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New Mexico Is the Place To Be!

Thursday, March 31st, 2016

In case you missed it, New Mexico was in the spotlight when the Yahoo Travel Editor listed her top travel destinations on Good Morning America (GMA) at the beginning of the year. New Mexico was her top bargain travel destination, as she talked about affordable dining, lodging and skiing. She only mentioned 4 locations worldwide, so New Mexico received good exposure.

Lonely Planet was part of the inspiration for the GMA spot. This major travel book publisher released its Best in Travel 2016 lists and New Mexico was the only U.S. destination in the Best Value group! Calling New Mexico “a beautiful, affordable, active, foodie corner of America’s southwest,” the article mentions our many natural and cultural attractions and concludes: “Given the richness of attractions all found within one state, New Mexico offers value from a time as well as monetary perspective.”

Credit Myths Exposed

Tuesday, March 29th, 2016

Myths About Multiple Mortgage Credit Inquiries

The 3 credit bureaus say it plainly – Borrower scores will not drop when a mortgage lender pulls their credit more than once.

Credit Inquiries: They are not weighted equally

A “credit inquiry” is a formal request to review a person’s credit report. They are just one small element within a larger credit-scoring category known as “New Credit”. New Credit accounts form 10% of a person’s overall credit score.

Why do inquiries matter?  A large number of inquiries means a greater risk. Statistically, people with six inquiries or more on their credit reports can be up to eight times more likely to declare bankruptcy than people with no inquiries on their reports.

Searching for new credit is relevant to your credit score because when you makes a credit inquiry, it’s a specific request to increase your level of indebtedness. Taking on additional levels of debt increases the probability of a default.

This is why credit scores drop when you go looking for new credit cards or charge cards — each new credit inquiry increases the probability of you taking on large amounts of debt, which makes it less likely that you’ll make good on payments to creditors.

Credit inquiries come in many varieties.

1. A credit check for a mortgage loan
2. A credit check for an auto loan
3. A credit check for a credit card application
4. A credit check for a store credit card or other consumer loan.

Not surprisingly, each of these 4 credit check-types receives different treatment by the bureaus. For example, a credit card application carries more weight than a mortgage loan and can cripple a credit score. This is because credit card debts tend to move higher over time, which weakens overall credit position. Mortgage debt, by contrast, eventually pays down to $0.

Mortgage Inquiry Lowers Your FICO Score by 5 Points

The effect of a mortgage inquiry on a credit score remains tiny because mortgage lenders evaluate credit using the FICO scoring model. The FICO scoring model ranks scores from 300-850. 65% of that score is linked to two elements of your credit history; (1) Payment History, and (2) Credit Utilization. The credit bureaus give the most weight to how much money you borrow from creditors, and whether you are actually paying the creditors back. That makes sense.

The next 15% of the credit score is tied to credit history; to the length of time you’ve had credit in your name. The more time spent managing your own credit, the better your score will be. This, too, makes sense. It’s risky to lend to a “first-timer”; a person who has never had a credit card to his name, or repaid a car loan, or borrowed money for an education.

The next 10% is linked to the type of credit that is maintained.  Auto loans and mortgage debt are viewed as positives in this regard. Store charge cards are viewed as negatives. These positives and negatives are based on default rates from tens of millions of other borrowers.

A mortgage credit inquiry is estimated to lower a credit score by just 5 points 

When shopping for lenders and taking on credit inquiries, it will initially lower your score. However, the important concept is that unlike applying for multiple credit cards, when someone applies for multiple mortgages, they won’t get “dinged” for multiple, consumer-initiated inquiries. This is because when they apply for 5 credit cards, they’ll likely get the option to use all five cards and accrue more debt on each of them. By contrast, with the mortgage applications, they’ll only get an approval once and assume only one new debt, albeit a big one.

Because of this, the credit bureaus have made it a formal policy to permit “rate shopping”. In fact, it’s encouraged. And this leads us to the second important FICO-protecting concept. Borrowers have the right to shop with as many lenders as they like. The secret, though, is to sort out your shopping for a mortgage within a limited, 30-day time frame. If the inquiries are properly managed, the credit bureaus will acknowledge the first credit pull as a “ding”, but will ignore each subsequent check.

This means that you can have your credit checked by an unlimited number of lenders within a 30 day period and only receive one 5-point “Hit” against your credit score.

Understanding Credit Scores & Their Impact on Real Estate Financing

By definition, your credit score is a number that reflects your credit worthiness at any given point in time. When a landlord, lender or credit card company is asked to loan money, they run a credit report to determine the amount of risk involved in investing in you, the applicant. Loan approval and the amount of money you are eligible to receive is one of the most critical elements of your real estate transaction, which makes it important to understand how credit scores work.

So, in summary, your credit score is calculated based on a number of different factors. These factors are broken down below by percentage of consideration:

 The number of new accounts and credit requests you’ve made (10%)
 Your credit risk (10%)
 The length of your credit history (15%)
 Your total indebtedness (30%)
 Your payment history or record of paying your bills on time (35%)

If you have questions about your credit score and real estate financing or want to see what type of loan you could be pre-approved for, please don’t hesitate to contact me. I am here to help!

Pending Homes Sales Higher in February

Tuesday, March 29th, 2016

WASHINGTON (March 28, 2016) — Pending home sales rose solidly in February to their highest level in seven months and remain higher than a year ago, according to the National Association of Realtors®. Led by a sizeable increase in the Midwest, all major regions except for the Northeast saw an increase in contract activity in February.

The Pending Home Sales Index, a forward-looking indicator based on contract signings, rose 3.5 percent in February and is now 0.7 percent above February 2015. The index has increased year-over-year for 18 consecutive months.

Lawrence Yun, NAR chief economist, says pending sales made promising strides in February, rising to the highest index reading since last July. After some volatility this winter, the latest data is encouraging in that a decent number of buyers signed contracts last month, lured by mortgage rates dipping to their lowest levels in nearly a year and a modest, seasonal uptick in inventory. Looking ahead, the key for sustained momentum and more sales than last spring is a continuous stream of new listings quickly replacing what’s being scooped up by a growing pool of buyers. Without adequate supply, sales will likely plateau.

2015 Year End Sales Stats Show Modest Gains

Tuesday, January 26th, 2016

This chart shows healthy growth in the number of units sold for single family homes in Santa Fe for 2015 as well as the average price per square foot by price range for the same period.
2015 Units & Price 2003-2015

Santa Fe Average & Median Sold Prices by MLS Area – May 2015

Thursday, September 24th, 2015

AvgMed Sold prices by Area-May 2015

Santa Fe MLS Area Map

Thursday, September 24th, 2015

MLS Map

New Listing – House and Guest Casita

Thursday, June 4th, 2015

2015 Second Quarter Statistics

Monday, May 4th, 2015

The second quarter of 2015 demonstrates the continuing stabilization trend we’ve seen for the past two years in the Santa Fe market for single-family homes. The charts below show the number of units sold by price range and the average sales price per square foot by price range.

Sales Stats EOY 2015 2nd Qtr Sgl Fam Revised

Average Sales 2002-2014 (YTD), Units Sold and Price per Square Foot

Tuesday, November 11th, 2014

2014 continues the stabilization trend we saw in 2013 for  home sales and mid-range prices. The charts below show the number of units sold by price range and the average sales price per square foot by price range.

Charts-for-Newsletter-as-of-7-31-2014

93rd Annual Santa Fe Indian Market and 1st Annual Indigenous Fine Art Market

Wednesday, August 20th, 2014

This week and weekend, you can go to two markets in Santa Fe featuring the best of Native art and craft.  The 93rd Annual Santa Fe Indian Market and the 1st Annual Indigenous Fine Art Market are both taking place, one on and around the Plaza, the other at the Railyard.

  santafeindianmarket.jpg

Both markets include several days of events devoted to Native art and culture.  Film, fashion, literature, dance and music are all part of the celebrations.  Check out the websites above to learn more about the many great events on offer.  And of course, they’re not museums, they’re markets.  The artists appreciate your purchases to support their continued work.

In Santa Fe, not one but two markets to enjoy!