Nearly Half of Couples Chip In Equally for Home Down Payment, NerdWallet Finds

When it comes to purchasing a home, 41% of Americans who bought their current home with a partner* reported that both partners contributed equal amounts of money toward their down payment, according to a new NerdWallet survey.

NerdWallet commissioned an online survey, conducted in June 2016 by Harris Poll, of more than 2,000 U.S. adults ages 18 and older. The poll delved into how homeowners sourced their down payments and what their common disagreements and fears were during the process.

Key takeaways

Among Americans who bought their current home with a partner:

  • 11% of women contributed all or more to the down payment than their partner.
  • 29% of adults in the Northeast contributed all or more of the down payment than their partners did, while only 17% of adults in the West contributed all or more than their partners.

Three in five homeowners are unsure how much they saved monthly toward a down payment for their current home

In general, homebuyers can expect to pay as little as 3.5% down for an FHA loan, or up to 20% of a home’s purchase price for a conventional loan, as a down payment, not to mention needing additional cash on hand for closing costs.

NerdWallet’s survey found that homeowners who recalled how much they saved for a down payment on their current home, individually saved an average of $1,078.50 monthly for that purpose. However, 60% of homeowners said that they weren’t sure how much money they individually saved on a monthly basis, which might suggest a lack of budgeting and planning.

Other savings trends

  • It took homeowners who needed to save an average of three years before purchasing their current home.
  • One in four homeowners saved money individually, on a monthly basis, to put toward the down payment of their current home.
  • 42% of millennial homeowners (ages 18-34) saved individually, on a monthly basis, for a down payment when they purchased their current home, while only 29% of Gen X homeowners (35-54) did the same.
  • More than half (52%) of millennial homeowners needed to save money before purchasing their current home.
  • Significantly more male homeowners needed to save up before buying a home (47%) compared with female homeowners (32%).

Tips for getting a mortgage you can afford

Finding the right house is just the first step. There are some practical ways to get a home loan that fits your needs — and your budget. Some tips include:

  1. Clean up your credit.
  2. Look for homes at the lower end of your budget.
  3. Shop around for the right lender.
  4. Consider the costs of owning a home.
  5. Focus on needs, not wants, in your home search.

Read additional survey results in the full story.

* “Partner/partners” refers to homeowners who purchased their current home with a partner or spouse.

Deborah Kearns is a staff writer at NerdWallet, a personal finance website. 

Mortgage Rates Today, Friday, Aug. 5: How Today’s Jobs Report Will Move Interest Rates

Thirty-year mortgage rates are unchanged Friday, 15-year fixed home loans moved a tick higher, and 5/1 ARMs were unchanged, according to a NerdWallet survey of mortgage rates posted by national lenders this morning.

There was little direction for mortgage rates prior to this morning’s jobs report. But that report may not be good news for interest rate watchers.

How the jobs report may move mortgage rates

This morning’s U.S. employment report has the potential to influence mortgage rates, as the bond market reacts to the news and lenders reprice their loan offerings. Bad news for the economy is usually good news for mortgage rates. However, today’s jobs report was much better than economists’ expectations, with nonfarm payroll employment up by 255,000.

“The best scenario for the bond market is rising unemployment, a sizable loss of jobs and little change in earnings,” Al Bowman, with Mortgage Commentary Services in Tampa, Florida, said in a report to clients. “Due to the importance of these readings, we will most likely see quite a bit of volatility in the markets and mortgage pricing following their posting, especially after the surprises of the past couple months in this data.”

With the good economic news from the July jobs report, mortgage rates are likely to see some pressure to move higher through the remainder of today and into next week.

The NerdWallet Mortgage Rate Index compiles annual percentage rates — lender interest rates plus fees, the most accurate way for consumers to compare rates. Here are today’s average rates for the most popular loan terms:

Purchase Mortgage Rates: Aug. 5, 2016

(Change from 8/4)

30-year fixed: 3.59% APR (NC)

15-year fixed: 3.00% APR (+0.01)

5/1 ARM: 3.46% APR (NC)

Homeowners looking to lower their mortgage rate can shop for refinance lenders here.

NerdWallet daily mortgage rates are an average of the published APR with the lowest points for each loan term offered by a sampling of major national lenders. Annual percentage rate quotes reflect an interest rate plus points, fees and other expenses, providing the most accurate view of the costs a borrower might pay.

Hal Bundrick is a staff writer at NerdWallet, a personal finance website. 

The article Mortgage Rates Today, Friday, Aug. 5: How Today’s Jobs Report Will Move Interest Ratesoriginally appeared on NerdWallet.

Mortgage Rates Today, Friday, July 29: Fixed-Rate Loans Move Lower

Thirty-year and 15-year fixed mortgage rates are down Friday while 5/1 ARMs are steady, according to a survey of national lenders by NerdWallet.

For 30-year fixed home loans, this is only the second move lower since July 7.

Mortgage rates higher while homeownership falls to all-time low

In recent weeks, mortgage rates have crept higher but remain near historic lows. However, low interest rates haven’t been enough to encourage new buyers, as the rate of homeownership has fallen to a record low.

In a new report issued by the U.S. Census Bureau, the rate of homeownership in the nation fell to 62.9% in the second quarter. That’s the lowest homeownership rate since the bureau began tracking the metric in 1995.

Second-quarter 2016 homeownership rates were highest in the Midwest (67.7%) and lowest in the Northeast (59.2%) and West (57.9%), according to the report. Homeownership rates were highest for householders 65 and over (77.9%) and lowest for adults under 35 (34.1%).

The Census Bureau also reported that the median asking price for a vacant home for sale during the second quarter of this year was $164,500, a figure that’s risen over the past four years. However, it’s still significantly lower than the over $200,000 median home price recorded just before the housing crash in 2006-2007.

The NerdWallet Mortgage Rate Index compiles annual percentage rates — lender interest rates plus fees, the most accurate way for consumers to compare rates. Here are today’s average rates for the most popular loan terms:

Purchase Mortgage Rates: July 29, 2016

(Change from 7/28)

30-year fixed: 3.64% APR (-0.02)

15-year fixed: 3.03% APR (-0.04)

5/1 ARM: 3.43% APR (NC)

Homeowners looking to lower their mortgage rate can shop for refinance lenders here.

NerdWallet daily mortgage rates are an average of the published APR with the lowest points for each loan term offered by a sampling of major national lenders. Annual percentage rate quotes reflect an interest rate plus points, fees and other expenses, providing the most accurate view of the costs a borrower might pay.

Hal Bundrick is a staff writer at NerdWallet, a personal finance website. 

The article Mortgage Rates Today, Friday, July 29: Fixed-Rate Loans Move Lower originally appeared on NerdWallet.

Mortgage Refinance Rates Today, Friday, July 22

Thirty-year fixed mortgage refinance rates are unchanged Friday, while 15-year fixed loans are just a tick higher; 5/1 ARM refinance rates are unchanged, according to a survey of national lenders by NerdWallet.

NerdWallet compiles annual percentage rates — lender interest rates plus fees, the most accurate way for consumers to compare rates. Here are today’s average rates for the most popular mortgage refinance terms:

Refinance Mortgage Rates: July 22, 2016

(Change from 7/21)

30-year fixed: 3.74% APR (NC)

15-year fixed: 3.08% APR (+0.01)

5/1 ARM: 3.46% APR (NC)

Homeowners looking to lower their mortgage rate can shop refinance lenders here.

NerdWallet daily mortgage rates are an average of the published APR with the lowest points for each loan term offered by a sampling of major national lenders. Annual percentage rate quotes reflect an interest rate plus points, fees and other expenses, providing the most accurate view of the costs a borrower might pay.

The article Mortgage Refinance Rates Today, Friday, July 22 originally appeared on NerdWallet.

Mortgage Rates Today, Monday, July 11: Another Rapid Rise

Recent headlines have touted lower mortgage rates and while rates are still historically low, borrowers who are considering locking in a rate should know that home loan pricing has moved noticeably higher in the past two days, particularly for 30-year mortgages. And the rate hikes have affected purchase loans as well as refinances.

The NerdWallet Mortgage Rate Index compiles annual percentage rates — lender interest rates plus fees, the most accurate way for consumers to compare rates. Here are today’s average rates for the most popular loan terms:

Purchase Mortgage Rates: July 11, 2016

(Change from 7/8)

30-year fixed: 3.58% APR (+0.03)

15-year fixed: 2.97% APR (NC)

5/1 ARM: 3.37% APR (+0.02)

Refinance Mortgage Rates: July 11, 2016

(Change from 7/8)

30-year fixed: 3.65% APR (+0.03)

15-year fixed: 2.99% APR (NC)

5/1 ARM: 3.38% APR (+0.02)

Homeowners looking to lower their mortgage rate can shop for refinance lenders here.

Wells Fargo, Chase and BOA mortgage rates

Three major components of the NerdWallet Mortgage Rate Index are leading lenders Wells Fargo, Chase and Bank of America. Their current purchase mortgage rates are:

Bank Mortgage Rates 7/11

30-year fixed 15-year fixed 5/1 ARM
Wells Fargo 3.66% APR 2.98% APR 3.42% APR
Chase 3.35% APR 2.79% APR 3.35% APR
Bank of America 3.57% APR N/A 3.32% APR

NerdWallet daily mortgage rates are an average of the lowest published APR for each loan term offered by a sampling of major national lenders. Annual percentage rate quotes reflect an interest rate plus points, fees and other expenses, providing the most accurate view of the costs a borrower might pay.

Hal Bundrick is a staff writer at NerdWallet, a personal finance website. 

The article Mortgage Rates Today, Monday, July 11: Another Rapid Rise originally appeared on NerdWallet.

Mortgage Rates Today, Tuesday, July 5: Down Again and Nearing Historic Lows

Fixed-rate mortgage terms are steeply discounted and approaching historic levels. After another round of cuts this morning, mortgage rates on 30-year terms are near all-time lows while 15-year home loans are now below 3%, according to an early Tuesday survey of major national lenders.

The NerdWallet Mortgage Rate Index compiles annual percentage rates — lender interest rates plus fees — the most accurate way for consumers to compare rates. Here are today’s average rates for the most popular loan terms:

Purchase Mortgage Rates: July 5, 2016

(Change from 7/1)

30-year fixed: 3.54% APR (-0.04)

15-year fixed: 2.99% APR (-0.01)

5/1 ARM: 3.31% APR (-0.01)

Refinance Mortgage Rates: July 5, 2016

(Change from 7/1)

30-year fixed: 3.62% APR (-0.05)

15-year fixed: 3.01% APR (-0.01)

5/1 ARM: 3.33% APR (-0.01)

Homeowners looking to lower their mortgage rate can shop for refinance lenders here.

Wells Fargo, Chase and BOA mortgage rates

Three major components of the NerdWallet Mortgage Rate Index are leading lenders Wells Fargo, Chase and Bank of America. Their current purchase mortgage rates are:

Bank Mortgage Rates 7/5

30-year fixed 15-year fixed 5/1 ARM
Wells Fargo 3.66% APR 3.04% APR 3.38% APR
Chase 3.34% APR 2.80% APR 3.32% APR
Bank of America 3.52% APR N/A 3.26% APR

NerdWallet daily mortgage rates are an average of the lowest published APR for each loan term offered by a sampling of major national lenders. Annual percentage rate quotes reflect an interest rate plus points, fees and other expenses, providing the most accurate view of the costs a borrower might pay.

Hal Bundrick is a staff writer at NerdWallet, a personal finance website. 

The article Mortgage Rates Today, Tuesday, July 5: Down Again and Nearing Historic Lows originally appeared on NerdWallet.

What Homeowners Need to Know About HARP Refinancing

In the wake of the subprime mortgage crisis and economic downturn of 2008, millions of U.S. homeowners saw the value of their homes — and their overall wealth — decline drastically. One of the steps taken by the federal government was to create the Home Affordable Refinance Program, or HARP, which allows eligible homeowners to refinance their mortgages to more favorable terms. More than 3.4 million people have taken advantage of the program, and many more Americans are still eligible.

We asked Roslyn Lash, an accredited financial counselor with Youth Smart Financial Education Services and a member of NerdWallet’s Ask an Advisor network, about things homeowners should know about HARP and how to reap its benefits.

What are the key things people should know about HARP?

HARP is an ideal program for people who have been responsible and have made their house payments on time but are “upside down” on their mortgage — in other words, the owner owes more than the house is worth.

HARP will not decrease the principal amount of the mortgage, but the interest rate will be reduced, which may reduce the overall cost or shorten the loan term. In addition, no upfront fees are required.

In order to be eligible, you must have originated the loan on or before May 31, 2009. You must be current on your mortgage, with no 30-day late payments within the last six months, and with no more than one late payment within the past year. Your mortgage must be owned or guaranteed by the government-sponsored loan programs Freddie Mac or Fannie Mae.

The program is set to expire on Dec. 31, 2016, although it has been extended several times.

What steps should people take?

Contact your lender to determine if you have the type of loan that qualifies for HARP. It’s important to first contact your lender, because each lender may have additional requirements. It’s usually easier to proceed with your current lender since you have already established a satisfactory credit history. HARP offers a new streamlined process that reduces paperwork and may reduce fees, too.

How else can people get their housing payments under control?

If you are having trouble meeting your mortgage obligations, consider seeking housing counseling provided by the U.S Department of Housing and Urban Development. A housing counselor will explore all of your options and can act as a liaison between you and your mortgage lender or creditors. The counselor will also carefully review your budget. If you do not qualify for HARP, the lender may have other programs for which you may qualify.

A budget will provide the lender with a clear vision of your income and expenditures that will demonstrate your inability to pay and explain any delinquencies. The development of a budget or a spending plan will make the counselor’s job easier, and it will justify any assistance provided by the lender.

Roslyn Lash is a financial counselor with Youth Smart Financial Education Services in Winston-Salem, North Carolina.

The article What Homeowners Need to Know About HARP Refinancing originally appeared on NerdWallet.

How to Search for a Home

When house-hunting fever strikes, it can hit hard. You’ll probably download a home search app or two and jump into the car, ready to explore a new neighborhood. Before you do, here are answers to some questions that might pop up along the way.

What’s the difference between a real estate agent and a Realtor?

All real estate agents are licensed by the state in which they operate. The title “Realtor” is a trademark held by the National Association of Realtors; it refers to agents who are members of a local real estate association that is NAR-affiliated. These agents agree to comply with the association’s ethical standards. Of course, the sales practices of all licensed agents are guided by the laws of their state.

What is the MLS?

A multiple listing service, or MLS, compiles properties for sale by individual firms and sellers into one comprehensive database. It’s a generic term and not really one centralized service, but rather a cooperative effort among real estate professionals.

Before the Internet brought the same information to the masses, access to MLS information was one good reason to hire a real estate agent. Now, you can tap the latest listings from multiple sources on the web.

What about open houses?

Open houses don’t sell homes like they used to. The NAR reports that only 9% of buyers in 2014 discovered the home they eventually purchased via an open house.

Most people start their home buying process online these days, looking at slide shows and taking virtual tours. But wandering through an open house or two can still inspire new ideas or help you explore neighborhoods you hadn’t previously considered.

What are some home search tips?

Here are some pointers for looking at properties, whether at open houses or private showings with an agent.

  • First, don’t look at homes over your budget. That’s just frustrating. Set your search parameters within your budget, and remember to leave some wiggle room if you’re in a hot market and might have to bump up your offer.
  • Take an extra set of eyes, someone with excellent attention to detail. But don’t bring a group of experts; one spare opinion is plenty.
  • Find out why the seller is leaving. The circumstances may provide useful insight, especially regarding how motivated the seller may be — such as when a job relocation or divorce is involved.
  • Walk through the home twice. You’ll be surprised by what you notice on the second go-round.
  • Open every door, even if you think it’s just a closet. Hey, it might be a closet! You know how important those are.
  • Take notes, keep a list of the things you like and don’t like, and compare them to your list of what you need and want in a home.
  • Snap a few photos (but ask permission first).
  • Bring a tape measure. That way you’ll know if your dining table, bed or sofa will fit in a room.
  • Pay attention to outside noise. If quiet enjoyment of your home is a priority, stick around long enough to get a sense of what you’ll hear in the neighborhood — whether it’s noisy neighbors or landing airplanes.
  • Use Google Maps to check the neighborhood view from above. (Yikes! There’s a landfill/railroad tracks/drainage ditch right there?) Google Earth has a “light meter” feature that shows sun exposure, too.
  • In older homes, pay close attention to the location and number of electrical outlets, storage and other modern conveniences that are sometimes in short supply.
  • Remember that do-it-yourself projects can be more hassle than you think. Don’t assume you can fix everything that’s wrong with a house.
  • If you use a real estate agent and he isn’t listening to you — by showing you houses, neighborhoods or price ranges you specifically said you aren’t interested in — change agents. It’s a waste of your time and the agent’s.

The home stretch

When you finally narrow down your list of homes to the top contenders, break the tie by driving your morning commute from each location, visiting the neighborhoods at night and on a weekend, and walking the streets. You’ll know when it’s right.