The home builder is slashing borrowing costs for new buyers in an effort to revive the abysmal market.
By Les Christie
NEW YORK (CNNMoney.com) -- One of the nation's largest builders is trying to shock the flatlining new-home market into action with an incentive plan that will slash monthly mortgage payments for qualified buyers.
Luxury homebuilder Toll Brothers Inc., said Wednesday that it will offer buyers of its existing new-home inventory a 30-year, fixed-rate mortgage at an interest rate of 3.99% with no points paid up-front. That contrasts with a rate of 5.59% for the average 30-year, fixed-rate mortgage with 0.3 up-front point, as reported this week by Bankrate.com.
A buyer taking a Toll Brothers mortgage, as opposed to the 30-year rate quoted by Bankrate, could lower their monthly mortgage payments to $1,988 from $2,391, a savings of $403 a month on a $417,000 loan (the maximum mortgage loan that will be bought or guaranteed by Fannie Mae (FNM, Fortune 500) or Freddie Mac (FRE, Fortune 500) in most places).
"The offer is aimed at people waiting for the rates to drop," said Don Salmon, CEO of TBI Mortgage, the Toll subsidiary that will provide the mortgages. "It will be a strong catalyst for potential buyers to get off the fence."
New home sales have been extremely slow. In November, the latest month for which statistics are available, sales of new homes fell to an annualized rate of 407,000, down 2.9% from 419,000 in October and off 35.3% from November 2007.
The Toll Brothers (TOL, Fortune 500) offer is only in effect through Sunday, so buyers will have to act quickly. It's available on homes in 270 Toll communities across 21 states, according to Fred Cooper, Toll's senior VP of financing. He said the program has drawn an immediate response; the phones have been ringing off the hook.Then, late Thursday, the company sweetened its offer, announcing that the 3.99% rate could also be locked in for as long as nine months. That option is aimed at Toll customers who want to purchase a new, built-to-suit home, rather than existing inventory.
Preview All of Our Listed Estates
(Click on Image)
Please Contact: The Smiths - Luxury Resort Portfolio at (561) 445-2282 or
email at TheSmiths@LuxuryResortPortfolio.com
Inquire about "The Property Organizer" Feature we exclusively provide at Luxury Resort Portfolio.
It is an organizing tool that makes it easy to search for properties and to keep track of properties you are interested in. Whenever you see property listings that you like, you can save them for future reference and for sharing with family members and friends. "The Property Organizer" also allows you to easily manage your Email Update service and save your search criteria for later use.
click link below to view:
"The Property Organizer"
If you have any questions on how to set up specific community searches
or for your Mizner Country Club Real Estate Update
compliments of The Smiths - Luxury Resort Portfolio,
please call or email Philip at (561) 445-2282 or Philip@LuxuryResortPortfolio.com
We can set up your customized search and you will receive instant email updates
directly to your inbox.
The information herein is believed to be accurate but not guaranteed and may be subject to errors, omissions and changes without notice. This is not to be construed as a solicitation of property presently listed for sale. All information is derived from the Palm Beach County Property Appraisers website and the MLS.