Which Renovations Have the Highest Impact on Your Home’s Value?

Remodeling your home is a wonderful way to make it your own when you first move in, or to update the space as your needs and styles change over time. Since home renovations can be pricey, balancing your budget and wish list can be tricky. Fortunately, there are lots of projects that can make you love your home even more, while also boosting its value. Increasing your home’s overall value increases your equity! This means that not only will you see a return on your investment when you sell your home, but you’ll also have a lower loan to value ratio while you live in it, which can impact your options when refinancing, and even potentially eliminate the need for a mortgage insurance.

The “2019 Cost Vs Value Report” (www.remodeling.hw.net), revealed which home renovations will give you the highest percentage of return on investment, and what they cost on average. According to the study, the top five renovations that provide the biggest bang for your buck are:

1. Garage door replacement

• Average out-of-pocket: $3,611
• Average return on investment: $3,520
• Percentage of cost recouped: 97.5%

2. Manufactured stone veneer

• Average out-of-pocket: $8,907
• Average return on investment: $8,449
• Percentage of cost recouped: 94.9%

3. Minor Kitchen Remodel

• Average out-of-pocket: $22.507
• Average return on investment: $18,123
• Percentage of cost recouped: 80.5%

4. Deck addition (wood)

• Average out-of-pocket: $13,333
• Average return on investment: $10,083
• Percentage of cost recouped: 75.6%

5. Siding Replacement

• Average out-of-pocket: $16,036
• Average return on investment: $12,119
• Percentage of cost recouped: $75.6%

Renovating your home can be a wonderful way to boost your enjoyment and your equity! Find more information from this study, including how project costs and values were calculated, at www.remodeling.hw.net/cost-vs-value/2019/.

Thinking about purchasing a fixer-upper, or refinancing to free up funds for your home renovation? Contact one of our Loan Officers today!

New Loan Limits!

Loan limits for Fannie Mae and Freddie Mac increase to $510,400 in 2020, an increase from $484,350 in 2019!

There has been an update provided by The Federal Housing Finance Agency. The agency has announced the Fannie Mae and Freddie Mac conforming loan limits for mortgages for 2020.

Each year, the baseline conforming loan limit is adjusted accordingly with the change in the average U.S. home price. House prices during the third quarters of 2018 and 2019 have increased by 5.38 percent on average, therefore, The Federal Housing Finance Agency is increasing 2020’s maximum limit by the same percentage.

It will be higher than the $510,400 baseline limit in certain areas where median home values were higher.

There are different calculations for Alaska, Hawaii, Guam, and the U.S. Virgin Islands. The baseline limit in these areas will be $765,600.

Click here for a map of 2020 loan limits by area!

If you are interested in learning more, contact one of our loan officers for information today!



FHA Revises Condominium Requirements

After a long-awaited update, the FHA is finally issuing a change to condominium guidelines. It was announced Wednesday that spot approvals are back, and steps are being taken in order to loosen eligibility requirements. With these revised guidelines, FHA is expecting the update to qualify an additional 20,000-60,000 condo units per year.

Changes that will come with the new guidelines include extending the re-certification deadline for approved condo projects from two years to three and loosening restrictions on owner-occupancy rules allowing projects to just be 50% owner-occupied. Department of Housing and Urban Development Secretary, Ben Carson, is hopeful the updated guidelines will open doors and allow more opportunities for homeownership. “FHA is publishing a new rule in the Federal Register that we believe will offer significantly more options for individuals and families to buy a home, specifically the kind of home more and more people are looking for in order to achieve homeownership, and of course that is a condominium,” Carson stated. Out of the 150,000 condo projects across the country, just 6.5% have approved financing through FHA.

The National Associations of Realtors has been advocating for change in FHA requirements for over a decade and stated they are thrilled with the change and the opportunities that will now be available to prospective homebuyers. NAR President John Smaby stated, “This ruling, which culminates years of collaboration between HUD and NAR, will help reverse recent declines in condo sales and ensure the FHA is fulfilling its primary mission to the American people.”

The updated guidelines will take effect on October 15, 2019.

What Causes Home Prices to Fluctuate?

The median sales price of a house in the United States is currently between $188,900- $279,500. There is such a large price range because many different factors can play into a home’s sales price. If you are looking to buy or sell soon, keep the following factors in mind when determining costs.

The price of a home can vary depending on the location. A more populous area, like a downtown neighborhood or a highly sought-after suburb, can boost the sales price because there is a high demand for borrowers wanting to live there. A less popular area, or even an up-and-coming neighborhood, may show lower home prices, even if the homes are similar in size to those in more expensive areas.

The season may also have an impact on home prices. Once the spring buying season starts heating up, there will be a larger demand for homes to purchase. Prices may also increase because there is a higher chance the home will be bought. With a hot buying market, bidding wars may ensue, which can also increase the price of a home. In colder seasons home prices may decrease since fewer people are shopping for a new home. Since the demand is low, sellers may consider a lower price tag, giving way to a better deal for borrowers.

A strong or weak economy can also impact home prices. When a strong economy is present, individuals and families may have a more secure financial mindset. With this in mind, buyers are more likely to feel comfortable obtaining a larger mortgage, which could lead to higher home prices. In an unstable economy, prices tend to be lower.

If you aren’t sure whether now is a good time to buy a new home, get in touch with one of our loan officers to learn more about the current market. We are happy to help and answer any questions you may have.

CAUTION- The Dangers of Rate Shopping

Buying a home will probably be the largest purchase you ever make.  With that in mind, you want the lowest interest rate, right?  WRONG!  The lowest advertised interest rate may not be your best option.  Some lenders and mortgage brokers advertise low rates, but don’t inform you of all the additional points and fees that come with the mortgage.  Here are a few tips to take into consideration to avoid misconceptions of an advertised low interest rate.

  1. Look at Points and Fees– Always ask about points, lender fees, broker fees and settlement costs. Points are pre-paid interest that affect the quoted interest rate.  You can ask to have your points quoted as a dollar amount instead of just a percentage.  For example, on a $200,000 loan, one point would equal $2,000.


  1. Shop Smart– Interest rates fluctuate daily. Talk to your Loan Officer about when the best time to lock is.  First Home Mortgage values honesty and service, so any questions you may have for your Loan Officer will be answered diligently, fairly and in regards to your best interest. If you contact different lenders, make sure you provide each lender with the same information.  Such information will include: the quality of your credit, location, type and use of your property, the size of down payment and/or the amount of home equity you have.


  1. Finding the Best Lender– Customer service may be the most important consideration when shopping for home financing. During the loan process, you should feel comfortable disclosing your financial information and asking questions. A trustworthy lender will be responsive and will assess your situation carefully to best suit your home buying needs. Make sure to choose a lender who can offer personalized options and takes the time to understand your goals.  Just remember, if you don’t close, interest rates don’t matter.


If you have any questions or would like to get started on this home-buying journey, contact First Home Mortgage Corporation today!  We provide the mortgage you need to make “home” happen by delivering customer service that not only fulfills goals, but exceeds expectations.

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Why Are Rates Going Down?

In the past couple weeks, there have been some international events driving interest rates down. Well what really drives mortgage rates? The old story from George Bailey in “It’s a Wonderful Life” is still true, for those that need a reminder there is a run on the Bank, and George explains that the money is in lent out to build the neighborhood.

Unfortunately, what happened in It’s A Wonderful Life happened many times in American history, and rarely had a positive outcome. The problem was one of liquidity. Liquidity, loosely is the ability to exchange something for cold hard cash quickly and cheaply.  George Bailey couldn’t just trade the loans for cold hard cash during that era.

Today, that isn’t quite the case. If that happened today, George could underwrite the mortgages to Fannie Mae’s standards and have something that he could trade to another bank for cash. The market for Fannie Mae loans is one of the most liquid in the world and allows American’s to borrow at rates as low as they are today! This is also because the liquidity allows other mortgage investors to painlessly invest in loans to American consumers. If you have a pension, or a life insurance policy, almost assuredly some of those funds are invested in mortgages. Anyone who has cash and wants to invest it in American mortgages can do so, and they even include international financial institutions.

That brings us to the main reason mortgage rates are so low today. The American economy and financial markets are much more stable compared to those internationally. In Japan, and Europe, interest rates are even lower than they are here, so money has been flowing from their banks and financial institutions into American’s mortgages.

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