Living in Lincoln Park Blog

Discover Living in Lincoln Park!


 SUBSCRIBE

November 29th, 2010

Home Depot and Lowe’s Recognize Military Service With 10% Discount

I found out something interesting this weekend, which will be old news for some, but was new and lucrative to me.  In an effort to recognize military service both Home Depot and Lowe’s have generously extended a 10% discount to all purchases made by veterans.  To take advantage, a veteran needs to provide proof of service at the register at checkout and the discount is applied.  This can amount to a good amount of money on larger projects and purchases.

November 23rd, 2010

Helping Your Children Buy Lincoln Park Real Estate

I work with a very diverse group of clients. One group is parents either buying, or helping their kids purchase a condo in Lincoln Park. For those who are planning ahead, this time of year presents a unique opportunity to help your kids with their down payment.  And BONUS!…there is little or no tax implications to you!  Here’s how it works. You can give up to $13,000 per child (or up to $26,000 if given jointly with your spouse) without triggering the IRS gift tax.  Even though I’m not a CPA or tax attorney, this sounds like a pretty sweet deal if you are of the mind to help your children with a cash infusion!

Assuming you have not hit the maximum amount that you can gift, the real beauty to this timing is that you can max it out by the end of December 2010 & gift the full annual amount again in January 2011. So theoretically, a parent, with their spouse, can give their child up to $52,000 in a matter of a few months, which adds up to a pretty substantial sum of money that will surely help with your child’s down payment.  Talk about a Happy New Year!

And, according to the AXA Equitable site, “if you don’t feel comfortable with giving substantial gifts directly to your recipients, the IRS allows another avenue. You can, for example, pay someone’s college tuition or medical expenses on a gift tax-exempt basis — as long as you write the check directly to the institution. This is generally considered a qualified transfer with no dollar limits.” While this is not relevant to helping your kids buy a condo, there may be other benefits to family members.

So if you are looking to purchase a condo this spring for or with your kids, now is the time to start planning. And while you’re discussing the financial options over the holidays, you might want to begin searching for that perfect Lincoln Park condo.

November 21st, 2010

Rates Rise as Bond Market Takes a Beating

Are you currently in the process of buying a home or refinancing?  Trying to decide when to lock can be a stressful and difficult decision.  In my job as a mortgage lender, I watch the markets daily to keep my clients abreast of changes to assist them in securing the best mortgage rate possible.  Please see my recommendations below.

If closing your Chicago mortgage in:

  • 5-7 Days: I recommend LOCKING
  • 7-15 Days: I recommend LOCKING
  • 15-30 Days: I recommend LOCKING unless your risk tolerance allows some substantial risk
  • 30 or more days: I recommend FLOATING, but LOCKING immediately on any improvements

The week that was:

Well, the time as has come to come to the realization that the best rates for Fannie Mae and Freddie Mac conforming loans may be behind us.  The last week brought substantial volatility and, although we did see some small periods of favorable movement, the news was generally bad.  Counter to many rate watchers expectations, the Fed’s move to buy up Treasury Bills has not had the expected impact.  This is chiefly because the buying has been in the shorter term T-bills as opposed to the 10-year, which drives mortgage rates.  Additionally, the amazing rates we saw several weeks back were the result of a market which was significantly over-bought.  With the surplus of investment unsustainable, the rate increase we have experienced was only a matter of time as investment moved back to stocks.

The good news, if you procrastinated, is that the market is now generally believed to be over-sold as investors clammered to dump their investment.  Correction may present rate watchers with some short opportunities to secure a rate better than the current market offerings.  Additionally, we may see some negative economic data as foreclosures resume after the hiatus resulting from the robo-signing debacle.  Also, the specter of continued economic woes in Europe may tip the scales back in the favor of the bond market and better rates.  Whether this will be enough to offset a continued rally in employment and earnings news is yet to be resolved.

The best advice that I can give is to act.  Procrastination will cost you as the much desired bottom of the market is, and will be, a trailing indicator.  In short, we will not know where the bottom is until it has passed.  It will be nearly impossible to time a transaction, especially the purchase of a new home, to secure the absolute bottom.  Couple this with the reality that the bottom of the mortgage rate market and the real estate market, which will also be a trailing indicator, will not coincide means that the waiting game is a fool’s folly.  There are currently great rates still to be had with National averages tracking ~0.25% above the bottom.  Historically, you cannot do much better.

30 YEAR FIXED

National Average Rate: 4.39%

Fees/Points: 0.9

15 YEAR FIXED

National Average Rate: 3.76%

Fees/Points: 0.7

Source: Freddie Mac

November 12th, 2010

Rates Rise Early In The Week, But Recover On Further Fed Info

Are you currently in the process of buying a home or refinancing?  Trying to decide when to lock can be a stressful and difficult decision.  In my job as a mortgage lender, I watch the markets daily to keep my clients abreast of changes to assist them in securing the best mortgage rate possible.  Please see my recommendations below.

If closing your Chicago mortgage in:

  • 5-7 Days: I recommend LOCKING
  • 7-15 Days: I recommend FLOATING, but keep your finger on the trigger to LOCK if rates drop
  • 15-30 Days: I recommend FLOATING
  • 30 or more days: I recommend FLOATING

The week that was:

This week started with an alarming increase in Fannie Mae and Freddie Mac conforming loans.  This eased, however, when further information on the planned schedule for purchase of Treasury Bills was released by the Fed.  As bargain hunters moved into the bond market, pricing for mortgages moved back into the low end of the spectrum.  This provides further evidence that rate watchers may see a benefit for the Quantitative Easing planned over the coming months.

In  the general economy, there were some bright spots.  Foreclosures dropped by around 9%, but this was mostly driven by the moratorium on banks seizing properties resulting from the hullabaloo around robo-signing.  It can, therefore, be surmised that foreclosure rates will return to previous levels in coming reports.  Employment was a bright spot, with first time claims for unemployment benefits once again dropping.  This is especially encouraging as it marks a trend of improvement.  It is widely believed that we may be on the precipice of stronger overall recovery as companies have exhausted their ability to depend on increased productivity and temporary workers to fill their needs.

30 YEAR FIXED

National Average Rate: 4.17%

Fees/Points: 0.8

15 YEAR FIXED

National Average Rate: 3.57%

Fees/Points: 0.8

Source: Freddie Mac

November 5th, 2010

Fed Announcement of QE2 Rewards Chicago Rate Watchers

Are you currently in the process of buying a home or refinancing?  Trying to decide when to lock can be a stressful and difficult decision.  In my job as a mortgage lender, I watch the markets daily to keep my clients abreast of changes to assist them in securing the best mortgage rate possible.  Please see my recommendations below.

If closing your Chicago mortgage in:

  • 5-7 Days: I recommend LOCKING
  • 7-15 Days: I recommend FLOATING, but you should LOCK on low points in this volatile market
  • 15-30 Days: I recommend FLOATING
  • 30 or more days: I recommend FLOATING

The week that was:

Strap on your seat belts if you are in the process of or considering a Chicago real estate transaction as things just got a bit more interesting.  On Wednesday, the Fed announced their plan to purchase $600 billion in Treasury bills in an effort to jump start the economy.  This process, called Quantitative Easing, should, if all goes as planned, increase the money supply and lower interest rates.  Although this did initially receive a mixed response, rates for Fannie Mae and Freddie Mac loans dropped by the end of the week.

30 YEAR FIXED

National Average Rate: 4.24%

Fees/Points: 0.8

15 YEAR FIXED

National Average Rate: 3.63%

Fees/Points: 0.7

Source: Freddie Mac

|
Lincoln Park News

[CaRP] XML error: not well-formed (invalid token) at line 46
FireStats icon Powered by FireStats