Let's Talk Real Estate

In September and early October 2010, several lenders suspended foreclosures due to questions about whether the transactions were being processed consistent with applicable state law requirements. Although nearly all of the foreclosures in question are expected to be fixed eventually, the current situation is creating difficulties and a new hurdle to the recovery of the housing and mortgage markets. Additionally, homes on the market without clear title will make sales much more difficult. It is expected that foreclosures in question are likely to be withdrawn from the market. The foreclosure problem isn't about whether some home owners had their homes wrongly foreclosed upon (there's been no evidence of that to date) but to what extent banks were taking short cuts on foreclosure procedures in states requiring judicial foreclosures. It is difficult to say what percentage of foreclosures that were improperly processed were. The assumption is that, for most of them, this may be onl

The Federal Housing Administration (FHA) is giving homeowners and buyers until October 4 to lock in a low monthly insurance premium. After October 4, the monthly insurance premiums on FHA loans will increase by over 63%. What does this mean for home buyers? A home buyer purchasing a $200,000 home using a $193,000 FHA mortgage before October 4 would pay an insurance premium of $88.46 per month. If the same home buyer waits until after October 4, the insurance premium would jump to $148.01. Although the upfront mortgage insurance premium is going down after October 4, the long term impact to the home buyer is actually a net increase in their out of pocket costs because the monthly premium is going up by 63%. Sellers can pay the upfront premium or it can be financed into the loan amount, so homebuyers rarely pay the upfront premium out of pocket. On the other hand, the increase in the monthly premiums will be paid right out of the home buyer's pocket with their mortgage payment each m

The Federal Reserve released a proposal earlier this week to give mortgage applicants three days to change their minds. The proposal was part of a 930-page document that clarifies and finalizes the new financial reform law. The Fed's document says that for closed-end loans secured by real property or a dwelling, a creditor must: "Refund any appraisal or other fees paid by the consumer (other than a credit report fee), if the consumer decides not to proceed with a closed-end mortgage transaction within three business days of receiving the early disclosures (fees imposed after this three-day period would not be refundable); and "Disclose the right to a refund of fees to consumers before they apply for a closed-end mortgage loan." The Fed says this proposal will make it easier and cheaper for consumers to comparison shop. It also acknowledged that borrowers who want to close a transaction in a hurry would be handicapped because most lenders will delay sending out an app

The economy is stabilizing. Home prices are holding. It's not just as good a time as ever to buy a house. It's one of the best times ever. ForSaleByOwner.com presents five overlooked reasons why now is a great time to buy a house. 1. Low mortgage rates serve as an equity shock absorber. When buyers borrow at today's record-low rates, they start building equity as soon as they close. That means they have a little give to absorb a few ups and downs as the still-recovering housing market gains traction. 2. Houses are in move-in condition. Homeowners have continued to spend on maintenance and repair, according to the Harvard Joint Center on Housing. Homeowners who have been holding back kept their houses in good shape while they waited. As those houses enter the market, they are in marked contrast to tattered foreclosures. 3. Terrific houses are coming on the market. Foreclosures are finally starting to clear the system - and this is just the opportunity that owners of many

The restoration of the ingle-family rural housing program that would guarantee home loans for rural buyers was passed by the Senate this week and is on its way to President Obama. Rural Development's Single Family Housing Programs provide homeownership opportunities to low- and moderate-income rural Americans through several loan, grant, and loan guarantee programs. The programs also make funding available to individuals to finance vital improvements necessary to make their homes decent, safe, and sanitary. This is great news for home buyers who want to buy a home while the rates and prices are still low. And it is a huge relief for thousands of rural home buyers who need to close on their home purchases before Sept. 30 to take advantage of the home buyer tax. To learn more about a USDA home loan program, click here . Visit my website's Mortgage Center for more helpful mortgage loan information.

With home mortgage rates at historic lows, many people are eager to refinance their current mortgage loan to lock in a low rate. Existing home owners with adjustable rate mortgage may never get a better time to refinance out of their current mortgage and into a more conservative and consistent 15 or even 30 year mortgage loan. When deciding to refinance a home mortgage, be sure to understand the refinancing costs associated with doing so and then try to limit them as much as possible. Refinancing an existing mortgage is very similar to securing an initial mortgage. In fact, your new mortgage will be used to pay off your existing one, so it is just like buying your home all over again. There are certain costs associated with a refinancing, just as there was when the original mortgage was secured. Closing costs such as broker fees, appraisal fees, title search, inspections and various administrative fees are all part of the fee structure associated with a mortgage refinance. To reduce yo

Mortgage rates fell for the 10th time in the last 13 weeks, tying a record low. Now, if only the economy would cooperate, even more people could take advantage of the low rates by refinancing. Mortgage brokers are reporting rising interest in home refinancings as rates on a 30-year fixed loans have hit record lows in four of the past five weeks. This week the average rate fell to 4.56 percent, the lowest since mortgage company Freddie Mac began tracking rates in 1971. Lower mortgage rates improve affordability: The difference between a 6% and a 5% mortgage rate on a $300,000 mortgage, for example, is about $188 a month. And it's not just 30-year fixed loans. The rate on the 15-year fixed loan, a popular choice for refinancing, dropped to 4.03 percent from 4.06 percent last week. That was the lowest on records dating back to 1991. What a great time to buy! With housing prices still low and rates like this, buying a home makes much more sense than renting. Visit my website's Mort

FHA Pros, LLC, a national FHA condo approval service, has developed a list of facts speaking to the top misconceptions associated with FHA loans in order to help home buyers better navigate an already confusing market. FHA loans are mortgages issued by qualified lenders and insured by the Federal Housing Administration (FHA). In the last three years, home buyer interest in FHA loans has gone from practically zero to upwards of 87 percent. However, many buyers still do not fully understand the benefits of these loans. So, in an effort to change that, here are seven things you should know: 1. FHA Loans Are Not Only For Lower-Income Borrowers. FHA loans are available to everyone. There is no maximum income restriction associated with FHA loans. Borrowers do need to substantiate income and assets by submitting proper documentation. This requirement ensures that borrowers are truly able to afford their future homes. 2. FHA Loans Are Not Only For First-Time Buyers. Many people believe FHA

The US Senate voted unanimously to extend the tax credit closing date and the National Flood Insurance Program (NFIP) to September 30. According to the National Association of REALTORS, "After a close brush with the deadline, Congress has passed an extension of the Homebuyer Tax Credit closing deadline, the Homebuyer Assistance and Improvement Act (H.R. 5623)". The extension applies only to transactions that have ratified contracts in place as of April 30, 2010 that have not yet closed. The legislation is designed to create a seamless extension - the new closing deadline for eligible transactions is now September 30, 2010. This will allow transactions to move forward. The bill is retroactive and covers the lapse period from June 1, 2010 to the date of enactment of the extension.

Up to 180,000 home buyers will lose their tax credit through no fault of their own if Congress fails to pass an extension to the home buyer tax credit by June 30 when the closing deadline expires. According to estimates by the National Association of REALTORS® there are home buyers in every state of the union that will be impacted, from 390 in Wyoming to 17,700 in California. These are not buyers who just entered into the market. These are buyers who previously met all the qualifications for the tax credit, but find themselves at the mercy of a workflow jam with lenders or other delays such as lapses in the National Flood Insurance Program, Rural Housing Service, and new home construction, and might not be able to complete the purchase of their homes by the current deadline. NAR issued the following state-by-state estimate of the number of home sales that would be delayed beyond the June 30 deadline (numbers are rounded to the nearest 10): Alabama, 2,590; Alaska, 830; Arizona, 5,440; A

Rates are at an all-time low! This is great news for anyone who has yet to refinance to take advantage of the lowest rates ever recorded, or to purchase that new home or investment property more affordably than ever before. Both 30 Year and 15 Year Fixed Rates clipped down to their lowest levels. All this is incredible as just months ago, many experts had anticipated that rates would be well above 5% this summer and on their way to 6% by year end. Visit my website's Mortgage Center for more helpful credit information.

Yesterday, the U.S. Senate approved a three-month extension to the tax credit closing deadline, which would give buyers until Sept. 30 to close. It is not completely final since it is attached to another bill that still has to be passed by the House. The extension would apply only to buyers who met the April 30 deadline to have signed purchase contracts. NAR estimates up to 180,000 buyers who were hoping to close by June 30 and get the tax credit are likely to miss the current deadline, so the extension is essential.

Rural Development has received additional Guaranteed Single-Family Housing Loan funds in the amount of $2.5 billion. They are able to begin to issue Conditional Commitments on loans subject to the availability of funds as follows: The guarantee fee for purchase transactions will be 3.5 percent The guarantee fee for refinance transactions will be 2.25 percent If have any buyers who have been waiting for it to come back, it's time to start shopping again!!! Click here for more detailed information.

Earlier this week, the US House of Representatives passed the Rural Housing Preservation and Stabilization Act of 2010 (HR 5017). Through this legislation, the guarantee fee in the USDA Guaranteed Rural Housing (GRH) Program may be raised to offset any need for Congressional Appropriations (Currently we believe to 3.5%). Additionally, HR 5017 would authorize USDA Rural Development to guarantee up to $30 billion in loans in Fiscal 2010. This would represent an $18 billion in loan making authority for the remainder of the fiscal year. Before these changes can be implemented, similar legislative action will need to occur in the US Senate. Following the action in the House, the USDA Rural Development National Office sent an announcement that stated “Depending on Congressional activity with the proposed legislation it is possible that the Agency may consider issuing additional commitments.” We're getting closer!

Yesterday, the Kanjorski bill (HR 5017) passed unanimously in the House Financial Services Committee and we anticipate that it will be voted on by the Full House of Representatives early next week. HR 5017 is a bill aimed at supporting the rural housing market that has struggled to get passed. Also known as the Rural Housing Preservation and Stabilization Act of 2010, it will end the current method of using federal funding to backstop the guarantee and instead will fund the program through mandatory fees. HR 5017 ensures rural homebuyers access to affordable loans through USDA, but because these loans have tripled since 2006, federal funding will be running out literally in the next few days, making passage critical. Rep. Barney Frank, who is a big supporter of the program, expressed his concern that the program was going to run out of funding by the end of the month, and said that he was going to do everything possible to expedite the bill so that would not happen. In order to pay for

The U.S. Treasury plan to help homeowners avoid foreclosure potentially applies to 75 percent of the mortgages in the U.S., including those backed by Freddie Mac or Fannie Mae (those two organizations are currently devising guidelines). The plan, which provides incentives for lenders and homeowners for completing Short Sales, is many-faceted: It provides incentives to lenders and borrowers for completing Short Sales It streamlines and standardizes the documentation necessary for Short Sales It limits the ability of subordinate lien-holders to obstruct the Short Sales process It sets limits on the time it takes lenders to approve or reject Short Sales requests It steps up pressure on lenders to make permanent the 650,000 trial loan modifications they started earlier in 2009 Incentives to Borrowers Under the plan, borrowers who complete a Short Sale are released from all mortgage debt. Additionally, they receive $1,500 for moving expenses. Incentives for Lenders The plan provides for pay

Homeowners across the United States who are undergoing financial hardship could avoid foreclosure under a plan announced on Nov. 30 by the U.S. Treasury Department. Under the plan, millions of at-risk homeowners could be free of mortgage debt without going through foreclosure, and given $1,500 for relocation. The Treasury plan, which potentially applies to 75 percent of the mortgages in the U.S., including those backed by Freddie Mac or Fannie Mae (those two organizations are currently devising guidelines), provides incentives for lenders and homeowners for completing Short Sales – transactions in which the lender agrees to a sale price that's less than the borrower owes on the mortgage. Short Sales are preferred to foreclosure because homeowners take less of a hit on their credit and lenders realize a smaller loss. However, Short Sales often get bogged down because of the complicated nature of the transaction. Deals can fall through because they take too long. Buyers are discourag

Don’t forget the cost of FHA mortgage insurance is going up. But there is a window of opportunity to get an FHA loan before the this happens. As long as the the laon in obtained before April 5, you can get an FHA loan with 1.75% upfront mortgage insurance (versus 2.25% AFTER April 5). Why This Is Happening: · FHA’s capital reserve requirement mandated by Congress has fallen below the minimum requirement. · FHA makes up 1/3 of all financing in today’s market What Will Change: · Increase in the up front MIP Fee to 2.25% from 1.75% · FHA is also asking Congress to increase its monthly premium which is one of the major advantages compared to a Conventional Loan’s PMI rate. (This has not been finalized yet). · Seller concessions will be lowered to 3% from 6% - currently viewed as a reason to inflate appraisals. · Minimum Credit Score of 580 – lower scores require 10% down · Most likely will not increase the amount the buyer needs to bring to the table, but by increasing the PMI it will incr

Home Affordable Refinancing Many homeowners pay their mortgages on time but are not able to refinance to take advantage of today’s lower mortgage rates perhaps due to a decrease in the value of their home. A Home Affordable Refinance will help borrowers whose loans are held by Fannie Mae or Freddie Mac refinance into a more affordable mortgage. Home Affordable Modification Many homeowners are struggling to make their monthly mortgage payments perhaps because their interest rate has increased or they have less income. A Home Affordable Modification will provide them with mortgage payments they can afford.

The homebuying season has been moved up this year! The springtime spurt in home buying does not seem to be waiting for the snow to melt this year as buyers scramble to meet an April 30 tax credit deadline. The spring buying season typically takes off in March and runs through May. But buyers who want to claim this year's tax credit — up to $8,000 for first-time buyers and up to $6,500 for repeat buyers — aren't wasting any time. They must have signed purchase contracts by April 30 and they have to complete the deal by June 30. So, what are some important things to keep in mind? First of all, be prepared for the amount of time it will take to close a deal. The average time it takes to get a home loan processed is about eight weeks now — two weeks more than it used to be, according to the National Association of Realtors. As we get closer to the deadline, loan processors could get very busy. Plan accordingly. Don't wait until the last minute. Sellers should be prepared to