The Truth About Credit Scores and Buying a Home
Your credit score plays a big role in the homebuying process. It’s one of the key factors lenders look at to determine which loan options you qualify for and what your terms might be. But there’s a myth about credit scores that may be holding some buyers back. The Myth: You Need To Have Perfect Credit According to Fannie Mae, only 32% of potential homebuyers have a good idea of what credit score lenders actually require. That means two-thirds of buyers don’t actually know what lenders are looking for – and most overestimate the minimum credit score needed. The Reality: Perfect Isn’t Necessary But the truth is, you don’t need perfect credit to become a homeowner. To see the average score, by loan type, for recent homebuyers check out the graph below: There is no set cut-off score across the board. As FICO explains: “While many lenders use credit scores like FICO Scores to help them make lending decisions, each lender has its own strategy, including the level of risk it finds acceptable. There is no single “cutoff score” used by all lenders, and there are many additional factors that lenders may use . . .” So, even if your credit score isn’t as high as you’d like, you may still be able to get a home loan. Just know that, even though you don’t need perfect credit to buy a home, your score can have an impact on your loan options and the terms you’re able to get. Work with a trusted lender who can walk you through what you’d qualify for. Simple Tips To Improve Your Credit Score If you want to open up your options a bit more after talking to a lender, here are a few tips from Experian and Freddie Mac that can help give your score a boost: 1. Pay Your Bills on Time This includes everything from credit cards to utilities and other monthly payments. A track record of on-time payments shows lenders you’re responsible and reliable. 2. Pay Down Outstanding Debt Reducing your overall debt not only improves your credit utilization ratio (how much credit you’re using compared to your total limit) but also makes you a lower-risk borrower in the eyes of lenders. That makes them more likely to approve a loan with better terms. 3. Hold Off on Applying for New Credit While opening new credit accounts might seem like a quick way to boost your score, too many applications in a short period can have the opposite effect. Focus on improving your existing accounts instead. Bottom Line Your credit score doesn’t have to be perfect to qualify for a home loan. The best way to know where you stand? Work with a trusted lender to explore your options. Let’s connect so you can get the scoop on what’s happening in our area and advice on how to make your next move a smart one. Check out our Beautiful Listings at https://davesalaskahomes.com/featured-listingSearch for homes easily at https://davesalaskahomes.com/listingGet your home’s estimated value instantly at https://davesalaskahomes.com/evaluation If you or anyone you know has ANY thoughts of buying or selling real estate, lets connect to talk about the opportunities available in our market and how to reach your goals. LET US BE YOUR TRUSTED GUIDE Call or text Dave now at 907-863-7289Call or text Travis now at 907-575-6779 davesalaskahomes@gmail.com http://www.DavesAlaskaHomes. com
Expert Forecasts for the 2025 Housing Market
Wondering what’s in store for the housing market this year? And more specifically, what it all means for you if you plan to buy or sell a home? The best way to get that information is to lean on the pros. Experts are constantly updating and revising their forecasts, so here’s the latest on two of the biggest factors expected to shape the year ahead: mortgage rates and home prices. Will Mortgage Rates Come Down? Everyone’s keeping an eye on mortgage rates and waiting for them to come down. So, the question is really: how far and how fast? The good news is they’re projected to ease a bit in 2025. But that doesn’t mean you should expect to see a return of 3-4% mortgage rates. As Lawrence Yun, Chief Economist at the National Association of Realtors (NAR), says: “Are we going to go back to 4%? Per my forecast, unfortunately, we will not. It’s more likely that we’ll go back to 6%.” And the other experts agree. They’re forecasting rates could settle in the mid-to-low 6% range by the end of the year (see chart below): But you should remember, this will continue to change as new information becomes available. Expert forecasts are based on what they know right now. And since everything from inflation to economic drivers have an impact on where rates go from here, some ups and downs are still very likely. So, don’t get caught up in the exact numbers here and try to time the market. Instead, focus on the overall trend and on what you can actually control. A trusted lender and an agent partner will make sure you’ve always got the latest data and the context on what it really means for you and your bottom line. With their help, you’ll see even a small decline can help bring down your future mortgage payment. Will Home Prices Fall? The short answer? Not likely. While mortgage rates are expected to ease, home prices are projected to keep climbing in most areas – just at a slower, more normal pace. If you average the expert forecasts together, you’ll see prices are expected to go up roughly 3% next year, with most of them hitting somewhere in the 3 to 4% range. And that’s a much more typical and sustainable rise in prices (see graph below): So don’t expect a sudden drop that’ll score you a big deal if you’re thinking of buying this year. While that may sound disappointing if you’re hoping prices will come down, refocus on this. It means you won’t have to deal with the steep increases we saw in recent years, and you’ll also likely see any home you do buy go up in value after you get the keys in hand. And that’s actually a good thing. And if you’re wondering how it’s even possible prices are still rising, here’s your answer. It all comes down to supply and demand. Even though there are more homes for sale now than there were a year ago, it’s still not enough to keep up with all the buyers out there. As Redfin explains: “Prices will rise at a pace similar to that of the second half of 2024 because we don’t expect there to be enough new inventory to meet demand.” Keep in mind, though, the housing market is hyper-local. So, this will vary by area. Some markets will see even higher prices. And some may see prices level off or even dip a little if inventory is up in that area. In most places though, prices will continue to rise (as they usually do). If you want to find out what’s happening where you live, you need to lean on an agent who can explain the latest trends and what they mean for your plans. Bottom Line The housing market is always shifting, and 2025 will be no different. With rates likely to ease a bit and prices rising at a more normal and sustainable pace, it’s all about staying informed and making a plan that works for you. Let’s connect so you can get the scoop on what’s happening in our area and advice on how to make your next move a smart one. Check out our Beautiful Listings at https://davesalaskahomes.com/featured-listingSearch for homes easily at https://davesalaskahomes.com/listingGet your home’s estimated value instantly at https://davesalaskahomes.com/evaluation If you or anyone you know has ANY thoughts of buying or selling real estate, lets connect to talk about the opportunities available in our market and how to reach your goals. LET US BE YOUR TRUSTED GUIDE Call or text Dave now at 907-863-7289Call or text Travis now at 907-575-6779 davesalaskahomes@gmail.com http://www.DavesAlaskaHomes. com
New Year, New Home: How To Make It Happen in 2025
This is the time when a lot of people take a moment to reflect and set their goals for this year. And as you picture what you want your 2025 to look like, one thing that may pop into your mind is the vision of you in a new home. But how do you get there? And where do you start? Here’s some advice that can help you get the ball rolling. Focus on Your Why To lay the foundation, you need to focus on your why. While the dollars and cents are important, so is the driving force behind your desire to move. Maybe you need more space for a growing family, want to sell so you can downsize, or are finally ready to buy your first home. Whatever your reason, it’s important to keep it front and center. Your why is what helps you stay focused. Share your motivation with your agent and they’ll use their expertise to help support that goal, no matter what the market looks like. With a great agent by your side, you’ll have someone to guide you, problem-solve, and keep you moving forward until you can check that goal off your to-do list. Get Clear on What You Need Then it’s time to figure out what your next home needs to have. How many bedrooms do you need? If you don’t have a designated home office, is that a deal-breaker? What about a big fenced-in backyard? Knowing your must-haves and nice-to-haves makes the search a lot smoother. Since affordability is still tight, it’s important to have a clear idea of your essential items upfront. Maybe you can flex a bit on location, if it’s got everything else you’re looking for. Go over those essential items with your agent and they’ll help you focus on the homes that check the boxes that matter most while staying within your price range. Know Your Numbers Before you jump in, take a look at your finances. How much have you saved? What monthly payment feels comfortable? Getting clear on your budget early will help you know what’s possible. The best way to do this is by partnering with trusted real estate professionals, like a local agent and a lender. They’ll help you: Plan for your down payment and look into down payment assistance programs Understand the equity you have in your current home and how you can use it to fuel your next move if you’re selling Get pre-approved for a mortgage so you know what you can borrow Lean on a Pro To Guide You It can be hard to know where to start, but you don’t have to do it alone. A real estate agent knows what you need to do to get ready to buy or sell, how to navigate the process, and can answer your questions every step of the way. As Bankrate puts it: “. . . now more than ever, it’s smart to lean on the guidance of an experienced local real estate agent. If you want to enter the housing market in 2025, whether as a buyer or a seller, let a pro lead the way for you.” Remember, buying or selling is a big milestone and a great goal for this year. With the right expert on your team, you’ll feel confident and ready to take on the market. Bottom Line If buying or selling a home is part of your goals for 2025, now’s the time to get started. Focus on your why, know what you need, and connect with trusted pros to make it happen. Let’s team up and make this the year you accomplish your real estate resolutions. Check out our Beautiful Listings at https://davesalaskahomes.com/featured-listingSearch for homes easily at https://davesalaskahomes.com/listingGet your home’s estimated value instantly at https://davesalaskahomes.com/evaluation If you or anyone you know has ANY thoughts of buying or selling real estate, lets connect to talk about the opportunities available in our market and how to reach your goals. LET US BE YOUR TRUSTED GUIDE Call or text Dave now at 907-863-7289Call or text Travis now at 907-575-6779 davesalaskahomes@gmail.com http://www.DavesAlaskaHomes. com
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