The sky is falling! The sky is falling! The Fed met last week and raised rates. What does that mean for the mortgage market and mortgage rates?

Not much. The Fed funds rate is the rate that banks lend money to each other on an overnight basis. The Fed raising rates a quarter percent does not instantly translate into a quarter percent increase in mortgage rates. Mortgage rates do not run parallel to the Fed rate. The perception is that all rates rise or fall based on a Fed decision, but, the reality is that the Fed rates have less of an instant impact and are more an indication of long-term borrowing trends for all types of credit.
Here’s why.
Mortgage Rates Are Up Already
Mortgage rates have increased substantially in the last few weeks following the election. There are many reasons for this (that we could discuss for hours), but because they have already risen around 0.5 percent or more, running to your lender even now means you are already too late.
Quick Reaction, and Then…
Mortgage rates typically see a quick jump with news of a Fed raise, but rates have already increased substantially. Why? Not only do mortgage rates not run directly parallel to the Fed rate, but often, the mortgage market has already reacted to the anticipation of an increase due to improving economic factors. Not only have we seen unemployment drop to new lows, but income growth is picking up and the stock market appears to be ...

There’s nothing like leaving it all behind and getting out to celebrate with family and friends. But that holiday vacation joy will quickly disappear if you return to trouble on the home front. It is not just the Grinch who steals gifts on Christmas.  The holiday season is open season as far as criminals are concerned. So while you’re packing for your getaway, make sure you’re also prepping the empty home you’re leaving behind. Take the following steps prior to leaving your home unattended for a few days to ensure you won’t return to an upsetting or costly scenario:

Put the lights on a timer. Total darkness or lights blazing round the clock are both good ways to let burglars know you’re out of town. Invest in a timer or smart home app that lets you turn the lights on and off remotely.

Notify your security company. If you have a security alarm system, notify the monitoring company that you plan to be away. Consider an outside motion sensor that will alert your neighbors and the police if anyone attempts a break-in.

Be smart on social media. We all love to share a vacation picture or two, but hold back on the details. Don’t share your departure date or check-in to out of town locations. This lets thieves know precisely where you are – which is not home.

Turn off the main water valve that leads into the house ...

It’s beginning to look a lot like cold nights, evening gatherings, decadent cookie displays and overflowing cups of eggnog. The holiday season is here, but don’t let that turn your focus away from your goal of buying a new home. Recently, mortgage interest rates have started to slightly increase and during a year that has been historically low that may start to worry some buyers. What is important to know is that the holiday season can still be a great time for you to lock in a great rate to purchase the home of your dreams for 2017.

Steve Grossman, Vice President and Partner of NJ Lenders Corp. said, “The winter and holiday months are typically a slower time of year for real estate.  Now this market can be an advantage for buyers. Fewer real estate transactions can translate to less competition, more motivated sellers, quicker mortgage approval, plus other advantages. Home prices are typically at 12-month lows in December. Lower home prices mean buyers can purchase more home for less”.

One of the biggest reasons that many buyers make the leap from renting to buying is for the tax benefits. If you wait until January to buy, you won't realize the tax advantages until the following year. Closing by December 31 can mean tax benefits for home buyers, like deductions for mortgage interest, property taxes and some closing costs.

Here are 4 tips to remember while you shop for your new home this holiday season.

  1. Be a Grinch with Your Credit Card ...

Mortgage rates have seen slight increases since the election, but that does not mean prospective homebuyers have lost the opportunity to still lock a great rate for their new home purchase. With the likelihood increasing that the Federal Reserve could boost interest rates later in December and stick with its policy of monetary tightening, at least in the near term, the reality is that mortgage rates could rise even more. This means prospective homebuyers need to be extra diligent in their efforts to secure a low mortgage rate.

According to Bankrate, as of Dec. 4, the average 30-year fixed mortgage was 4.13%. Comparatively, a month before, the 30-year mortgage rate averaged just 3.51%, a difference of 62 basis points. Mortgage rates have reached their peak to date this year in the week leading up to the expected rise in the key interest rate, with the 30-year fixed-rate mortgage averaging 4.13 percent, according to Freddie Mac's recently released Primary Mortgage Market Survey® (PMMS®). The key rate, which the Federal Reserve will determine action on next week, generally informs the movement of mortgage rates. Analysts widely anticipate an increase in the rate, despite initial claims to the contrary after the election.

Before you get started the most important step to take is to consult an experienced licensed loan originator who will be able to educate you on all of the options available the match your financial needs.  The average NJ ...

4 Financial Tips for Military Families

Dec 5
Category | Blog

Managing your money is always a complicated task, but military families in particular have a bevy of unique situations to navigate. Service members and their families often cite finances as one of their most significant stressors, even more so than deployments and personal relationships. Service members can’t adequately focus on the job at hand if they are concerned about financial problems at home. Military families face unique financial challenges like deployments and relocations, so we stress the importance of planning ahead as much as possible.

Here are some financial tips for Military and Armed Forces service members and their families:

  • Contribute automatically to a Thrift Savings Plan. Military members have access to the Federal Thrift Savings Program, which offers the lowest-cost retirement savings plan available. Have automatic contributions withdrawn from your paycheck.
  • Plan for deployment. Before deployment, have a family conversation about managing the household budget. Consider granting power of attorney to your spouse, should they need to make any urgent financial decisions while you are gone. Check with your bank to see if they have pre-printed forms you can use for bank accounts. Military personnel also receive additional funds while deployed. Decide on the best use for that extra cash, whether it is paying off debt or additional Thrift Savings Plan contributions.
  • Set up ...

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