Hi People.
I haven't wrote (or written?) in a couple of days due to my new concoction of H1N1, swine flu, SARS, whooping cough and the boogey woogey flu. I am such a trail blazer. But, now I am back.
The President threw down his State of the Union speech last night and at the tail end of talking about how much better, and affordable, he's going to make education he said this about the real estate plan "That's why we're working to lift the value of a family's single largest investment -- their home. The steps we took last year to shore up the housing market have allowed millions of Americans to take out new loans and save an average of $1,500 on mortgage payments. This year, we will step up refinancing so that homeowners can move into more affordable mortgages".
Then he immediately went into health reform. Now I know there are plenty of important things to talk about, but maybe he could have took another five minutes and went into it a little more. It's estimated that there will be 3 million plus foreclosures this year. His reply to that, we'll fix it.
Maybe I'm a little sensitive because the real estate world is where I work, eat and live.
He is a lovely speaker.
Click on the title to read the president's entire speech.
God Bless America.
Thursday, January 28, 2010
Monday, January 25, 2010
Trial Re-Mod & You Being Kicked To The Curb
Hi People.
If you are one of the 450,000 people who are in the President's HAMP (Home Affordable Modification Program) program (redundant) you better make sure that all of your paper work is in. More importantly, you better make sure that your paper work is in and that the bank did not lose it (oh, it happens brother). Also, it wouldn't be a bad idea to make sure all of your payments are straight.
Companies that service the mortgages have until Jan. 31 to review all trial modifications that have been underway for several months. During the review period, servicers must determine whether borrowers have made all their payments and have handed in all the necessary paperwork. Those who haven't will get letters giving them 30 days to comply. The goal is to clean up the backlog. With that much cleaning going on there will undoubtedly be someone who was swept outside when they should have been left inside (couldn't think of a better "cleaning" analogy).
So, stay on your servicer. Make sure they have all of your documentation. Make sure they acknowledge that you have been making your payments on time. Try to get this in writing, or at least an email. These servicers/ banks are overwhelmed with short sales and re-modifications. The person working your file has another 150+ files that look just like yours. He is over worked and under paid and his boss is yelling at him and the home owner is yelling at him and his wife is leaving him and his son is on drugs and his daughter is dating a guy from some band. If he comes across a file that isn't right it goes to the bottom or even the trash. Make it easy on the poor bastard.
To read more about the good times a comin', click on the title.
God Bless.
If you are one of the 450,000 people who are in the President's HAMP (Home Affordable Modification Program) program (redundant) you better make sure that all of your paper work is in. More importantly, you better make sure that your paper work is in and that the bank did not lose it (oh, it happens brother). Also, it wouldn't be a bad idea to make sure all of your payments are straight.
Companies that service the mortgages have until Jan. 31 to review all trial modifications that have been underway for several months. During the review period, servicers must determine whether borrowers have made all their payments and have handed in all the necessary paperwork. Those who haven't will get letters giving them 30 days to comply. The goal is to clean up the backlog. With that much cleaning going on there will undoubtedly be someone who was swept outside when they should have been left inside (couldn't think of a better "cleaning" analogy).
So, stay on your servicer. Make sure they have all of your documentation. Make sure they acknowledge that you have been making your payments on time. Try to get this in writing, or at least an email. These servicers/ banks are overwhelmed with short sales and re-modifications. The person working your file has another 150+ files that look just like yours. He is over worked and under paid and his boss is yelling at him and the home owner is yelling at him and his wife is leaving him and his son is on drugs and his daughter is dating a guy from some band. If he comes across a file that isn't right it goes to the bottom or even the trash. Make it easy on the poor bastard.
To read more about the good times a comin', click on the title.
God Bless.
Friday, January 22, 2010
I'm not calling you "STUPID"
What up, People?
Today's message is really just some advice on how I would go about buying a home. Not telling anyone this is the only way or that you and your realtor are stupid if you don't think like me.
Write offers. No duh, right? The thing is, I come across so many buyers who want to check on the area or the schools or perform a seance before they put in an offer and end up losing out. Put the offer in first! You have a contingency period (usually between 10 & 17 days but not set in stone so it is negotiable) to check all of that out, it's called your "inspection contingency period" (catchy). This contingency allows you to perform inspections on the physical conditions of the house, the zoning for natural disasters (mainly earthquakes zones, fire zones, flood zones and any other biblical plague or curse), any permits on the property, rental restrictions (important if you're ever going to rent it out), any safety issues, area nuisances (ranges from airport noise to a next door neighbor who might be a little too nazi like), and anything else you can think of (anything without actually damaging the property. You can't open up a wall to make sure you like the way the wiring looks).
What about your deposit? It's safe as long as you cancel escrow (cancel on your offer to purchase the property) before your contingencies expire. Yes, that means if you do what is contractually correct and cancel before the contingency is up you will get your full deposit back. You don't even have to shake hands with the seller.
When do contingencies expire? When the contingency period is over AND you release your contingencies in writing. (?) You sign a form stating that you release your contingencies. Once that happens you either buy the property or forfeit your deposit.
The reason that i'm so hot on making offers first before you investigate anything (except that the price is acceptable) is you might lose out. If you like a property rest assured that someone else likes it too. That is the law of.... I don't know what it is the law of. But, I've seen it over and over and over again (no matter what the market is like) that when a buyer becomes interested in a home then at least someone else is interested in the home. If you do not move quickly two ugly things can happen: First, the property could be tied up by someone who wrote an offer sooner. And, unlike buyers, the seller does not have the luxury of cancelling if he recieves a beeter offer. Second, you could end up in a bidding war and either get beat out or paying more than you wanted. Both scenarios suck.
Once again, I'm not telling you how to do it, just how I would do it.
God Bless.
Today's message is really just some advice on how I would go about buying a home. Not telling anyone this is the only way or that you and your realtor are stupid if you don't think like me.
Write offers. No duh, right? The thing is, I come across so many buyers who want to check on the area or the schools or perform a seance before they put in an offer and end up losing out. Put the offer in first! You have a contingency period (usually between 10 & 17 days but not set in stone so it is negotiable) to check all of that out, it's called your "inspection contingency period" (catchy). This contingency allows you to perform inspections on the physical conditions of the house, the zoning for natural disasters (mainly earthquakes zones, fire zones, flood zones and any other biblical plague or curse), any permits on the property, rental restrictions (important if you're ever going to rent it out), any safety issues, area nuisances (ranges from airport noise to a next door neighbor who might be a little too nazi like), and anything else you can think of (anything without actually damaging the property. You can't open up a wall to make sure you like the way the wiring looks).
What about your deposit? It's safe as long as you cancel escrow (cancel on your offer to purchase the property) before your contingencies expire. Yes, that means if you do what is contractually correct and cancel before the contingency is up you will get your full deposit back. You don't even have to shake hands with the seller.
When do contingencies expire? When the contingency period is over AND you release your contingencies in writing. (?) You sign a form stating that you release your contingencies. Once that happens you either buy the property or forfeit your deposit.
The reason that i'm so hot on making offers first before you investigate anything (except that the price is acceptable) is you might lose out. If you like a property rest assured that someone else likes it too. That is the law of.... I don't know what it is the law of. But, I've seen it over and over and over again (no matter what the market is like) that when a buyer becomes interested in a home then at least someone else is interested in the home. If you do not move quickly two ugly things can happen: First, the property could be tied up by someone who wrote an offer sooner. And, unlike buyers, the seller does not have the luxury of cancelling if he recieves a beeter offer. Second, you could end up in a bidding war and either get beat out or paying more than you wanted. Both scenarios suck.
Once again, I'm not telling you how to do it, just how I would do it.
God Bless.
Wednesday, January 20, 2010
FHA Done Good
Hello People.
The FHA loan program is trying to make some changes in policy. These changes have to be done because FHA is getting beat up with bad loans and they are running out of loot. If they get much more out of pocket they will have to raise the minimum down payment of 3.5%. But don't worry, the changes shouldn't be too painful.
First up, they want to change the up front mortgage insurance premium or UFMIP (Sounds like you got drunk after coming from the dentist and happened to have a mouth full of marbles while saying......fill in the blank) from 1.75% to 2.25%. That's a percentage of the loan amount. On a $300,000 loan your UFMIP will go from $5250 to $6750. It hurts but not as much as the furniture you'll buy. And when you see that the walls look so old next to the new furniture you'll have to paint. Then the floors. Then the kitchen. Then the bath rooms. On and on until it's time to buy new furniture again. You'll never miss it in the long run.
B. New borrowers will have to have a credit score of at least 580 to qualify for the 3.5% down payment or they will have to fork over a 10% down payment. Guess what, most lenders do not care what FHA says. They don't give FHA loans to anyone who has under a 620 credit score, some are going to 640 (you might be able to get an FHA loan with a 600 fico but the rate will suck). If you have a credit score under 580 and someone gives you a loan you better pay him or he'll brake your legs.
III. Seller credits to the buyer go from 6% to 3%. Who cares! It's very rare that you can get into a home where the seller give you a full 6% towards closing cost. If you buy a $300,000 (I'm stuck on that #) and you get a 6% seller credit either the seller comes out of his pocket $18,000 or it's really a $282,000 place and now it wont appraise.
And lastly, they will increase enforcement on FHA lenders. I don't know if that means surveillance or espionage or beating the crap out of some mortgage lender who didn't fill out the FHA paperwork correctly. But, I'm glad they're doing something.
Again, if these changes go through they will be good. They will keep the FHA program going so it can continue to do loans. They currently account for approx 1/3 of all U.S. loans. That would really blow if they went away because they ran out of cash or had to raise the minimum down payment from 3.5% to ???.
Check out what HUD has to say about it by clicking the title.
God Bless.
The FHA loan program is trying to make some changes in policy. These changes have to be done because FHA is getting beat up with bad loans and they are running out of loot. If they get much more out of pocket they will have to raise the minimum down payment of 3.5%. But don't worry, the changes shouldn't be too painful.
First up, they want to change the up front mortgage insurance premium or UFMIP (Sounds like you got drunk after coming from the dentist and happened to have a mouth full of marbles while saying......fill in the blank) from 1.75% to 2.25%. That's a percentage of the loan amount. On a $300,000 loan your UFMIP will go from $5250 to $6750. It hurts but not as much as the furniture you'll buy. And when you see that the walls look so old next to the new furniture you'll have to paint. Then the floors. Then the kitchen. Then the bath rooms. On and on until it's time to buy new furniture again. You'll never miss it in the long run.
B. New borrowers will have to have a credit score of at least 580 to qualify for the 3.5% down payment or they will have to fork over a 10% down payment. Guess what, most lenders do not care what FHA says. They don't give FHA loans to anyone who has under a 620 credit score, some are going to 640 (you might be able to get an FHA loan with a 600 fico but the rate will suck). If you have a credit score under 580 and someone gives you a loan you better pay him or he'll brake your legs.
III. Seller credits to the buyer go from 6% to 3%. Who cares! It's very rare that you can get into a home where the seller give you a full 6% towards closing cost. If you buy a $300,000 (I'm stuck on that #) and you get a 6% seller credit either the seller comes out of his pocket $18,000 or it's really a $282,000 place and now it wont appraise.
And lastly, they will increase enforcement on FHA lenders. I don't know if that means surveillance or espionage or beating the crap out of some mortgage lender who didn't fill out the FHA paperwork correctly. But, I'm glad they're doing something.
Again, if these changes go through they will be good. They will keep the FHA program going so it can continue to do loans. They currently account for approx 1/3 of all U.S. loans. That would really blow if they went away because they ran out of cash or had to raise the minimum down payment from 3.5% to ???.
Check out what HUD has to say about it by clicking the title.
God Bless.
Tuesday, January 19, 2010
Stabilization Mission Complete
Hola People.
The HUD has just set a temporary one year policy to broaden what FHA buyers can buy. To be in effect on 2/1/10, this policy will allow FHA buyers (government backed loan with 3.5% down until that changes. Stay tuned) to purchase homes that have been foreclosed on and put back on the market or flipped (although the attached article says "flipping" is a predatory practice. Why? I don't know. They make really bad and unrealistic realty shows, but it's not necessarily an evil thing).
The current rule is that if you are using an FHA loan to buy a house, the seller has to have owned it for more than 90 days. The HUD feels the new policy will open the door to affordable properties for people who do not have the conventional (kind of funny that they still call 20% down "conventional" when hardly anyone has it) 20% down and will in turn stabilize home values.
This will be a big deal, just not here in San Diego (at least initially). Right now (not later right now, right now) there are currently 45 properties in San Diego county that say "No FHA, 90 day rule" that are actively on the MLS. There are a combo of 8,078 active houses, townhomes and condos on that same MLS.
I don't want to be too much of a downer, this is a good thing. The ripple will help. Those 45 properties and the ones to follow will get a better sales price because there will be more buyers competing. That better price will drive up the comparable sales analysis that will drive up appraisals and that will set appreciation in motion (or, at least fight off depreciation). Not to mention this temporary policy really helping other parts of the country that are really being beat down. That brings up the GNP which will eventually cut into unemployment.
How long will this take? A lot longer than the one year temporary policy will last.
Click on the title above to read more about it.
God Bless
The HUD has just set a temporary one year policy to broaden what FHA buyers can buy. To be in effect on 2/1/10, this policy will allow FHA buyers (government backed loan with 3.5% down until that changes. Stay tuned) to purchase homes that have been foreclosed on and put back on the market or flipped (although the attached article says "flipping" is a predatory practice. Why? I don't know. They make really bad and unrealistic realty shows, but it's not necessarily an evil thing).
The current rule is that if you are using an FHA loan to buy a house, the seller has to have owned it for more than 90 days. The HUD feels the new policy will open the door to affordable properties for people who do not have the conventional (kind of funny that they still call 20% down "conventional" when hardly anyone has it) 20% down and will in turn stabilize home values.
This will be a big deal, just not here in San Diego (at least initially). Right now (not later right now, right now) there are currently 45 properties in San Diego county that say "No FHA, 90 day rule" that are actively on the MLS. There are a combo of 8,078 active houses, townhomes and condos on that same MLS.
I don't want to be too much of a downer, this is a good thing. The ripple will help. Those 45 properties and the ones to follow will get a better sales price because there will be more buyers competing. That better price will drive up the comparable sales analysis that will drive up appraisals and that will set appreciation in motion (or, at least fight off depreciation). Not to mention this temporary policy really helping other parts of the country that are really being beat down. That brings up the GNP which will eventually cut into unemployment.
How long will this take? A lot longer than the one year temporary policy will last.
Click on the title above to read more about it.
God Bless
Monday, January 18, 2010
How much do you like beer?
Hello People.
Rates dipped under 5% last week to 4.99%, down 6 basis points from 5.05%. Sweet. On a $300,000 loan your monthly principle and interest payment will be $1608.63 instead of $1619.64, saving you a colossal $11.01. Que?
People, we all want to save money, but don't out smart yourself and try to time interest rates or the bottom of the market. If you like the house and the payment isn't going to force you to deliver news papers or eat "Blackened Alpo Delight" with a side of tap water, then go for it. Have your lender lock you in and be done with it. I see it too many times when people are paralyzed by trying be too savvy and wait for the perfect situation. Don't be one of those people saying "I could have bought real estate when prices and interest rates were at a all time low and I let $11.01 a month stop me". People, $11.01 doe not get you a twelve pack of bad beer. Would you let bad beer get in the way of buying a house? If so, you might want to check into a clinic.
Click on the title to read an article regarding this fabulous drop in rates.
God Bless.
Rates dipped under 5% last week to 4.99%, down 6 basis points from 5.05%. Sweet. On a $300,000 loan your monthly principle and interest payment will be $1608.63 instead of $1619.64, saving you a colossal $11.01. Que?
People, we all want to save money, but don't out smart yourself and try to time interest rates or the bottom of the market. If you like the house and the payment isn't going to force you to deliver news papers or eat "Blackened Alpo Delight" with a side of tap water, then go for it. Have your lender lock you in and be done with it. I see it too many times when people are paralyzed by trying be too savvy and wait for the perfect situation. Don't be one of those people saying "I could have bought real estate when prices and interest rates were at a all time low and I let $11.01 a month stop me". People, $11.01 doe not get you a twelve pack of bad beer. Would you let bad beer get in the way of buying a house? If so, you might want to check into a clinic.
Click on the title to read an article regarding this fabulous drop in rates.
God Bless.
Friday, January 15, 2010
Short Sale Guidelines A Go Go
Hi People.
The U.S. Treasury has set some new guidelines that are supposed to go into effect by April this year. The new rules include the lender giving a thumbs up or a middle finger to the seller with in 10 days of receiving a short sale offer. According to Rismedia "The Treasury rules, in addition to imposing a 10-day deadline for bank decisions, call for sellers to receive $1,500 moving allowances—and for the sellers to not have to repay any of the debt. Also, lenders will get $1,000 to cover administrative and processing costs, while investors owning the mortgages will receive a maximum $1,000 for allowing as much as $3,000 of a short sale’s proceeds to be distributed to less senior lenders".
This all sounds good, but I've done short sales on the seller's side and on the buyer's side. The lenders are swamped! Each short sale negotiator has 100s of files. This will be very interesting to see how this is received and what the penalty will be if and when they take 11 days. I predict that the short sale departments of lending institutions will be the new employer of people going "postal".
Click on the title to read more.
God Bless.
The U.S. Treasury has set some new guidelines that are supposed to go into effect by April this year. The new rules include the lender giving a thumbs up or a middle finger to the seller with in 10 days of receiving a short sale offer. According to Rismedia "The Treasury rules, in addition to imposing a 10-day deadline for bank decisions, call for sellers to receive $1,500 moving allowances—and for the sellers to not have to repay any of the debt. Also, lenders will get $1,000 to cover administrative and processing costs, while investors owning the mortgages will receive a maximum $1,000 for allowing as much as $3,000 of a short sale’s proceeds to be distributed to less senior lenders".
This all sounds good, but I've done short sales on the seller's side and on the buyer's side. The lenders are swamped! Each short sale negotiator has 100s of files. This will be very interesting to see how this is received and what the penalty will be if and when they take 11 days. I predict that the short sale departments of lending institutions will be the new employer of people going "postal".
Click on the title to read more.
God Bless.
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