FLOOD INSURANCE UPDATE

Please read below for latest update from FEMA regarding flood insurance. And i need to speak my peace. Notice what they call the law….the Homeowners Flood Insurance Affordability Act. The federal government thinks all of us Americans are pin heads. They think they can put the word “Affordabilty” in all their legislation and all of us regular Joe’s think they are helping. They used that same word in our new health insurance plan as well. Now premiums are skyrocketing and the deductables are at $6000. Pretty soon and only the rich will be able to afford health insurance. The rest of us will decline and take the penalty because our budgets can’t handle even the premium, much less the deductable. What a mess. There is nothing affordable to the American people in anything our government attempts to do. Just like health insurance, they need to privitize flood insurance and the rates will come back down.   

FEMA issues flood insurance update

 

 

WASHINGTON – April 4, 2014 – On April 3, the Federal Emergency Management Agency (FEMA) issued a memo that outlined the steps it’s taking to implement the Homeowner Flood Insurance Affordability Act of 2014. 

The seven-page memo issues instructions to private insurers who issue flood insurance policies on FEMA’s behalf. 

The overriding message for homeowners and buyers: Be patient. They may not receive the lower rate under the new law immediately. Homeowners facing a high bill are advised to pay it and wait for a rebate rather than go without flood coverage.

If you currently have a flood insurance policy in effect and it’s time to send in a renewal payment, “under no circumstances should you allow that policy to lapse” while waiting for clarity on how the new flood insurance law will impact it, advises Lisa S. Jones, a flood insurance specialist with Carolina Flood Solutions and consultant to the National Association of Realtors® (NAR).

“FEMA is working with Congress, the private Write Your Own insurance companies (private companies that act as intermediaries selling flood insurance policies) and other stakeholders to implement these Congressionally mandated reforms,” says Dennis Kuhns, FEMA’s director of the Risk Insurance Division.

However, Kuhns also says, “It is not possible for changes to happen immediately. While the new law does require some changes to be made retroactively – applying to certain policies written after July 6, 2012 – other changes require establishment of new programs, processes and procedures.”

It’s the “programs, processes and procedures” that will take time, and FEMA offers no solid dates, only that more information “will be forthcoming.”

However, FEMA echoes Jones’ advice for homeowners: Pay your flood insurance bill even if it’s still over-priced rather than wait for clarity on the lower rates authorized by the new flood law.

“FEMA does NOT recommend cancelling a flood insurance policy,” Kuhns said in the letter. “Cancelling flood insurance policies now will leave policyholders unprotected during spring flooding, and may cause policyholders to lose important discounts on their rate if they reinstate in the future.”

The complete FEMA letter and memo is posted online in Florida Realtors Flood Insurance Toolkit.

© 2014 Florida Realtors®

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INTEREST RATES ARE RISING!

For all you fence sitters, the party is over…….no not really, but seriously, if you are considering buying a home and have been putting it of you may want to reconsider. Interest rates a year ago were in the middle to high 3’s and today they are at 4.5% and continuing to creep up as our economy gets better. In addition, home prices are also rising a bit, so with those two factors what it means is a year from now you won’t be able to buy as much house unless your income rises as well. For all you young people out there that are just coming into the housing market, please read article to the bottom and you will see the what the interest rates have been in the past by the decade. That should convince you that now is the time to buy that dream home now…..and buy as big as you think you will need and can afford as these current rates will never be back. They are still the lowest in my life time. Don’t miss the boat! As always, if you need any help making a purchase in the greater Tampa Bay area, please feel free to give Richard Kemper a call at 813-777-5332 or email me at getrichquick2@aol.comImage 

 

Freddie: No more record-low mortgage rates

 

 

WASHINGTON – April 2, 2014 – While mortgage rates have been rising the last few months, they’re still historically low compared to the trend over the last four decades, Freddie Mac says in a blog post.

But rates as low as they were in November 2012 – when the 30-year fixed-rate mortgage reached an all-time low of 3.31 percent – aren’t likely to return any time soon, the mortgage giant says. 

Still, Freddie assures borrowers that the all-time record high of 18.63 percent reached in October 1981 isn’t on the horizon either. (At 18.63 percent, monthly mortgage payments on a $200,000 loan would be $3,117, compared to $992 a month at today’s 4.32 percent average.)

With mortgage rates at 4.32 percent, 123 of the 157 metros that Freddie Mac tracks remain very affordable to households earning the median income. In order for affordability to be hampered in the majority of markets, interest rates would have to reach 7 percent, according to Freddie Mac.

“Stubbornly high unemployment over the last several years coupled with stagnant income growth exacerbates declining affordability in a rising interest rate environment,” according to Freddie’s blog post. “More jobs and income growth would help blunt the effects of higher interest rates and make buying a home more accessible. While jobs and income have shown some improvement in recent months, they continue to be challenged.”

Mortgage rates through the years

Here’s an overview of mortgage rates in the past four decades, as well as the approximate payment on a $200,000 mortgage and how it changes with the rise and fall of rates, according to Freddie Mac.

 1970s
 Average 30-year fixed-rate mortgage: 8.86%
 Approximate payment on a $200,000 mortgage: $1,589

 1980s
 Average 30-year fixed-rate mortgage: 12.70%
 Approximate payment on a $200,000 mortgage: $2,166

 1990s
 Average 30-year fixed-rate mortgage: 8.12%
 Approximate payment on a $200,000 mortgage: $1,484

 2000s
 Average 30-year fixed-rate mortgage: 6.29%
 Approximate payment on a $200,000 mortgage: $1,237

 2014
 Average 30-year fixed-rate mortgage: 4.36%
 Approximate payment on a $200,000 mortgage: $997

Source: “Mortgage Rates: From Dirt Cheap, to Cheap,” Freddie Mac (March 24, 2014)

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