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Things to Consider

Why Choose an RMS Loan Officer?

One cornerstone of our RMS company culture is what we refer to as “the 4 H’s”. We expect our employees to be hard-working, honest, humble and have a healthy sense of humor. These traits support our ongoing efforts to work together, as a team, to get the job done as efficiently as possible and to do it well.

But what exactly sets our Loan Officers apart from others?

Guiding and Educating Our Customers

RMS LO’s coach and support our borrowers through every step and stage of the mortgage loan application and approval processes. Here is a breakdown:

Choosing the Right Loan - Our loan officers’ knowledge, experience and local market familiarity enables them to help our borrowers make the best possible choices about the home financing options and products that meet their unique needs. Are you looking to refinance your current home? Or maybe you are a first-time homebuyer? If you have a lot of questions and don’t know where to start, begin the process by reading up on all the major loan programs. It doesn’t matter if you need more or less hand holding, our LO’s are here to inform and educate you on the important pieces of your mortgage puzzle.

Our LO’s have access to a variety of tools to explore financing options and share numbers that will help shape your idea of what kind of mortgage best meets your needs, how much you should borrow and if it is the right time for you. They share this knowledge with you and help you understand it along the way.

Loan Application – You fill out your mortgage application and submit the documentation we need to get started. Things like recent pay stubs, bank statements, photo ID, tax returns, W-2s, etc. In other words, personal and confidential information. Our loan officers know how to leverage available technology to fill in the gaps when face-to-face contact is not an option. Using our RMS Ready Mobile App you can submit an application from your mobile device, upload your sensitive documents securely through the app and stay well-informed through the process.

The mortgage process can go smoothly and quickly, and technology is playing a great role these days in speeding up what has been a lengthy process historically, but there are still important steps involved after you submit your application. Your loan officer and his or her team understand all these factors and it’s their role to help make sure your application is as complete as possible when you submit it.

Approval Process - From Conventional to VA to Jumbo Loans, our LO’s will stick by your side to keep things running smoothly. They work diligently to make sure you stay updated on the progress of your loan through each step of the way. Not only will you be notified once each important milestone has been passed but your loan officer will make sure you understand the details and educate you on what it all means so you can always stay in the loop.

Dedicated Team and Support - It’s also important to note that while delivering this exceptional home financing experience starts with our LO’s, it doesn’t end there. At RMS we work hard to establish and maintain a strong spirit of collaboration and partnership between our Sales and Operations Teams. This helps ensure our borrowers are well served. And it is one of primary reasons why RMS earns industry leading Customer Satisfaction ratings, and why most of our new customers and loans are the direct result of referrals from those how have already had a positive home financing experience with RMS.

Always Putting the Customer First

Pandemic driven social distancing protocols have significantly reduced the frequency of face-to-face meetings between RMS employees and our borrowers. While we do miss that direct face to face interaction, the good news is that we provide borrowers access to a full spectrum of technology-based tools that, along with continued access to and support from our LO’s via phone and e-mail, provide a convenient, efficient, and secure home financing experience.

Serving the needs of thousands of borrowers each year and earning exceptional customer satisfaction ratings all start on the front lines with our experienced RMS Loan Officers. In 2020 RMS helped over 30,000 customers finance their homes (for a total of $8.5 billion in closed loan volume). Even with 90%+ of our employees working from home, we grew our loan volume 70% year over year. And, most importantly, we maintained industry leading Customer Satisfaction Ratings for Customer Satisfaction (94%), Likelihood to Recommend (95%) and Likelihood to Use Again (95%).

Residential Mortgage Services, Inc. is dedicated to consistently providing our customers a high-quality home financing experience that is both simple and easy to understand. Using the right balance of communication, technology, and teamwork our RMS loan officers will provide a home mortgage experience you can feel confident about. So rest assured, next time you or someone you know need help financing a home, your experienced RMS Loan Officer is ready to help guide you home!


Things to Consider

How to spend and save wisely on home renovations in 2021

The effects of COVID-19 have forced many people to think about the things they would like to get done, given that so much of life has been put on hold. With more people spending their time in the comfort of home — approximately one-third of Americans say they now telecommute on a full-time basis, according to a recent Gallup poll — many homeowners are contemplating how they can renovate in 2021 without breaking the bank. 

Several recent polls appear to suggest as much. For instance, in a survey conducted by Houzz, which tracks home renovation expectations among builders, its Business Activity Indicator (BAI) reached 75 in the third quarter, its highest level since the same period in 2018 and up from 49 compared to the second quarter.

The National Association of Home Builders' Remodeling Market Index (RMI) showed a similarly revitalized reading, hitting an 82 on a scale of 0 (worst) to 100 (excellent) during the same three-month stretch.

Tom Ashley, the current chairperson for the NAHB Remodelers, noted homeowners across the country are showing renewed interest in beautifying their properties.

"With refinancing activity surging, homeowners are investing in their homes, which is sustaining strong demand for remodeling," Ashley explained. "As a result of the rapid changes for work and the economy after the virus-induced recession, homes are serving multiple roles such as school, office and gym. This has directly increased the demand for improvements."

At the same time, they don't necessarily want to pay an arm and a leg to get their places looking as good as new. In terms of price ranges, the RMI showed the highest readings in the $20,000 to $50,000 range (86) and under $20,000 (90).

It raises the question: What kinds of renovations provide the most bang for your buck? Do certain rooms provide a bigger return on your investment?

What brings the most ROI?

Every year, Remodeling Magazine comes out with an annual report called Cost vs. Value. It assesses which projects paid for by homeowners retain the most value should they decide to sell. Once again, kitchen remodels were in the top three, with the average expense totaling $23,452. Once sold, however, sellers net roughly $18,200, recouping almost 78% of the original money spent.

For some families, dropping over $20,000 for renovations may be beyond what's financially feasible. But the Cost vs. Value report showed you can spend less and get more. For instance, No. 2 on the list was garage door replacement. Costing $3,695, the average resale value is nearly $3,500 for a ROI of 94.5%. No. 1 is manufactured stone veneer. As Bankrate.com noted from the report, replacing vinyl siding with stone veneer yields an average 95.6% return on investment thanks to a resale value of $8,943 and cost of $9,357. In short, it almost pays for itself. 

Here are a few other projects that Remodeling magazine says are well worth saving for:

  • Siding replacement (fiber-cement)
    - Average cost: $17,008

- Average resale value: $13,195

- ROI: 77.6%

  • Siding replacement (vinyl)

- Average cost: $14,359

- Average resale value: $10,731

- ROI: 74.7%

  • Window replacement (vinyl)

- Average cost: $17,641

- Average resale value: $12,761

- ROI: 72.3%

If you have the money for these projects, you're in a good place. If not, here are some strategies that can help you save:

Save up consistently

Once you've settled on the right project, commit to saving regularly. Whether you put a percentage of each paycheck aside or a specific dollar figure, try to be consistent so you can have the money when you are ready to start your renovation. The hardest part is taking the first step. Once you begin, you'll develop a habit and reach the proper amount before you know it. The key is frequency and discipline.

Shop around

There are many remodelers out there these days, some of whom may specialize in the project you're looking for. If you perform your research online, you should be able to find someone that is reliable, in your area, and willing to offer a free estimate. Yelp, the Better Business Bureau and HomeAdvisor are great websites you can leverage, but you may also want to speak with friends who had work done and were pleased with the results for the money they spent. 

Your house has provided you with great comfort this past year. Make 2021 the season where you repay the favor.

Explore Your Financing Options

There are renovation financing options, like the FHA-203k home loan program and Fannie Mae Homestyle® renovation loan, that can help you make improvements to your home. A renovation loan program can be a great option to improve your existing home instead of moving, or can be used if you plan on buying and updating a fixer-upper, foreclosure, or short sale home. To learn more about your financing options contact us today!

 


Things to Consider

What home buyers would have done differently 

Homeownership can be a rollercoaster ride of emotions. And they can occur at all phases. Some are somewhat skeptical about their purchase initially but grow to absolutely love it. For others, it's the reverse - they adore their place in the beginning, but after a few months or years, aren't as wild about it as they were back then. 

It raises an interesting question: If first-time buyers had to do it all over again, or were given the opportunity to do so, what would they change? Here are a few of the most common mistakes first-time homebuyers make. Being cognizant of them —whether you're on the cusp of buying a house or are in the market a second or third time — can help you avoid making decisions that you may come to regret: 

1. Not factoring in the hidden costs  

When you see the price of a house you like and it's within your budget, it's a great thing. However, there are several added expenses that the price doesn't include, such as mortgage insurance, property taxes and repairs. According to a 2018 poll from Bankrate.com, in the average year, a homeowner pays roughly $2,000 just to maintain their place's upkeep. 

Rely on your real estate agent to give you the whole picture. If you are a debut or repeat buyer, run the numbers and evaluate all the costs that come with buying a house. You may not be able to get a precise figure, but the more people you talk to, the better off you'll be in determining what a house will cost you over the long term.  

2. Thinking with your heart rather than your head 

When it comes to buying a house, love at first sight really does exist. When you see a potential home that looks great from the listings —and visiting the place confirms your initial reaction — it's a wonderful feeling. The problem is the rush of emotion can lead to impulsivity, buying the house without doing your research into the property's history. It may also result in a bidding war, where you are keen on purchasing the home so long as it is within the range that was pre-approved by your lender. 

Instead, it's best to adjust your expectations and not let emotions guide your decisions. No house is perfect, so try to be as objective as possible and not rush into anything until you're certain you've covered all your bases before you make a formal commitment. 

3. Foregoing or paying a minimal down payment 

Perhaps the biggest misunderstanding people often have upon entering the home buying process is the down payment. Some think they're required to come up with a 20% down payment when in reality they can pay much less. Some mortgages don't require any down payment whatsoever. 

If you have the ability, consider putting as much toward the down payment as possible. In addition to the fact that this helps you build equity faster, a down payment helps you reduce how much you spend on monthly mortgage payments and will help you pay off your loan faster, potentially years quicker. 

It's important to note that you should only pay as much toward your down payment as you can reasonably afford. In other words, if it requires draining your savings dry, then it's probably too much. 

4. Not taking advantage of a land survey 

There are several reasons why buying a house is typically the biggest decision a person makes in their life. It's not only a significant investment, but it can result in opportunities as well.  

The extent of those opportunities may be available through a land survey. While getting one isn't required, it can be very helpful and give you more room to improve or use your land how you want. As noted by HGTV, a professional survey may determine that you have much more square footage of land area than the seller led you to believe. This means you have the legal right to use the extra space as you would like.  

5. Failing to refinance 

Interest rates have been low for quite some time now, but they're particularly low today, averaging 2.87% among 30-year fixed-rate mortgages, according to the most recent statistics available as of this writing from Freddie Mac.  

The general consensus is refinancing makes sense if you can lower your interest rate by even half a percent. Some may opt not to refinance because of the paperwork involved or feel like such a small percentage difference won't amount to much. In reality, it can save you thousands of dollars over the life of a loan. 

Your awareness of these pitfalls can help you make the most of your home buying experience so you never come to regret it.


Things to Consider

Why this time of year is a good time for home renovations 

Be it beautiful fall foliage to tasty pumpkin-flavored treats, fall is chock full of sweet surprises, with lots of exciting things to do and accomplish. But here's a task that you may not necessarily associate with autumn: home renovation. No matter what room of the house is due for a do-over, now is the time to take those measures - and measurements. 

In reality, there really is no one single bad time to begin or complete a home renovation. Even during the height of the coronavirus pandemic, more than half of respondents in a Houzz poll were able to finish their projects despite the uncertainty and tumult that the shutdown created. This was particularly true of homeowners living in the South, as nearly two-thirds successfully continued on with the renovation amid the crisis.  

When it comes down to it, though, the fall months just may be the best of them all for remodeling, pairing a seasonal change with those of your home's. Here are a few reasons why, especially in 2020: 

The weather is delightful 

Ask anyone who enjoys autumn, one of their top reasons for the admiration will be the weather. Not too hot and not too cold, fall is the Goldilocks of seasons - it's just right. Not having to worry about the hazards and mess of heavy wet snow, nor the discomfort and productivity losses from hot humid temperatures, make fall a great several weeks of outdoor conditions that are ideal for projects large and small.  

Building materials usually cost less 

As most people know, spring as well as a good portion of the summer, are the busy seasons not only for home buying, but home building.  

Take June as an example. According to the National Association of Home Builders and the Department of Housing and Urban Development, a rate of nearly 1.2 million houses began construction on a seasonally adjusted annual basis this past June, a more than 17% increase compared to the previous month. The surge in demand led to an uptick in prices for lumber.  

However, since building activity usually trails off as the months draw to a close, so too do the costs of building materials. These savings get passed on to you from whichever contractor is performing the renovation. 

Projects are frequently completed faster 

Many factors play into when a renovation is 100%, as there are always issues that can come up that no one was anticipating, such as COVID-19. Generally speaking, though, since construction crews' workload tends to level off as the temperatures get cooler, they have more time available to prioritize whatever rooms you're rehabbing. Additionally, since the holiday season is just around the corner, rebuilders have an added incentive to finish everything before December and January arrive, which is when the snow starts falling in many areas - or at least is more likely to in comparison to October and early November.   

Cooldown period from summer commotion 

Summer may undoubtedly be the season for vacations, but that doesn't mean it's a time when you're less busy. Whether it's travel or having kids at home from college, June through August can be activity- and people-filled. 

Much like the temperatures, things tend to cool off in fall, as students return to their classrooms, dorms and apartments. Work schedules resume. In short, life gets back to normal. Take advantage of this quieter period by scheduling your renovation just as the days get noticeably shorter and leaves change color.  

The season for hosting 

Speaking of holidays, this is typically the period when family, friends, co-workers and extended relatives come to visit to celebrate the annual festivities. What better way to welcome friends and family memebers than with a new-and-improved kitchen, living room, dining room or guest bathroom when things go back to normal? 

You may want to consider installing an island as a gathering place. According to a survey done earlier this year by Houzz, roughly 66% of respondents who had their kitchens redone had an island either put in or upgraded.  

Again, since it's so close to Thanksgiving, Christmas, Hanukkah and New Year's, builders will aim to complete the job by a certain date so they too can enjoy the time with their loved ones.   

Deep discounts are common at home improvement stores 

Retailers know that a great way to increase customer traffic is by offering doorbuster sales events and discounts. And that's just what many of them do during the off-season, which is fall. If you haven't seen them already, take a look at the websites, circulars and signage of your nearest home improvement stores. You're almost guaranteed to see price cuts on a variety of products. You can take advantage of them or relay the info to your builder and designer.  

Close out 2020 with a bang, only the kind you hear from swinging hammers and clapboards. Residential Mortgage Services has renovation loans that are customized to fit your needs. Contact us today.  


Things to Consider

3 Reasons Why Homebuyers Prefer Fixed Rate Mortgages

You have lots and lots of decisions to make as a current or prospective homeowner. Will you live in the city or somewhere more rural? Is a single-family home the best style for you and your family's budget and needs, or do you prefer the accoutrements that come with condo life? Are you interested in something that is move-in ready, or perhaps you're considering a fixer-upper?

And that's just the tip of the iceberg. However, when it comes to interest rates, there is one choice that is overwhelming in terms of popularity: fixed-rate mortgages. More often than not, when asked which they'd prefer, people select it over variable. Indeed, based on the most recent statistics available from government-sponsored enterprise Freddie Mac, 90% of homebuyers pick a fixed-rate loan.

It raises an interesting question, though: Why? What is it about FRMs that makes them the odds-on favorite to be selected over variable?

Here are three reasons industry experts believe fixed-rate mortgages are so consistently well-received:

1. Rates stay the same

It's said that the only constant in life is change; in short, it's the one thing that is guaranteed. But a rare exception to that truism are FRMs. No matter what, the interest rate you pick is locked in for the life of the loan term, which is usually 30 years.

There is great security and comfort in this fact. When the mortgage payment becomes due each month, you know exactly how much you'll spend on principal and interest. This predictability can help you with planning and budgeting for the week, month, or year.

2. Affordable

The interest rate environment is subject to change, primarily due to market dynamics of the moment, the state of the U.S. economy and actions by the Federal Reserve. But for several years now, interest rates have remained solidly in affordable territory.

The numbers prove as much. Based on archived data maintained by Freddie Mac, 30-year FRMs never edged above 5% in the entirety of 2019. In fact, they stayed well below that figure for all 12 months, topping out at 4.51% the very first week of the year. They remained in the 4% territory or lower throughout 2018 and 2017 as well.

The same has been true in 2020. While everyone can attest to this being an unusual year with lots of changes, FRMs are in record-low territory, now hovering around 3% for the week ending June 4.

In short, people like to pay less, and generally speaking, FRMs are highly affordable given the fact rates have been low for so long.

3. Flexible

This one just may be the main reason as to why FRMs are the overwhelming favorite in comparison to variable. People like the freedom of options, which may explain why homeownership is as popular as ever. In fact, according to a recent survey from the National Association of Realtors, which was conducted in May, nearly 60% of respondents considered buying real estate an "essential" service.

They not only expect to have the freedom to purchase a house at a time that is right for them, but appreciate the ability to pay down their mortgage in a manner that makes sense to them. FRMs offer this kind of flexibility, noted Sean Becketti, former vice president chief economist at Freddie Mac.

"Thirty-year fixed-rate loans are generally prepayable at any time without penalty," Becketti explained. " If the homeowner chooses to pay off the loan before maturity to refinance or sell the home, the homeowner can do so without paying an early prepayment fee."

He went on to note that this option is fairly exclusive to the U.S., as in other parts of the world, it's not unusual to be docked for paying off a loan ahead of schedule.

Another way in which FRMs increase flexibility is this structure can be used in many different loan types. As The Balance noted, they can be leveraged for conventional loans - which are not backed by the government - and also those guaranteed by the Federal Housing Authority or Department of Veterans Affairs for VA loans.

Additionally, while 30-year FRMs are the most common length homebuyers choose, 15 years if also available to them if they so choose. While monthly payments tend to run higher, you wind up spending less on interest overall because the term is significantly shorter. The rate itself is often lower than it is with the long-term option as well.

None of this is to say that variable rates aren't good. They have several positives to them as well. Nor is it to say that fixed rates don't have certain disadvantages.  But these are some of the main reasons why FRMs are a smart choice and why so many pick them when given the choice.

For more information on FRMs or other aspects of homeownership, please contact RMS today.


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