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IS NOW THE TIME TO MOVE UP?

You have another baby on the way. Your aging parents have decided to move in. You are starting your own home-based business. There is an endless supply of reasons why a family may need to move up to a bigger, or nicer, home.  How do you know, though, that now is a good time to move up? Let's examine a few issues that will lead you to your answer.

Interest Rates. There is a huge difference between buying a home at 5 percent interest (June 2010), and buying one at, say, 13 percent interest (February 1983). The available rates can change from week to week, and how you qualify depends largely on your credit rating. The first order of business when considering interest rates is to contact a local mortgage lender to find out what rates would be available to you on what loans. Keep in mind rates also vary depending on the type of loan for which you are applying (fixed, adjustable, conforming, jumbo, 30 year, 15 year, etc.).

Income. Moving up to a bigger or nicer house will more than likely mean a bigger mortgage payment. Take an honest look at your budget to see if this makes sense for your family.

Equity. This is one way to avoid a bigger mortgage payment. If you have built substantial equity in your current home, and are selling in a good sellers market where you expect to receive around your asking price, then you could apply your profits from the sale of your current home towards your new mortgage.

Market Conditions. To find out your own local market conditions, contact your local real estate agent, or visit Realty Times. Is your market favoring buyers or sellers? Are homes selling quickly? Are prices appreciating or falling? These are all important questions to answer.

Wish list. Many first homes are starter homes, and as families grow, needs change. Neighborhoods changes as well, as residents age and jobs come and go. Take a moment to consider what area of town would be best for your family. Think about schools, commute times, and neighborhood amenities.

Use these simple issues as a starting point on your journey to a new home.

Conventional 30-year fixed mortgages remain available at 4.375% for well-qualified consumers paying a standard origination fee of about 1 point. 15-year fixed mortgages remain available at 3.875%.

It's not just conforming mortgage rates that are low, FHA mortgage rates continue to mirror those of conforming mortgages. Today's 30-year fixed FHA loan rate is also 4.375%. Despite FHA loans being available at the same note rate as a conforming mortgage, APR is higher because of MI and other FHA fees. Still FHA loans have been most popular among home-buyers with an attractive minimum down-payment of just 3.5%

30-year fixed jumbo loans are available today at 5.375%.

FreeRateUpdate.com researches over 2 dozen wholesale lenders' rate sheets for brokers on a daily basis to determine the most accurate rates available to well-qualified borrowers at a standard origination fee of .07 to 1 point.

Wells Fargo, the #1 volume originator of new mortgages, is advertising on their website today a 30-year fixed-rate of 4.75% with an APR of 4.939.

Mortgage-backed securities prices, which drive mortgage rates in the opposite direction, have benefited from the recent drop in stocks. As investors wary of the volatile stock market flee to the safety of bonds, MBS prices typically go up, pushing mortgage rates down.

Today's Mortgage Rates - Available today at a standard origination fee of 1 pt to well-qualified borrowers:

• 30-yr fixed-rate - 4.375%

• 15-yr fixed-rate - 3.875%

• 5/1 ARM rate - 3.500%

• FHA 30-yr fixed-rate - 4.375%

• FHA 15-yr fixed-rate - 4.000%

• FHA 5/1 ARM rate - 3.500%

• VA 30-yr fixed-rate - 4.500%

• Jumbo 30-yr fixed-rate - 5.375%

• Jumbo Conforming 30-yr fixed-rate - 4.625%

Conventional = Standard, Conforming, Freddie Mac / Fannie Mae

by Ed Ferrara