Listing Courtesy of RE/MAX REALTY GROUP REHOBOTH
Rehoboth Beach home buying activity may be going great guns, but for some would-be buyers, credit score woes are still a stubborn obstacle. That’s why we have been keeping an eye on the new pilot project that was announced late last year. This was the one called the "Wealth Building Home Loan." It’s an experiment aimed at opening up home ownership options, particularly for first time home buyers. Bank of America and Citibank were first to sign up for the program, said to “take a fresh approach to affordable mortgage lending.” It sounds like a pretty good idea!
How It Works
The Wealth Building Home Loan is a mortgage that runs for 15 years at a fixed interest rate. Because the term is so short, equity builds rapidly. The payments are more manageable than any reality-grounded Rehoboth Beach mortgage watcher would think because discount points can be used to buy the interest rate down to…well, “zero”! Since no down payment is generally required, home buyers can apply their available cash to purchasing those points. Since that sounds almost too good to be true, we’ve been keeping an eye open for progress reports.
Extra Help for Buyers with Modest Income
Qualifying for the mortgages would emphasize home buyer income rather than credit score. This would be a real godsend to the many people still rebuilding their credit after the economic downturn. Furthermore, interest would be set at three-fourths of a percent lower than the 30-year FHA rate—which makes sense, since shorter terms mean lower lender risk—with additional points to be offered at special bargain prices.
A Game-Changing Approach
The loan program is piloted through The Neighborhood Assistance Corporation of America, which secured underwriting from BofA and Citibank. It’s intended to be "a game changer,” because equity ownership takes place rapidly. Already in the first three years of a WBHL, 77% of the monthly payments pay off the principal, rather than the 68% that goes to interest under a standard 30-year mortgage. The effect is to accumulate a significant ownership stake almost from the word ‘go’—and more ownership equates to better loan performance.
When last checked, the program was in “pilot project” status (still in the initial shakedown phase) while the innovators who came up with the idea figure out how to make the loans widely available. So far, so good, apparently—we’ll keep an eye on developments to see if the program is greenlighted by the two underwriters.
In the meantime, Rehoboth Beach mortgage-seekers have a wide variety of currently available options for taking advantage of the great buys viewable on this morning’s Rehoboth Beach listings. Give me a call for a no-obligation discussion of how you can take advantage of today’s opportunities! Call/Text me Russell Stucki at (302) 228-7871, email me at firstname.lastname@example.org, visit more listings at www.beachrealestatemarket.com.
Amazon has invaded the realm of real estate—but you couldn’t say it’s happening in a big way.
It’s happening in a tiny way.
Last week the improbable news arrived that the web’s 400-pound gorilla had made its first foray into the realm of real estate. Since Delaware real estate (like all real estate) is by definition local, its very nature would seem to preclude the buying and selling of homes as a mail order enterprise. But since Amazon.com has succeeded in other industries where failure had been assumed (high-end fashion, for instance), could local Delaware real estate soon be monopolized by a tsunami of Amazon Prime home sales? At least it warranted some looking into!
It turned out that Delaware real estate was not likely to be overcome anytime soon. The Amazon listings that showed up are hard to find, and not likely to tempt many Delaware home shoppers. The few listings were only searchable when you entered “tiny homes”—and the few homes being offered were sandwiched in between how-to books about designing and building very small cabins.
(Here, a note for Delaware residents who aren’t familiar with the “tiny homes” phenomenon…they are what the name says: structures smaller than 400 square feet…although some can be as microscopic as 80 square feet, most are in the 300-350 range).
You may not find too many tiny homes in Delaware, but the movement is nation-wide. And the concept is not as far-fetched as it might seem. Anyone who has taken weeks-long vacations in campers or lived for any stretch of time on a pleasure boat knows that you can reduce your living space to a slender minimum if you plan carefully.
Back to Amazon. The lead-off listing was a pre-fab tiny home converted from a shipping container. Like any good Delaware real estate listing, the details pointed out key selling points (in this case, the shipping container was new). Price was a thrifty $36,000, which would be even more thrifty if the “$0.00 estimated tax” turns out to be accurate. The customer reviews were mixed, with one in particular naming a possible sticking point: meeting Delaware and Delaware building codes. Additionally, Amazon Prime members who revel in their free delivery perk were bound to be disappointed: the tiny home wasn’t eligible (they’d have to pony up another $3,754 in shipping fees).
If your own Delaware home buying or selling requirements are greater than the tiny home square footage limit, I’m here to lend a hand. Call me! Call/Text me Russell Stucki at (302) 228-7871, email me at email@example.com, visit more listings at www.beachrealestatemarket.com.