Saturday, April 18, 2015

7 Surprising Reasons to Refinance Your Los Angeles Mortgage Now


There are obvious potential benefits to a mortgage refinance in 2015... and not so obvious reasons.

Let's quickly touch on the obvious reasons to refinance:
  • If you can save 1/2% point and plan to stay in the home 3 years, you'll save money
  • To take out cash for another investment, college funds, home improvement, etc.
  • To shorten the term of the loan
  • To reduce your payment
Now, here is the way less obvious list:
  1.  To get rid of mortgage insurance (FHA, PMI). If your home has increased in value since your purchased it, and you now have 20% equity, a refinance can save you the cost of mortgage insurance. In many cases this saves you over $100 a month.
  2. To increase the term of the loan so that you get low interest financing for longer. This will include either cash out and or lower payments, but your goal is to to "borrow" at these crazy rates for longer. 
  3. This may be your last chance to refinance while you have income. If you are close to retirement, you can use the refinance to set up your retirement plan, keeping in mind that you may not be able to refinance in future years regardless of your assets or the equity in the home. 
  4. Getting rid of a "bad" loan. Possibly your current loan is an adjustable with a balloon, or was the result of a loan modification where the benefits are going to run out soon. 
  5. Pre divorce planning. You are considering a divorce. Currently both names are on the loan. Refinance now with only the name of the spouse who will continue with the payments. Easier now than it will be after the divorce.
  6. An old reason that is back in style - Pay of higher interest debt including credit cards, home equity loans, and finance companies.
  7. A combination of the above. No one of these reasons may be enough to move you to action, but consider this list of benefits we found one family received in a single refinance.
  • Go from a 30yr (with 18yrs left) to a 15yr mortgage
  • Drop my interest rate over 2%
  • Lower my monthly payment by $20
  • Get cash back at closing
It costs nothing to discuss your options and potential benefits of a refinance with Bill Rayman. He can advise you as to whether your circumstances, including reasons to refinance, equity in the home, income, and credit score provide you with a potential advantage.  Call Bill at 424-354-5325

Bill Rayman Home Mortgage

12121 Wilshire Blvd
Suite 350
LA CA 90025

Friday, March 27, 2015

Spring 2015 Los Angeles Real Estate Market is RED HOT!!


Spring has sprung and there are still no sellers

As we continue to review the Los Angeles and West Los Angeles real estate market, the unmistakable data points one inventory. 56 single family dwellings for sale in Santa Monica, 25 in Culver City, and 5 in Ladera Heights. Virtually all of these are over $1,000,000.  Super hot bedroom communities, Westchester and El Segundo have more listings and some 3 bedroom units in the $700,000 and up range.

As always, as you go inland, you will see better prices, but not necessarily many more total great opportunities for value. One home I am aware of just listed at $100,000 over the highest market estimate for that home.

The good news is that mortgage rates continue to be super low - under 4% for 30 year fixed depending on the qualifications of the buyer. One pundit mentioned the other day that this is good news now, but might cause some reduction in the home value when rates go up in the future. This might be true, but in the West Los Angeles Market there is not going to be increasing supply of single family dwellings. If anything that supply will decrease as some homes are being converted to multi-unit dwellings.

If you are contemplating purchasing a home in West LA, and would like to have a conversation about your options, call Bill Rayman at  424-354-5325

Bill Rayman Home Mortgage

12121 Wilshire Blvd
Suite 350
LA CA 90025


Thursday, March 19, 2015

The Fed's March Move Not Moving the Mortgage Market Much


The Washington Post provides the latest housing statistics. What do they mean?

According to the latest data released Thursday by Freddie Mac, the 30-year fixed-rate average fell to 3.78 percent with an average 0.6 point. (Points are fees paid to a lender equal to 1 percent of the loan amount.) It was 3.86 percent a week ago and 4.32 percent a year ago.

The 15-year fixed-rate average dropped to 3.06 percent with an average 0.6 point. It was 3.1 percent a week ago and 3.32 percent a year ago.

Hybrid adjustable rate mortgages were mixed. The five-year ARM average slid to 2.97 percent with an average 0.5 point. It was 3.01 percent a week ago and 3.02 percent a year ago.

The one-year ARM average held steady at 2.46 percent with an average 0.4 point.

“Housing starts dropped 17 percent to a seasonally adjusted pace of 897,000 units, below market expectations,” Len Kiefer, Freddie Mac deputy chief economist, said in a statement. “However, housing permits increased 3 percent in February. As we head into spring, home builders remain positive about home sales in the near future although the NAHB Housing Market Index dropped another [two] points to 53 in March.”

Meanwhile rising interest rates have put the brakes on mortgage applications, according to the latest data from the Mortgage Bankers Association.

The market composite index, a measure of total loan application volume, decreased 3.9 percent. The refinance index fell 5 percent, while the purchase index dropped 2 percent.

The refinance share of mortgage activity accounted for 59 percent of all applications.
The consensus seems to be that the Fed will raise rates later this year. This is likely to be a very modest increase in the Fed rate, and doesn't mean that mortgage rates will increase at all. Mortgage rates are only somewhat influenced by the Fed rate. Supply and demand for mortgage capital and the cost of bonds to underwrite mortgages are more critical to market rates for mortgages.

As noted by The Washington Post, mortgage rates have been moving up and down in a very small range for months, even years. There is no clear evidence that a boom in housing sales is anywhere on the horizon. While a shortage of available properties, and the increases in rental prices continue to drive up housing prices in many markets, it has not taken on boom proportions.

As noted in earlier posts on this blog, this is a good time for you to purchase a home if this is a good time for you to purchase a home. In other words, don't rush out and buy to beat a market trend, and don't stay out of the market to try and take advantage of some future pricing or mortgage interest rate advantage. At this time, it seems unlikely that interest rates will go much lower than these historically low rates, but they also don't seem headed higher. Home prices seem likely to trend higher.

As with all prognostications about any market, as soon as the prediction is made, it could be dead wrong. One things we can be certain of: if you are looking for a mortgage on a home for you and your family, or for investment, we can help you find the very best options for your situation.  Call Bill Rayman at Guaranteed Rate today.  424-354-5325

Bill Rayman Home Mortgage

12121 Wilshire Blvd
Suite 350
LA CA 90025

Thursday, March 5, 2015

Visual DNA Suggests a New Way to Test Your Credit Worthiness


Banks won't give you credit based on your credit score. Maybe this test would be better.

A company called Visual DNA claims to have developed a very short test that will give lenders a better indicator of credit worthiness than the current use of Credit Scoring based on your historic use of credit, income, expenses, and such.

The test uses a series of questions like the one above to determine your impulsiveness, conscientiousness, response to crises, and other markers they have determined point to the likelihood you will pay off your debt.

You can take the test here. 

You can read a longer article on the subject here.  The article points out that while you may think it is silly to offer such a test for this purpose, think again. It is already being used in Russia and South Africa for those who have little credit history.

If you are looking for a mortgage, and have the ability to make the payments, but your credit scores aren't what you need, give Bill Rayman a call to discuss how you might potentially resolve that and be able to buy that dream home or condo.  424-354-5325

Bill Rayman Home Mortgage

12121 Wilshire Blvd
Suite 350
LA CA 90025

Tuesday, February 24, 2015

Would You Like to Buy a Home in Santa Monica?

Home values are skyrocketing in Santa Monica

There are just under 90,000 folks living in the city of Santa Monica. Depending on whose statistics you use, there are 25-30 houses for sale at this time. Over the course of the past year, around 15 - 20 sell each month. If you look up the definition of seller's market, you'll see a picture of the this little berg.

Condos and townhouses add a few more possible places to purchase. Zillow says that there are a total of 157 total residential dwellings for sale, so that suggests about 130 attached houses of one kind or another. Amazingly, you can still buy some well located condos for under $500,000. They are also under 700 square feet and feature one bedroom and one bath.

Renting might be an option for you, but unless you are blessed to have a rent controlled apartment (rent control practically started here), you will pay an average of $2800 for a one bedroom unit.

Your trusty reporter is old enough to have lived in a large 1 bedroom on 4th Street, North of Wilshire for just $95 a month.  That would have been 1970.  I looked at, and almost purchased, a 2 bedroom, one bath home in the 900 block of Georgina for $52,500.  But if you've lived on the Westside for any length of time, you have such stories.

The good news regarding Santa Monica real estate has to do with mortgages. Bill Rayman can get you a mortgage for one of these houses or condos at historically low rates. 30 year fixed rates are still under 4% for most loans, and right around 4% for jumbo loans. This means that your $1m mortgage will only set you back $3300 a month in interest, some of which will be tax deductible. You'll pay a total of $4774 on the mortgage plus property tax and insurance.

So if that sounds like a good deal to you, or if you need half that much or twice that much to buy your dream home, give Bill Rayman a call at 424-354-5325. He promises to help you find the very best mortgage product to fit your needs.

Bill Rayman Home Mortgage

12121 Wilshire Blvd
Suite 350
LA CA 90025

Monday, February 16, 2015

2015 May Be A Great Time to Refinance Your Mortgage and Save


Current mortgage interest rates are fantastic

The average 30-year, fixed-rate mortgage costs just 3.75% (Feb 16, 2015); the average 15-year mortgage rate is 3.00%. See today's rate by going to and selecting mortgage rates at the top of the page.

Lowering your interest rate even one point (or even less) means saving thousands of dollars in interest payments over the life of your loan. And saving money on your mortgage is one way to work toward financial security.

You don't necessarily need to read all the details below to determine if refinancing now makes sense to you. The simple and free way to know for sure is to give Bill Rayman a call. If possible grab your mortgage so that you can give Bill a couple of pieces of information about your current loan. You can reach Bill at 424-354-5325. If he isn't in, he will call you back same day.

If you want to do a quick analysis, consider the following elements.

Refinance if you can shave a percentage point off your mortgage rate

The 1% rule is still a good rule of thumb to follow when deciding whether it makes sense to refinance, but in this environment, you may find it financially beneficial to refinance if you can save half that amount.

Let's say your home loan rate is about 4.75%. Refinance with current interest rates and you'll reduce your monthly payments by about $60 a month for every $100,000 you borrow. So if you have a typical Southern California Mortgage of $250,000, you will be saving $150 a month, which is $1800 a year or $54,000 over the course of 30 years. Half of that would still be a great deal depending on other circumstances.

Refinance if you can reduce or eliminate mortgage insurance

FHA rates have just dropped by .4% or more, and that has resulted in similar drops in private mortgage insurance (PMI). This means that you might be able to save enough in mortgage insurance alone to justify refinancing. But if you can save .4% on FHA or PMI and another .5% on your rate, that will generally be a fantastic deal.

Here is a detailed post on the changes in mortgage insurance and FHA.

Keep in mind that many other issues will effect the final numbers such as your credit score, income, home value, equity, and more. It costs nothing to ask Bill Rayman to evaluate your situation and offer you options that might lead to savings of many thousands of dollars per year. 424-354-5325

Bill Rayman Home Mortgage

12121 Wilshire Blvd
Suite 350
LA CA 90025


Do You Have an FHA Financed Home? Refinance Now and Save Hundreds of Dollars per Month


Major savings possible as FHA and PMI rates drop

If you bought a house or refinanced a mortgage since 2011 using FHA, Listen Up! You can save a boatload of money by refinancing now. The FHA rate over the last 4 years has been a minimum 1.15% and as high as 1.5% depending on your credit. That rate has just dropped by about .4%. On a $300,000 loan that would be a savings of $1,200 per year if you were to refinance. Depending on the basic interest rate on the loan, the savings could be even higher. MUCH HIGHER!

You could save $150,000 on a $300,000 loan!

Moreover, if you now qualify for PMI (private mortgage insurance) you can save more now and pay no premiums later in the mortgage. You see, the folks who sell PMI have to compete with the FHA insurance. They charge less, but have tighter restrictions on who they will insure. But the critical difference today is that PMI can be stopped when you have 22% equity in your house. 

Here is an example. Possibly you purchased a home for $310,000 in 2013 at 4.35% interest and 1.15% on an FHA insurance policy. You only put down $10,000, so had a $300,000 mortgage. Your combined interest and FHA would be approximately 5.5% of the $300,000 or $16,500 per year ($1375 per month.) Possibly that home has gone up in value to $380,000. If so, you would be able to refinance for $300,000 but now have over 20% equity. This would mean no FHA and no PMI would be needed. Moreover, at today's interest rates, you might also save .6% on interest alone. This could add up to savings of $5250 per year or $437.50 per month...for the life of the loan. That would be a savings of over $150,000.

If you change to PMI, you still save!

Not every home has gone up by 20% over the last two years. But most homes have gone up. Maybe your credit rating has improved also. By refinancing now, you may be able to either lower your FHA rate to the current levels and save at least .4% or you may be able to switch to PMI and save even more. Add this to any savings in the underlying interest rate and you still may be saving 1% or more. On that same $300,000 loan that could be $250 per month every month.

In addition, you may not realize that the FHA insurance you are paying may be for THE LIFE OF THE LOAN! Starting in 2013, FHA does not allow the homeowner to eliminate the insurance when the loan to value ratio is 78%. PMI is almost always for a much shorter period. By refinancing, you can eliminate that extra cost that will continue for up to 30 years. But if you MISS THIS LOW INTEREST RATE window, it may not be possible to refinance. You need to act right now.


ACT NOW! Interest rates will not stay this low forever.

It won't cost you a single red cent to call and find out what your options are. Call Bill Rayman at Guaranteed Rate today to learn more about this amazing opportunity.