commitment rates should be reported along with average fees and points to reflect the total upfront cost of obtaining the mortgage. Borrowers may still pay closing costs which are not included in the survey.  

Source: Freddie Mac

If you have any questions about the local market, or if you're thinking about buying a home in the Greater Amherst and Northampton Area, contact Delap Real Estate.

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Help for First Time Homebuyers

Do you think that a home of your own is beyond your reach?  Many potential home buyers are unaware that there are resources that can assist in making the dream of owning a home a reality. Valley Community Development (Valley CDC)  is an amazing organization right here in Western Massachusetts.  Their team has guided scores of people through their home buying experience.

The Valley CDC offers First Time Homebuyer workshops every month at a different location, rotating between Easthampton, Northampton, & Amherst. Each workshop series meets 4 times, once per week, from 6 p.m. – 9:00 p.m. Classes are always held on weekday evenings. The workshops are open to anyone, regardless of where you live or work, or whether or not you are a First Time Homebuyer. Topics including budgeting, home inspections, closing procedures and more are covered. See the workshop schedule here. And of course, we at Delap are here for you and always delighted to help! If you are not yet in the market, or just starting out, or have questions-stop by our office, give us a call, or contact us by email. We can begin the journey with you to find a new home. It is nearer than you think!

 

 

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Win the Bidding War and Get the House You Want

By Holly Young, Co-Owner

Shopping for a home can be fun and rewarding as well as frustrating and discouraging. Finding the home you love only to have your offer edged out by another buyer can be heartbreaking, but in this market it’s almost a rite of passage. In a hot market, where the supply of homes is low and the demand high, you may find yourself in a bidding war with multiple offers.

Here are 6 tips to making a winning offer:

Buying a Home

1. Include a preapproval letter with your offer

Don’t prohibit a seller from taking your offer seriously by not including a preapproval letter or proof of funds (in the case of a cash offer). The seller will be assured of your financial viability with a letter from your lender that corroborates your ability to make a purchase. Getting preapproved before looking at homes will ensure you can pounce quickly when you find the home you want. You will also avoid the stress of submitting preapproval paperwork and writing an offer at the same time.

2. Make a clean offer

Put yourself in the seller’s position: if you were presented with two identical offers but one was firm and binding and the other conditional upon inspection, upon financing, or upon anything, which one would you choose? Sellers want offers that are clean and concise. If you know other bids are coming in and you really want a home, avoid putting in too many contingencies or making too many demands. That being said, one contingency you should think twice about before waiving is the home inspection. Should the inspector discover a major problem at the home, you may want to protect your right to back out of the purchase.

3. Have the best terms

In a bidding war situation, the seller is reviewing more than one offer to determine which the best fit is for them. The terms of the offer, not just the price, may determine which offer they choose. A good agent will give you the edge by finding out what the seller’s desired close date is so you can marry your offer to that date. A sizable deposit may also help sweeten the impression of your offer over another. If it comes down to a few thousand dollars, an offer with more attractive terms may win the day.

4. Write a letter to the seller

While this won’t overcome a large difference in your bidding price, it will definitely help at the margin. Let the seller know who you are and why you love their house. A heartfelt and sincere letter that includes a picture of yourselves, children, or pets will make you stand out as more than just a number on a page and build rapport with the seller.

5. Use an escalation clause

An escalation clause is a term in an offer that states you will pay x price for the home, but if the seller receives another offer that's higher, you will increase the offer by some increment up to y price. In theory, an escalation clause is fairly simple. In practice, there are a lot of details involved, especially if there are two or more offers submitted that contain escalation clauses. Some sellers don’t like escalation clauses and prefer that buyers submit exactly what they're willing to pay. Your agent can find out whether an escalation clause will be favorably received.

6. Work with an agent who knows the market

Working with a real estate professional who is an expert in the market is crucial in a multiple offer situation. There are countless strategies and details that an experienced agent can navigate to give you the competitive edge. That edge may determine whether you will be on the winning or losing end of a bidding war.

Are you thinking about buying a home in the Pioneer Valley of Massachusetts? Contact Delap Real Estate or start your home search today!

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