ADVERTISING SUPPLEMENT Four Reasons Why Homeowners Refinance a Loan Rental Help Part of Relief Package Southiand Regional Asociation of Reators By Dane Sydes, Presidert, and Dovid Waer Here are four common reasons offered by Freddie Mac on why homeowners decide to refinance and what they should consider before starting the process. Lower the monthly mortgage pay- ment-Even the slightest difference in the President Joe Biden's American Rescue Plan of 2021 legisla- tion that is likely to pass the Congress offers $1.9 trillion and an array of coronavirus relief measures championed by ther National Association of Realtors. Those benefits include: new aid for struggling state and kocal govemments; the creation of a homeowners'assistance fund and a small-business grant program; and, a fresh round of funding for rental assistance, expanded unemployment, stimulus checks, vaccines, and testing. "Perhaps the biggest component of this bill is state and local aid, which was left out of previous legislation," said Shannon McGahn, NARS chief advocacy officer. "Nearly nine in ten cities expect a budget shortfall this year. No local govermment could really prepare for something like what we have lived through the past year, and this new assistance was needed to keep our economic recovery from suffering a relapse." The American Rescue Plan would be the sixth major coronavirus relief package passed by Congress. The package now is before the Senate, where few changes were expected, McGahn said, with final passage and signing by the President likely by mid-March, when current unemployment benefits expire. SOUTHLAND REGIONAL AssoCIATION OF REALTORS", INCc. a significant amount on interest in the long run. Switch mortgage types With a fixed-rate mortgage, the interest rate is locked in for the life of the loan, which as koan origination fee underwriting fees, title services, and more. So, if a relocation is likely before these costs are recouped, then refinane- ing now may not make financial sense. Mortgage termRefinancing to offers the stability of consistent montnly lower the interest rate can save money, mortgage interest payments that wont increase. If the rate on an adjustable rate mort- gage is moving upwards, it may be time to convert to a fixed-rate mortgage. What to consider before deciding to refinance: but if a mortgage is nearing the end of its life, getting a new mortgage with a new term may not make financial sense. For instance, if 20 years are left on a 30- year fixed-rate mortgage and the loan is refinanced into a new 30-year, fixed-rate mortgage, the term of the loan has been extended. As a result, a borrower could actually end up paying more interest over the life of the loan. inte rate can impact the monthly payment. The following ex- ample shows the dollar amount difference when refinancing a $200,000 outstanding loan balance into a 30-year fixed-rate mortgage at various rates. Monthly P&I Payment $859 $875 Specifically, the plan would provide: $1,400 stimulus checks to most Americans, phased out for higher earners; An extension through Aug. 29, 2021, to the Pandemic Unemployment As- sistance program and an increase of Pandemic Unemployment Compensation from $300 to $400 weekly; $20.3 billion in new money for rental assistance, on top of the $25 billion allocated in December; An extension of the eviction and foreclosure moratorium and forbearance for federally guaranteed mortgages through Sept. 30; A one-year increase from $2,000 to $3,000 in the child tax credit; Expanded Paid Sick and Family Lenve through Sept. 30; s10 billion for a Housing Assistance Fund that will allow state housing finance agencies to help homeowners with COVID-19 hardships; $100 million for housing counseling services; $15 billion for a new small business grant program; $350 billion in state and local aid; $130 billion for schools. Realtor Diane Sydel, 2021 SRAR President Current interest rates-Rates have ticked up slightly in the last couple historical standards. Interview several lenders and compare rates and terms. It may be easier to refinance with the current lender or find new lenders who offer options suited to particular financial situations. Mortgage Rate 3.15%. 3.29% 3.36% 3.65% Use Freddie Macs refinance savings calculator to see how much a borrower coukd save: https://myhome.freddiemac. com/resources/am-i-better-off-refi- $883 5915 nancing-caloulatochtml The Southland Regional Association of Real tors is a local trade association with more than 10,300 members serving the San Fer- nando and Santa Clarita Valeys. SRAR Is one of the largest local associationis in the nation. 3.75% $926 Cost of refinancing The closing costs on a refinance are going to be similar to what was paid when the home was purchased. It will likely include the same services and fees, such Refinancing to a lower interest rate, typically means the monthly payment will likely shrink. Any savings can be put toward other expenses or it could be applied the principal balance, which will pay off a loan sooner. Pay off a loan sooner-A 30-year term may have made the most financial sense when first applying for a mort- gage, but financial situations change. If the owner is earning more money, changing the term of the loan could save big. Securing a shorter-term loan, like a 15-year mortggage, will allow a homeowner to build equity-Wealth! - faster and own the home sooner. Save on total interest-The interest rate and the mortgage term, together, determine how much total interest a borrower will pay over the life of the loan. By reducing one or both of these factors, an owner coukl be saving In a letter to House Speaker Pelosi and Republican Minority Leader McCarthy, Realtors wrote: The 1.4 million members of the National Association of Realtors thank you for your focus on rebuilding our economy, businesses, and families during and after this worldwide pandemic. The "American Rescue Plan Act of 2021," which is currently being considered by lawmakers via the budget reconciliation process, has several provisions that will be essential to ensure Americans are safe, small businesses survive, and the cconomy recovers Housing Stability: Due to widespread extensions of eviction moratoria, the financial solvency of many in the rental housing industry, including thousands of small "mom and pop fims, are in jeopardy. The $19 billion in rental as- sistance provided will help renters meet their obligations and allow housing providers to fulfill their financial obligations and maintain safe properties for their tenants. Rental assistance that is ecasily accessible to qualified households will relieve renters from excessive debts, and ensure our critical rental housing stock is sustainable. NAR also supports the $10 billion included for a Housing Assistance Fund that will allow state housing finance agencies to help homeowners with COVID-19 hardships. The funds can be used for mortgage payment assis- tance, utility payments, property tax assessments, and other support to prevent eviction, mortgage delinquency, default, foreclosure, or loss of utility services and will go a long way to help maintain homeownership. The additional $100 million in funding for housing counseling services will better guide renters, people experiencing homelessness, people at risk of homelessness, and home- owners through options to preserve housing stability. Assistance to State and Local Communities: Across the country, com- munities are adapting and responding to the needs of their constituents as the pandemic alters the lives of so many Americans. According to the National League of Cities, nearly nine in ten cities expect a budget shortfall this year due to COVID-19. The $350 billion in funding will allow states to more ef- fectively address public health risks so they can gradually and safely reopen. Income-to-Loan Guide Condominiums - JANUARY - San Fernando Valley Monty Minimum income Needed to Qualiy fora Lon $89,628 Median Price Muy Pr Ta $154 $485,000 ssos Tal Moy Loan Amount (80%) 52.241 $388,000 Yearto Year Perantag Interest Rate May Merand +6.6% 2.74% Sounce Southland Regional Association of REALTORS *PITI eouals Monhy loan priecipal &ienerest plus taves &insunnce payments Income-to-Loan Guide Condominiums - JANUARY - Santa Clarita Valley Morey iran Minimum income Needed to Quiy dora Loan $80,573 Median Price $436,000 Interest Rate Update Tas National Average as reported by Freddie Ma on: $454 Toral Marey $2,014 Loan Amount (80% February 25 30-Yr FRM - 2.97% Year-to-Yer Percentage $1,422 $348,800 15-Yr FRM - 2.34% February 18 30-Yr FRM 2.81% 15-Yr FRM 2.21% +3.5% Morety Marte and Interest Rate 2.74% THE VOICE OF REAL ESTATE IN THE SAN FERNANDO AND SANTA CLARITA VALLEYS www.SRAR.com | Real Estate Questions? E-mail Diane Sydell, SRAR 2021 President, c/o DavidW@SRAR.com REALTORS is a federally registered collective membership mark which identifies a real estate professional who is a Member of the NATIONAL ASSOCIATION OF REALTORSe and subscribes to its strict Code of Ethies. ADVERTISING SUPPLEMENT Four Reasons Why Homeowners Refinance a Loan Rental Help Part of Relief Package Southiand Regional Asociation of Reators By Dane Sydes, Presidert, and Dovid Waer Here are four common reasons offered by Freddie Mac on why homeowners decide to refinance and what they should consider before starting the process. Lower the monthly mortgage pay- ment-Even the slightest difference in the President Joe Biden's American Rescue Plan of 2021 legisla- tion that is likely to pass the Congress offers $1.9 trillion and an array of coronavirus relief measures championed by ther National Association of Realtors. Those benefits include: new aid for struggling state and kocal govemments; the creation of a homeowners'assistance fund and a small-business grant program; and, a fresh round of funding for rental assistance, expanded unemployment, stimulus checks, vaccines, and testing. "Perhaps the biggest component of this bill is state and local aid, which was left out of previous legislation," said Shannon McGahn, NARS chief advocacy officer. "Nearly nine in ten cities expect a budget shortfall this year. No local govermment could really prepare for something like what we have lived through the past year, and this new assistance was needed to keep our economic recovery from suffering a relapse." The American Rescue Plan would be the sixth major coronavirus relief package passed by Congress. The package now is before the Senate, where few changes were expected, McGahn said, with final passage and signing by the President likely by mid-March, when current unemployment benefits expire. SOUTHLAND REGIONAL AssoCIATION OF REALTORS", INCc. a significant amount on interest in the long run. Switch mortgage types With a fixed-rate mortgage, the interest rate is locked in for the life of the loan, which as koan origination fee underwriting fees, title services, and more. So, if a relocation is likely before these costs are recouped, then refinane- ing now may not make financial sense. Mortgage termRefinancing to offers the stability of consistent montnly lower the interest rate can save money, mortgage interest payments that wont increase. If the rate on an adjustable rate mort- gage is moving upwards, it may be time to convert to a fixed-rate mortgage. What to consider before deciding to refinance: but if a mortgage is nearing the end of its life, getting a new mortgage with a new term may not make financial sense. For instance, if 20 years are left on a 30- year fixed-rate mortgage and the loan is refinanced into a new 30-year, fixed-rate mortgage, the term of the loan has been extended. As a result, a borrower could actually end up paying more interest over the life of the loan. inte rate can impact the monthly payment. The following ex- ample shows the dollar amount difference when refinancing a $200,000 outstanding loan balance into a 30-year fixed-rate mortgage at various rates. Monthly P&I Payment $859 $875 Specifically, the plan would provide: $1,400 stimulus checks to most Americans, phased out for higher earners; An extension through Aug. 29, 2021, to the Pandemic Unemployment As- sistance program and an increase of Pandemic Unemployment Compensation from $300 to $400 weekly; $20.3 billion in new money for rental assistance, on top of the $25 billion allocated in December; An extension of the eviction and foreclosure moratorium and forbearance for federally guaranteed mortgages through Sept. 30; A one-year increase from $2,000 to $3,000 in the child tax credit; Expanded Paid Sick and Family Lenve through Sept. 30; s10 billion for a Housing Assistance Fund that will allow state housing finance agencies to help homeowners with COVID-19 hardships; $100 million for housing counseling services; $15 billion for a new small business grant program; $350 billion in state and local aid; $130 billion for schools. Realtor Diane Sydel, 2021 SRAR President Current interest rates-Rates have ticked up slightly in the last couple historical standards. Interview several lenders and compare rates and terms. It may be easier to refinance with the current lender or find new lenders who offer options suited to particular financial situations. Mortgage Rate 3.15%. 3.29% 3.36% 3.65% Use Freddie Macs refinance savings calculator to see how much a borrower coukd save: https://myhome.freddiemac. com/resources/am-i-better-off-refi- $883 5915 nancing-caloulatochtml The Southland Regional Association of Real tors is a local trade association with more than 10,300 members serving the San Fer- nando and Santa Clarita Valeys. SRAR Is one of the largest local associationis in the nation. 3.75% $926 Cost of refinancing The closing costs on a refinance are going to be similar to what was paid when the home was purchased. It will likely include the same services and fees, such Refinancing to a lower interest rate, typically means the monthly payment will likely shrink. Any savings can be put toward other expenses or it could be applied the principal balance, which will pay off a loan sooner. Pay off a loan sooner-A 30-year term may have made the most financial sense when first applying for a mort- gage, but financial situations change. If the owner is earning more money, changing the term of the loan could save big. Securing a shorter-term loan, like a 15-year mortggage, will allow a homeowner to build equity-Wealth! - faster and own the home sooner. Save on total interest-The interest rate and the mortgage term, together, determine how much total interest a borrower will pay over the life of the loan. By reducing one or both of these factors, an owner coukl be saving In a letter to House Speaker Pelosi and Republican Minority Leader McCarthy, Realtors wrote: The 1.4 million members of the National Association of Realtors thank you for your focus on rebuilding our economy, businesses, and families during and after this worldwide pandemic. The "American Rescue Plan Act of 2021," which is currently being considered by lawmakers via the budget reconciliation process, has several provisions that will be essential to ensure Americans are safe, small businesses survive, and the cconomy recovers Housing Stability: Due to widespread extensions of eviction moratoria, the financial solvency of many in the rental housing industry, including thousands of small "mom and pop fims, are in jeopardy. The $19 billion in rental as- sistance provided will help renters meet their obligations and allow housing providers to fulfill their financial obligations and maintain safe properties for their tenants. Rental assistance that is ecasily accessible to qualified households will relieve renters from excessive debts, and ensure our critical rental housing stock is sustainable. NAR also supports the $10 billion included for a Housing Assistance Fund that will allow state housing finance agencies to help homeowners with COVID-19 hardships. The funds can be used for mortgage payment assis- tance, utility payments, property tax assessments, and other support to prevent eviction, mortgage delinquency, default, foreclosure, or loss of utility services and will go a long way to help maintain homeownership. The additional $100 million in funding for housing counseling services will better guide renters, people experiencing homelessness, people at risk of homelessness, and home- owners through options to preserve housing stability. Assistance to State and Local Communities: Across the country, com- munities are adapting and responding to the needs of their constituents as the pandemic alters the lives of so many Americans. According to the National League of Cities, nearly nine in ten cities expect a budget shortfall this year due to COVID-19. The $350 billion in funding will allow states to more ef- fectively address public health risks so they can gradually and safely reopen. Income-to-Loan Guide Condominiums - JANUARY - San Fernando Valley Monty Minimum income Needed to Qualiy fora Lon $89,628 Median Price Muy Pr Ta $154 $485,000 ssos Tal Moy Loan Amount (80%) 52.241 $388,000 Yearto Year Perantag Interest Rate May Merand +6.6% 2.74% Sounce Southland Regional Association of REALTORS *PITI eouals Monhy loan priecipal &ienerest plus taves &insunnce payments Income-to-Loan Guide Condominiums - JANUARY - Santa Clarita Valley Morey iran Minimum income Needed to Quiy dora Loan $80,573 Median Price $436,000 Interest Rate Update Tas National Average as reported by Freddie Ma on: $454 Toral Marey $2,014 Loan Amount (80% February 25 30-Yr FRM - 2.97% Year-to-Yer Percentage $1,422 $348,800 15-Yr FRM - 2.34% February 18 30-Yr FRM 2.81% 15-Yr FRM 2.21% +3.5% Morety Marte and Interest Rate 2.74% THE VOICE OF REAL ESTATE IN THE SAN FERNANDO AND SANTA CLARITA VALLEYS www.SRAR.com | Real Estate Questions? E-mail Diane Sydell, SRAR 2021 President, c/o DavidW@SRAR.com REALTORS is a federally registered collective membership mark which identifies a real estate professional who is a Member of the NATIONAL ASSOCIATION OF REALTORSe and subscribes to its strict Code of Ethies.