Buying a Home with a Mortgage? A Quick Guide to Closing Costs and What to Expect

Whether you're just starting to shop for a new home or you've already found the perfect new house and you're ready to submit an offer, if you're taking out a mortgage loan to cover some of the home's purchase price you should be aware of the various closing costs you may encounter.

In today's blog post we'll share a quick guide to closing costs and what you can expect to pay when you buy a new home.

What Closing Costs Do Buyers Typically Pay?

As you move forward in the home purchase process you'll incur a variety of fees that cover document preparation, inspections and other services that are required to fully process your mortgage. Your application and processing fees cover the cost of preparing your loan application and submitting it to your lender. Your credit report fee covers the cost of pulling a credit report which is used to assess your suitability for a mortgage and whether your loan is worth the risk.

You'll likely pay an appraisal fee as you'll need a proper appraisal of the home's value, and you may need to pay a flood certification or survey fee depending on where the home is physically located. Additional fees that you may incur include wire transfer fees, commitment fees, courier fees and private mortgage insurance application fees.

Finally you'll also encounter a number of closing costs that aren't directly related to your mortgage, including insurance costs, attorney fees, property taxes, government filing or recording fees and more.

Consider Negotiating with the Seller

It may be worth asking the seller to pay some – or all – of your closing costs, depending on the offer that you've submitted and how strong of a negotiating position you're working from. Trust in your real estate agent's advice in this regard as you'll want to avoid spooking the seller by asking them to cover costs that they didn't anticipate.

As you can see, there are a number of different closing costs that you may encounter when you purchase a new home. An experienced mortgage professional will help you to better understand these costs and can show you areas where you may be able to find some additional savings. 

Case-Shiller Home Prices: Price Growth Slows in September

According to the Case-Shiller National Home Price Index, annual home price growth slipped to a seasonally-adjusted rate of 4.80 percent in September. This was 0.30 percent lower than August's year-over-year reading of 5.10 percent.

Cities posting the highest year-over-year gains in home prices were Miami, Florida 10.30 percent, Las Vegas, NV with a gain of 9.10 percent, San Francisco, California posted a gain of 7.90 percent, Dallas home prices gained 7.40 percent and home prices increased by 6.70 percent in Portland, Oregon.

David M. Blitzer, chairman of the S&P Dow Jones Index Committee, said that Florida and the Southeastern region showed sustained strength. Citing gains in builder confidence and housing starts and pre-crisis levels for foreclosures and mortgage defaults, Mr. Blitzer said that the outlook for housing in 2015 should be "stable to slightly better."

Analysts said that higher inventories of available homes had slowed home price growth. Cooling home prices allow more buyers into the market, which creates a better balance between buyers and sellers. Rapidly increasing home prices in late 2013 through early 2014 forced buyers onto the sidelines as investors and cash buyers drove home prices higher and raised demand for available homes.

Cities Post Incremental Month-to-Month Gains

Case-Shiller's 10-and 20-City Home Price Indices were 15 and 17 percent below their mid-2006 peaks with 18 of 20 cities tracked showing slower growth in September than in August. Top month-to-month gains were incremental, with Miami, Florida and Charlotte, North Carolina gaining 0.60 percent, Las Vegas, Nevada gained 0.40 percent and Dallas, Texas gained 0.30 percent. Denver, Colorado, Tampa, Florida and Portland, Oregon posted month-to-month gains of 0.20 percent.

Cities posting no month-to-month gain included Los Angeles, California and New York City.

The steepest decline in month-to-month home prices was seen in Washington, D.C. at -0.40 percent., followed by Atlanta, Georgia at -0.30 percent San Francisco, California, Atlanta, Georgia, Chicago, Illinois, Detroit, Michigan and Seattle Washington posted month-to-month declines in home prices of -0.20 percent. San Diego, California and Boston, Massachusetts posted declines in month-to-month home prices of -0.10 percent.

FHFA House Price Index Unchanged in September

The Federal Housing Finance Administration posted no gain on its month-to-month reading for September, although analysts had expected a gain of 0.40 percent from August to September. Year-over-year, FHFA reported a 4.50 percent gain in home prices between the third quarter of 2013 and the same period in 2014.

On a positive note, Seasonally-adjusted home prices for purchase-only transactions rose in 40 of 50 states during the third quarter of 2014. The top five states posting the highest annual home price gains were Nevada, Hawaii, California, North Dakota and Florida.

You Ask, We Answer: Should I Consider a Warranty when Buying a New Home?

Are you buying a new home? If so, you've likely pondered whether or not you should invest in a warranty to protect your investment. In today's blog post we'll briefly explore home warranties including some of the pros and cons of buying one and how they differ from homeowner's insurance.

The Benefits of Buying a Home Warranty

Home warranties are an excellent solution if you're buying a brand new home which has a lot of new appliances and fixtures inside of it, or if you're not really the "do it yourself" type and would prefer to make a service call if something inside of your home breaks down.

For example, imagine that you have a home warranty that covers your central air conditioning system and one day it stops working. You simply call the warranty provider to book a service call and as long as the problem falls within the scope of your warranty the repairs are completed without any additional cost to you.

How a Home Warranty Differs from Homeowner's Insurance

Home warranties and homeowner's insurance are vastly different but work together to protect your investment. Insurance policies cover your home against unexpected damage - fires, crime, wind storms, water damage and more, depending on your policy. A home warranty tends to cover items inside of the home - the furnace, the plumbing, electrical wiring and appliances - and will provide you with discounts on repairs or replacement should the covered items break down or otherwise stop working.

Cost and Other Home Warranty Downsides

Of course, there are a few downsides to buying a home warranty. You'll need to pay the up-front purchase cost of the warranty unless you're buying a brand new home in which the warranty is included. You'll also find that warranties generally won't cover a lack of maintenance due to the previous homeowner, which can be a bit of an issue if something breaks down and you find out it's not going to be covered. Finally you may find that any necessary repairs are actually less costly than the warranty itself.

As you can see, home warranties aren't the perfect solution for every scenario but if you're buying a new home they are an option worth considering. For more information about home warranties and how they will affect your purchase, ask your real estate professional as they'll be able to share their guidance and expertise.

What's Ahead For Mortgage Rates This Week - November 24, 2014

Last week's scheduled economic news included the NAHB/Wells Fargo Housing Market Index, Housing Starts and Existing Home Sales. FOMC meeting minutes were released along with weekly Freddie Mac mortgage rates and weekly jobless claims.

In addition, the National Association of Realtors® suggested that FHA should lower its mutual mortgage insurance premiums (MMI) as its fund for paying claims has normalized since recession.

Homebuilder Confidence Nears Nine-Year High

The National Association of Home Builders/ Wells Fargo Housing Market Index achieved a reading of 58 for November. This was two points higher than the expected reading of 56 and four points above September's reading. This was the fifth consecutive month of readings above 50.

Readings above 50 indicate that more builders are confident about housing market conditions than not. Components of the index improved with builder confidence in present sales of new homes up 5 points to a reading of 62, confidence in sales over the next six months rose by two points to 66, and the reading for prospective buyer traffic rose four points to 45.

Housing Starts Slow, Existing Home Sales Suggest Stronger Housing Market

Housing starts were lower by 2.80 percent in October at a seasonally-adjusted rate of 1.01 million against an expected reading of 1.03 million and September's reading of 1.04 million homes started. October's reading was affected by a 15.50 percent drop in multi-family construction, but single-family home construction increased by 4.20 percent. Analysts noted that the multi-family sector is notoriously volatile.

The National Association of Realtors® reported that the seasonally-adjusted annual rate of existing home sales for October exceeded the expected reading of 5.15 million with 5.26 million existing homes sold. October's reading also surpassed September's reading of 5.17 million previously-owned homes sold. October's reading represented a 1.50 percent increase over September sales of existing homes, and was the highest reading since September 2013.

The median price of previously-owned homes rose to $208,500 in October, which represented a 5.50 percent increase year-over-year. The inventory of homes for sale is higher with a 5.1 month supply of homes available, which was a year-over-year increase of 5.20 percent. Higher inventories of homes available and low mortgage rates were seen as factors contributing to more home sales.

Builders, Realtors® Call for Lower FHA Premiums

Kevin Kelly, chairman of the National Association of Home Builders and the National Association of Realtors® called for the FHA to lower its mortgage insurance premiums. The cost of FHA loans, which require borrowers to pay an upfront mortgage insurance premium and annual premiums that are pro-rated and added to monthly mortgage payments, were seen as an obstacle to first-time and moderate income homebuyers. This request was based on a report that indicated the FHA fund for paying mortgage insurance claims is in the black for the first time since 2011.

Mortgage Rates, Jobless Claims Fall

Freddie Mac reported that average mortgage rates fell across the board on Thursday with the average rate for a 30-year fixed rate mortgage lower by two basis points at 3.99 percent, and the average rate for a 15-year fixed rate mortgage lower by three basis points at 3.17 percent. The average rate for a 5/1 adjustable rate mortgage dropped by one basis point to 3.01 percent. Average discount points remained the same for all loan types at 0.50 percent.

The Commerce Department reported that new jobless claims fell to 291,000 from the prior week's reading of 293,000. Analysts expected a reading of 280.000 new jobless claims, but this was the tenth consecutive week of readings for fewer than 300,000 new jobless claims. The four-week rolling average of new claims rose by 1750 to a reading of 287,500. The four week average reduces the volatility of weekly jobless claims and provides a more accurate reading of unemployment trends.

What's Ahead

Next week's scheduled events include the Case-Shiller 10 and 20-City Home Price Indices, FHFA's House Price Index and New and Pending Home Sales reports. There are no reports set for Thursday or Friday due to the Thanksgiving Holiday.

The 3 Minute Guide to Real Estate "Flipping" and How to Get Moving Today

If you've been thinking about investing in a real estate project you may have considered buying a distressed house or two at a steep discount in order to fix them up and sell them at a higher price. This is known as "flipping", and in today's post we'll share a quick guide to flipping homes and how to get started with this type of real estate investing.

Assessing Your Budget and Tolerance for Risk

We'll start by stating the obvious: when you buy real estate with the intent of flipping it, losing money is a very real possibility. You'll need to assess your own tolerance for risk and decide how much you want to invest in your real estate venture.

If you're new to buying homes it's a great idea to start small – an inexpensive "fixer upper" house or a condo – and work your way up from there. Spend some time crafting a budget to assess how much you'll be spending to acquire the home and in repairs or renovations, and what you expect to receive when you sell.

Shopping for Suitable Houses and Condos

Once you've got your budget prepared and your finances are in order you'll need to start looking for a suitable home. The ideal listing is one that is priced at a discount to all of the other homes in the neighborhood as the home is in some state of disrepair or has certain issues that need to be fixed up. Spend some time browsing through local property listings which are sorted by price and note which options are the least expensive. This is where you'll want to start.

Scale Things Up by Finding a Partner

After you've bought, repaired and sold a home or two you're likely going to want to scale things up. Consider bringing on a partner who can help shoulder some of the workload or one that may want to invest capital so that you can buy homes in a higher quantity. Remember, this is business; if you work with someone else you'll want to formalize your arrangement with a written contract.

As with any business venture, there's a bit of a learning curve that you'll need to overcome when you begin flipping houses. As long as you're patient and ready to move when you find the perfect home, you'll soon find success with your real estate investments. To learn more about flipping houses and to get started with finding properties in your area, contact your local real estate agent today.

FOMC Minutes: Economy Growing, Housing Lags

Minutes of the Federal Open Market Committee (FOMC) meeting held October 28 and 29 were released Wednesday. The report suggests that the U.S. economy continues to improve, although the annual inflation rate remains near 1.50 percent and short of the committee's goal of 2.00 percent. Falling crude oil prices were cited as a cause of faltering inflation rates. The minutes indicated that FOMC members expect inflation to remain below the 2.00 percent benchmark for the next year or so.

The minutes did not reveal an exact date for raising the target federal funds rate, which is currently 0.00 to 0.250 percent, but analysts expect a rate change in mid-to-late 2015. One committee member said that the Fed should commit to keeping the target federal funds rate at its present level until inflation reaches the Fed's goal of 2.00 percent.

Job Markets Improve, Mortgage Rates Fall

FOMC members said that labor markets had improved "somewhat further." The minutes noted that the national unemployment rate had declined to 5.90 percent in September, which was lower than the FOMC goal of 6.50 percent for national unemployment. While this was good news, FOMC discussed the fact that a significant number of part-time workers suggested under-utilization of the labor force. A combination of stronger labor markets and a 0.25 percent reduction of mortgage rates during the intermeeting period between September 17 and October 28 were seen as positive for housing markets, but the committee noted that mortgage lending standards for single-family homes had not changed much. Lending requirements were more accommodative for commercial real estate.

QE Ends, FOMC Seeks to Maintain "Accommodative" Financial Conditions

FOMC members voted to end asset purchases made under the Fed's quantitative easing program, but said that ongoing reinvestment of principal payments on bonds and MBS with the goal of maintaining "sizeable" holdings of long-term securities. The minutes indicated that this would help maintain "accommodative" financial conditions.

The committee agreed to re-assert its position that although national unemployment and inflation may achieve or surpass FOMC goals, the committee could maintain the target federal funds rate at current levels for "some time" after the benchmarks are achieved. Ultimately, the FOMC's decision to change the target federal funds rate will include thorough and ongoing review of global and domestic economic developments.

Committee members concluded this meeting with a decision to set the next FOMC meeting for December 16 and 17.

Failed Negotiations: What to Do when the Seller is an Immovable Object

Once you've found the perfect new home and delivered your first offer to the seller, you may find that they return with a counteroffer or a flat out refusal. Negotiation is part of the home buying process, but at times you may feel like the seller is the one holding up the deal due to their approach or attitude.

In this blog post we'll share a few ways to manage an unreasonable or stubborn home seller so you can get the deal closed.

Ask Yourself: Are Your Demands Reasonable?

Before trying to figure out how to work the seller from a different angle in order to win the home, you'll need to assess whether or not there's a problem with your offer or your purchasing terms which is causing friction with the seller.

Ask the seller or their agent to identify the exact issue so that you can decide whether or not you are willing to sacrifice that particular term in order to secure the home.

What is Motivating the Seller?

If you're finding that seller is simply being stubborn or is unwilling to budge on their price or the terms of the sale, you'll need to approach them differently. During the home buying process it should be your goal to try to figure out why the seller has placed their home on the market and what their motivation for selling might be.

Are they moving to a new city for work? If so, there is likely some sort of time limit on their sale and you may be able to wait them out. Or, perhaps you've discovered that they are simply downgrading to a smaller home and that they'll only sell their current home for the right price.

Sweeten the Deal and Be Ready to Walk

If the price is what is holding the deal up, you can submit a final offer with your maximum price but be sure to let the seller know that you're walking away from the deal if they aren't ready to sign. At this point you can consider the home a lost cause if they refuse, so table the best offer that you're willing to make and encourage the seller to accept it.

Dealing with a stubborn home seller might seem like a bit of an impossible situation, but try to keep in mind that they are selling their property for a reason. If you have your heart set on the home just keep faith that eventually they'll crack and the home will be yours. If you're just getting started with the home buying process or if you need more information about buying a local property, contact a real estate agent today.

Selling Your Home? Give Your Bathrooms a Facelift with These Three Quick Tips

Are you getting ready to sell your home? As soon as your listing goes live you'll begin entertaining potential buyers who will be inspecting your home from top to bottom to ensure it meets their needs perfectly. Your bathrooms will be a key area of focus and you might be surprised to learn that the look and feel of these small rooms can make or break a sale.

In today's blog post we'll share three quick tips for renovating or upgrading your bathrooms to freshen up their look before potential buyers start viewing your home.

Clean Your Bathroom Out and Start Fresh

Before you begin, take a close look at your bathroom. Is there wallpaper on the walls? Are the sinks and faucets a bit dated and stained? Does the bathtub have a crack in it or is there some discoloration in the tiles or grout?

If your bathroom hasn't been renovated in the past few years, there's a good chance that the entire room needs a top-to-bottom overhaul. Clean all of the fixtures, materials, cabinets and even that dated flooring out and start from scratch.

Choose Your Color Palette Wisely

Before you begin you'll want to have some sort of color palette in mind. Does the bathroom receive some sort of direct sunlight? Is there a skylight or a window in the room? Is there a color theme in other rooms in the house that you'll need to match up with? Having some color ideas in mind will greatly assist with painting and adding shower curtains, mats, towels and more.

Don't Skimp on Fixtures and Accessories

Remember that you're selling the home and that you're likely to recoup some or all of the costs of your bathroom renovations in the form of a bump in your selling price. Don't buy cheap faucets or fixtures as buyers will be looking closely and they'll want to ensure they're buying a home that has quality building materials used throughout. If you're going to upgrade your bathrooms, use materials that are high-quality but avoid anything too luxurious unless it fits with the rest of the decor.

Breathing some new life in to your bathrooms won't break the bank, but it might just help secure your home sale. For more tips and strategies on how to ensure a quick and successful sale, contact your local real estate agent today.

What's Ahead For Mortgage Rates This Week - November 17, 2014

Last week's housing related news was lean, with no scheduled reports released other than Freddie Mac's primary mortgage market survey.

We'll start with some good news. The University of Michigan / Thompson-Reuters Consumer Sentiment Index reported its highest reading in more than seven years. November's reading of 89.4 surpassed the expected reading of 88.0 and was higher than October's reading of 86.9

Mortgage Rates Near 4.00 Percent, Weekly Jobless Claims Up

Freddie Mac reported a one-basis point drop in the average rate for 30-year fixed rate mortgage from 4.02 percent to 4.01 percent; the average rate for a 15-year fixed rate mortgage also fell by one basis point to 3.20 percent.

The average rate for a 5/1 adjustable rate mortgage rose by 5 basis points to 3.02 percent. Discount points for all three loan types held steady at an average of 0.50 percent.

Weekly jobless claims rose by 12,000 to 290,000 against expectations of 280,000 new jobless claims filed and the prior week's reading of 278,000.

Last week's report was the ninth straight week that new jobless claims came in under 300,000. The reading for the four-week rolling average was 285,000 new jobless claims, which represented an increase of 6,000 new claims.

What's Ahead

This week's number of scheduled economic reports will be more robust. The NAHB Housing Market Index, Housing Starts and the National Association of REALTORS® Existing Home Sales reports will be released.

The minutes of the most recent Federal Open Market Committee (FOMC) meeting of the Federal Reserve will also be released along with weekly mortgage rates and jobless claims data.

How to Use a Mortgage Calculator to Determine Your Monthly Payments, Interest and More

Are you thinking about using a mortgage to buy a new home? Buying your own piece of local real estate is a major financial investment and one that can require some pretty complex math to fully understand.

In this blog post we'll discuss mortgage calculators and how to use one of these tools to determine your monthly mortgage payments, interest charges, amortization periods and more.

Determining Your Principal and Down Payment Amounts

To get started with a mortgage calculator you'll need to know how the price of the home and how much you intend to contribute as a down payment. Generally speaking you'll want to place a down payment of at least 20 percent in order to avoid having to pay for private mortgage insurance and to give you access to better interest rates.

Choosing Your Interest Rate and Amortization Period

Now that you have an idea of the amount of mortgage financing you'll need, the next step is to choose your interest rate and amortization period. Different lenders will offer different interest rates for every one of their mortgage products, so again you'll want to play around with these numbers and run the calculation to see which combination of mortgage financing, interest rate and amortization period gives you a monthly payment that suits your budget.

Using a Mortgage Calculator for Refinancing

If you're thinking about refinancing your current mortgage you can also use a mortgage calculator to help make the math a bit easier. Simply use your outstanding mortgage balance as the principal amount and then choose an amortization schedule that fits your financial goals. Be sure to keep an eye on your interest payments, as you may find that by refinancing to a longer amortization period your monthly payments go down but your total interest paid is quite a bit higher.

Don't Forget the Closing Costs

Finally, don't forget that there are numerous "closing costs" - fees, taxes and more - which you'll need to factor in to your overall calculation. Closing costs will include everything from home appraisal fees to government filing fees and property taxes, and will vary depending on the home and the city or community you're buying in.

While online mortgage calculators can handle the tricky math to determine monthly payments and interest costs you may still find that you have questions about your mortgage or some aspect of the process. For more information, contact your local mortgage professional and they'll be happy to share their advice and expertise.

Save Money on Your Home Energy Costs This Winter in Just Three Easy Steps

It doesn't matter if you heat your home with electricity, natural gas or some other energy source; prices continue to rise and that means increased heating costs for most of us.

In today's blog post we'll share three easy ways that you can save money on your home energy costs this winter.

Install and Use Programmable Thermostats

Now that Nest and other companies have brought Wi-Fi enabled, programmable thermostats on the market there's very few excuses to avoid using them. At bare minimum you'll want a digital thermostat that can be programmed to turn on and off at certain hours of the day.

For example, you can shut your heat off after leaving for work and have it turn back on again a half-hour or so before you get home. You can do the same at night when you're fast asleep under warm blankets. If possible, try to get a thermostat for each room so that rooms can be heated individually as needed.

Switch Up Your Ceiling Fans

If you have ceiling fans you may not know that by reversing their direction you can keep your rooms feeling much warmer. In the winter you'll want your fans spinning in a clockwise direction, which will push warm air downward into the room where you'll be able to feel it. In the summer you'll want to switch the fans back to counter-clockwise as this will help move warm air towards the ceiling.

Check Your Insulation, Furnace and Ducts Now

Finally, you'll want to check that your home heating system is operating at peak efficiency. If you can access your attic, check to ensure that your insulation is tightly packed and that it's still in good condition. Clean or replace the air filter on your furnace, and check your ducts for any leaks that need to be repaired. If it has been a few years, consider having a professional furnace and duct cleaning to get all of the dust and debris out of the ductwork.

As you can see, a little time spent on home maintenance can end up saving quite a bit in energy costs when the temperatures drop. When you're ready to look at buying a newer, more energy-efficient home, contact your local real estate agent and book a consultation where you can share your needs and price range.

Yard Staging: How to Stage Your Front and Back Yard to Appeal to Home Buyers

Whether you're just listing your home for sale or you've already started entertaining potential buyers, focusing on your "curb appeal" can drastically increase your chances of a quick and successful sale.

In today's blog post we'll discuss how to stage your front and back yards in order to make them seem more inviting and welcoming to home buyers.

It All Starts with a Great Lawn

Whether you're standing on the street looking at the front of your home or you're on your patio looking out over your back yard, your lawn sets the tone and is one area that potential buyers are sure to focus on.

You'll want to ensure that your lawn is very well-kept, with no weeds, dandelions or patches of clover breaking up the continuity of the grass. You'll also want your lawn to be a healthy green, unless you're in an area which has some seasonal turnover or your community has watering restrictions.

Use Gardens to Add a Splash of Color

Once the lawn looks incredible, it's time to move on to your gardens and other landscape features. Gardens are the best way to add a vibrant splash of color to your yard and they can be used to accessorize the front or back of your home to break up the monotony.

Choose flowers or plants that are in season for your area to ensure that they are healthy while potential buyers are driving past and viewing the home. Also, keep in mind that most of the time, less is more; don't overdo your gardening or you'll have a small jungle on your hands.

Make Your Backyard Feel as Inviting as Possible

Your backyard will be a major selling feature for many different types of homebuyer - especially those with children. You'll want to ensure that your backyard feels as inviting as possible. If you have a deck or patio, ensure that you have furniture and your BBQ tastefully arranged so the buyer can picture themselves hosting friends and family.

Staging your front and backyards is just one of the many tasks that you'll need to take care of in order to prepare your home for a successful sale. For more information about how to prepare your home, contact your local real estate agent today and they'll be able to share expertise that is specific to your local community.

What's Ahead For Mortgage Rates This Week - November 10, 2014

Last week's economic reports contained mixed reports indicating that the economy continues to recover with occasional "blips" in its progress. Construction spending was lower than expected.

A Federal Reserve survey of senior loan officers indicated that credit standards remain strict for mortgages and other types of lending. According to the survey, a "modest net fraction" of large banks had eased credit standards for prime mortgage lending.

First-Time Homebuyers Struggle as Market Share Hits 27-Year Low

The National Association of REALTORS® (NAR) reported that first-time buyers' share of home purchases has slipped to 33 percent, which was its lowest level in 27 years. According to Lawrence Yun, chief economist for the NAR, high home prices and mortgage insurance costs along with strict mortgage credit requirements continue to sideline first-time buyers.

In other news, the Department of Commerce reported that construction spending dropped by 0.40 percent in September as compared August's reading of -0.50 percent and an expected reading of +0.70 percent. September's reading represented a seasonally-adjusted annual construction spending rate of $950.90 billion.

Mortgage Rates: Average 30-Year Mortgage Rate Tops Four Percent

Average mortgage rates rose last week according to Freddie Mac. The average rate for a 30-year fixed rate mortgage rose by four basis points to 4.02 percent. The average rate for a 15-year fixed rate mortgage rose by eight basis points to 3.21 percent, while the average rate for a 5/1 adjustable-rate mortgage rose by three basis points from 2.94 percent to 2.97 percent. Average discount points remained at 0.50 percent for all three types of mortgages.

This is not altogether bad news, as higher mortgage rates are typically prompted by improving economic conditions. 2014 started with an average rate for 30-year fixed rate mortgages of 4.05 percent.

Labor Reports Suggest Stronger Jobs Markets

Last week's economic news included several reports that indicated improvements in U.S. labor markets. The Department of Labor released its Non-Farm Payrolls report for October with a reading of 214,000 jobs added against expectations of 243,000 jobs added and September's reading of 256,000 jobs added. While this appears contrary to stronger labor markets, analysts said that a new low in the national unemployment rate of 5.80 percent indicated that fewer new jobs were needed. October was the ninth consecutive month reporting 200,000 or more jobs added.

The ADP employment report, which tracks payrolls in the private sector, reported an increase of 5,000 jobs from September's reading of 225,000 jobs to October's reading of 230,000 jobs.

Weekly jobless claims fell to 278,000 against expectations of 285,000 new jobless claims filed and the prior week's reading of 288,000 new claims filed. This reading supports a stronger jobs market and may compel would-be home buyers to enter the market as concerns about unemployment and jobs wanes.

The national unemployment rate reached a new low with October's reading of 5.80 percent. In related news, Fed Chair Janet Yellen indicated in a speech on Friday that the target Federal funds rate will likely rise in 2015, but she gave neither a prospective date nor details about how much the benchmark federal funds rate may rise.

Have You Had Trouble Getting a Mortgage? Three Tips for Sprucing Up Your Credit Before Reapplying

If you've had some trouble getting approved for a mortgage recently, you're not alone. Many individuals face mortgage challenges due to past blemishes on their credit reports or a personal financial crisis that resulted in bills not being paid on time.

In this post we'll share three quick tips for sprucing up your personal credit before reapplying for a mortgage. With a bit of luck and hard work you can be on your way to purchasing that new dream home.

Pay Off Your Credit Cards And Lines Of Credit

The easiest way to improve your credit score and prove that you can afford your mortgage payments is to eliminate other forms of debt from your monthly budget. If you have outstanding credit card, student loan or other debts, get them paid off as quickly as possible.

You'll also want to avoid taking on any new loans while you're trying to get your mortgage approved as these are likely to show up on your credit report and can hurt your chances at approval.

Pull Your Credit Report And Look For Errors

If you haven't seen your credit report recently, it might be worth investing in a copy so you can see exactly what your lender sees when they are evaluating you for a mortgage. You may discover that there are errors or inaccuracies that can be cleared off with a quick phone call, such as a past loan that was fully paid or a missed car payment that was reported in error. Every credit report error that you can fix will bring you one step closer to your mortgage approval, so spend a few minutes combing through your report.

Pay All Of Your Bills On Time

Did you know that every overdue bill can leave a negative mark on your credit report? With so many bills to juggle - credit cards, cell phones, utilities and more - it can be tough to keep them all organized and paid before the due date. However, if you're working to secure a mortgage you must keep your bills paid to avoid being reported as a late or overdue payment.

If you've had some trouble getting approved for a mortgage in the past, take a few minutes to contact your local mortgage professional today to ask for their advice. You may find that they have additional tips and strategies that you can leverage to better your chances of being approved.

Moving in to a New City or Community? Here's Why You'll Want to Meet the Neighbors

Are you moving to a new community or a new city? When you find a new house that meets your needs and seems like a perfect fit, you'll want to take some time to meet your potential new neighbors before you sign on the dotted line.

In today's blog post we'll share a few reasons why meeting the neighbors can help you feel right at home in your new community.

Your Neighbors Are Experts on Your Local Community

Whether you have questions about the area's safety at night or you simply want to know where the best coffee shops are, you'll find that your neighbors are an excellent source of information about the local area.

Spend some time thinking about questions that you would want answered before committing to buy in a certain area, and ask the locals after you've viewed the home. Yes, you could ask the seller, but remember that it's their goal to get you to buy the home and you're most likely interested in impartial answers.

They Can Help the Kids Get Settled in

If you're moving to a new city with children you'll likely want to get them introduced to other neighborhood kids so they can start making new friends. Meeting your potential neighbors during the home buying process will allow you to determine which have children that are of a similar age as yours. Of course, if you find that there are no other children in the local community that might be a sign that the area isn't very family-friendly, so you'll want to factor this in as well.

You'll Need to Assess Your Future Relations

If you decide to buy this particular new home you're likely going to be living in the local neighborhood for years - perhaps even decades. Meeting the local neighbors before purchasing your home allows you to make an assessment of how well you're going to integrate into the local community and whether or not you'll be able to have warm relations with those that live around you. It takes just a few minutes of asking around friends and family to hear horror stories about bad neighbors; meeting the locals will help ensure that you don't make a mistake that you'll regret later.

When you're ready to start your hunt for the perfect new home - and the perfect new neighbors - contact your local real estate professional. Working with an experienced real estate agent is the best way to get the home you're after in a price range you can afford.

Negotiation Tips: How to Ask the Seller to Pay the Closing Costs

You've found the perfect new house or condo, and you are now preparing an offer that you believe the seller will find tempting enough to accept. However, you know that there are going to be thousands of dollars in closing costs that need to be paid before the sale is completed and you become the home's new owner.

The question is, should you ask the seller to pay some or all of the closing costs? In today's blog post we'll address this question and list a few scenarios in which you may want to consider having the seller pick up the tab.

Ask if You're Offering the Full Listing Price

If you're prepared to offer the full asking price for the home you can certainly include the caveat that the seller assist with some or all of the closing costs. Many sellers will price their home slightly higher than they expect to receive as they believe that buyers will submit low initial offers which need to be negotiated.

For example, if a home is listed at $275,000 a seller might actually be expecting $260,000 or $265,000 for it. You can offer $275,000 but ask that they take care of the closing costs.

Ask if You're Confident the Seller Has Few Other Options

If the home has been on the market for a number of months or if you're fairly confident that the seller isn't going to find much luck elsewhere you can ask them to pick up the closing costs as one of your purchase conditions. You'll obviously want to negotiate in good faith, but if you're coming from a position of strength you can leverage this in to some additional savings.

Ask if You're Ready to Close Immediately

Are you ready to sign on the dotted line today? If you're sure that this is the right home for you, let the seller know that as long as they're willing to assist with the closing costs and accept your bid that you'll start the closing process today. Nearly all sellers will be willing to make a small sacrifice to get the deal done.

As you can see, there are a number of situations in which it makes sense to ask the seller to shoulder some of the closing costs. If you have found a home that you wish to purchase and you'd like advice on how to proceed, contact a real estate agent today. An experience real estate professional can help you craft an offer that the seller won't be able to refuse.

Home Selling Tips: How to Compete with New Construction for Home Buyers' Attention

Are you thinking about selling your house or condo? If you're in a market that has a lot of newly constructed homes, you're going to be competing with those listings for buyers' attention.

In today's post we'll share a few tips that can help you attract buyers and convince them that your pre-owned home is just as good as a brand new one.

Upgrade And Modernize Your Home Prior To The Sale

Numerous studies have shown that buyers who prefer brand new homes are mostly interested in the new appliances and fixtures throughout the home.

If your home is more than a decade or so old, you'll want to invest some time and money in upgrading your appliances and fixtures before trying to list your home on the market.

If you have newly constructed homes very close to yours it might be worth installing these items after you've moved out so that the buyer is the first person to use them.

Focus Your Marketing On A Specific Buyer

Depending on which neighborhood your home is located in and the local amenities, you may want to consider focusing your marketing on one particular buyer. For example, a downtown condo would be marketed to a completely different prospective buyer than a large four-bedroom home out in the suburbs. Take some time to consider the "persona" of your target buyers, and craft your messaging around what these individuals or families will be looking for in their dream home.

Shine The Spotlight On Your Home's Strong Points

As with any major sale, you'll want to ensure that you spend as much time as possible highlighting the strong points in your listing. Be sure to mention any local community amenities as well, such as schools, parks or community centers. If you're selling to a family, your proximity to these amenities will be a significant point of comparison with brand new homes in the area.

If you have the budget, you may also want to consider having your home professionally staged, as staging is an excellent way to show a potential buyer just how good your home can look with tasteful furnishings, art and other finishing touches.

Selling your home is a challenging proposition that shouldn't be faced alone. When you're ready to sell your home be sure to contact your local real estate agent, who has experience selling in your local market and can help to ensure your sale moves along smoothly.

What's Ahead For Mortgage Rates This Week - November 3, 2014

Last week's economic news brought mixed developments as pending home sales moved to their second highest level of 2014.

The Federal Open Market Committee (FOMC) announced the expected end of asset purchases under its quantitative easing program. In its post-meeting statement, the committee noted improvements in overall economic conditions labor markets as indications of better than expected economic trends.

The Case-Shiller Home Price Index reports for August showed continued slowing in housing price gains. Mortgage rates were higher, but consumer confidence exceeded expectations.

Pending Home Sales Rise, Case-Shiller Reports Slower Price Gains

The National Association of REALTORS® reported that pending home sales gained 0.30 percent in September for an index reading of 105 as compared to August's reading of 104.7. Analysts said that lower home prices and more homes available likely brought more buyers into the market.

The S&P Case Shiller 10 and 20-city home price index reports for August showed further slowing in home price growth with a year-over-year reading of 5.60 percent as compared to July's year-over-year reading of 6.70 percent.

This was the slowest price increase since November 2012. Home price growth is slowing as demand decreases. Tight mortgage qualification requirements are likely contributing to lower demand for homes.

FOMC ends QE, Mortgage Rates Rise

The Fed ended its asset purchases under its QE program according to a statement after the FOMC meeting on Wednesday. This move was expected, and the statement repeated its plan to leave the target federal funds rate unchanged for a considerable period after the QE program's conclusion. Analysts interpreted that to mean that no rate change would likely occur until approximately June 2015.

Mortgage rates responded to the demise of QE with an across the board increase. Average rates reported by Freddie Mac on Thursday were 3.98 percent for a 30-year fixed rate mortgage, 3.13 percent for a 15-year mortgage and 2.94 percent for a 5/1 adjustable rate mortgage. Discount points were unchanged at 0.50 percent for all three loan types.

New Jobless Claims Up, But No Big Deal

Housing market trends are connected with what's happening in labor markets. Last week's report for new jobless claims took an unexpected jump with 287,000 new jobless claims filed against predictions of 281,000 new claims and 284,000 new jobless claims filed the prior week. The four-week average for new jobless claims dropped to 281,000 and new claims remained below the 300,000 benchmark for the seventh consecutive week.

October's Consumer Confidence Index rose to a reading of 94.50 as compared to the expected reading of 87.3 and September's reading of 89.0. The Consumer Sentiment Index for October was also showed an increase of 0.50 percent with a reading of 86.9 against a predicted reading of 86.4 and September's reading of 86.4.

What's Ahead

Next week's scheduled economic news includes construction spending for September, Non-farm payrolls, national unemployment, and the ADP employment report. Regularly scheduled reports on mortgage rates and new jobless claims will be released on Thursday.