Q. I’m thinking of refinancing my Crofton home, but I’ve been paying on my 6.5% loan for 12 years and don’t really want to re-start that 30–year term. What do you recommend?

A.  If you haven’t refinanced your home since interest rates dropped below 4%, now is the time to get off the fence and do it. 

Va and FHA borrowers will find it very easy to refinance, since you can take advantage of a streamline process that doesn’t require an appraisal, credit report, income verification or any of the other dreaded processing steps.  You just have to be “on time” with payments for the past year.  Even Conventional borrowers will find the aggravation of processing a new loan to be well worth the trouble at today’s record-low rates.

With the decision to refinance made, the next issue is this:  15 year or 30 year? 

The payments on a 15 year loan will be a little higher than a new 30–year loan, but you’ll get a lower interest rate and build equity much faster. 

Let’s look at an example of a $200,000 mortgage with the choice of a 30 year term @ 3.75% compared to a 15 year term @ 2.875%. The payments would be $442.94 higher on the shorter term but the equity would be considerably higher even after you adjust for the higher payments. 

If you’ve been paying down a 30–year loan @ 6% for the past 12 years, your payment will remain about the same, but you could drop 3 years off the remaining term.

On the other hand, refinancing to a new 30 year loan could reduce your mortgage payment cash flow at a time when federal, state, and local taxes are going up, and retirement is on the horizon for you. This is an option that may be right for some borrowers, especially if cash flow is your Number 1 concern.

Contact me if you’d like a recommendation for a trusted Crofton area mortgage lender who can help you examine your options and make the right decision for your situation.

Chart and some content licensed by PatZaby.com

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Coming soon:  Star-Spangled Sailabration, June 13–19, 2012.  

An international parade of more than 40 tall ships and naval vessels sailing into Baltimore for the national launch of the Bicentennial of the War of 1812 and the writing of the Star-Spangled Banner.  Star-Spangled Sailabration will feature free tours of the ships, waterside festivities, an airshow featuring the Blue Angels, and the world-premiere of “Overture for 2012,” composed by Philip Glass.

New contracts were down over 36% with only 14 firm contracts vs. 22 in March 2012, but activity overall was good if we consider the 18 new contingent contracts.  In fact, one home sold non-contingent overnight, and I’m happy to say it was my listing on Eton Way in Old Crofton.

Now, let’s take a look at the five year history of real estate sales in Crofton for the month of March. 

After four months of new “sold” units equaling or outnumbering new listings, the new listings were up in March.  Hopefully that was just a bump in the road, because consistent reduction in inventory will help tip the balance in favor of “normal” rather than a buyer’s market.

If you have any questions about the real estate market in your specific neighborhood or home type (detached vs. townhomes), I’d be happy to answer them.  Just click on the contact tab at the top of this page.

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Four properties went to closing during March, ranging from $395,000 to $740,000.

Fourteen properties went under contract during that same month, compared to five the previous month.  One of them has already closed, eight of them are firm contracts, and the remaining ones have a contingency. Listing prices for the homes that went under contract ranged from $375,000 – $1,290,000. Two of them were short sales.

Eleven new listings came on the market in March, and two of them are already under contract. For the first time in a while, new listings were outnumbered by new contracts – a very good thing, because it signals a slight decline in the inventory of Davidsonville homes.  The new lsitings were priced between $479,900 and $1,195,000.

NEW LISTING IN DAVIDSONVILLE   SPACE & PRIVACY! My new listing in the Ashley community has it all! Nestled behind trees on a 5 acre lot, you’ll discover a spacious home loaded with upgrades and special features that will pamper you from Day 1. Granite counters, stainless steel appliances, stone fireplace, double staircase, fabulous master suite, main level library and powder room, walkout rec room and bath in the basement… the list goes on and on…  ($889,000)  MLS AA7808366

Take a look at this video minute.

Imagine a view of the 2nd fairway at Crofton Country Club from your deck, dining room, kitchen and master bedroom!  Other special features of this new listing include hardwood floors & oversize windows on the main level and a huge family room “L” that’s not included in the room dimensions on MRIS. Clean and well maintained so you can enjoy living in this home while updating it at your own pace.

With a location like this, 1653 Eton Way will not be on the market for long.  Please contact me directly for more information so you can be one of the first people to see the interior of this home.  (301–346–2923)

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