Mortgage Payment Scams

Scam AlertThe Mortgage Payment Scam has been around a long time. Mortgages are recorded in the local county courthouse and are therefore public information.  It is just as easy for a criminal to get a hold of this information as anyone else, so be mindful of any solicitations you get in the mail regarding your property.

How does it work?

A member may receive a letter from a company other than their known mortgage company indicating that they purchased their Freedom mortgage and future payments are to be make to them, not us.  This is the entire SCAM.  Freedom does not sell the servicing of our mortgages to anyone.  If you receive such a letter, please disregard and report it back to us.

How can I protect myself from this type of scam?

Do:

  • Be wary of any solicitations demanding immediate payment or warning that you are late on a payment that is not from your known mortgage provider.
  • Call your mortgage provider to confirm that there have been no changes to your loan servicing agreement.
  • Report the letter to your credit union.
  • Use the Consumer Finance Protection Bureau’s online portal to file a mortgage-related complaint
  • Report any suspected scams to the Better Business Bureau (BBB). Don’t let those crooks walk free!

 Don’t:

  • Make a payment to anyone who is not your known mortgage lender without verified proof from your original lender.
  • Share any personal information with an unverified contact. If it’s personal info, make sure to keep it that way!
  • Click on links or download files from an unfamiliar email address.

Stay safe!

Freedom keeps all loans, including mortgages, in house for the duration of the loan term.  Your loans will not be sold to any other management company.  If you receive something suspicious via text, email, or mail, please don’t hesitate to reach out if you are unsure.  

Your Turn: Have you encountered a scam like this before? Tell us about it on Facebook, LinkedIn,Twitter, or Instagram @FreedomFedCU.

 

IS NOW A GOOD TIME TO OPEN A HELOC?

Is a HELOC a good idea

If you’re looking to fund a home improvement project, or if the economic devastation of COVID-19 has left you in need of cash, consider tapping into your home’s equity with a home equity line of credit, or ‘HELOC’.

What is a HELOC?

A HELOC is a revolving credit line allowing homeowners to borrow money against the equity of their home. Borrowers can withdraw money as needed during a set amount of time known as the “draw period,” which generally lasts 10 years. Some lenders place restrictions on HELOCs and require borrowers to withdraw a minimum amount of money each time they make a withdrawal, regardless of need. Other restrictions include the requirements to keep a fixed amount of money outstanding or to withdraw a specific sum when the HELOC is first established; however, borrowers are typically free to spend the money however they please.

Most homeowners are eligible for a HELOC with a debt-to-income ratio that is 40% or less, a credit score of 620 or higher and a home assessment that stands at a minimum of 15% more than what is owed.

How do I repay my HELOC?

Repayment of HELOCs varies but is generally flexible.

Many lenders collect interest-only payments during the draw period, with principal payments being strictly optional. Others require ongoing monthly payment toward both principal and interest.

When the draw period ends, some lenders require borrowers to pay back the entire loan “balloon” amount. Others allow borrowers to pay back the loan in monthly installments over a new time period, known as the “repayment period.” Repayment periods are generous, lasting as long as 20 years.

What are the disadvantages of a HELOC?

A HELOC places your home at risk of foreclosure if not repaid. Before opening a HELOC, it’s a good idea to run the numbers to ensure you can easily meet the payments.

Also, many lenders require the full payment of the HELOC after the draw period is over. This can prove to be challenging for many borrowers.

Finally, if you don’t plan to stay in your home for long, a HELOC may not be the right choice for you. When you sell your home, you’ll need to pay the full balance of the HELOC.

A HELOC can be a great option now

HELOCs have variable interest rates, which means the interest on the loan fluctuates along with the general interest rate, sometimes dramatically.

The economic fallout of COVID-19 has generated historically low interest rates. The average APR for fixed 30-year mortgages has hovered at the low 3% for months now, and experts predict it will continue falling. The low rates make it an excellent time to take out a HELOC with manageable payback terms.

The economic uncertainty the pandemic has generated also makes it a prime time to have extra cash available for any need that may arise.

Now may be the perfect time for you to refinance your current mortgage, from another loan provider, into a lower rate from Freedom Federal Credit Union! We offer a wide range of programs with low rates and great terms. Contact us about a refinance option that meet your needs today.

About Freedom Federal Credit Union

Freedom serves and is open to anyone who lives, works, worships, attends school, volunteers, or has family in Harford or Baltimore County, MD. As a credit union, we are committed to putting you first, not shareholders, and helping you achieve your financial goals. Learn more at freedomfcu.org or call us 800-440-4120 to see how we can help.

Your Turn: Are you looking to sell your home? Tell us about it on Facebook, Twitter, or Instagram. @FreedomFedCU

Selling Your Home During COVID-19

Home Selling During COVID-19

Selling a home is a move people generally plan years in advance, and 2020 was no different. For many homeowners, the hot real estate market of spring and summer of 2020 was going to be the season they put their homes up for sale. And then came the coronavirus — and the world turned upside down. With people struggling just to get by financially, and health and safety paramount, selling a home seemed like a dream from another lifetime. Records of home sales in the U.S. from the beginning of the outbreak reflect these feelings, with a sharp decline of 21% in total homes sold in March, and another decrease of 17.8% in April, according to data from the National Association of Realtors (NAR) .

 

Now, though, the U.S. real estate market is looking very different. As the economy limps toward a recovery, many buyers are searching for a new place to call home and the housing market is thriving. In fact, national home sales climbed a record 20.7 percent in June compared with home sales from a year ago, global pandemic notwithstanding.

Despite the flourishing housing market, many homeowners who have planned to sell their homes this year are still reluctant to take that leap. And it is no wonder, with restrictions still in place and so much uncertainty still surrounding the economy.

If you have been thinking of selling your home, you still can. Here’s all you need to know about selling your house during the COVID-19 crisis.

 

Are you really ready to sell?

Before putting your home on the market, it’s important to consider all the variables involved in this step and be sure it’s a financially responsible move. With the pandemic causing a slowdown of the economy and a likely recession, life circumstances you may have relied on, such as a steady job and salary, may not be dependable anymore. Before calling a real estate agent, it’s a good idea to review all the relevant numbers to be sure that selling your home now is in your best interest.

Stage your home to sell

Anyone selling their home knows they need to showcase it in the best possible light, and never has this been truer than now. With restrictions still in place in many states and lots of people stuck home in quarantine, many buyers will be doing their touring virtually. For sellers, this means that staging and photographing a home well is more important than ever.

Here are some general tips to follow when staging and photographing your home, as shared by Buddy Mountcastle,  a real estate photographer based in Fort Lauderdale, Fla.:

  • Clean up the outside. Curb appeal is the first selling point for any home. Make sure there are no weeds, overgrown grass or kids’ toys ruining the first impression of your home.
  • Let the sunshine in. Aim to shoot mid-day. Scrub your windows clean, open the curtains and let the natural sunshine brighten up every room.
  • Undo the lived-in look. Remove all personal effects from your home before going camera-crazy. This includes stray shoes, family photos, piles of magazines, small kitchen appliances and more.
  • Shoot from the right spot. When capturing a room on camera, try to get as much of the space in the frame. Aim to include three walls, which can mean shooting from the corner or doorway. It’s also important to shoot straight and from chest height so as not to distort the room.

To make it easier for buyers to view your home, you can post a virtual tour on your online listing, and offer the option of scheduling a live tour with an agent through FaceTime or Zoom.

Play it safe

If you will be allowing potential buyers into your home, don’t forget to play it safe. Set up a box of disposable masks, shoe covers and sanitizing wipes at the door for all visitors who will be tramping through your home. If you will be hosting an open house, it’s best to allow a limited number of people inside at a time to make social distancing possible.

Price it right

Fewer homeowners are putting their houses up for sale this year, but the pool of buyers is also smaller than usual. This means you won’t be able to jack up the price of your home for way more than it’s worth. Work with an agent to look at comparable home sales in the area and to determine a fair asking price. Also, as always, list a selling price a bit higher than your actual desired price to allow for negotiations.

Closing during COVID-19

The coronavirus pandemic will likely affect every aspect of selling your home, up until the closing. With many workers in the home-selling industry, from professional home inspectors, to mortgage lenders, to movers working with a smaller team now, be prepared for various steps of the home-selling process to be delayed. It’s best to be patient and to anticipate that things may take longer than usual. This is especially true with lenders, as low mortgage rates are triggering a spike in refinance applications across the country and lenders are busier than ever.

COVID-19 has wrecked all sorts of plans, but selling your home does not have to be one of them. With some adjustments and altered expectations, you can successfully sell your home during the coronavirus pandemic.

 

Your Turn: Are you looking to sell your home? Tell us about it on Facebook, Twitter, or Instagram. @FreedomFedCU