By Ralph Dibugnara November 7, 2024 By Brian OConnell Home insurance seems to be a low priority for new homeowners, but adopting that mindset could be a serious mistake. Why? Because of costs related to home insurance and the reasons homeowners need insurance in the first place. You're going to want to protect yourself and your assets. Do you think you need home insurance? If so, you're going to want to evaluate your personal finances and determine how to budget for home insurance payments. Before you get out your wallet, here's what you need to know. How much does home insurance cost? Price-wise, new home buyers can expect to tack on $1,200 to the cost of a new home, in the form of proper home insurance. That cost, however, depends on several key factors including: Age and price of the home Amount of cash put down via a down payment State or municipality where the home is located Since real estate is primarily about location, where you buy your new home largely dictates how deeply you’ll have to dig in your pocket for home insurance payments. For example, homeowners in Louisiana face the highest home insurance rates in the U.S., at $1,958 (on average) per year. Compare that to $677 in Oregon or $692 in Utah. RECORD-LOW MORTGAGE RATES WON'T LAST — REFINANCE BEFORE IT'S TOO LATE What does a typical homeowners policy cover? No matter where you live home insurance shares some basic commonalities. "Good home insurance policies will mainly cover two types of liabilities - loss of personal property as well as liability for any other damages," said Ralph DiBugnara, president at Home Qualified, a digital platform for home buyers, sellers, and investors. "Yet every carrier has some common standards as well as items and scenarios that they deem to be high risk or low risk." That’s why it’s important a shopper should get at least three quotes because costs and coverages will vary from carrier to carrier. The idea is for shoppers to compare different rates from different companies, and the best way to accomplish that is by going online. To get the best home insurance policy at the best price, DiBugnara advised asking – and answering – three key questions before signing on the dotted line: How much insurance coverage do you actually need? What exactly does that coverage protect me from happening? How much of a deductible should I take and still be safe? "Answering these questions correctly can help you avoid major issues in case of disaster or damage to your home," he said. HOW TO FIND THE BEST MORTGAGE RATES AND FASTEST CLOSINGS What type of home insurance coverage do you need? Some home insurance experts say homeowners put too much emphasis on monthly payments and not enough on getting the right coverage. In that scenario, costs escalate in the form of high out-of-pocket expenses when a disaster strikes and the house incurs major damage. "Just like auto insurance, there can be great variance in the cost from one home insurance company to another," said Jeff Zander, founder of Zander Insurance, in Nashville, Tenn. "In many cases, people have paid less attention to their home insurance cost since it is often included in the escrow payment portion of the mortgage." "For most people, a home is their greatest asset, but the bank is only concerned about getting them their money and not about any of their contents, personal property, or liability risks that arise from owning a home," Zander said. Homeowners looking for quality home insurance at a decent price also need to make a distinction between covering select risks or covering all risks. Fortunately, home insurance policies have you covered. "There are really two types of home insurance policies," Zander noted. A "named perils" policy: This lists the perils that are covered. "If the peril is not listed, then it is not covered," he said. An all-risk policy: "This is the most preferred homeowner insurance policy since it lists the exclusions," Zander added. "Basically, if it is not excluded then it is covered. An all-risk policy is a much broader policy form and includes better protection." The takeaway on getting good home insurance for the best price? Think value and not cost. "Don’t cut corners when purchasing home insurance," said Orlando Frasca, an insurance specialist at Rogers Insurance Services in Danville, Cal. "Consumers often look at the lowest price as opposed to what they are getting for that price, only to find out certain coverages they thought they have were not included on the policy."

By Ralph Dibugnara November 7, 2024 By Brian OConnell Home insurance seems to be a low priority for new homeowners, but adopting that mindset could be a serious mistake. Why? Because of costs related to home insurance and the reasons homeowners need insurance in the first place. You're going to want to protect yourself and your assets. Do you think you need home insurance? If so, you're going to want to evaluate your personal finances and determine how to budget for home insurance payments. Before you get out your wallet, here's what you need to know. How much does home insurance cost? Price-wise, new home buyers can expect to tack on $1,200 to the cost of a new home, in the form of proper home insurance. That cost, however, depends on several key factors including: Age and price of the home Amount of cash put down via a down payment State or municipality where the home is located Since real estate is primarily about location, where you buy your new home largely dictates how deeply you’ll have to dig in your pocket for home insurance payments. For example, homeowners in Louisiana face the highest home insurance rates in the U.S., at $1,958 (on average) per year. Compare that to $677 in Oregon or $692 in Utah. RECORD-LOW MORTGAGE RATES WON'T LAST — REFINANCE BEFORE IT'S TOO LATE What does a typical homeowners policy cover? No matter where you live home insurance shares some basic commonalities. "Good home insurance policies will mainly cover two types of liabilities - loss of personal property as well as liability for any other damages," said Ralph DiBugnara, president at Home Qualified, a digital platform for home buyers, sellers, and investors. "Yet every carrier has some common standards as well as items and scenarios that they deem to be high risk or low risk." That’s why it’s important a shopper should get at least three quotes because costs and coverages will vary from carrier to carrier. The idea is for shoppers to compare different rates from different companies, and the best way to accomplish that is by going online. To get the best home insurance policy at the best price, DiBugnara advised asking – and answering – three key questions before signing on the dotted line: How much insurance coverage do you actually need? What exactly does that coverage protect me from happening? How much of a deductible should I take and still be safe? "Answering these questions correctly can help you avoid major issues in case of disaster or damage to your home," he said. HOW TO FIND THE BEST MORTGAGE RATES AND FASTEST CLOSINGS What type of home insurance coverage do you need? Some home insurance experts say homeowners put too much emphasis on monthly payments and not enough on getting the right coverage. In that scenario, costs escalate in the form of high out-of-pocket expenses when a disaster strikes and the house incurs major damage. "Just like auto insurance, there can be great variance in the cost from one home insurance company to another," said Jeff Zander, founder of Zander Insurance, in Nashville, Tenn. "In many cases, people have paid less attention to their home insurance cost since it is often included in the escrow payment portion of the mortgage." "For most people, a home is their greatest asset, but the bank is only concerned about getting them their money and not about any of their contents, personal property, or liability risks that arise from owning a home," Zander said. Homeowners looking for quality home insurance at a decent price also need to make a distinction between covering select risks or covering all risks. Fortunately, home insurance policies have you covered. "There are really two types of home insurance policies," Zander noted. A "named perils" policy: This lists the perils that are covered. "If the peril is not listed, then it is not covered," he said. An all-risk policy: "This is the most preferred homeowner insurance policy since it lists the exclusions," Zander added. "Basically, if it is not excluded then it is covered. An all-risk policy is a much broader policy form and includes better protection." The takeaway on getting good home insurance for the best price? Think value and not cost. "Don’t cut corners when purchasing home insurance," said Orlando Frasca, an insurance specialist at Rogers Insurance Services in Danville, Cal. "Consumers often look at the lowest price as opposed to what they are getting for that price, only to find out certain coverages they thought they have were not included on the policy."

By Ralph Dibugnara October 17, 2024 By Tribune News Service | Tribune News Service UPDATED: September 27, 2024 By Erik J. Martin, Bankrate.com Leaves aren’t the only things falling this autumn: Mortgage rates are finally heading down, too. And that, combined with a seasonal dip in home prices, is causing some end-of-year excitement among homebuyers and sellers. The median existing-home price was $416,700 in August, per the National Association of Realtors — a record high for August, but still down from $422,600 a month earlier. And average rates for the benchmark 30-year fixed-rate mortgage loan have dropped from a high this year of 7.39% in May to 6.24% in late September. With rates already down more than a full percentage point and more Fed interest-rate cuts on deck, many market-watchers are asking, what do the final three months of 2024 have in store for sellers and buyers? We reached out to a panel of pros for their real estate trends and forecasts. Q4 2024 housing market trends: What to expect The last quarter of the year is usually a slowdown period for real estate markets across the country. Typically, home sales tend to decrease in the fourth quarter and stay subdued until spring. During this period, there are usually fewer buyers, the number of homes for sale declines and properties are more likely to see price cuts compared to other times of the year. Molly Boesel, principal economist for CoreLogic, seconds those sentiments. “Many buyers have been waiting on the sidelines to purchase, and many will now purchase quickly,” she says. “Therefore, we most likely won’t see the typical slowdown in the last three months of the year.” Ralph DiBugnara, president of Home Qualified, says these factors, combined with the presidential election, should ensure sharp movement in favor of buyers between October and December. “It should make the fourth quarter of 2024 probably the busiest of the year,” he predicts. Q4 mortgage rate projections As of September 25, the rate for a 30-year fixed mortgage averaged 6.24% versus 5.43% for a 15-year fixed home loan, per Bankrate’s latest survey of large lenders. And housing experts envision rates dipping even lower over the rest of the year. “During the next three months, we’re probably going to see average 30-year fixed mortgage rates in the low 6% or perhaps the high 5% range,” says Ted Rossman, senior industry analyst for Bankrate. “The path forward for mortgage rates will depend on the state of the economy, the job market, what the Fed does and more. Consider that last fall, the average 30-year fixed mortgage rate briefly hit 8% for the first time since 2000. Now, we’re moving in the right direction — although today’s rates are still much higher than they were for most of the past 15 years.” Bugnara anticipates 6.25% and 5.625% average rates, respectively, for 30-year and 15-year mortgage loans this quarter. But Boesel expects the 30-year mortgage rate to average 6.0% this quarter. Sharga mirrors that prediction, with a caveat: “There’s an outside chance it could dip below 6% and settle in the high 5% range,” he says. Where home prices are heading Housing prices have been on the rise for quite some time, and that doesn’t look to change in Q4: Buyers should not expect to see a significant drop in prices before the end of the year. “Home prices should increase this quarter by 3.9% year-over-year,” says Boesel. “Continued homebuyer demand bumping up a still-limited supply will push prices up.” Bugnara concurs, predicting that we’ll see home prices jump 3% to 5% over the quarter. Dennis Shirshikov, an adjunct professor of economics at City University of New York, also foresees prices remaining high — “however, you might see slight cooling in certain overvalued markets,” he says. Housing inventory predictions for Q4 “We’re unlikely to see a huge wave of homeowners listing their properties for sale until mortgage rates come down significantly — probably below 5.5%,” says Sharga. However, he notes that inventory levels are up about 40% from last year. “The inventory of new homes for sale is actually back to pre-pandemic levels, so overall there’s more to buy,” he says. But Shirshikov does not think inventory will grow much more this year, particularly for entry-level homes. “Many homeowners locked into low mortgage rates will continue holding off on selling, restricting supply,” he says. Boesel anticipates the inventory that does arrive on the market to sell fast. “As new supply enters the market, it should quickly exit as homebuyers waiting on the sidelines act quickly,” she says. For-sale inventory should trend around 15% to 20% above 2023 levels, she forecasts. Strategies for homebuyers and sellers Now that the tea leaves have been read on real estate trends for Q4, how should consumers proceed? If you’re hoping to buy, be sure your finances are in order. “Don’t buy a home before you’re ready,” says Rossman. “Make sure you have a cushion for transaction costs, repairs and maintenance. It’s better to rent for longer than to buy before you are ready.” Still, be prepared to pounce if a great opportunity arises. “Competition for properties should remain brisk in quarter number four, so buyers should be ready to act when they find the home they want to purchase,” Boesel says. “I’d recommend considering less competitive markets where your purchasing power can go further,” says Shirshikov. And if fewer buyers than expected enter the market this season, “you might find some good deals, especially from sellers who are more motivated to close before the end of the year.” Sellers, meanwhile, should consider the following factors: Local market conditions: “Know what’s happening in your local market,” says Sharga. “If homes are selling quickly and prices are rising, it’s probably a good time to list. On the other hand, if you see inventory levels increasing, homes remaining on the market longer and prices weakening, it might make sense to wait until spring to list your home for sale.” Competitive pricing: “Even in a seller’s market, buyers are sensitive to high mortgage rates,” Shirshikov says. “Overpricing your property could lead to it sitting longer on the market. Consider offering incentives, such as covering closing costs, to make your listing more attractive, if necessary.” Where you will live next: “You can probably get a good price for what you’re listing, but you may have to pay more than you want for what’s next,” says Rossman. “And your mortgage rate could be a lot higher than you are used to, even as rates have begun to come down. Sweet spots are empty-nesters downsizing and people leaving higher-cost markets for lower-cost markets. On the flip side, trading up in a similar market is pricey.”

By Ralph Dibugnara October 10, 2024 By Christy Biebe October 1, 2024 Home equity loans have long been one of the more affordable ways for property owners to borrow and, unlike alternatives such as a home equity line of credit (HELOC), home equity loans typically offer borrowers a fixed interest rate and predictable payments. Unfortunately, home equity loan rates have soared in the post-pandemic era as the Federal Reserve raised the benchmark interest rate to fight inflation. While home equity loans and HELOCs remained cheaper than credit cards, borrowing costs hit the highest levels in years. The good news is, the tide may be turning. Driven by anticipation of a Fed rate cut, expert predictions of falling rates in the summer of 2024 proved accurate. With the latest inflation report showing just a 2.5% year-over-year increase in the all-goods index, the Fed rate cut announced in September and the Fed strongly signaling more cuts are coming, predictions of additional rate drops this fall have many owners hoping cheaper loan options will soon be on the table. But, will rates drop in October or should homeowners hold on for further rate declines? We asked some experts where they think rates are trending. Here's the home equity loan interest rate forecast for October Looking to access your home equity this month? Here's what could happen to interest rates: A rate reduction could be on the table Homeowners eager to tap into their equity as soon as possible may have some new opportunities to borrow at a lower rate this October. "Home equity loan rates will be reduced by .50% in October," predicts Melisa Cohn, Regional Vice President at William Raveis Mortgage. Cohn indicates that rates will drop because of the Federal Reserve's recent rate cut at the September meeting. Borrowers who currently have home equity loans won't see their costs decline, unlike those with variable-rate HELOCS that often move directly with the prime rate which is heavily influenced by the Fed. Although HELOC rates fluctuate over time, home equity loan rates are fixed. Anyone who already borrowed is locked in at the rate they were initially offered unless they refinance. New home equity loan borrowers, however, could benefit from more affordable loan options coming on the market. The Fed's benchmark rate is just one factor affecting how much banks charge homeowners looking to tap equity, but when it costs banks less to borrow, they often respond by lowering rates on home equity and other consumer loans. Bigger rate cuts are coming While loans should become more affordable in October, those who can hold on for a little longer may be rewarded for their patience. "I don't think we'll see much change in home equity rates in October; however, pretty sizable drops are coming," predicts Aaron Gordon, Branch Manager and Senior Mortgage Loan officer at Guild Mortgage. "The Fed dropped rates 50 basis points in September so that was great news for home equity loans but the next Fed meeting isn't until early November. With inflation getting closer to the Fed's 2% stated target, I believe we'll see steady drops over the next year." Ralph DiBugnara, President of Home Qualified, also believes rate drops are imminent but not necessarily immediate, although he predicts the rate decline will start in October. "With overall mortgage rates coming down because the Fed has started lowering the borrowing rate, home equity loan rates will come down as well," he says. "This reduction should happen over the fourth quarter of 2024 and into 2025." DiBugnara explained that reduced consumer spending, higher unemployment rates and high levels of consumer debt will prompt the Fed to continue rate cuts, which will lead to further reductions in home equity loan costs for property owners. The bottom line Of course, not everyone can delay their borrowing date indefinitely if they have pressing financial needs now and those looking for home equity loans in October should still see some good opportunities out there. The key will be finding them. "It's important to shop home equity rates as there may be a pretty big difference between your favorite bank or credit union and other lenders," Gordon says. By exploring multiple loan offers and comparing rates and fees, borrowers who need to tap their equity can find the best deals in the current market -- while homeowners who aren't on the clock can sit back and wait for even better offers in November and beyond.

By Ralph Dibugnara October 4, 2024 By Christy Bieber Edited By Angelica Leicht September 24, 2024 On September 18, 2024, the Federal Reserve announced a 50 basis point cut to the federal funds rate. For homebuyers faced with record-high mortgage rates in the post-pandemic era, this was welcome news. Many had been prepping for a rate cut in hopes mortgage rates would fall after the September Fed meeting. Those readying themselves for cheaper home loans were given reason for optimism about September's mortgage rate forecast when the Fed delivered a larger-than-anticipated rate cut. Still, the big question for most buyers is whether the Fed's moves will push current mortgage rates low enough so they can finally buy a home with affordable monthly payments. Mortgage costs had already begun dropping in anticipation of the Fed's actions and are down over a point from the post-pandemic highs — but are still higher than during the pandemic and in the years leading up to it. Buyers looking at loan offers in the 6% range are likely wondering if there's a chance rates could decline further in October, even though the Fed doesn't meet again until November. If you're considering staying on the sidelines in hopes that will occur, here's what experts say about your chances. Will mortgage rates drop in October without a Fed meeting? For would-be homeowners focused on the Fed, it's important to realize the central bank doesn't play as big a role in driving borrowing costs as some buyers might think. "The Fed funds rate is not directly tied to mortgage rates, so we don't need the Fed to announce another rate cut in October to see rates continue to decline," says Sarah Alvarez, vice president of mortgage banking at William Raveis Mortgage. The Fed sets the overnight rate at which banks borrow from each other. It doesn't impact mortgage rates directly. "Mortgage rates can and do move without a big decision by policymakers," says Ali Wolf, the chief economist for Zonda. "Mortgage rates move on a day-to-day basis based on economic data and investor sentiment." Wolf believes that since economic data is likely to come in muted, rates are likely to continue trending downward in October. Both inflation and employment numbers are key factors to watch. "If inflation continues to show signs of cooling we will likely see rates continue to decline," Alvarez says. While Alvarez warns election uncertainty and an escalation of global wars could potentially have a negative impact, there's also plenty of evidence suggesting economic trends will favor further cuts. "Prices have reached a point where Americans have stopped buying. Unemployment has also continued to increase," says Ralph DiBugnara, founder of Home Qualified. "The combination is bringing inflation down, and with that mortgage rates will continue to fall next month." October's rate cuts still may not be as substantial as borrowers hope, though, unless conditions worsen. "Right now, the economy is running pretty strong but if labor market conditions weaken considerably, that could lead to a more sizable drop in interest rates," says Lisa Sturtevant, PhD and chief economist at Bright MLS. Anticipation of future Fed action could cause rates to fall While some would-be homebuyers saw the long-awaited September rate cut as crucial to declining mortgage rates, the reality is that borrowing costs had already started to fall in anticipation of the Fed's actions — and this is a pattern likely to repeat. "The expected Fed rate cut this week has already been largely baked into mortgage rates, which have been falling since July," Sturtevant says. "An expectation of a rate cut by the Fed in November could actually cause mortgage rates to fall in October in anticipation." Alvarez agrees that when the Fed is hawkish about future rate cuts, this positively impacts the mortgage market. That's good news as the central bank signaled another half-point rate decrease is likely this year. With the Fed's intentions made clear, lenders can act sooner rather than later. "The Fed has changed their sentiment to one of reducing the borrowing rate," DiBugnara says. "The markets now understand that the Fed has no choice but to lower rates." Investors and banks will react accordingly. Buyers shouldn't wait for a rate cut to act While all available evidence suggests rate cuts are likely outcome in October, there are no guarantees — and there are some risks worth considering. "Many homebuyers have been waiting on the sidelines for rates to fall. If there is a surge in mortgage demand in October, mortgage rates could actually be pushed up a bit as lenders respond to that increased demand," Sturtevant warned. An increase in buyer demand could also put upward pressure on home prices, leaving would-be borrowers in the unfortunate position of facing a more competitive market and higher purchasing costs just as mortgage loans become more affordable. Since buyers can refinance a home loan if rates decline, but can't buy at today's prices if home costs surge, those who have been sitting on the sidelines may want to take advantage of opportunities available now. Today's rates aren't the most competitive in history, but they're down considerably from recent highs. Borrowers who are financially ready can get in at a reasonable cost before home prices rise and consider refinancing later if rates continue to decline. The bottom line While a Fed meeting won't happen in October, potential home-buyers could still see important changes in the mortgage and housing market — including a reduction in loan rates. Still, the downside risks of delaying a home purchase in anticipation of future rate cuts may outweigh the upside. Would-be borrowers should seriously consider taking action before a potential home price surge — especially with the Fed signaling rate cuts could continue into 2025. Future opportunities to refinance are likely to become more plentiful over time, but the home prices of today may be gone for good tomorrow.