Category: Housing Market (Page 1 of 43)

Ask for Seller Concessions or a Rate Buydown — Not Just a Lower Price

October 5, 2026 / Tom Bonetto / 0 Comments

If you’re shopping for a home right now, you have more leverage than you’ve had in years — and how you use it matters.

Roughly 42% of listings are cutting their price. Active inventory is near ~1.17 million homes, the highest since late 2019, and up about 5–6% from a year ago.

Listing prices have been declining year over year for 36 weeks. Mortgage rates are in the mid 7% range (roughly 7.49% at the time of this article).

Sellers are more open to negotiation. Buyers who only ask for a smaller sticker price may be leaving better options on the table.

A price cut isn’t always the best ask

A modest drop in list price can feel like a win. But depending on your loan, it may not change your monthly payment much — and it doesn’t always help with closing costs. Seller concessions (credits toward closing costs) and rate buydowns often do more for your real monthly budget.

roll of american dollar banknotes tightened with band

Closing-cost credit: Reduces cash you need at the table. Useful if you’re tight on reserves or want to keep more money for moving, repairs, or an emergency fund.

Temporary buydown (e.g., 2-1): Lowers your payment in the early years while you settle in, refinance later, or grow income.

Permanent buydown (points): Can lower your rate for the life of the loan when the numbers work.

Sometimes the smartest offer is to keep the price closer to list and ask the seller to fund a credit or buydown that improves your payment or cash-to-close.

Why this works in today’s market

Sellers still care about net proceeds and the “sold” story. A modest price cut plus a targeted credit can get you under contract without forcing them into a deep discount. With so many homes already cutting price, you’re not being difficult by asking — you’re being practical.

How to talk about it with your agent and lender

1. Ask your lender to run side-by-side numbers: price cut vs. credit vs. buydown.

2. Decide what matters more for you — lower payment, less cash at closing, or both.

3. Have your agent present the ask as a path to a clean close, not a hardball tactic.

4. Get pre-approved so sellers know your financing is real when you negotiate.

Next step

If rates above 7% have you hesitating, don’t assume the only lever is “wait for a lower list price.”

Ask about seller concessions and buydowns.

Call me anytime to keep the conversation going, ask questions, or run numbers.

The blog postings on this site represent the positions, strategies or opinions of the author and do not necessarily represent the positions, strategies or opinions of Starlight Mortgage. Each loan is subject to underwriter final approval. All information, loan programs, interest rates, terms and conditions are subject to change without notice. Always consult an accountant or tax advisor for full eligibility requirements on tax deductions.

UAD 3.6 Is Coming: What Real Estate Agents Should Start Putting in MLS Listings Now

September 29, 2026 / Tom Bonetto / 0 Comments

There is a significant change coming to residential appraisals, and real estate agents should be preparing for it now.

Fannie Mae and Freddie Mac are transitioning to Uniform Appraisal Dataset (UAD) 3.6, along with a redesigned Uniform Residential Appraisal Report.

Beginning November 2, 2026, all new appraisal reports submitted to the Uniform Collateral Data Portal (UCDP) must use UAD 3.6.

Importantly, lenders are already permitted to use UAD 3.6, and Fannie Mae has said agents and appraisers should expect lenders to increasingly request the new format as the mandate approaches.

So, while November 2 is the official deadline, this is something Realtors should start preparing for now.

Why UAD 3.6 Matters to Real Estate Agents

UAD 3.6 isn’t simply a new-looking appraisal form. Fannie Mae and Freddie Mac have redesigned how property and market information is collected and reported. The new system uses a larger, more structured dataset and a dynamic appraisal report rather than relying as heavily on free-form commentary.

In practical terms, appraisers need more precise information about properties and transactions.

That makes the quality of information entered into MLS increasingly important—not only for the home you’re selling today, but also when that property becomes a comparable sale for another appraisal months or years from now.

The days of relying on descriptions such as “beautifully updated throughout” are becoming less useful from an appraisal standpoint. Facts, dates and documentation are much more valuable.

1. Be Specific About Renovations and Updates

Instead of simply stating that a property has been remodeled, document what was done and approximately when it was completed.

For example:

Less useful:
“Beautifully updated kitchen.”

When possible, provide approximate ages or replacement dates for major components such as the roof, HVAC system, electrical, plumbing, windows, flooring and other significant improvements.

Much more useful:
“Kitchen fully remodeled in 2022 with new cabinets, quartz countertops, appliances and flooring.”

The objective isn’t to make the MLS description sound technical. It’s to create a reliable record of the property’s condition and improvements that an appraiser can understand and potentially verify.

2. Provide Better Information About the Home’s Layout

UAD 3.6 places greater emphasis on detailed property characteristics, so agents should become accustomed to documenting the home’s layout more precisely.

Include bedrooms, full and half bathrooms, and finished versus unfinished areas by level whenever possible.

Also identify ADUs, additions, converted garages, finished basements and other converted spaces. If a space was originally built for one purpose and is now being used for another, that information can be helpful. If you know whether the work was permitted, document that as well.

Fannie Mae has also published specific UAD 3.6 guidance regarding ANSI reporting and area breakdowns, reflecting the greater level of structure in the new appraisal reporting process.

3. Document Features That May Not Be Obvious

Think beyond bedrooms, bathrooms and square footage.

Does the property have a detached garage, workshop, pool, spa, deck, outdoor kitchen or other significant amenity? Is there an ADU or guest quarters with a separate entrance, kitchen, bathroom or utilities?

Solar deserves particular attention. If a solar system is present, indicate whether it is owned, financed, leased or subject to another agreement whenever that information is known.

These details can help an appraiser understand how a property differs from competing homes.

4. Seller Concessions and Financing Matter

The final sales price doesn’t always tell the entire story.

If the seller provided concessions, document the total amount and purpose whenever possible. For example, was the money used for closing costs, a temporary or permanent interest-rate buydown, repairs, HOA expenses or something else?

Financing information can also provide useful context, including whether the transaction involved conventional, FHA, VA or other financing.

gold and silver coins scattered near gold coin bank

Why does this matter?

Consider two homes that both sell for $500,000. One sells without concessions, while the other includes a substantial seller credit toward the buyer’s financing costs. Those transactions may provide different information to an appraiser analyzing the market.

5. Preserve the Story of the Sale

Agents should also think about documenting how the market responded to the listing.

Useful information can include the original list price, final list price, days on market, significant price changes and whether the property received multiple offers.

If there were unusual circumstances surrounding the transaction—such as an estate sale, relocation, non-arm’s-length transaction or significant personal property included with the sale—those details may also provide important context.

The objective isn’t to influence the appraiser’s conclusion. It’s to give the appraiser accurate information about what actually happened.

6. For Current Listings, Keep the Documentation

When you have a property under contract, consider keeping an appraisal-ready package containing the complete purchase contract and addenda, documentation of seller concessions, builder upgrade or option sheets, solar agreements, and plans or permits for significant construction, additions or conversions.

The appraiser may not need everything you’ve collected. But having it available can be much easier than trying to reconstruct the history of the property later.

And that brings us to what may be the most important reason Realtors should pay attention to UAD 3.6.

Today’s Listing Becomes Tomorrow’s Comparable Sale

Once your transaction closes, your MLS listing doesn’t stop being important.

That property may be used as a comparable sale in appraisals throughout the neighborhood for years.

Imagine an appraiser using your listing 18 months from now. The MLS says only “gorgeous remodeled home!” The appraiser may have no idea what was remodeled, when it was completed, whether the HVAC was replaced, whether a converted area was permitted, or whether the transaction included substantial concessions.

Someone may have to track down the listing agent to find out.

Now imagine that the original listing already contains specific renovation dates, property characteristics, transaction information and detailed remarks. The historical record becomes much more useful.

Better MLS information today can mean fewer verification calls later—and potentially fewer appraisal questions, delays and revision requests on future transactions.

This Is a Good Habit to Start Now

The November 2 mandate applies to new appraisal reports submitted to UCDP, but the transition is already underway. UAD 3.6 has been available for broad production since January 26, 2026, and Fannie Mae and Freddie Mac are encouraging the mortgage industry to transition before the deadline.

So there is little reason for real estate agents to wait.

Start creating listings with the future appraiser in mind. Be specific about improvements. Document dates. Describe the layout accurately. Record concessions and financing details. Preserve information about how the market responded to the property.

Great marketing still matters. Beautiful photographs and compelling descriptions still help sell homes.

But under the new appraisal environment, good data matters, too. Here are the specific links that Fannie and Freddie provide:

Fannie Mae UAD 3.6 resources

Freddie Mac UAD 3.6 resources

Conclusion

The agents who build better information into their listings today aren’t just helping the current transaction. They’re creating a better historical record for every transaction in which that property may eventually be used as a comparable sale.

Reach out to me directly—I’d be happy to go over the specifics to help you succeed.

As always, you can set up an appointment with me here…

Should I Wait for Mortgage Rates to Drop Before Buying a Home? – Navigating Home Buying in a Mid-6% Interest Rate Market

August 24, 2026 / Tom Bonetto

There’s a lot of energy right now in the media and the real estate world around one question: How do you navigate buying and selling homes (primary residences, second homes, or investment properties) when interest rates are in the mid-6s?

The most common version of that question is: “Should I wait for rates to come down?” The underlying assumption seems plain — lower rates mean lower cost on the loan…but it’s truly not that simple.

I’ve covered this topic before in podcasts and blog posts, but the conversation keeps coming up, so I want to dig into it with a real-world example and some clear numbers.

A Quick but Important Disclaimer

The interest rates I use below are samples only. I am not advertising them, not suggesting they are available today, and not inviting anyone to call me expecting these exact rates. They are simply tools to illustrate how to evaluate the decision of waiting versus buying now.

I’m also using a conventional conforming 30-year fixed loan (Fannie or Freddie) with an 80% loan-to-value ratio, so there is no mortgage insurance in the example. The principles hold either way.

Why the Interest Rate Alone Is Not the Full Story

Most people focus almost exclusively on the rate. That’s understandable, but incomplete.

When I evaluate the true cost of a loan, one of the most important numbers I look at is the principal balance remaining at years 5, 7, and 10 (sometimes year 3 depending on the situation).

Why? Because it is near a statistical certainty that the average loan in the United States is retired—through sale or refinance—somewhere between years 7 and 10. Very few people take a 30-year mortgage all the way to term.

During those early years, the vast majority of each payment is interest. Lenders know this. Most of the public does not.

If we accept that the loan will likely be refinanced or paid off in that window, then the remaining principal balance becomes a critical part of the overall cost equation.

The question is not simply “What is my payment for the next few years?” It is “How do I own this home in the shortest effective duration possible?”

A Concrete Example

Let’s assume a $500,000 home with 20% down—a $400,000 loan.

Buy today at a sample rate of 6.75%. Five years later, the remaining principal balance is approximately $375,503.

Now suppose your gut tells you rates will drop by half a percentage point within a year to 6.25%. You wait.

In that year, the home appreciates 3% (I’ll address appreciation in a moment), so the new purchase price requires a loan of about $412,000.

Buy one year from now at 6.25%. Five years after that purchase (six years from today), the remaining principal balance is approximately $384,549.

From a principal-balance perspective alone, you would have been better off buying today at the higher rate.

What About Home Appreciation?

Across the country, the best current estimates for national average home-price appreciation this year land somewhere in the 1.5%–3% range. Prices have been relatively stable and continue to rise in many markets.

Are there neighborhoods where values are flat or declining? Absolutely—especially certain pockets inside large metropolitan areas. That is why you need a strong real estate agent who can speak in numbers, not just anecdotes. Ask them:

What has this specific property or neighborhood done historically?
What do the data suggest for the next 12 months?

Historically, year-over-year depreciation is rare, but it can happen. Even if you believe values will decline, a competent lender can run the same model with a negative appreciation assumption so you can see the math clearly.

Other Costs That Often Matter More Than the Rate

Waiting for rates also means giving up the negotiating environment we have today. Inventories have improved. The market is slower. Sellers are more willing to offer concessions. Competitive bidding is far less intense than it was a few years ago.

Here’s a practical tip many buyers overlook:

If a seller offers, say, $10,000 in concessions, in many cases, the smarter move is not to use that money to buy down the rate. Instead, have the seller cover a large portion of your closing costs, take a slightly higher rate from the lender (which generates a lender credit), and then use the net cash advantage to increase your down payment or shorten the term while keeping the payment roughly the same.

If you still believe rates will fall later, this approach can leave you in a stronger position to refinance. The decision is nuanced. A blanket “I’m waiting for rates to drop” is, in many (if not most) cases, a costly gut-level choice rather than an analytical one.

happy couple holding and showing a house key

What You Should Do Next

Mortgage and real-estate decisions are subtle. They require a team that can run the numbers.

Work with a real estate agent who can discuss both experience and data on current values, historical performance, and reasonable expectations for the next year.
Work with a lender who can build simple but solid models that incorporate rate scenarios, appreciation (or depreciation), remaining principal balances, closing-cost credits, and term options.

If your lender cannot or will not do that kind of math, find one who will. In a higher-rate environment, the analytical work becomes more important, not less.

When rates were 2.75%, the risk profile was different. Rates in the mid-6s still demand clear-eyed analysis alongside gut feel.

Let’s Talk

I hope this discussion helps you think more clearly about the true cost of waiting.

If you’re trying to figure out whether a particular house or refinance makes sense in this market, do contact me. I’m happy to run the numbers, walk through the trade-offs, and help you see the full picture.

Reach out to me directly—I’d love to talk strategy and explore how we can best take advantage of market conditions to help you succeed.

As always, you can set up an appointment with me here…

Condo Warrantability: What Every Listing Agent Needs to Know About the New Fannie Mae & Freddie Mac Rules

August 10, 2026 / Tom Bonetto

Selling a condominium is different from selling a single-family home.

While buyers often focus on interest rates, down payments, and qualifying for a mortgage, there’s another important factor that can determine whether a sale closes successfully: the condominium project itself.

Before many buyers can obtain conventional financing, the condo community must meet the project eligibility requirements established by Fannie Mae or Freddie Mac.

If it doesn’t, financing options can become limited, making it more difficult to attract qualified buyers.

What Is a Warrantable Condo?

A “warrantable” condominium is simply a condo project that meets the lending guidelines established by Fannie Mae and Freddie Mac.

These guidelines evaluate the overall financial health and physical condition of the homeowners association—not just the individual unit being sold. Lenders review items such as the association’s budget, reserve funding, insurance coverage, deferred maintenance, pending litigation, and other project characteristics.

When a project satisfies these requirements, buyers typically have access to more financing options, lower interest rates, and smaller down payment requirements.

Why Listing Agents Should Care

Many listing agents don’t discover a condominium has financing issues until after the home is under contract. At that point, the lender begins reviewing the project and identifies concerns that may prevent the loan from being approved.

This can lead to financing delays, contract cancellations, or buyers having to switch to more expensive loan programs. Understanding a condo’s warrantability before placing the property on the market allows listing agents to identify potential concerns early, communicate accurately with buyers, and avoid costly surprises during escrow.

Why Fannie Mae and Freddie Mac Are Tightening the Rules

The recent changes announced by Fannie Mae and Freddie Mac are designed to strengthen the financial health of condominium associations across the country.

Following several high-profile building failures and increasing concerns about deferred maintenance, the agencies are placing greater emphasis on adequate reserve funding, proper maintenance planning, and long-term financial sustainability.

Their objective is to reduce the likelihood of expensive special assessments while helping preserve both property values and affordable homeownership.

The Biggest Change: More Comprehensive Project Reviews

Beginning with new loan applications on or after August 3, 2026, Fannie Mae and Freddie Mac are retiring the Limited (or Streamlined) Review process for most condominium projects.

Going forward, many larger projects that previously qualified for a simplified review will now undergo a more thorough analysis of the association’s budget during underwriting. In practical terms, lenders will be taking a much closer look at the financial health of condominium associations before approving conventional financing.

Reserve Funding Requirements Are Increasing

Another significant change involves replacement reserves. Beginning January 4, 2027, condominium associations will generally be expected to allocate at least 15% of their annual assessment income toward replacement reserves, an increase from the long-standing 10% requirement.

Associations that rely on reserve studies instead of the percentage calculation must now fund reserves at the highest recommended level identified in the reserve study, rather than a lower baseline recommendation.

These changes encourage proactive maintenance and help reduce the risk of costly repairs or special assessments in the future.

Additional Updates Worth Knowing

Several other updates are intended to improve the lending process while maintaining strong underwriting standards.

Smaller condominium projects—up to ten units—may now qualify for review waivers in certain situations, investor concentration limits have been removed for many established projects, and insurance requirements have been updated to better reflect today’s insurance market.

These changes provide additional flexibility while continuing to protect both lenders and homeowners.

The Bottom Line for Real Estate Agents

Condominium warrantability is no longer something that only lenders need to understand. It has become an important part of properly marketing and selling condominium properties.

By identifying potential warrantability concerns before a home is listed, seller’s agents can help reduce financing delays, avoid canceled contracts, and provide better guidance to both sellers and buyers.

If you’re preparing to list a condominium and would like to discuss whether the project may qualify for conventional financing, I’d be happy to review the project with you before your listing goes live.

A little preparation upfront can make the entire transaction smoother for everyone involved.

Reach out to me directly—I’d be happy to go through these changes in greater detail with you.

As always, you can set up an appointment with me here…

Mortgage Affordability in 2026: 7 Things You Can Control Before Buying a Home

July 28, 2026 / Tom Bonetto

Lately I’ve been getting the same question in conversations with clients: “Tom, how do we make housing affordable right now?”

It’s late July 2026. The first half of the year has been tough. Things looked a little better late last year and into January, but affordability remains the dominant conversation.

I wanted to address it directly—first the things none of us control, then the things you can control starting today.

A Quick Word on Perspective

Before we dig in, let’s hold two-time horizons at once.

In the long run I do believe rates are coming down. If that’s true, today’s payment is not necessarily your permanent payment. You can refinance later, shorten the term, or increase principal payments as your income and circumstances improve.

Short-term affordability and long-term affordability are related, but they are not the same calculation. Keep both in view.

The Things You Can’t Control About Affordability

When elected officials and media talk about “making housing more affordable,” I have to be honest—I often shake my head. Not because the problem isn’t real, but because the solutions they discuss rarely touch the actual cost drivers.

Property Taxes – A perpetual tax on an asset you already own and paid for with after-tax dollars is a strange policy. The property-tax structure is one of the biggest levers on true housing cost. If we were serious about affordability, this would be near the top of the list.
Capital Gains – At the federal level (and in many states) the tax friction on selling a property keeps inventory locked up. Reform here would increase supply and improve market function.
Over-Regulation of the Mortgage Industry – Yes, we need regulation. I am not arguing for a return to the pre-2008 environment. But the compliance burden that landed on mortgage companies, loan officers, and investors after the financial crisis is enormous. I spend a significant amount of time and money every year simply staying compliant. Those costs do not disappear—they get passed through to the borrower in the form of higher fees and higher rates.
Third-party Fees – Eleven years ago a credit pull cost roughly $30–$35. Today it routinely runs $150 or more. Automated verification of employment can add hundreds more. On a recent closing I saw more than $500 in combined credit and VOE costs alone. That’s a roughly 320% Cost of Credit Inquiries – There is no competition or efficiency gain being forced into that system, so the borrower pays.

These are macro and structural issues. Outside of voting and advocating, most of us cannot change them overnight. So let’s talk about what you can control.

What You Can Control Right Now About Affordability

1. Get the right mortgage product—and the right structure.

Not every loan is the same. Conventional conforming (Fannie/Freddie), FHA, VA, USDA, and non-QM products all carry different cost structures, different mortgage-insurance rules, and different long-term implications. The term matters too.

A 29-year loan is almost always less expensive over the life of the loan than a 30-year loan, even though the monthly payment is slightly higher. Down-payment amount changes both rate and monthly cost.

Work with a loan officer who will run the actual numbers side-by-side instead of defaulting to the product that is easiest to sell.

2. Negotiate the contract like it matters—because it does.

Three, four, five years ago almost every contract I saw came in above asking price. Appraisals were routinely waived. Inspection items were often left unaddressed. The interest rate was low, so the payment looked affordable—but buyers were financing a higher purchase price and accepting more risk.

Today the rate is higher, which makes the payment feel harder. But I almost never see a contract without meaningful seller concessions. Appraisals are not being waived. Inspection issues are being negotiated and frequently repaired.

Those concessions can be used to pay closing costs, buy down the rate, or both. A skilled real-estate agent who knows how to structure the offer is one of the highest-leverage tools you have for affordability right now.

3. Be careful with down-payment assistance.

These programs can be excellent for the right buyer. They can also be expensive. In eleven years I have never seen a “grant” that truly never gets paid back in some form—either through a higher rate, a second lien, or repayment on sale or refinance.

If you need the assistance to close, use it. If you don’t, the extra cost is rarely worth it. Ask your loan officer to show you the true all-in cost before you commit.

4. Master your credit profile deliberately.

I hear this story constantly: “We paid off all our credit cards so we could buy a house.” In many cases that decision does two harmful things at once—it reduces the cash available for down payment and closing costs, and it can actually lower the credit score because of how utilization and length of credit history are calculated.

I am not advocating consumer debt. I dislike it. But before you start paying things off in the name of becoming a stronger buyer, sit down with a loan officer who has access to credit simulators.

We can model the effect of paying down one card versus another, or keeping balances where they are, against your debt-to-income ratio, available cash, and the pricing of the loan. Randomly “cleaning up” credit is one of the most common self-inflicted wounds I see.

5. Build the right team and understand their incentives.

Buying or refinancing a home is a complicated transaction. The people around you matter:

A real-estate agent who can negotiate price, concessions, inspections, and timeline.
A mortgage lender who will put you in the correct product and structure—not just the one that closes fastest.
A CPA who will help you understand the tax implications.
A financial advisor who can place real estate inside your broader plan for building wealth and legacy.

Every one of those professionals has a bias. A CPA is paid to minimize taxes. A financial advisor is often compensated for assets under management. A good loan officer is paid when the loan closes.

None of that is inherently bad—just know the incentives so you can weigh the advice!

Short-Term and Long-Term Affordability

If you cannot make the payment today, do not buy the house. That is non-negotiable.

But if the payment is workable and you believe—as decades of data support—that residential real estate remains a resilient long-term asset, then you also have tools for the years ahead: refinancing when rates allow, shortening the term as income grows, and making additional principal payments.

Affordability is not only the payment on day one. It is the total cost of ownership over the time you hold the property and the equity you build along the way.

Final Thought

As The Lending Coach, I enjoy talking to people on the phone, explaining the nuances, and helping clients make decisions that support the life and legacy they actually want. Honesty, transparency, and long-term relationships are the only way this business works for me.

Reach out to me directly—I’d love to talk strategy and explore how we can best take advantage of market conditions to help you succeed.