Florida mortgage rates mirror national trends but can be impacted by state-specific economic factors and insurance costs. As of late 2023/early 2024, rates fluctuated between 6-8% for a 30-year fixed mortgage, significantly impacting affordability compared to the sub-3% rates seen in 2021. Each 1% increase in mortgage rates can reduce a buyer’s purchasing power by approximately 10%. High property insurance premiums in Florida, driven by hurricane risk, add to the overall cost of homeownership and can influence lender risk assessment. The Florida Housing Finance Corporation offers programs aimed at first-time homebuyers, potentially providing lower rates or down payment assistance. Fluctuations in the 10-year Treasury yield heavily influence mortgage rate movements.

Teddy Roosevelt thought that lawyers are trained to serve clients and not justice. An interesting discussion topic. Residential lending certainly has its share of legal proceedings and suits, but commercial lending does as well. For example, Wells Fargo is suing JPMorgan over a troubled $481 million commercial real estate loan made in 2019 to “recover losses for investors on the loan allegedly based on fraudulently inflated net operating income by 25 percent. According to the complaint in Manhattan federal court, JPMorgan went ahead with the loan, knowing it would eventually be sold in pieces to unwitting investors. The borrower defaulted in 2022 and still owes more than $285 million, while investors have lost tens of millions of dollars, Wells Fargo said. Wells Fargo wants New York-based JPMorgan to repurchase the loan, less amounts the trust received from sales of underlying properties, or else pay damages for breach of contract. In the residential world, the talk of repurchase requests by Freddie and Fannie has died down, but it is still a possibility and the cost of handling and defending against those requests, or dealing with repurchases, is certainly added to the cost of business for lenders. (Today’s podcast can be found here and this week’s is sponsored by TransUnion. TransUnion offers thousands of B2B solutions designed to address the unique needs of mortgage lenders, especially for their identity-focused, data-driven mortgage insights and solutions. Hear an interview with TRAiNED’s Jonathan Freed on what problems AI can solve in mortgage lending and how successful lenders are embracing it.)

Florida’s homeownership rate hovers around 68%, slightly below the national average. First-time homebuyers should budget for closing costs, typically 2-5% of the purchase price. Property taxes average around 0.97% of assessed value annually. Homeowners insurance is significantly higher than the national average, influenced by hurricane risk and averaging over $6,000 per year in some coastal areas. Flood insurance is often required, especially in high-risk zones, and is separate from homeowner’s insurance. Common home maintenance costs in Florida include AC maintenance ($150-$300 annually), lawn care ($100-$200 monthly), and potential roof repairs due to storm damage. Homestead exemption can significantly reduce property taxes for primary residences, up to $50,000 in some counties. Down payment assistance programs are available for eligible first-time buyers and can provide up to $15,000 in assistance.