Current Mortgage Rates: Richmond, VA
3.750% (3.751% APR) 30yrs
3.250% (3.282% APR) 15yrs
as of 08/16/19
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Mortgage Blog

Mar 25

Millennials May Be Ready to Buy a Home Sooner Than They Think

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The generation that has graduated from college in the last 5 to 10 years are no strangers to debt, and perhaps have more experience with loans, credit scores, and building credit than any generation to come before them. Student loans were not a necessity 30 years ago, but now require graduates to have a financial understanding of credit, loans, and debt. As they look to become first-time homebuyers, this group may have an advantage.

In a digital age that constantly creates new ways to spend as well as to save, millennial buyers are one of the largest and most sought-after markets. And they know how to spend—and save! It’s true, millennials are not afraid to save money. So why not take this mentality towards building equity, possibly for the first time in your young adult life? Millennials are ready to stop renting and start buying homes.

Here are three reasons buying a home will save money:

1. Start building equity sooner

Don’t just plan for retirement, plan for life. Whether into new investments—creating an estate for your family, refinancing your home to start a business—having reliable equity such as a paid off home will get you ready to begin the next chapter of your life with all of the resources that you need.

2. Pay less over time

Since most mortgage loans have 30-year amortizations, the payments will most likely be lower than a rent payment. This will also be building towards your equity, as opposed to the landlord's equity. Because of this, you will ultimately save a significant amount of cash as opposed to renting.

3. Long term savings

Begin a plan for retirement now. Everyone plans to retire at some point in their life. We all have goals in between now and then, whether it is to own a home, or several homes, to start a company, or to pay for an education. Choosing to buy a home instead of renting will open up income possibilities in the future, and ensure that you become debt-free upon retirement.

Mortgages are designed to meet a client’s specific needs and interest, and will help you to achieve the goal of owning a home of your own. Renting will result in monthly payments with no return, whereas buying a home will pay off now and in the future. Millennial buyers may be ready to search for their dream home sooner than they believe and should be encouraged to meet with a mortgage lender to begin this process.

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Feb 28

Determining Your Down Payment for First-Time Homebuyers

Determining your down payment for first time homebuyers web

One of the most important factors for securing your mortgage loan is the down payment. This upfront payment on a home is separate from your monthly mortgage payments. Planning a realistic down payment is important to getting the type of mortgage loan that you want. Because of this, saving the desired sum is important and requires considered financial awareness. Basically, the higher your down payment, the lower your monthly payments, because it is the remaining amount owed divided over the term of your mortgage.

Before you determine how you will make a down payment, it’s important to understand the requirements that certain types of loans will have, as many will require you to pay 3%-5% of the total cost of the home. An FHA loan requires a minimum down payment of 3.5% and is what many first-time homebuyers will end up using. All FHA loans also require home buyers to purchase MI, or mortgage insurance. With a 20% down payment, home buyers can use Conventional financing will not be required to purchase mortgage insurance. A higher down payment will give the buyers more options when it comes to shopping for a mortgage and ultimately with the house they buy.

The down payment is one of approximately 4 factors that will determine if a buyer is pre-approved and ultimately approved for a loan: down payment, credit history, employment and income, and bank statement history. A down payment does not actually have to be available to the buyer at the time an offer is made, so long as the full sum is available at the time of the closing.

The more you put down the lower your monthly mortgage payment will be. USDA and VA mortgage loans are government-backed and do not require a down payment which may be attractive to some customers who have difficulty saving a large sum. Homebuyers with lower credit scores may benefit from providing a larger down payment.

Here are four steps to determining how much money to put down:

1. Plan ahead
Because mortgage loan approval will involve the home buyer’s credit score, income and employment history, and bank history, it is important to evaluate these factors before beginning home buying process. Because the down payment will be provided up front, a large down payment can increase the likelihood of getting the loan that you want if you have a low credit score. However, if you have excellent credit history and income, providing a larger down payment may not be necessary unless you would like to avoid the requirement of purchasing mortgage insurance.

2. Determine what you can pay from savings
After evaluating your credit score and income history, you should determine how much you can provide as a down payment. Savings are important, so be reasonable and realistic about what you can provide. Remember that FHA loans require at least 3.5% down, and when speaking to a mortgage lender, they may provide you with their own, additional requirements. Keeping these
factors in mind will help you determine your home buying budget—but remember, lending is a conversation, and you should feel comfortable working through different scenarios with your mortgage professional.

3. Set a goal for your mortgage terms
It is important to set goals when shopping for a mortgage and one of the most important is your interest rate. If you are seeking a lower interest rate, you may want to provide a higher down payment. Not only will this offset the costs that you will be paying each month because the remaining balance on the loan will be reduced, but it will be a positive factor in evaluating your readiness to repay the loan to the lender. Remember that after a down payment, the remaining balance on the loan will be divided by the loan term, and this will be your monthly payment with interest. Figuring out these numbers with a mortgage lender will allow you to realistically evaluate what you can pay each month, and having that goal in mind will help you take the steps to get there.

4. Meet with a mortgage lender
After setting goals and determining what type of mortgage loan you would like, it is time to visit a loan professional and get a rate quote. Many local mortgage agents are happy to go back to the drawing board and help you to determine your best options for obtaining your ideal interest rate and loan terms. Remember to be open and honest with your mortgage lender, and that a local lender will be able to give you the most time and attention, opposed to large, national lenders or over-the-phone mortgage apps.

Determining your down payment is an important step in shopping for a mortgage. Remember to evaluate all of the factors that will determine your mortgage loan, set goals, and find a local mortgage lender that will work hard to realize your goals.

Click here to get a rate quote from RatePro Mortgage today!

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Feb 9

Advantages of a Local Mortgage Lender

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Quick mortgages are advertised everywhere these days. Large quick approval mortgage lenders portray home buyers signing “instant” mortgages over their smartphone. Corporate structured mortgage lenders advertise that they care about individual success and financial security. Whatever the claim of these large companies, it’s nowhere near the reliability of a local mortgage lender. Here are four reasons why you should work with a local mortgage lender:

1. Have the opportunity to shop rates more closely
Having the availability of a mortgage lender in person will give you the opportunity to view and discuss mortgage rates and loan types more closely. Insider knowledge will allow you to see the variables that are affecting your rates and will help you to understand which mortgage type may be best for you. You won’t be able to get that sort of conversational feedback from an app or large financial institution.

2. Face to face contact unavailable from a website or app
Local mortgage lenders are usually small, personal businesses that value relationship building. Many rely on setting appointments, standing by for phone calls, and giving quick replies to questions. Don’t deal with the contact structures of corporate or online lenders who will reroute you through their customer service department. To them, you’re a number. Local lenders will give you their time and presence in order to ensure that you have a friendly experience.

3. Work with one person who understands your needs.
National banks are giving you scripted information. Their loan types are a part of a system that was built at a corporate office. Mobile apps and websites are even further detached and will allow no options for conversation, feedback, and re-evaluation. Meeting with a local lender will allow you to build a relationship that isn’t possible with online or large corporate lenders. Shop local to meet a real person who will evaluate and value your needs.

4. Local lenders will understand your local market.
Shopping for a mortgage locally will not only make it easier to find a reliable partner in the expenditure of buying a home but will also provide insights into your local real estate market. Real estate agents will commonly have relationships with local lenders and can point you in the direction of someone trustworthy. A local lender will understand your wants and needs better than a large lender or app because they will have worked in your area previously.

Local has meant better for a long time now. Local mortgage lenders are going to give you more time and appreciation, and in turn, you will return more value on your new home. Mortgages don’t need to be a hassle, and lenders don’t need to rush you in and out of their doors. Remember to shop locally when considering a mortgage.

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Feb 7

Goochland County Real Estate: 2016 Market Summary

Goochland Real Estate and Home Sales Statistics for 2016

2016 was another strong year for home sales in Goochland, Virginia with 317 homes sold. The average home sold in 2016 was 2,933 square feet and sold for $478k (an average of $163 per square foot). The average sale price was up 9% over 2015 home sale prices marking another strong year of growth in home values. The average listing price in 2016 was $483k with homes averaging 72 days on the market. The highest priced home sold in Goochland in 2016 was $2.7 million where the lowest sale price was $23,700.

Goochland is very diverse area offering everything from horse and livestock farm properties to luxury neighborhoods such as Holland Hills, Kinloch, and The Meadows at Joe Brooke Farm. Goochland homeowners are spoiled with the serenity of country life with convenient access to many amenities in neighboring Short Pump (West End of Henrico). Find your peaceful country getaway in Goochland Virginia.

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Feb 7

Powhatan County Real Estate: 2016 Market Summary

Powhatan Real Estate and Homes Sales Statistics for 2016

2016 was another great year for real estate activity in Powhatan County, Virginia. In total, there were 464 homes sold in Powhatan which was a slight increase over 2015. The average home sold in 2016 was 2,245 square feet and sold for $299k which comes to $133 per square foot (average for 2016). This average sale price was up 3% over 2015 Powhatan home sale prices, marking the third straight year home sale prices have increased. The average listing price in 2016 was $302k and averaged 55.7 days on the market. The highest sale price for a Powhatan home sold in 2016 was $1.2 million while the lowest priced home sold for $31,650.

Powhatan is a very diverse area offering many luxury neighborhoods such Aston, French Hill, and Founders Bridge. It is also a community known for expansive acreage available for horse, livestock and agriculture farms. While the area is considered rural, Powhatan homeowners still appreciated convenient access to local medical facilities, great restaurants, and multiple entertainment options. Find your next home in beautiful Powhatan Virginia.

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