There are many reasons why New Jersey is lacking quality inventory of homes. In this article we will outline a number of causes that are having a negative impact in the market.
First, with historically low interest rates, many current New Jersey homeowners have recently refinanced. Therefore, it is more practical for them to stay in their existing home, rather than consider a move to a new home and pay a higher rate on a new mortgage. This is just one factor resulting in less new inventory for potential homebuyers in New Jersey.
Another issue impacting inventory is that more than 60% of those looking to purchase a home must sell an existing one first. Mortgage lending standards are tighter for those who must carry two mortgages, making it increasingly difficult to qualify for a mortgage while owning two homes.
There are also influences from trends affecting new, younger buyers, that keep them from being able to move out on their own and purchase or rent a home. Unemployment rates, even among this younger population, including recent college graduates, delay their parents downsizing from their existing family home. These Baby Boomers who had planned to move to a smaller home, or another state, have been unable to do so. So these adult children often move back home after college, due to joblessness, divorce, or the ...
While it's no surprise that credit scores can vary from report to report, the shock can come when it directly affects you. A little research can go a long way. It can also make the difference in getting the mortgage rate you want and the one you get stuck with. When seeking out a credit score for a home mortgage, equip yourself with some facts. Consider these points as you start out.
When you get a free credit score, it is usually only one bureau
Free is good. Everybody loves free. But in the case of getting your credit score, free is also incomplete. If the provider of this free score only uses one report, you are seeing a very incomplete picture. Mortgage applications require three scores, so the other two scores could be very different. If these overlooked scores are not as good (or worse, contain negative information) you could be stuck with a rate that negatively impacts you -- and your wallet.
From our various locations in New Jersey -- where we service clients in the high stakes New Jersey and New York mortgage markets -- every single point helps.
So do your due diligence and prepare yourself accordingly.
Caution! It's not the same
Not only is the online free credit score incomplete, the quality of the score is also lacking.
What can we expect this year, in terms of product and services, from your Company?
NJ Lenders has initiated a program that will take perspective buyers through the entire mortgage approval process and provide them with a solid mortgage Credit Approval subject to an appraisal. We found that this is a necessary tool for a buyer to have when bidding on a home in this highly competitive housing market. In essence, the borrower is in the same position as an all cash buyer (subject to an appraisal).
What is your forecast for the Bergen County Market?
Bergen County is not one market. Certain towns will outperform others. From a number of transaction perspective I believe the market will be similar to 2013. Because of the lack of quality inventory I do not believe the total number of sold units will exceed the spring market of 2013.
What new changes in your industry should REALTORS be aware of right now?
QM. On January 10th the federal regulators (CFPB) introduced new legislation that requires lenders to adhere to specific underwriting guidelines to determine a borrower's Ability To Repay. In order for a loan to be classified under the Safe Harbor protection, a loan must have an Automated Underwriting Approval (AUS) from either Fannie Mae, Freddie Mac or FHA. If the loan is manually underwriting the debt to income ratios cannot exceed 43%. The ...