Here’s a look at the latest developments in the mortgage market for the week beginning 6/7/21.
- Missed refinancing in 2020? Find out if you can save with RefiNow.
- How new government policies could make homebuying more affordable
- Rates are below 3% and still near historic lows
- How Better Mortgage helped Jasmine buy a home in less than 30 days
Missed refinancing in 2020? Find out if you can save with RefiNow.
An estimated 2 million homeowners are now eligible to refinance with RefiNow, a new Fannie Mae loan program. The option is designed for homeowners who may not meet the income requirements for a standard refinance, and weren’t in a position to save during last year’s stretch of record low rates.
Refinancing with RefiNow guarantees an interest rate that’s at least .50% lower, and at least $50 off your monthly payments. The program is estimated to save qualified homeowners $100-$250 a month, or up to $3,000 a year.
Better Mortgage is offering loans through the program as of June 5th. Wondering if you’re eligible? Here are three key requirements.
A mortgage backed by Fannie Mae
Fannie Mae is a government-sponsored entity that purchases loans from lenders, and in order to access RefiNow, your existing mortgage needs to have been purchased by them. Be sure to look it up with this tool to confirm.
An income within the required range
Since RefiNow is meant to help a specific group of homeowners, you need to make 80% or less of the median income in your area to qualify. If you’re not sure what your area’s median income is, use this tool to find out.
A solid credit score and payment history
Unlike most other loan options, your debt-to-income ratio can be at or below 65% to qualify for RefiNow, but your FICO credit score has to be at least 620. Your current loan-to-value ratio can be anywhere up to 97%. Eligible homeowners also need a steady payment history over the last twelve months, without any missed mortgage payments.
For more details on the program’s benefits and requirements, see our complete guide to RefiNow. Better Mortgage is one of its first participating lenders, with digital services that save applicants even more by cutting out lender fees and commissions. If you’re ready to apply today, get started here. Not eligible? Don’t give up. We may have another refinance product that’s right for you.
How new government policies could make homebuying more affordable
As home prices rise around the country, a handful of new initiatives from the federal government could help more buyers afford their next home. While most plans are still being debated within Congress, analysts expect their passing to impact the homeownership landscape for years to come.
The First-Time Homebuyer Act is set to provide a tax credit to first-time buyers of up to 10% of their home price, for a maximum $15,000. There’s also The Neighborhood Homes Tax Credit, which incentivizes people to buy and renovate outdated homes, and sell them to buyers who make less than 140% of the area’s median income. That plan also comes with a $100 million initiative to offer down payment assistance to FHA loan-holders.
The biggest initiative is President Biden’s infrastructure bill, which sets aside $213 billion for housing development and improvements. It aims to create more jobs in residential construction, build more affordable homes at a range of price points, and help fill the supply gap that exists on the market today. Today’s inventory is nearly 4 million homes short in relation to buyer demand, after over a decade of underproduction. The lack of selection has driven up price growth and the frequency of bidding wars, so having more homes on the market would help to ease competition.
Rates are below 3% and still near historic lows
The average 30-year fixed rate dropped below 3% in the first week of May, and beyond a couple of jumps since, hasn’t risen past that threshold. This week, the rate is averaging 2.99%, down from 3.18% one year ago. For context, it reached its lowest level in 50 years in January of 2021, at 2.65%.
Considering rates were below 3% during last year’s refinance wave, when droves of owners took home savings, there’s a good chance many can still take advantage with a new loan. To find out if you’re one of them, take a look at today’s rates to see how your current mortgage measures up.
How Better Mortgage helped Jasmine buy a home in less than 30 days
Starting with Jasmine James, an engineering manager who bought her home in Atlanta, Georgia this past January. She was able to get the loan she needed online with Better Mortgage and close on her new home in less than 30 working days. This was Jasmine’s fifth home, and she says working with Better Mortgage gave her the easiest and most streamlined process she’s ever gone through.
Much of that speed is thanks to our online tools and services, which have helped our buyers close 10 days faster than the industry standard, on average. If you want to finance your home quickly, read up on how working with an online lender can help.
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