Recent Changes in the Mortgage Market

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In our weekly news alerts, LM Cohen aims to deliver pertinent  and relevant information to our clients.

 

Mortgage rates always seem to be  a hot topic amongst most of our clients, whether it is for business or personal use and therefore we  are sharing what is going on in the market.

 

At their March 2019 meeting, of the Federal Reserve  announced they have no plans to raise interest rates in 2019 and, possibly, for the next two years. After a series of steady rate hikes, economic indicators justified a halt to these increases.

 

Markets reacted immediately with mortgage rates immediately falling to a new 18-month low.

 

Reviewing current mortgages is a smart move

A low-rate environment is an ideal opportunity to examine one's current loans. By reviewing your interest rate, loan term, and property value along with your personal financial situation and goals, you can assess how you might benefit from a new loan.

 

With a property you plan to sell within the next few years, a fixed-rate loan may not be meeting your needs. Conversely, if you have an adjustable-rate mortgage on a property you plan to keep long term, now might be exactly the right time to convert to a fixed-rate loan.

 

Exploring a shorter loan term can yield substantial benefits, as well. Lower rates can make a 15-, 20- or 25-year loan more affordable while significantly reducing the interest you pay over the life of a loan.

 

A new financial environment for new purchases

Today, a potential purchase looks a lot different than it did a year or two ago. Lower mortgage rates, a revised tax code, and an increase in the number of available loan products all impact the financials of a purchase. Understanding this new environment is vital to making the right decision when it comes to buying a new to buying a new home, office space, or investment property.

 

Making your mortgage work for you

Educated owners understand that there are many ways to make real estate equity and a corresponding mortgage work for them. Home values have increased significantly over the last few years. This can mean increased equity for homeowners-equity that can be put to work efficiently in a low-rate environment. Whether it is a primary residence, second home, or one or more investment properties, many programs exist that facilitate access to your equity.

 

A new loan can be used to consolidate higher-priced debt, fund the purchase of a new property, or use in any way the investor chooses. Becoming more familiar with the new mortgage debt guidelines is simply a prudent step for anyone with real estate holdings or future real estate plans.

 

Expanded mortgage opportunities for the self-employed

Over the last few years, banks' notoriously tight underwriting guidelines have begun to loosen. Whereas self-employed borrowers have historically had a difficult time getting mortgage financing, many new loan programs have been created to cater to this large segment of property owners. For prospective buyers who have felt locked out of the market, today's options are more and better than ever before.

 

The LM Consulting and Advisory Services (LMCAS) team is available to offer advice and solutions for any your mortgage needs. Contact  LMCAS's Lee Hamway (lhamway@lmcas.com) to discuss how you might be able to benefit from these recent changes.

 

LMCAS was established to offer unbiased and best in class mortgage advice and solutions to its clients. By combining tax efficient strategies with its expertise of the mortgage markets, LMCAS is a unique resource designed to enhance any real estate finance transaction.

 

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