Listing Courtesy of RE/MAX REALTY GROUP REHOBOTH
Something new is stirring in the ordinarily hidebound world of residential mortgage offerings: a new way of approaching the financing of home purchases. If successful, it might well shift the way some Rehoboth Beach mortgage contracts are written.
The experiment is known as the "Wealth Building Home Loan," and it addresses a home-ownership problem that has been talked about for a long time, with little being done to solve it. The issue in question is how to unburden new homeowners from spending years in a situation that bears more resemblance, financially, to renting than to owning— especially during the first 3 to 5 years. For low- and moderate-income mortgagees, that’s the difference between sinking into more debt and actually building wealth. After all, every dollar that goes toward interest is lost, while dollars that pay down principal are investments.
According to Edward Pinto, one of the authors of the WBHL, often during the opening years of a 30-year loan, "68% goes to pay interest." In the new program, 77% of monthly payments go to pay off principal—with the result that in a short time, new homeowners have a much larger equity stake in their homes. And, it is hoped, a sizeable increase in pride of ownership: "a stake in the game."
It sounds good, but you might be wondering how this could be possible. Is this just a ‘pie in the sky,’ feel-good idea that will never see daylight in the real world? Apparently not. The pilot program is being put into action by some serious players: the American Enterprise Institute (if that sounds like a conservative outfit, it is) and administered by the Neighborhood Assistance Corporation of America (if that sounds like a liberal outfit, ditto). And it’s being funded by Bank of America and Citi Mortgage—neither of which would be likely to bankroll some fly-by-night scheme.
The mechanics of this kind of mortgage work out like this. First, it’s based on a 15-year term, which of course speeds the rate at which equity builds; and second, it’s a mortgage that carries a very low interest rate. Something for nothing? Not quite: the concept is to
· change the underwriting standards to tilt away from credit history and toward recent payment history and residual income, thought to lower lender risk
· eliminate the down payment altogether, instead allocating that initial cash toward "points": buy-downs of the mortgage’s interest rate to .5%, (or even 0%)!
It boils down to an approach that could be a win-win. Borrowers (even those who suffered credit black marks during the economic downturn) could be newly eligible for a home loan, and because lenders pocket the interest rate buy-down amount, a proposition they might find acceptable.
Should Rehoboth Beach mortgage applicants expect this deal to be available next week? Not likely: it’s in the pilot phase. But if it seems to work out, it could be a shot in the arm for homeowners who can manage a slightly higher monthly payment. If you would like to chat about today’s home loan availability (or any other current Rehoboth Beach real estate doings), I hope you’ll give me a call!
If 90% of home buyers use the internet at some point in their search, the percentage who go to the Rehoboth Beachlistings has to be close to the same ballpark. It’s hard to imagine anyone NOT wanting to take at least a peek at the current listings. Even if they have already settled on a target property, curiosity would send most of us to check out the way it’s described in its Rehoboth Beachlisting.
When you begin your house-hunting project online, the chances are you just scan the listings’ major features to narrow down the candidates, leaving out the majority of the finer details until later. Some of that information might turn out to be decisive—but most likely not until you’ve settled on the major contenders, and possible already toured them in person.
What can be more important than you’d think might be the descriptive language that describes the overall property: the ‘blurb’ that’s up there at the top of Rehoboth Beachlistings. Just as a good salesman in any field strives to present the most attractive facets of their product, a Rehoboth Beachlisting’s descriptive paragraph can be as important as the glamour photo that accompanies it.
In pursuit of facts that might support that idea, Zillow’s writer Catherine Sherman took a look at some research that dissected the language used in some 24,000 listings. They all resulted in sales—but some brought higher sale prices than did others. Her summary of the findings is pretty interesting:
Luxurious, Captivating, Impeccable (and Spotless) were among the adjectives that appeared most often in listings that resulted in above-average sale prices. That stands to reason: adjectives pointing to higher-end features would be apt to set a superior tone.
Less obviously, some of the nouns that accompanied larger price tags were Basketball, Pergola, and Granite. “Granite” will surprise no one who has been exposed to home design over the past 20 or 20 years—granite counters are the default go-to material that’s come to symbolize quality in kitchen décor. And pergolas are landscaping plusses…
Apparently for lower-priced homes with listings that mention ‘basketball,’ selling prices are 4.5% more than expected. You have to suspect that the word gives some color to a run-of-the mill listing—yet I’d be surprised if just setting up a hoop over the garage door made much of an impact. When Author Sherman writes “Among lower-priced homes…an indoor basketball court is a huge selling point,” I have to think, “DUH!” How many Rehoboth Beachlistings for lower-priced homes have indoor basketball courts (or bowling alleys or soccer stadiums, either)?
More practically, Upgraded and Updated were listing words that coincided with slightly higher sale numbers—at least in mid-priced homes. And Gentle was a surprising winner, too, as in “gentle rolling hills.”
I think ‘gentle’ highlights the most important take-away that I believe is relevant and true. Thoughtfully composed, accurate descriptions are what give Rehoboth Beachlistings a working advantage over cookie-cutter summaries—especially those weighed down by cliché-studded vocabularies. I work hard to insure that my clients’ online presence stands out from the crowd. If you plan to be listing a Rehoboth Beachproperty soon, I hope you will give me a call to demonstrate what I mean! Call/Text me Russell Stucki at (302) 228-7871, email me at firstname.lastname@example.org, visit more listings at www.beachrealestatemarket.com.