In today’s dynamic real estate market, homeowners are discovering new opportunities to leverage their home’s equity. With recent shifts in the economic landscape, many property owners are finding themselves sitting on substantial equity – in fact, the average mortgage-holding homeowner currently has access to over $200,000 in tappable equity. This significant financial resource has caught the attention of homeowners looking to fund home improvements, consolidate debt, or invest in other opportunities.

When it comes to accessing your home’s equity, three main options stand out: home equity lines of credit (HELOCs), home equity loans, and cash-out refinancing. Each option serves different needs and comes with its own set of advantages. HELOCs offer flexibility with a revolving credit line, perfect for ongoing projects or uncertain future expenses. Home equity loans provide the security of fixed payments and rates, ideal for one-time large expenses. Cash-out refinancing, meanwhile, allows you to replace your existing mortgage with a new loan while accessing your equity, potentially improving your current mortgage terms in the process.

The choice between these options often depends on your specific financial situation and goals. For instance, if you’re planning a series of home improvements over time, a HELOC might be your best bet with its flexible draw period and interest-only payment options. If you need a specific amount for a one-time expense and prefer predictable payments, a home equity loan could be the way to go. And if you’re interested in potentially lowering your current mortgage rate while accessing equity, a cash-out refinance might be worth exploring.

As your mortgage professional, we’re here to help you navigate these choices and find the option that best suits your needs. We’ll take into account factors such as your current mortgage terms, how much equity you have available, your financial goals, and your preferred payment structure. Remember, your home’s equity is a valuable asset, and making the right choice about how to access it can have a significant impact on your financial future. Contact us today to discuss which option might be right for you and to explore current rates and terms.

Top 10 Frequently Asked Questions About VA Loans in Washington State**

1. What is a VA loan, and who is eligible for it?**
A VA loan is a mortgage program backed by the U.S. Department of Veterans Affairs (VA) that offers favorable terms for eligible military members, veterans, and their families. Eligibility typically includes:
– Active-duty service members.
– Veterans with honorable discharges.
– National Guard and Reserve members.
– Certain surviving spouses.

Proof of eligibility is obtained through a Certificate of Eligibility (COE), which your lender can assist in acquiring.

2. Can I use a VA loan to buy a home in Washington State?**
Yes, VA loans can be used to purchase primary residences, including single-family homes, condos, and multi-unit properties (up to 4 units). The home must meet VA property requirements.

3. Is there a maximum loan amount for VA loans in Washington State?**
The VA does not set a maximum loan amount, but it limits how much it will guarantee. In most counties, you can borrow up to $726,200 without a down payment (as of 2024). In higher-cost areas, like King County, the limit may be higher. Borrowing beyond this amount may require a down payment.

4. Do VA loans require a down payment?**
Typically, no down payment is required for VA loans, which is one of their main benefits. However, some borrowers may choose to make a down payment to reduce their loan balance and lower the funding fee.

5. What is the VA funding fee, and can it be waived?**
The VA funding fee is a one-time cost that helps sustain the program. The amount depends on your down payment and prior use of the VA loan benefit.
– First-time use: 2.15% (no down payment).
– Subsequent use: 3.3% (no down payment).

It can be waived for veterans with a service-connected disability rating or eligible surviving spouses.

6. What are the credit requirements for a VA loan?**
The VA does not set a minimum credit score, but lenders typically look for a score of at least 620. Some lenders may approve lower scores, depending on the overall financial profile.

7. Can I refinance my existing loan with a VA loan?**
Yes, VA loans offer two refinance options:
**Interest Rate Reduction Refinance Loan (IRRRL)**: Simplified refinancing to lower your interest rate.
**Cash-Out Refinance**: Converts home equity into cash, available even if the original loan was not a VA loan.

8. Are there closing costs for VA loans?**
Yes, VA loans have closing costs, but they are typically lower than conventional loans. Common costs include:
– Appraisal fees.
– Credit report fees.
– Title insurance.

Sellers can contribute up to 4% of the purchase price toward covering these costs.

9. Can I use a VA loan more than once?**
Yes, VA loans can be reused multiple times, as long as you meet eligibility requirements and have entitlement available. Entitlement can be restored after paying off a previous VA loan or selling the property.

10. What are the benefits of a VA loan compared to other loan types?**
– No down payment (in most cases).
– Competitive interest rates.
– No private mortgage insurance (PMI) requirement.
– Lenient credit and income requirements.
– Ability to refinance easily.

These features make VA loans an attractive option for eligible borrowers in Washington State.

For personalized assistance, consult with a VA-approved lender familiar with Washington State guidelines.

Alabama
Army: Redstone Arsenal, Anniston Army Depot
Air Force: Maxwell Air Force Base, Gunter Annex
Alaska
Army: Fort Wainwright, Fort Greely
Air Force: Eielson Air Force Base, Joint Base Elmendorf-Richardson
Arizona
Army: Fort Huachuca
Air Force: Davis-Monthan Air Force Base, Luke Air Force Base
Marine Corps: Marine Corps Air Station Yuma
Arkansas
Air Force: Little Rock Air Force Base
Army: Pine Bluff Arsenal
California
Army: Fort Irwin, Presidio of Monterey
Air Force: Edwards Air Force Base, Travis Air Force Base, Beale Air Force Base
Navy: Naval Base San Diego, Naval Base Coronado, Naval Air Station Lemoore
Marine Corps: Marine Corps Base Camp Pendleton, Marine Corps Air Station Miramar, Marine Corps Logistics Base Barstow
Colorado
Air Force: Peterson Space Force Base, Schriever Space Force Base, Buckley Space Force Base
Army: Fort Carson
Joint: Cheyenne Mountain Complex
Florida
Air Force: Eglin Air Force Base, MacDill Air Force Base, Tyndall Air Force Base
Navy: Naval Air Station Jacksonville, Naval Air Station Pensacola, Naval Station Mayport
Marine Corps: Blount Island Command
Georgia
Army: Fort Benning, Fort Stewart, Fort Gordon
Air Force: Robins Air Force Base, Moody Air Force Base
Navy: Naval Submarine Base Kings Bay
Hawaii
Army: Schofield Barracks, Fort Shafter
Navy: Joint Base Pearl Harbor-Hickam
Marine Corps: Marine Corps Base Hawaii
Illinois
Army: Rock Island Arsenal
Navy: Naval Station Great Lakes
Kansas
Army: Fort Riley, Fort Leavenworth
Air Force: McConnell Air Force Base
Kentucky
Army: Fort Knox, Fort Campbell
Louisiana
Army: Fort Polk
Air Force: Barksdale Air Force Base
Maryland
Army: Fort Meade, Aberdeen Proving Ground
Air Force: Joint Base Andrews
Navy: Naval Air Station Patuxent River
Missouri
Army: Fort Leonard Wood
Air Force: Whiteman Air Force Base
Nevada
Air Force: Nellis Air Force Base, Creech Air Force Base
New Mexico
Army: White Sands Missile Range
Air Force: Kirtland Air Force Base, Holloman Air Force Base, Cannon Air Force Base
North Carolina
Army: Fort Liberty (formerly Fort Bragg)
Marine Corps: Marine Corps Base Camp Lejeune, Marine Corps Air Station Cherry Point, Marine Corps Air Station New River
Oklahoma
Army: Fort Sill
Air Force: Tinker Air Force Base, Vance Air Force Base, Altus Air Force Base
South Carolina
Army: Fort Jackson
Marine Corps: Marine Corps Recruit Depot Parris Island, Marine Corps Air Station Beaufort
Air Force: Joint Base Charleston
Texas
Army: Fort Cavazos (formerly Fort Hood), Fort Bliss, Fort Sam Houston
Air Force: Lackland Air Force Base, Randolph Air Force Base, Dyess Air Force Base, Goodfellow Air Force Base, Laughlin Air Force Base
Joint: Joint Base San Antonio
Virginia
Army: Fort Gregg-Adams (formerly Fort Lee), Fort Eustis, Fort A.P. Hill
Navy: Naval Station Norfolk, Naval Air Station Oceana
Marine Corps: Marine Corps Base Quantico
Washington
Army: Joint Base Lewis-McChord (Fort Lewis)
Navy: Naval Base Kitsap, Naval Air Station Whidbey Island, Naval Station Everett
Wisconsin
Army: Fort McCoy

Happy Veterans Day to all the brave men and women who served our country and fought for our freedom! You are appreciated beyond words.

Take this day to reflect, honor, and remember that freedom is not free! Be sure to thank a Veteran close to you today and every day.

The Federal Reserve’s recent decision to cut interest rates has brought a sense of cautious optimism to the housing market and broader economy. On Thursday, the Fed reduced its key benchmark borrowing rate by a quarter percentage point, bringing the target range to 4.75-5.0%. This marks the second consecutive rate cut, following a similar reduction in September, indicating a measured shift in monetary policy aimed at supporting economic growth.
While the Fed’s rate cuts influence various consumer lending products, their effect on mortgage rates isn’t always direct. Mortgage rates tend to follow the 10-year Treasury yield more closely, which responds to a variety of economic factors. However, the recent Fed action has contributed to a modest downward trend in mortgage rates. The average 30-year mortgage rate has eased to 6.50% as of early November, down from its peak of 7.79% in October 2023.
Federal Reserve Chair Jerome Powell offered a balanced perspective on the current economic landscape: “We’re seeing some encouraging signs in the economy, including in the housing sector. Our recent policy adjustments aim to support sustainable growth while keeping inflation in check. It’s a delicate balance, but we’re cautiously optimistic about the path forward.” Powell’s words reflect the Fed’s commitment to fostering economic stability while acknowledging the complexities involved.
For potential homebuyers and those considering refinancing, this shift in monetary policy could present new opportunities, though it’s important to maintain realistic expectations. While mortgage rates may not immediately mirror the Fed’s cuts, the overall trend suggests more favorable borrowing conditions could emerge in the coming months. As always, it’s advisable to stay informed about market trends and consult with financial professionals to navigate these changing economic conditions. The Fed’s actions, combined with evolving economic indicators, suggest a generally positive outlook for both the housing market and the broader economy as we move into 2025, though challenges and uncertainties remain.

Refinancing to a 15-year mortgage is an option many homeowners consider when interest rates drop. This type of refinance allows you to pay off your mortgage faster, potentially saving on long-term interest costs. While the appeal of faster equity-building and reduced interest is strong, refinancing to a shorter term does come with trade-offs. Here’s what to consider if you’re thinking about making the switch.

Before making the leap, it’s essential to assess several key factors. First, check if you’ve held your current mortgage long enough to refinance; lenders often require a set period before allowing this, known as “seasoning.” Another critical aspect is your financial comfort with the potential increase in monthly payments. Refinancing to a 15-year loan from a 30-year loan can significantly raise your monthly payment, even if you secure a lower interest rate. Additionally, consider how long you plan to stay in your home, as closing costs can offset potential savings if you sell too soon.

One of the primary reasons to refinance into a 15-year mortgage is the opportunity to lock in a lower interest rate and save on total interest payments. With a shorter repayment period, you can build equity faster, potentially giving you access to more financial flexibility through options like home equity lines of credit (HELOCs) in the future. However, keep in mind that monthly payments on 15-year loans are higher, which may affect your ability to meet other financial goals, like saving for retirement or maintaining an emergency fund.

Refinancing isn’t a one-size-fits-all decision, and it’s wise to weigh the pros and cons carefully. If your income is stable, you’re financially prepared for the higher payments, and reducing your mortgage term aligns with your long-term plans, then a 15-year refinance could be a smart move. But for those who might prefer lower monthly obligations or who have other high-priority savings goals, sticking with a longer-term mortgage or making additional payments on the current loan could be a better approach.

The Basic Allowance for Housing (BAH) rates at Joint Base Lewis-McChord (JBLM) for 2024 have been updated to reflect the higher costs of living around the base, ensuring service members have the necessary support for local housing. Here is a breakdown of the 2024 rates for all ranks, divided into “with dependents” and “without dependents.”

Enlisted Rates
E-1 to E-4: $2,235 with dependents, $1,683 without dependents
E-5: $2,430 with dependents, $1,908 without dependents
E-6: $2,724 with dependents, $2,055 without dependents
E-7: $2,805 with dependents, $2,241 without dependents
E-8: $2,892 with dependents, $2,493 without dependents
E-9: $3,003 with dependents, $2,574 without dependents
Warrant Officer Rates
W-1: $2,742 with dependents, $2,175 without dependents
W-2: $2,841 with dependents, $2,490 without dependents
W-3: $2,949 with dependents, $2,586 without dependents
W-4: $3,027 with dependents, $2,739 without dependents
W-5: $3,123 with dependents, $2,823 without dependents
Officer Rates
O-1E: $2,817 with dependents, $2,427 without dependents
O-2E: $2,931 with dependents, $2,556 without dependents
O-3E: $3,039 with dependents, $2,715 without dependents
O-1: $2,472 with dependents, $2,034 without dependents
O-2: $2,721 with dependents, $2,364 without dependents
O-3: $2,946 with dependents, $2,613 without dependents
O-4: $3,150 with dependents, $2,802 without dependents
O-5: $3,297 with dependents, $2,850 without dependents
O-6: $3,321 with dependents, $2,928 without dependents
O-7: $3,348 with dependents, $2,976 without dependents
These rates reflect efforts to adjust housing support as the local housing market fluctuates, helping military families secure housing near JBLM. For more details, check sources like VA Home Loans and JBLM’s official housing information.

A zombie mortgage is a haunting financial surprise that can emerge years after a homeowner thought their mortgage was fully paid off or discharged. This second mortgage, often linked to loans from the early 2000s housing bubble, resurfaces with demands for repayment, even though the borrower believed it was settled. Many of these loans were part of “piggyback” financing, where a borrower took out a first mortgage for 80% of their home’s value and a second mortgage for the remaining 20%. Over time, confusion around modifications and loan terms has led some homeowners to mistakenly believe the second mortgage was forgiven or discharged, only for it to rise again—hence the term “zombie mortgage.”

Zombie mortgages tend to resurface when market conditions improve, and investors seek to collect on old debts. These mortgages can sometimes balloon in size due to accumulated interest over the years, catching homeowners off guard. According to experts, many borrowers are now seeing substantial increases in what they owe—sometimes turning a $95,000 loan into a $400,000 debt. While these loans seemed forgotten during the financial downturn of 2008, rising home prices during the COVID-19 pandemic have given new life to zombie mortgages, as lenders and investors see an opportunity to recover their money.

If you find yourself facing a zombie mortgage, it’s crucial not to ignore the situation. Reaching out to a HUD housing counselor or real estate attorney with experience in zombie mortgages should be your first step. They can help determine the validity of the claim and work with you to explore options for resolution. Additionally, checking loan documents and contacting your county recorder’s office to verify if the mortgage was officially discharged may provide further clarity. Some states also have laws protecting homeowners from unfair debt collection practices, and it’s important to know your rights under the Fair Debt Collection Practices Act.

Homeowners today who are considering taking out a home equity line of credit (HELOC) should be mindful of the risks that might arise in the future. While lenders may not push for foreclosure now, these second mortgages could resurface as zombie mortgages years down the line when housing prices rise again. Whether you are currently facing a zombie mortgage or planning for the future, staying informed and seeking professional advice is key to avoiding this unsettling financial trap.

When it comes to mortgage rates, the Federal Reserve plays an influential but indirect role. The Fed doesn’t set mortgage rates directly, but its decisions around interest rates significantly impact the financial landscape, including the cost of borrowing to buy a home. Understanding the Fed’s role in monetary policy is key to grasping how mortgage rates fluctuate and what might drive up or lower the rate on your home loan.

The Federal Reserve primarily influences short-term borrowing costs by setting the federal funds rate, which is the interest rate banks charge each other for overnight loans. When the Fed raises or lowers this rate, it affects the broader economy by influencing rates on credit cards, car loans, and home equity lines of credit. While fixed mortgage rates aren’t directly tied to the federal funds rate, the ripple effects of the Fed’s decisions can still be felt. Notably, in 2022 and 2023, the Fed raised rates to combat inflation, leading to higher borrowing costs across the board, including for homebuyers.

Fixed-rate mortgages, which are popular among homeowners, are more closely tied to the 10-year Treasury yield. When the yield rises or falls, fixed mortgage rates tend to follow suit. However, mortgage rates aren’t an exact match to Treasury yields; they typically have a gap of 1.5 to 2 percentage points. Recently, this gap has widened, making mortgages more expensive. Other factors such as inflation, supply and demand in the mortgage market, and investor activity in the secondary mortgage market also influence fixed-rate mortgage costs.

For those with adjustable-rate mortgages (ARMs), the Fed’s rate decisions have a more direct impact. ARMs are often tied to the Secured Overnight Financing Rate (SOFR), which moves in response to changes in the federal funds rate. When the Fed raises its rate, the SOFR tends to increase, causing ARM rates to rise during their next adjustment period. In conclusion, while the Fed doesn’t set mortgage rates outright, its policies shape the economic conditions that drive both fixed and adjustable-rate mortgages, affecting how much you’ll pay for your home loan.

Mortgage rates have dropped once again, offering a unique opportunity for both homebuyers and current homeowners, with rates at their lowest rate in over 18 months. For homeowners, this may be the perfect time to consider refinancing—replacing their existing mortgage with one that has a lower interest rate. If you’ve been holding off on refinancing due to high rates, now could be your chance to lock in savings.
In recent years, refinancing activity plummeted as rates surged from 3 percent during the pandemic to as high as 8 percent in late 2023. However, with rates starting to dip, some homeowners who took out mortgages during the rate hike may find it beneficial to refinance now. For homeowners with adjustable-rate mortgages or those locked into higher rates, the current market conditions could make refinancing a smart move.
However, refinancing isn’t as simple as getting a better rate. It’s important to weigh the costs involved, including closing fees, which typically range from 2 to 5 percent of the loan amount. You’ll need to factor in expenses like credit checks, appraisal fees, and title insurance. Some states even impose additional taxes on mortgage refinances. Experts suggest that homeowners should aim for at least a 1.5 percentage point drop in their interest rate to make refinancing worthwhile.
If you’re thinking about refinancing or wondering what else is on the horizon got to our calendar on our website and schedule an evaluation.