The Mortgage Minute | October 2023

As a full-service mortgage lender, Keller Home Loans has the solution for nearly every mortgage need. From renovation loans to financing for manufactured housing and everything in between. Our goal is to make home ownership more accessible for your clients! Check out some of our specialized programs and market updates for this month.

5 Essential Tips for Agents Assisting First-Time Homebuyers

For a first-time homebuyer, the process of finding and purchasing a home can be equal parts exciting and overwhelming. As a real estate agent, you have the power to play a key role in guiding, advising, and assisting new buyers through their journey. By sharing your expertise, you can make this memorable experience both simpler and less stressful for everyone involved.

It's important to understand the challenges new buyers face and the best practices for guiding them through the process if you want to best serve your clients. The following five tips will help you become a first-time homebuyer's greatest resource.

Visit the Keller Home Loans blog to discover five key tips for real estate agents who are helping to guide first-time homebuyers on their exciting journey to homeownership.

Proudly Offering the Essex DPA Program - 100% Financing for an FHA Loan

The Essex DPA Loan Program is designed to provide financial assistance to individuals and families who are looking to purchase their dream homes but face challenges in meeting the down payment requirements. The Essex's DPA program provides homebuyers with 100% financing for an FHA loan, requiring 0% down payment (closing costs still apply.)

This is made possible through a combination of a first and second mortgage, with the second mortgage amounting to up to 3.5% of either the sales price or appraised value, whichever is less. The term for the 2nd is 10 years. This DPA program has many advantages over other loans, which makes them an excellent choice for first-time homebuyers and homebuyers with less than perfect credit.

Key Features of the Essex DPA Loan:

• ZERO down payment
• Low mortgage insurance adjustments
• No income limits
• Minimum 600 FICO score
• Non-Occupant Co-Borrowers Allowed

If you have questions or would like to learn more about how the Essex DPA Loan Program can further help your clients achieve their homeownership goals, please contact a Keller Home Loans Loan Officer.

Example Pricing Scenario: Sale price: $275,000 | Down payment: $55,000 | Loan amount: $220,000 | 30-year fixed rate: 7.25% |APR 7.39%| P&I payment $1,500 | 360 monthly payments | Payment stated does not include taxes and insurance. Notice: This is not a commitment to lend or extend credit. Restrictions may apply. Information and/or data is subject to change without notice. All loans are subject to credit approval. Not all loans or products are available in all states.

Homebuying Trends for Agents: Localized Market Conditions

With current income rates, housing shortages, and other economic factors, buyers may be hesitant to enter the homebuying market; however, there are some trends that realtors can pay close attention to that may help bring homeownership within reach.

The first trend to look for is the localized market corrections. While this trend varies region by region, recent market corrections have reduced home prices anywhere from 9% to 14% according to Redfin data from April of 2023. These market corrections often are due to a combination of factors including:

• Shifts in supply and demand
• Economic downturns, recessions, or other economic factors.
• Heightened interest rates

As a real estate professional, it can be beneficial to keep an eye out for localized market corrections to naturally adjust prices, and bring a more balanced state to the market. These localized corrections could end up bringing home ownership within reach for clients that have been struggling with home affordability.

We Can Help Your Clients Get Offer Ready With Only a Soft Credit Pull!

We have some incredible news to share. At Keller Home Loans, we now offer a groundbreaking feature that allows your clients to underwrite their entire loan without affecting their credit score, even before they find a property. We have implemented a system that runs an Automated Underwriting System (AUS) with Fannie and Freddie using a soft credit pull. This means that a soft pull won't have any impact on your clients' credit score.

Features of Offer Ready Plus+:

• With this program, your clients can obtain their credit results and complete the underwriting process without any negative impact on their credit score
• The Offer Ready certificate will help you and your client gain a competitive advantage over other home buyers because their approval will only be waiting on the client to find the property they desire to purchase!
• Offer Ready pre-approvals allow for a quicker loan closing process and create a more attractive offer to the seller, ultimately strengthening the buyer's position
• With this approach, you'll be able to move quickly and confidently when your clients do find the perfect property

Fixed vs. Adjustable Mortgages: Guiding Clients with Clarity

Realtors are often the go-to source for homebuyers, fielding questions about everything from purchasing offers to financing decisions. As your clients navigate through the purchasing process, they may look to you for advice about choosing between a fixed-rate or adjustable-rate mortgage.

Clearly understanding the differences and the pros and cons of each can help you guide your clients to the decision that is most likely to meet their needs.

Discover the key differences between fixed and adjustable-rate mortgages. This concise guide will help realtors advise clients with clarity.

ZeroPlus+ Can Help Reduce Upfront Mortgage Costs for Your Clients

ZeroPlus+ is an exclusive Keller Home Loans program that reduces the amount of upfront costs for obtaining a mortgage. Featuring:

• $0 Origination Fee
• $0 Lender Fee
• Plus $1,000 credit at closing* if loan amount is over $150,000

Buydowns Available at Keller Home Loans: 3-2-1, 2-1, 1-1, and 1-0

Keller Home Loans is pleased of offer a variety of temporary buydown programs to borrowers looking to lower their monthly payments or increase their purchasing power.

A mortgage buydown is a financing technique where a borrower pays an upfront fee to the lender at closing. This payment is then utilized to lower the interest rate on the mortgage loan for a specific time, which typically ranges from one to three years. This reduced interest rate translates to lower monthly mortgage payments for the borrower throughout the buydown period. Once the buydown period concludes, the interest rate and monthly payments will revert to the original terms agreed upon in the loan contract.

3-2-1 Buydown Example

The 3-2-1 Temporary Buydown reduces the buyer's interest rate by 3% for the first year of their loan, 2% for the second year, and 1% for the third year.

Example: Sale price: $275,000 | Down payment: $55,000 | Loan amount: $220,000 | 30-year fixed rate: 7.25% |APR 7.39%| P&I payment $1,500 | 360 monthly payments | Payment stated does not include taxes and insurance

Keller Home Loans is proud to be a partner you can count on. We are dedicated to ensuring a smooth and stress-free mortgage process for your clients and helping your business grow. Connect with one of our talented Loan Officers today.