How tro Negotiate your closing costs

The ever confusing arena of closing costs...
Although this article is really good, or else I wouldn't post it, it leaves out the tgechniques of negotiating your closing costs...talk to me!

How to negotiate your closing costs
By Holden Lewis • Bankrate.com

Shop around before choosing a mortgage lender, but don't stop there. When you receive your good faith estimate of closing costs, or GFE, the negotiation hasn't ended.
The lender or mortgage broker is required to give you a GFE within three working days of accepting your loan application. The GFE comes in the form of an itemized list of estimated closing costs for everything from the lender's fees to the appraisal charge to the title insurance premium to a partial month's interest payment.
The lender or broker charges some fees, and third parties charge others. The first step is to find out which are loan origination fees and which are third-party fees. Don't guess. Ask the lender or broker.
The big money question
"Say, 'Please explain to me what those fees are,'" says Jessica Cecere, director of the Consumer Credit Counseling Service in West Palm Beach, Fla.
Simple advice, but a lot of loan applicants don't follow it.

On the GFE, fees are categorized by numerical codes ranging from the 800s to the 1300s. Most of the negotiable lender-charged fees are in the 800s: application, origination, commitment, loan discount, broker, tax-related service and underwriting fees.

Keys to lower closing costs

• Ask for a justification for each lender-charged fee.
• If the lender charges an application fee, ask if it will be credited toward closing costs.
• If the lender charges an underwriting fee as well as a processing fee, ask for details of those services. Maybe you'll find a fee that can be waived or reduced.
• Recognize that some items are non-negotiable: taxes, city and county stamps, recording fees, prorated interest and reserves. On the GFE, these items are in the 1000s and the 1200s.



-- Updated: July 12, 2007



Third-party fees
Fees charged by third parties are trickier to negotiate. A few third-party fees pop up in the 800s section of the GFE: those for the appraisal, credit report and inspection. The lender is supposed to pass along these charges without marking them up. Theoretically, they are negotiable and you can ask the lender to seek good deals on these three items and pass along the savings. In practice, you probably won't get a break on those services because the lender has contracted for them at a set price.
You can realize some of your biggest savings by negotiating the items in the 1100s section of the GFE: title insurance, title search, title exam, attorney's fees and settlement fees. Most borrowers use a title company recommended by the real estate agent or lender. But you don't have to. You can shop for title insurance and settlement services, just as you shopped for the house and for the loan.
Be prepared for resistance. Some lenders have business affiliations with title companies, and they'll pressure you to keep the title work in-house.
Title insurance, settlement services
Where you shop for these title insurance and settlement services depends on where you live, because different places have different ways of closing real estate and mortgage transactions. In parts of the Northeast, closings are conducted in lawyers' offices. In some places, including Southern California, closings take place at escrow or mortgage companies. In much of the country, the closing takes place in the office of the agency that sells title insurance.
Government regulation can limit your negotiating room. In Texas, the state sets one overall fee for title insurance, title search and settlement services, so title agencies compete on service and not price. Regulations aren't as restrictive in most other states and you could save hundreds of dollars in settlement services by shopping around.
"I think it's a matter of what the traffic will bear," says Bob Moulton, president of American Mortgage, a brokerage on Long Island, N.Y. He gives this tip: If you're refinancing your mortgage, and you've lived in the house less than 10 years, ask to get title insurance at a less-expensive "reissue rate."
And don't forget to shop for hazard insurance -- item No. 903 on the GFE. Compare offers for homeowners insurance policies, either on your own or with the help of an insurance agent. Make sure the insurance company and settlement agent communicate with each other. You're not going to get that mortgage without proof that you have a homeowner's policy. That requirement is not negotiable.

-- Updated: July 12, 2007


Posted:Aug. 10, 2006

Tax Credit Extended and.......!!!!

You heard it here first folks...well, maybe...

Under a compromise reached Wednesday, the existing $8,000 credit would be extended for first-time home buyers who sign a contract for a home by the end of April 2010 and close by the end of June.

It also creates a $6,500 credit for people who buy a home but have owned a home for at least five consecutive years out of the past eight years.

The income limit would be raised to $125,000 a year for individuals and $225,000 for married couples, up from the current income limits of $75,000 and $150,000, respectively.

Thank you National Association of Realtors...you oughta be the only lobbyists allowed on the hill!!

And the news is...

59% of Home Buyers Rely on Low Down-Payment Government Mortgages
________________________________________
RISMEDIA, October 21, 2009—
The new home market is cooling down and government intervention has been a key driver to new home sales, according to a recent monthly survey of home builders, just released by John Burns Real Estate Consulting.
In addition to the tax credit that expires Nov. 30, government mortgage programs have been critical in 2009. The survey reveals that 59% of this year’s sales have been dependent on FHA, VA or USDA financing programs with 96.5% to 100% LTV.
What percentage of your home buyers this year used this type of financing?

Region Cash FHA Jumbo Other Conforming USDA VA Don’t
Insured Loans Loans Loans Know
Midwest 3% 59% 1% 18% 3% 3% 13%
Northeast 7% 41% 8% 28% 2% 6% 8%
Northwest 5% 34% 13% 31% 6% 11% 1%
Northern CA
Region 4% 68% 0% 16% 0% 8% 3%
Northern
Florida 6% 47% 2% 15% 16% 9% 5%
Southeast 7% 48% 6% 18% 3% 11% 7%
Southern
California 6% 48% 15% 19% 0% 8% 3%
Southern
Florida 22% 59% 4% 13% 0% 3% 0%
The highest use of FHA financing was reported by Northern California builders, while Southern Florida builders reported the highest percentage of cash purchases. “The cash sales are most likely due to investor purchases of attached homes,” said Jody Kahn, a vice president with the firm.
Not surprisingly, Southern California reported the largest use of jumbo mortgages. “The tough underwriting and higher pricing of jumbos has constrained sales of move-up homes,” said Kahn.
This month’s survey consists of 262 home building industry executives from public and private companies. In total, their insight is reflective of on-the-ground conditions in 86 MSAs and 1,741 communities.
“The good news for builders is that there seems to be momentum behind the effort to extend the federal tax credit and that the FHA is going to become more conservative, but not significantly curtail operations,” said CEO John Burns. “Political winds can change quickly though, so stay tuned.”
Survey Highlights:
-The average unsold, finished inventory per community decreased nationally to 2.7 from 3.7 last month. This significant decline in inventory indicates the speculative starts from the summer are being converted to closings. Regions reporting significant declines in inventory per community since last month include Southern California, the Northwest and Southern Florida.
-Average net sales per community dropped from 2.0 to 1.6 nationally, returning to levels last seen in June and July. The net sales rate declined in seven regions compared to only one during the prior month. While significantly better affordability, low conventional mortgage rates, and the federal tax credit continue to support new home sales, builders across the country are reporting declines in traffic and sales rates in September and into October. Some builders lacking entry level inventory to close by November 30th are losing sales to competitors. Seasonality is also contributing to declining sales.
-Last month’s reports of price increases in California softened this month. Pricing in Southern California is now rated flat, while Northern California pricing is decreasing. This month, Southern Florida builders rated pricing as increasing. The direction of new home prices was unchanged nationally this month, and remains hovering near flat, as builders reporting further decreases in prices offset those builders seeing flat or increasing prices.
-Builders started more homes in 4 of 10 regions, and trimmed starts in 3 regions. The Northeast, Southeast and Northwest regions are all reporting increased starts in the 8% to 9% range. The Southern Florida region reported the largest increase in starts this month. Notable declines in start rates were reported in the Midwest, Southern California and Northern Florida.
For more information, visit www.realestateconsulting.com.

The $8,000 Tax Credit deadline is approaching FAST!!!

Just a subtle little reminder that time is slipping away to ensnare the $8,000 tax credit! Yes, there are a lot of rumors out there about the Tax Credit being extended and up to $162.783, but don't believe all you read or hear, especially on FOX News.
Just a couple of things...the home purchase must be CLOSED by the end of November and the term First Time Home Buyer is dangeroyus and misleading!!!
Read on...

1. Who is eligible to claim the tax credit?
First-time home buyers purchasing any kind of home ”new or resale” are eligible for the tax credit. To qualify for the tax credit, a home purchase must occur on or after January 1, 2009 and before December 1, 2009. For the purposes of the tax credit, the purchase date is the date when closing occurs and the title to the property transfers to the home owner. A limited exception exists for certain contract for deed purchases and installment sale purchases.
2. I read that the tax credit is "refundable." What does that mean?
The fact that the credit is refundable means that the home buyer credit can be claimed even if the taxpayer has little or no federal income tax liability to offset. Typically this involves the government sending the taxpayer a check for a portion or even all of the amount of the refundable tax credit.
For example, if a qualified home buyer expected, notwithstanding the tax credit, federal income tax liability of $5,000 and had tax withholding of $4,000 for the year, then without the tax credit the taxpayer would owe the IRS $1,000 on April 15th. Suppose now that the taxpayer qualified for the $8,000 home buyer tax credit. As a result, the taxpayer would receive a check for $7,000 ($8,000 minus the $1,000 owed).
3. What is the definition of a first-time home buyer?
The law defines "first-time home buyer" as a buyer who has not owned a principal residence during the three-year period prior to the purchase. For married taxpayers, the law tests the homeownership history of both the home buyer and his/her spouse.
4. How is the amount of the tax credit determined?
The tax credit is equal to 10 percent of the home’s purchase price up to a maximum of $8,000.

National Association of Realtors view of the $8,000 Tax Credit expiring

Signs your home value could drop...
I "acquired" this article from a link on my MSN Homepage. I probably peruse 3 or 4 articles a day and dismiss most of them
I didn't dismiss this one because even though we have been somewhat insulated in Northern Colorado from massive foreclosues, we've had not "our share", but some.
And because we've had "some", there is "some" pertinent info hereunder...

4 signs your home value could drop
________________________________________

Even if you have a stable job and can pay your mortgage, your house might not be safe from a dip 'underwater.' Look around to see whether your house is at risk.
By SmartMoney

Despite signs that the real estate market is bottoming out, millions of homeowners are likely to find themselves in worse shape within the next two years.
Nearly half of the nation's 52 million mortgage borrowers will have negative equity by the end of the first quarter of 2011, up from the 14 million at the end of this year's first quarter, according to estimates in an Aug. 5 report by Deutsche Bank. With so many borrowers "underwater" -- or owing more on their mortgages than their homes are worth -- the risk is high that they'll default and their homes will go into foreclosure, says Mark Zandi, the chief economist at Moody's Economy.com. (Moody's Economy.com estimates that 17.5 million mortgage borrowers will be underwater by early 2010.)
Negative equity is the product of several factors. The most significant weight is the broad and persistent decline in home values. A Zillow.com index of home values fell 12.1% year-over-year during the second quarter, resulting in a total drop of 22.3% since the market peaked in mid-2006, according to an Aug. 11 report by the online real estate marketplace. Many buyers who bought their homes around the peak with a 20% down payment have lost that dollar amount.
"The continued decline of U.S. home prices will contribute to rapidly rising rates of negative equity," Karen Weaver, a Deutsche Bank research analyst, wrote in the report. "The most obvious implication is for mortgage defaults."
Current homeowners, or those shopping for a home and who are concerned that they'll end up underwater, should consider how long they expect to live in their homes. Being underwater doesn't affect homeowners unless they plan to sell, Zandi says.
Individuals who are staying put for at least the next five to seven years will likely recoup the lost value of their home, says Amy Bohutinsky, a Zillow.com spokeswoman. In addition, homeowners should refrain from borrowing against their mortgages, she says.
Those who find themselves underwater can turn to the federal Making Home Affordable plan, which can help you refinance or do a loan modification. You'll have to meet the eligibility requirements listed here.
Whether you're at risk for falling behind may have more to do with the economy and your neighborhood than your job, your credit or your income. Here are four warning signs that you're heading underwater.
Foreclosures in your neighborhood
The quickest way to end up underwater is to live in a neighborhood that's plagued by foreclosures.
When one home on your block goes into foreclosure, your home's value drops by 1%, Zandi says. But that isn't a one-to-one relationship. If two homes on a block go into foreclosure, your home's value will drop by more than 2%.
As homes go into foreclosure, they create a domino effect, lowering home values throughout a neighborhood in a cascade beyond homeowners' controlYou can find neighborhood foreclosure listings at MSN Real Estate.
Homes lingering on the market
When "For Sale" signs linger in a neighborhood for three or more months, that may mean buyers and sellers can't agree on a price. In that environment, homes are unlikely to sell unless the sellers lower their asking prices.
"The time on the market is always a good barometer of demand for homes and for the price homes are transacting at," Zandi says. "The longer it appears that neighbors are taking to sell their home the more likely it is they're not getting the price they want and that prices are falling."
Compare the time it took for homes to sell in your neighborhood three years ago versus today; if it's taking weeks or months longer to sell, the prices homes can fetch are dropping, Zandi says.
MSN Real Estate's home valuation tool includes time-on-market information.

The recession will end~Then What?

Ways to thrive after the recession
Have hard times inspired a newfound frugality in you? These steps will help make it last even after the economy improves.

By U.S. News & World Report
Americans have put themselves on a budget. They're spurning Caribbean vacations, $10 cocktails and designer coffees in favor of shoveling more money into savings accounts. In the first quarter of 2009, the personal savings rate hit 4.2%, its highest level since 1998. At the same time, consumer credit card debt fell by 6.5%. And in a recent survey by the National Foundation for Credit Counseling (NFCC), 57% of Americans said they're spending less than they were a year ago.
That moderation, it turns out, could outlast the recession, and most economists and consumer experts say that's a good thing. In the NFCC survey, about half the respondents who had reduced their spending said they would continue to spend less even if their financial situation improved. "The consumer has fundamentally changed," says Margot Bogue, associate director of brand planning for the advertising firm Cramer-Krasselt. The new "evolved consumer," she says, shops with more discipline and focuses on buying products with lasting value rather than just accumulating stuff.
To take advantage of that shift and thrive in the new, post-recession economy, consider making these changes:
1. Rethink your lifestyle. Veronica Neilan, a 25-year-old Brooklynite who recently completed a master's degree in forensic mental-health counseling, is considering moving back to her mother's house in New Hampshire while she looks for a job. She will soon need to start paying back the $113,000 in student loans she has accumulated over the past seven years. She's learned to ask for things such as pasta or gift certificates from relatives who are giving her presents, a move that keeps her food costs down. She rarely buys new clothes unless they are on sale or she can use a gift certificate, and when she needed a new television, she found one online being given away. Neilan says she expects her frugal behavior to stick. "I don't want to be the person who buys a house they can't afford," she says.
Robbie Blinkoff, principal anthropologist at Context-Based Research Group, a consulting firm that recently conducted interviews with consumers, says lifestyle overhauls like Neilan's are easier for younger consumers to adopt. "They're just learning habits about how to consume. It will last into the recovery," he says, just as the Great Depression turned many people who are now in their 80s and 90s into lifelong savers.
• Why you should outsource your chores now
2. Eliminate small expenses that add up. After Deborah Pont, 41, of Stonington, Conn., was laid off from her communications job at a large financial services firm in January, she dramatically reduced her budget: She stopped going out to dinner, shopping, vis iting expensive hair salons and getting her nails done. She also rediscovered grocery store coupons and started buying what's on sale. It was easy, in part because so many of her friends were making similar cutbacks. "Everybody else said, 'Let's not go out, let's not spend too much money,' so somebody would make dinner and we'd go to their house," Pont says.
What she discovered is that it's a relief not to feel pressure to spend so much. She has more time for things she enjoys, such as gardening and home improvement projects, and says she probably won't return to regular spa visits even after finding a new job.
Blinkoff says Pont's discovery is not uncommon. "People have kind of woken up, and they feel the things they consumed don't match who they are and their identity," he says.
3. Downsize -- permanently. Doreen Orion, 49, a psychiatrist and author of the memoir "Queen of the Road," also decided to turn a temporary exercise in minimalism int o a longer-term lifestyle. She initially cringed at the thought of leaving her dream house in Boulder, Colo., and her 200 pairs of shoes to go on a road trip with her husband. But at his insistence, they spent a year living in a 340-square-foot bus, camping throughout the country.
More from MSN Money and U.S. News & World Report
When the couple returned home to their luxe but hardworking lifestyle, they realized they were much happier with less. They calculated that, even though their 401k's had fallen in value, if they sold their home and lived in their bus while working occasionally, they could support themselves. Such a dramatic change, she says, "put a spark back into our lives. . . . We discovered there can be an upside to downsizing."
4. Get competitive about it. The recession inspired yoga studio owner Annie Mahon, 46, of Washington, D.C., to start a competition with her husband to see who could go longer without buying anything new. (They make exceptions for groceries, medicine and certain items for their four children.) Instead of curling up with catalogs that arrive in the mail, Mahon puts them directly into the recycling bin. "It feels great, because afterward, there's no residual feeling of, 'Oh, I wish I had gotten this.' So far, it doesn't feel like I'm missing anything. It feels like I'm gaining," she says. Wanting or craving things soaked up energy, Mahon adds. She estimated that, six weeks into the competition, she had saved at least $1,000.
5. Take advantage of the way retailers have changed. An advertising campaign touts that "summer costs less at Wal-Mart." One television spot features the simple pleasures of the season, including hot dogs, Popsicles and running through sprinklers. Target's "New Day" ad campaign, which ran from September through May, highlighted ways to save money: cutting hair at home, staying in for a movie night, biking to work.
Lena Michaud, a Target spokeswoman, says the company has seen sales increase for products that let people cut costs by staying home, including nail polish and hair color, single-serve coffee brewers and popcorn poppers. People also are making the most of what they already have. Michaud says Target's sales of scarves and fashion hats have gone up as customers freshen up old outfits with new accessories.
Video on MSN Money
"We are not bouncing back. The face of retail and consumption has been fundamentally changed," says Paco Underhill, author of "Why We Buy: The Science of Shopping." Even before the recession, there were too many stores, a problem that has started to self-correct through business bankruptcies and closings, such as Circuit City's. What's changed? "People are no longer celebrating how much they spend but how little they spend," says Underhill.
John Quelch, a marketing professor at Harvard Business School, says that although the length of the recession will determine just how long the newfound frugality lasts, up to 10% of consumers will change their behavior on a sustained basis. "Many of those changes will be in favor of reducing consumption and a simplified lifestyle," he says.
Although these consumers are still in the minority, there are enough of them to make retailers take note. "It's a huge shift in buying power," says Quelch. Because consumer spending makes up such a large portion of our economy (about 70% of gross domestic product), 10% of consumers also represents a huge dollar value.

Hmmmmmm...

Found this in my inbox this morning and I need to read it and study it some more and see how it feels compared to Northern Colorado...
Do me a favor and let me know what you think, wouldd you please?

Housing crisis set to enter new stage
________________________________________
Filed under: housing, Anthony Mirhaydari
The march of good news continues for housing. Existing home sales jumped 7.2% between June and July -- the largest increase in over a decade and the fastest pace in nearly two years -- according to the National Association of Realtors (NAR). Prices are down 15% compared to last year.
A combination of cheap distressed properties, seasonal trends, low interest rates, and tax credits for first-time buyers is working its magic. But a number of issues have me worried that instead of an end to this epic housing nightmare -- we are about to enter a new stage.
The first problem is that the current buying trends are by no means normal with a large percentage of sales focused on foreclosures, short-sales, or other forced transactions rooted in financial distress.
According to a survey by Inside Mortgage Finance, only 10% of overall sales are coming from what could be considered a normal sales process. It's no wonder, with the Mortgage Bankers Association (MBA) reporting Thursday that more than one in eight mortgage holders are in some stage of delinquency or foreclosure. RealtyTrac reported that July foreclosures jumped 7% compared to June. In a situation like this, with the impetus on the seller to unload quickly, prices will naturally gravitate lower.
This brings us to the second issue: The change in focus from subprime borrowers unable to refinance loans because of falling home values to prime borrowers unable to pay their bills because of job loss. According to the MBA survey, 58% of new foreclosure starts originated in the well-to-do prime loan category, up from 44% last year. Meanwhile, subprime borrowers were responsible for only 33% of foreclosures, down from 49% last year. As foreclosures affect a larger and larger swath of the population, it will only add to the number of properties on the market.
The third problem is the looming wave of loan resets in 2010 and 2011. As you can see in the chart above, a large number of prime, Alt-A, and Option ARM borrowers will be facing the prospect of higher payments just as the housing market digests the fallout from the subprime problem of 2007 and 2008. Notice the pleasant dip in reset activity for 2009. Plus, should the economy actually start recovering, the Federal Reserve could be forced to raise interest rates during this period.
And finally, we have the inventory issue. Despite the uptick in sales, the inventory of existing homes for sale actually increased 7.3% to 4.1 million last month. I have talked about a "shadow inventory" of homes owned by people just waiting for a smidgen of good news to list their homes. Now we see the dynamic in action: Lawrence Yun, the NAR's chief economist, said the increase was the result of "some held back inventory coming back to the market."
It's also worth mentioning the crisis of confidence that is set to develop as the peak buying season ends and prices reaccelerate their downward slide. In its latest survey, Zillow found that a full 81% of homeowners believe their home won't fall in value over the next six months. Adding to the perception that people are losing touch with reality, only 60% believed the value of their home had fallen over the last year; when 83% of all homes actually lost value during that time.
The cold chill of falling home equity awaits many Americans this winter -- just in time for the holiday shopping season. Not only does this spell trouble for homebuilders like D.R. Horton (DHI), the U.S. Home Construction ETF (ITB), and the S&P Homebuilders ETF (XHB), but for aspriational retailers like Coach (COH) and big toy manufacturers like Arctic Cat (ACAT) as well.
Disclosure: The author does not own or control a position in any of the funds or companies mentioned.
Anthony Mirhaydari is a researcher for the Strategic Advantage investment newsletter. He can be contacted at anthony.mirhaydari@live.com.

Why Helping People Live Indoors is what I do!

Study: Americans Still Want to Be Home Owners
--------------------------------------------------------------------------------

Despite all of the bad news in the media about homeownership and mortgages, most Americans still believe buying a home is a great investment, according to a new study commissioned by Bankrate.com.

Among the findings from the study:

92 percent say that a home is a good investment for the future.
48 percent worry about losing or being unable to afford their homes.

"These results provide an interesting illustration of the public's mindset in a difficult economy," says Julie Bandy, editor in chief at Bankrate. "While nine out of 10 still believe in the American dream of homeownership, nearly half worry about losing their homes.”

Source: Bankrate.com (08/18/2009)

$8,000 Home Buyer Tax Credit!

Home Buyer Tax Credit deadline is approaching!

First-Time Home Buyers Eager to Reap Tax Credit Benefits, but Unsure of Details
RISMEDIA, July 22, 2009-The federal tax credit for first-time home buyers is now half way to its Dec. 1, 2009, expiration date, and it seems fair to ask just how much it is helping real estate markets. The RE/MAX network in northern Illinois did just that, interviewing 40 RE/MAX agents from across the region about how the tax credit is impacting the first-time buyers with whom they work. “The overall conclusions we draw from the survey are twofold,” said Jim Merrion, regional director of the RE/MAX northern Illinois real estate network. “First, buyers are generally aware of the fact that there is a tax credit available. However, a majority of them understand only a few, if any, of the program’s details.

“Second, the tax credit has a stimulative impact, but the effect is primarily psychological. Buyers want to get the benefit of the tax credit, and that encourages them to act, but the tax credit doesn’t have much impact on how much first-time buyers can afford to pay for a home,” said Merrion.

The tax credit was a key part of the economic stimulus package approved by Congress and signed by President Obama in February. Designed to encourage home purchases, it can be worth as much as $8,000 in reduced taxes or added income.

The 40 RE/MAX agents interviewed for the survey estimate they worked with 390 first-time buyers through the first half of 2009. Seventy-three percent of those buyers were aware of the tax credit even before meeting with the agent. To date, approximately 18% of the 390 buyers have either purchased a home or have had an offer accepted and are preparing to close the transaction. Most of the remaining buyers are still in the market looking for the right home.

“The fact that the tax credit expires at the end of November should begin to get more and more of them off the fence and into a home in the next few months,” said Merrion. “In responding to our survey, the agents we interviewed said a majority of buyers see the tax credit as a major motivation to buy this year even though they can afford to buy a home without it. For others, it merely reinforces their existing decision that this is the time for them to buy,” he said.

During the first-half of 2009 in the metro Chicago real estate market, the average price of a home was $259,354, according to data from the MRED multiple listing service. The $8,000 credit equals 3.1% of that amount. That helps explain why the survey indicated that the tax credit is having a major impact on affordability for only 17% of buyers.

For the majority of qualified buyers, said the RE/MAX agents interviewed, the tax credit provides a financial boost by replenishing the savings they use for a down payment and closing costs or covering some of the incidental expenses that often come with purchasing a first home, whether that involves buying a lawn mower, putting up wallpaper or acquiring new furniture.

The survey also revealed that many first-time buyers don’t have a firm grasp of the details of the tax credit.

-Most buyers knew there was a date by which they had to act in order to qualify for the tax credit, but many are confused about when that was and what they had to do. A home purchase must be closed no later than Nov. 30, 2009 to qualify for the credit.

-Many buyers do not realize that to qualify as a first-time buyer you can have owned a home previously as long as you have not have owned a home for three years before making a home purchase that qualifies for the tax credit.

-A large percentage of buyers also are unclear about the fact that they will receive the full benefit of the tax credit to which they are entitled even if they don’t pay that amount in income taxes for 2009. For example, if an individual or couple qualifies for the full $8,000 credit but owes only $3,000 in income taxes for the year, their entire tax bill would be eliminated, and they would also receive a tax refund check for $5,000.

-Another area of confusion, but one that the RE/MAX agents report as affecting relatively few first-time buyers, involves income limitations. Individuals with an adjusted gross income up to $75,000 can qualify for the full $8,000 credit, as can married couples earning up to $150,000. The available credit amount then declines as income increases and phases out at $95,000 for individuals and $170,000 for couples.

For many buyers, another aspect of the tax credit that is confusing is the possibility of repayment. An earlier version of the first-time buyer tax credit did have to be repaid, meaning that it functioned like an interest-free loan. The updated version of the credit approved this year eliminates the need for repayment unless the home is sold within three years, in which case the credit must be repaid.

“There is talk in Congress about increasing and/or extending the tax credit and making it applicable to all home buyers, not just those purchasing their first home,” reported Merrion. “That would be a great help to the housing market, which continues to face significant headwinds in this soft economy. However, for first-time buyers, we see very limited value in waiting and hoping that Congress will act again. If a home purchase is on their radar today, our advice is to start shopping seriously and close on a great new home before Dec. 1. To do that, they will want to get the house under contract by Sept. 30 so they have ample time to close the transaction.”

For more information, visit www.remax.com.

RISMedia welcomes your questions and comments. Send your e-mail to: realestatemagazinefeedback@rismedia.com.

The ride ain't over yet by a long shot but it's gonna be eaier to stay on for the whole 8 seconds...

RISMEDIA, July 21, 2009-The U.S. housing market continues to show signs of stabilization with a drop in the number of Multiple Listing Service (MLS)-listed homes for the twelfth consecutive month. The number of single family homes and condos listed for sale according to MLS data decreased in June 2009 from May by 2.1%, bringing the total number of active listings in 28 major U.S. markets to 696,858, according to national real estate brokerage ZipRealty.

Additionally, ZipRealty tracked an increase in the median list price in the 28 markets to $270,440 in June from $270,027 in May. Despite the sequential increase the median list price still decreased 2.72 percent when compared to June 2008.

Other highlights from ZipRealty’s Housing Inventory Index, compiled from local Multiple Listing Service (MLS) data, for June 2009 include:

-Las Vegas, Los Angeles and Phoenix all recorded a decline in inventory which may have contributed to some homes receiving multiple bids.
-Median list prices have flattened or increased in Las Vegas, Phoenix, San Francisco Bay Area and Los Angeles, pointing toward stabilization in those areas.
-While South Florida has substantially fewer homes for sale than last summer, housing inventory there is plentiful. For example, Miami has 27.1% more homes listed for sale compared to Los Angeles even though Miami has a significantly smaller population than Los Angeles.
-California is seeing the most dramatic inventory declines with massive year-over-year inventory reductions: Los Angeles saw a 53.9% decrease year-over-year while Bakersfield/Fresno tracked a 56.2% decrease.
-Several major metros that have been hit hardest by foreclosures had limited inventory in June 2009, which is at levels not seen or experienced in years.

“‘Affordability’ has been the buzz word in real estate this summer, and with a significant number of listed homes bank-owned, we’re seeing instances in some areas of banks dropping prices to generate more offers from buyers,” said ZipRealty President and CEO Patrick Lashinsky. “If the number of home listings continue declining and buyer interest and activity remains strong, we should see sales prices and home values increase as we head into the fall.”

What's all this "Short Sale" stuff, anyway?

Hi there,

This whole foreclosure “issue” is going to be with us for a while yet and a subset of the “issue” is what is known as a Short Sale. In laymen’s terms that means that the Seller is trying to avoid foreclosure and because he is over financed (too many ill advised re-refi’s during the last 10 years) and/or because prices have deflated he can’t sell his house for what is owed against it.

Sidebar: There is only one reason a property gets foreclosed on and only one…and that is because it can’t be sold for what is owed against it. It can’t be sold “retail”, i.e. putting it on the market, or “wholesale”, i.e. being purchased by an investor at the actual foreclosure sale on the courthouse steps. So what makes the “GP”, i.e. general public think that by the time a bank gets the property back along with having to pay all the attorneys fees and foreclosure costs that they can buy it for “50¢ on the dollar”?

Anywho, short sales…

The Seller, with hopefully experienced and competent help, contacts the bank who holds the mortgage and tries to negotiate a “deal” whereby the bank will accept less than is what is owed, typically so that the bank can avoid all the hassle and costs involved with a foreclosure where typically they are going to loose money anyway!

Below, hereunder, therefore, where to then and habeas corpus is a pretty good article on Short Sales.

Any further questions or “whatever”, please contact me!



Putting the 'short' back in short sale

Tips on how to make process go smoother

By Steve Bergsman, Friday, July 17, 2009. Inman News

Lately, homebuyers are seeing more and more short-sale opportunities, but it seems as if fewer purchases are actually being completed. The perception in this case is correct. The short-sale process has become a nightmare: it goes on forever, sometimes never coming to a satisfactory conclusion even after months of effort.

All I can say is, "Hang in there, folks, help is on the way."

According to industry sources, the playing field will soon begin to make more sense to buyers as servicers (the folks who actually handle your loan) will either move at-risk loans to special servicers that are experienced in this field and/or set parameters ahead of bids.

"There are going to be a lot more short sales coming into the system," predicts Scott Thompson, a principal in Mortgage Resolution Services Inc. in Rancho Cordova, Calif. "Servicers have done a lousy job. They know it and are now looking to solve the problem."

This is a necessity, Thompson adds, "as right now the queues are long and getting longer day by day."

The short sale seems complicated -- mostly because it takes so darn long to accomplish -- but it's not. The basic short sale happens when the proceeds from the sale of a property are less than the balance owed on the loan (secured by the property being sold). The key in all of this is the lender accepting a price that is less than the amount owed on the property -- and the lender would do that to avoid a foreclosure situation, which can be a lengthy and sometimes costly process.

For buyers, a short sale is the chance to acquire a property at discount.

More often than not, however, the process has been gummed up. The numbers I hear are: just one to three out of 10 applications get accepted; and while the process can take as little as 45 days, it has been taking on average 90 to 120 days with some wayward dealings going on for nine months.

The principal difficulties in the process can be isolated to the agents (especially the listing agents!) and banks. Let's start with the latter first because things on this side of the process are changing.

According to Thompson, a number of major servicers including Fannie Mae, JPMorgan Chase & Co., Citigroup Inc. and OneWest Bank Group (formerly IndyMac Bank) are putting systems in place to more easily identify which borrowers have attempted loan modification programs and failed or are well into the default process. Secondly, and this is a key point, they are going to give price certainty in the case of a short sale; the servicers will give price guidance, telling the agents a price range for the short sales.

Finally, many of at-risk loans will shift over to a special servicer, an asset manager experienced in handling REO situations.

"The special servicers will run a determination on these properties as which should come to market, engage in an outreach effort to the homeowners so as to avoid foreclosure and if all else fails to bring the property to market with pricing guidance where the buyer will know that a deal won't fail because of price," says Thompson. ...The short sale is different from a common house acquisition, and, unfortunately, not enough agents have experience in this type of deal -- and many just don't get it right.

Two things agents often get wrong are buyer education and packaging, says Speare Valasakos, a principal in The Frontline Group in San Diego. "Part of the challenge is, a lot of agents are not educating the buyers upfront as to what the process will be, so they go through it, get the buyer, get an offer, package and submit, and the buyer eventually gets nervous and by the time the sale is accepted they go away."

Secondly, the seller's agent needs to be able to put together a proper package of documents to get the lender to look at the file.

"A loss mitigator is dealing with hundreds of files, so if you don't have a complete package and it is not done professionally, it goes to the bottom of the stack," says Valasakos. "An inexperienced agent doesn't give the lender the tools to get a short sale completed."

All that being said, here are some things that can be done to smooth the process:

1) Prequalify the listing agent. If the listing agent hasn't even started getting from the seller the key documents -- tax returns, bank statements, pay stubs, in short, the completion of the "hardship package" -- then the property should not be listed because the agent is nowhere near ready to close a deal.

2) When a property is found, demand a commitment from the seller. In lots of areas, such as California, there is a provision in regulations that allows the seller to continue marketing the property during the short-sale process. However, your agent should have written into the contract that you are the primary buyer and any other offers that come in are backup offers.

3) Many lenders don't look at a short sale unless there is a viable offer in hand. Every agent should have an arsenal of investor clients. If the agent representing the investors can't bring them to the table, she can then go to her investor base and say, "Would you make a fair offer on this property? That allows us to start the foreclosure process. We will give you a 72-hour clause to perform and then substitute a higher offer in there."

4) Broker price opinions are needed for sales, but since brokers doing the valuations are paid so little, they often do no more than a drive-by. However, if you can give the broker background on the property, list what repairs are needed and offer comparables, the valuation can be more accurate.

"The agent," says Valasakos, "is the gatekeeper to getting the short sale accepted."

Steve Bergsman is a freelance writer in Arizona and author of several books, including "After the Fall: Opportunities and Strategies for Real Estate Investing in the Coming Decade."



Pete

Peter H. Tippett, e-Pro, S.H.O.P.

"Helping People Live Indoors"

Associate Broker

RE/MAX Advanced, Inc.

1018 Centre Avenue

Fort Collins, CO 80526

Office: (970) 221-5995 FAX: (970) 221-5999

Direct: (970) 530-2428

Cell: (970) 690-4106

Pete@LivingIndoors.com

BUSINESS LEADERS LAUNCH WEBSITE TO TRACK STIMULUS SPENDING

The Loop: BUSINESS LEADERS LAUNCH WEBSITE TO TRACK STIMULUS SPENDING

July 7, 2009, vol 2, no. 44

BUSINESS LEADERS LAUNCH WEBSITE TO TRACK STIMULUS SPENDING

Construction associations, Denver biz leaders aim for efficiency when spending taxpayer dough

In an effort to ensure stimulus dollars are utilized to their full potential, representatives from the construction industry and members of the business community say they unveiled a Web site this month to facilitate better communication between the public and private sectors.

StimulusColorado.org went live on July 1, and sponsors of the site say their hopes are that it will improve how the private businesses spend the billions of federal dollars flowing into state under the American Recovery and Reinvestment Act.

In addition to a detailed database of the nearly $2.9 billion slated to be spent on infrastructure in Colorado, the website also includes news updates on federal spending and a message board where organizations can meet and discuss stimulus project opportunities.

"This level of collaboration will certainly position Metro Denver and Colorado favorably," said Michael Gifford, of the Associated General Contractors of Colorado. "We want to show that we can move quickly and efficiently to put stimulus dollars to work to create jobs and help the economy."

AGC Colorado and the Colorado Association of Mechanical & Plumbing Contractors spearheaded the initiative to launch the Web site. The Denver Metro Chamber of Commerce, the Metro Denver Economic Development Corporation and the Colorado Contractors Association were partners in the development of the website.

StimulusColorado.org focuses primarily on ARRA spending in the areas of building, energy, natural resources and transportation infrastructure.

"Developing this Web site has improved the collaboration and communication within our business community and our public sector partners, federal labs, and universities to maximize Colorado's share of ARRA discretionary and competitive grants," said Holli Baumunk of the Metro Denver EDC.

Investors Beware!!!!!!

Hi there,

Occasionally this networking thing provides some interesting information. This comes from my friend and fellow Realtor® Scott Lee, who although not a RE/MAX Agent does have his act together. I’ve had a couple of transactions with Scott over the years and I find him to be on my “Attaboy” list, or whatever I’m going to call it…check my website (www.livingindoors.com) out at some point in the future!

Real Estate Investors BEWARE!

There is a new guideline implemented by Fannie Mae to restrict investors from purchasing a Fannie Mae REO (Real Estate Owned) and turning around and selling it for a profit (flip).

Fannie Mae has begun requiring agents who market its REO properties to include provisions in sales contracts that certain anti-flip language will be included in deeds. The language may vary, but is generally along the following lines:

Grantee herein shall be prohibited from conveying property to a bonafide purchaser for a sales price of greater than ($__=120% of sales price) for a period of 180 days from the date of this deed. Grantee shall also be prohibited from encumbering (getting a new loan) subject property with a security interest in the amount greater than ($___=120% of sales price) for a period of 180 days from the date of this deed. These restrictions shall run with the land and are not personal to grantee.

It appears the attempt is to help owner occupied buyers get into property that an investor, with more purchasing power, may have purchased instead. The problem with this concept is when a property is flipped by an investor; they quickly fix up the property usually including good curb appeal, helping to make the neighborhood look better. These flippers often help with higher values in the neighborhood as well, looking to realize a gain in the sale upon completion of the work. Time will tell if making it more difficult for Real Estate investors will help us get out of the current Real Estate slump we are in.

Scott J Lee
Coldwell Banker
www.ScottJLee.com

I find this worthwhile to pass on…

More on the Mason Street Corridor

I am sooooooooo excited for Fort Collins' best kept secret to finally get underway!!!

As part of the Mason Corridor project, Mason and Howes Streets will be changed to accommodate 2-way traffic from Laurel to Cherry Streets. Road closures will begin June 8 and crews will fully convert Howes before moving on to Mason.

Converting Howes:
Beginning June 8, City crews will begin work at Cherry Street and continue south to Laurel. One to two blocks of Howes will be closed for approximately one day at a time while crews are working.

Converting Mason:
Once Howes is completed, work will begin on Mason. The Mason work is tentatively scheduled to start in Mid August; a signal at Laurel and Mason must be installed before the conversion work can begin. Crews will begin at Laurel and move north. One to two blocks of Mason will be closed for approximately one day at a time while crews are working. The conversion of Mason will be more complex and longer in duration.

Business and Property Access:
The work on Howes and Mason will not prevent access to existing businesses and properties, but they may not have access from Mason during the brief road closures. Access from Howes or Mason during each closure will be limited. Certain side streets will no longer be directly accessible from northbound Mason since some of the Mason intersections will prohibit north and south bound left turns. There will not be any right turn restrictions to side streets from Mason.

Parking Impacts:
In order to provide room for new left turn lanes on Mason Street, it will be necessary to eliminate a small number of parking spaces at the Mulberry, Olive, and Mountain intersections. Otherwise, on street parking will remain as is.

Why Change Traffic Flow?
The conversion is designed to increase efficiency for the bus rapid transit system as well as improve overall downtown access and mobility for cars and bicyclists. Converting the streets requires re-painting the roads, changing signage, and managing traffic.

Mason Corridor:
Enabled by transit, the Mason Corridor embodies Fort Collins' commitment to infill development, environmental stewardship, and will be a major element of the community's immediate and long-term economic well-being.

The Mason Corridor is a five mile north-south byway with Bus Rapid Transit within the City of Fort Collins which extends from Cherry Street to south of Harmony Road. The corridor is located along the Burlington Northern Santa Fe Railway property, a few hundred feet west of College Avenue (US 287).

The Mason Corridor is a fundamental connection between the City, Colorado State University, and local business and neighborhoods.

Mason Corridor construction is scheduled to begin in 2010 and be completed by the end of 2011. The Bus Rapid Transit service is scheduled to begin by the end of 2011. For more information about the Mason Corridor visit fcgov.com/mason.

-------------------------------------------------
fcgov.com - Connecting Fort Collins
http://www.fcgov.com

I don't see dead people...I actually see good news in this story!

Fort Collins home prices take small dip
Region's rates down modest amount when compared nationally
BY PAT FERRIER • PatFerrier@coloradoan.com • May 27, 2009

Fort Collins home prices continue to perform better than the national average, falling less dramatically than the rest of the country.

In the new Standard & Poor/Case-Shiller national home price index released Tuesday, home prices for 20 major cities tumbled by 19.1 percent in the first quarter, the most in its 21-year history.

Fort Collins home prices dropped a relatively small 5.4 percent - to $243,408 - for the quarter and bottomed out at $235,326 in March.

Since then, average sale prices rebounded to $248,418 in April, leading some experts to predict the region's sales prices may have hit bottom.
"The first quarter was not very good in terms of volume and pricing," said Dave Pettigrew of Prudential Rocky Mountain Realtors and a Coloradoan real estate columnist.

"March was the bottom. In terms of average selling price, it was the worst month we've had since at least 2007."

Still, Pettigrew does not believe the region is in danger of seeing any double-digit price declines such as those seen on the Case-Shiller report because there's not enough inventory.

"We're in pretty good shape. We went through all of last year with less than 1 percent average price increase."

Year-to-date, the region's average sale price is down 3.8 percent, a "modest" amount compared with the rest of the country, he said.

Pettigrew expects average sales prices to remain in the $245,000 range that they are currently in.

"I don't expect we'll see anything like March for the rest of the year."

While there's still only about a 50/50 chance of selling one's home in this market and many homes priced below $275,000 are selling relatively quickly, Realtors see lower prices, record low interest rates and the $8,000 first-time homebuyer tax credit as a "great time to be buying real estate," said Chip Parrish, a Realtor with BancWise.

"As first-time homebuyers continue to take advantage of the federal tax credit and excellent terms on FHA loans, the "move-up" buyer market is showing strong signs," Parrish said. "The confluence of great pricing and historically low-mortgage rates has produced an unprecedented market for buying."

We haven't hit bottom, not even close. There's still a moratorium on FNM and FRE foreclosures going on. Banks also don't want to foreclose on an underwater house because then they have to take the loss. And sellers in Larimer still are keeping their underwater homes off the market because they think that prices might go back up. We *still* have the giant slug of ARM resets coming this summer, and unemployment is continuing to go up. Home prices are going to go down down down down for the next couple years. I know a lot of prospective homebuyers who refused to buy in 2003-2007, continued to rent, and continue to build up money for a massive 50% downpayment. When interest rates go to 9-11% because of profligate government borrowing, home prices will fall 40-50% nationwide FROM HERE and those that waited to buy with their bag full of cash will be sitting pretty.

Looking to buy a home? Now may be the best time



By Erin Frustaci
For Fort Collins Now
For months, national headlines have screamed of the housing crisis gripping the country. The number of foreclosures has skyrocketed and home values have plummeted, sending the economy into a frenzy.

While Northern Colorado has seen some of the shift on a smaller scale, the truth is these headlines don’t tell the full story on a local level.

Real estate experts suggest that the Fort Collins market is relatively stable and healthy. Combined with historically low interest rates, a promising outlook for price appreciation in the next few years, and the existence of a few motivated sellers who are facing impending foreclosures, there may not be a better time to buy a home in the Fort Collins area, some experts suggest.

In some areas of the country, home prices continue to depreciate, and some potential buyers may be waiting to see the market hit rock bottom. But according to a recent Colorado State University study, home prices in Fort Collins actually grew slightly in the past year, suggesting that the bottom has already occurred here.

Historically low interest rates add to the temptation to buy a home.

“Interest rates allow buyers to afford more home for the same amount of money than what they could afford a few years ago,” said Brandon Bidwell, broker associate with Remax Alliance and member of the Fort Collins Board of Realtors.

For example, two years ago interest rates were about 6.25 percent. Now they are about 5 percent. That makes a big difference to the buyer when it comes down to the monthly payment, Bidwell said.

The recent CSU real estate study showed that five of the 11 major housing markets in Northern Colorado have experienced price increases in the past year. Fort Collins is one of the five.

“What happens with the national headlines doesn’t apply to Fort Collins,” said Rick Hausman, supervising broker with Benchmark Realty LLC.

Sure, the Fort Collins market has been impacted and it might be a little harder to sell a home than it was five years ago, he said, but homes aren’t seeing the drastic drop in value compared to other places. It’s a smoother and steadier market.

Hausman said it’s important to note that there are even markets within markets based on price points and geography.

“The low end of the market is super hot right now,” he said.

Bidwell agreed, adding that in general he has seen inventory shrink, a good sign for the housing industry.

“The majority of that shrinking is in the single-family homes under $250,000,” he said.

He attributes that to the first-time homebuyer tax credit, and said he has seen lots of first-time homebuyers take advantage of the incentive in Fort Collins.

Furthermore, each neighborhood within Fort Collins is different. There are a few that may have depreciated in value. And yet, areas like Old Town remain in high demand. Hausman said it’s common for neighborhoods that are centrally located and closer to jobs to hold their value.

He said overall, Fort Collins was not seeing the movement six months ago that is seeing now, especially in the lower prices.

“Fort Collins is like the slow and steady turtle, never dropping but climbing slowly,” Bidwell said.

Happy Mother's DAy, Sis!

And I really mean that...
You've done a more than admirable job of raising your brood and I respect the hell out of you for that.
You did it with no formal training in spite of some pretty big "catholic" obstacles.
You're my hero!

I've got two pictures displayed at home of/about mom. One is of her somewhere in Red Feather holding her voice gizmo to her throat and she's smiling.
She had to overcome some pretty big obstacles too, huh.
The other is not of her but of the sunset over the ocean when she and I went to Mexico. It's that one that makes me cry, like right now and I ain't even looking at it. T'was the sunset of her life and it was in a foreign country and it was a beautiful sight and there was /is some poetic symbolism with all that but I'm not sure what it was.

Some any time of the year home maintenance tips...

From the Realtor
Internet Newsletter...

Daily Real Estate News | May 6, 2009
Five Maintenance Issues Owners Shouldn't Ignore
Consumer Reports magazine advises home owners not to put off important maintenance projects, noting that waiting until the economy rebounds could end up making the repairs more costly while putting a family's health at risk.

The magazine identifies five crucial maintenance issues:

1) Check the gutters: Clogged gutters, broken fasteners and separations where the gutters meet the fascia board will lead to roof leaks if they haven’t already.
Inspect the roof:
2) Cracked, curled and mussing shingles mean a roof is nearing the end of its useful life. Cracks around chimneys, skylights, and roof valleys can also suggest the roof might be leaking.
3) Look for bugs: Termites and carpenter ants can bore through a home in a few short years. Probe the sill plate on top of the foundation with a screwdriver to check for rotten wood. Also look for carpenter ants and termites along windowsills and walls.
4) Avoid mold: Mold and mildew can cause musty odors, dank air, and make residents sick. Check under carpets and around windows for visible mold or mildew.
5) Don’t ignore cracks: Foundation cracks wider than 3/16 of an inch can be a problem. These require examination by a structural engineer.

Source: Consumer Reports (05/04/2009)

Fort Collins does it again!

One of these days I'm gonna either compose my own list or find a list that already exists of all the "accolades" Fort Collins and Northern Colorado have gotten in the recent past.
Here's "another"...

Money Magazine sez...

Homeowners insurance....

A pretty good, but brief info blurb on Homeowner's insurance:
http://www.mmgweekly.com/video/video_player.html?vidID=189

Below please to here-to-fore-find an e-newsletter I receive weekly from one of my preferred lenders, Ryan Abrahamson of Universal Lending Corporation.
I’ve “cut and pasted it” and therefore probably it will not come out as nicely choreographed because of cut and paste limitations. Should you wish to receive it on a regular basis, I believe there is a subscription link…if not let me know and I’ll get you subscribed…

If you can't see the newsletter, or would like to view it online, use this link
If you have received this newsletter indirectly and would like to be added to our weekly distribution list, use this link



Provided to you Exclusively
By
Ryan Abrahamson& Anne Boward

Ryan Abrahamson & Anne Boward Mortgage Consultants Office: 970-225-2800 Fax: 866-802-0437 Ryan Cell: 970-222-9024 Anne Cell: 970-391-1862 E-Mail: rabrahamson@ulc.com



For the week of Mar 16, 2009 --- Vol. 7, Issue 11



Last Week in Review


"I DO NOT THINK MUCH OF A MAN WHO IS NOT WISER TODAY THAN HE WAS YESTERDAY." Abraham Lincoln. Now more than ever, it's important for our country's leaders to heed yesterday's lessons and make wise choices today for our banking system and the economy. There were several key developments that happened on this front last week - here are some highlights.
On Thursday, the Securities and Exchange Commission's (SEC) Chief Accountant, the Financial Accounting Standards Board's (FASB) Chairman and the Deputy Comptroller for Regulatory Policy in the Treasury Department testified in front of the House Financial Services committee on the "Mark-to-Market" accounting rule. This rule was created so that there would be more transparency in business dealings, but fell prey to the law of "unintended consequences", and has played a major part in our current financial crisis. If you've been receiving this newsletter for awhile, you know this has been discussed several times - and we've even sent you a great explanatory video that breaks down what it all means, and why it has been such a major issue.
Because so many of you have been asking about this topic and great video - I am including the information and video once again in this week's issue - keep reading for the full scoop in the Mortgage Market View article below.
During Thursday's hearing, Congress demanded an answer for repairing this situation within the next three weeks, so right now, it looks like we will see some sort of coordinated action by both the FASB and the SEC to address the Mark-to-Market situation soon. Stocks certainly reacted positively to this news last week, as well as to Citigroup's announcement that it will not need more TARP money from the government. Stocks also liked the remarks from Federal Reserve Chairman Bernanke that the recession would be over by year-end if the banking situation is stabilized, and that major financial institutions would not be allowed to fail.
In other news, the Retail Sales numbers for February came in better than expected and the numbers for January were revised higher. This report is very volatile from month to month, but the last couple of readings have been encouraging. However, the job market continues to struggle as the number of people receiving unemployment reached a record 5.32 Million. And there was news that China is concerned the US may be spending too aggressively on the recession, which could lead to inflation down the road that would diminish the value of Bonds and China's investments in the US.
Overall, Bonds and home loan rates didn't worsen last week - even with the huge Stock rally - and ended the week relatively close to where they began.

Forecast for the Week


The middle of this week will be action packed with both scheduled economic reports and the Fed's next regularly scheduled meeting, including their policy statement and rate decision being delivered on Wednesday. With all the actions the government has been taking to stabilize our economy, it will be especially important to hear what the Fed has to say.and to see how the markets react.
This week also brings news on the inflation (or deflation) front, with Tuesday's wholesale measuring Producer Price Index (PPI) Report and Wednesday's Consumer Price Index (CPI) Report. Given China's concerns mentioned above about US spending to combat the recession and what that could mean for inflation, it will be important to see how these reports come in.
Also this week, we'll get a read on the new construction housing market with Tuesday's Housing Starts and Building Permits Reports. On Thursday, the Philadelphia Fed Report will be released. This monthly survey of manufacturing purchasing managers conducting business around the tri-state area of Pennsylvania, New Jersey, and Delaware is one of the most-watched manufacturing reports. We'll also have another Initial Jobless Claims report on Thursday, and with the number of people collecting unemployment reaching record highs as mentioned above, it will be important to keep an eye on this report, too.
Remember: Weak economic news normally helps Bonds and home loan rates improve, as money flows out of Stocks and into Bonds. As you can see in the chart below, Bonds were helped by important technical support and were able to hold onto recent gains even with the rally in the Stock market. I'll be watching closely to see how Bonds and home loan rates react to all of this week's events!
Chart: Fannie Mae 4.5% Mortgage Bond (Friday Mar 13, 2009)

The Mortgage Market View...


The current economic crisis is the top news story for nearly every media outlet. But until recently, one of the most important factors that led to this challenging market has also been one of the least discussed.
By popular demand, I am again sending along this highly sought after video and article, unpacking the "Mark-to-Market" accounting issue - with some help from Barry Habib. Barry is a highly respected expert on home loans, who serves as Chairman of MSS, an organization that helps me to stay informed as your trusted advisor.
With the help of some easy-to-understand terms and illustrations, you will learn what it has taken the media and politicians many months to take seriously and begin to address.
Link here now to get the real story: www.mortgagesuccesssource.com/go/markmarket/

The Week's Economic Indicator Calendar


Remember, as a general rule, weaker than expected economic data is good for rates, while positive data causes rates to rise.
Economic Calendar for the Week of March 16 - March 20
Date
ET
Economic Report
For
Estimate
Actual
Prior
Impact
Mon. March 16
08:30
Empire State Index
Mar
-32.0

-34.65
Moderate
Mon. March 16
09:15
Capacity Utilization
Feb
71.1%

72.0%
Moderate
Mon. March 16
09:15
Industrial Production
Feb
-1.2%

-1.8%
Moderate
Tue. March 17
08:30
Building Permits
Feb
510K

531K
Moderate
Tue. March 17
08:30
Housing Starts
Feb
453K

466K
Moderate
Tue. March 17
08:30
Core Producer Price Index (PPI)
Feb
0.1%

0.4%
Moderate
Tue. March 17
08:30
Producer Price Index (PPI)
Feb
0.4%

0.8%
Moderate
Wed. March 18
02:15
FOMC Meeting



0.00% - 0.25%
HIGH
Wed. March 18
10:30
Crude Inventories
3/13
NA

749K
Moderate
Wed. March 18
08:30
Core Consumer Price Index (CPI)
Feb
0.1%

0.2%
HIGH
Wed. March 18
08:30
Consumer Price Index (CPI)
Feb
0.3%

0.3%
HIGH
Thu. March 19
08:30
Jobless Claims (Initial)
3/14
NA

654K
Moderate
Thu. March 19
10:00
Index of Leading Econ Ind (LEI)
Feb
-0.6%

0.4%
Low
Thu. March 19
10:00
Philadelphia Fed Index
Mar
-40.0

-41.3
HIGH


The material contained in this newsletter is provided by a third party to real estate, financial services and other professionals only for their use and the use of their clients. The material provided is for informational and educational purposes only and should not be construed as investment and/or mortgage advice. Although the material is deemed to be accurate and reliable, we do not make any representations as to its accuracy or completeness and as a result, there is no guarantee it is not without errors.

As your trusted advisor, I am sending you the MMG WEEKLY because I am committed to keeping you updated on the economic events that impact interest rates and how they may affect you.

Watch out for phony HUD Website!

One of my preferred Mortgage Lenders, Ryan Abrahamson, sent me this moments ago...

Please see the email below from the Oklahoma City HUD Director’s Office…

HUD staff please let your customers know that there is a deceptive website out there that is posing as HUD. This website tries to dupe people into giving out personal information (known as “phishing”) - and because they’ve made their site appear to be an “official us government website”, some people may fall prey to this scam.
The website is: http://bailout.hud-gov.us/
The IG has been notified, and is investigating.
Ryan Abrahamson Sales Manager Universal Lending Corp.
970-225-2800 office 970-222-9024 cell 866-802-0437 fax rabrahamson@ulc.com
300 E. Horsetooth Rd, Ste 200 ~ Ft. Collins, CO 80525

Thanks, C.J.!

I love learning new things, new ideas or new concepts...I just do!!!!

I was out looking at a house with a client, we'll call her C.J., because that's her name(!) and we were talking about real estate stuff in general and I made the comment that there were a lot of +'S and -'s to buying a house and one of the +'s is that the mortgage interest deduction is still, even if Obama's thing about reducing the deduction for those who make over 250k is reduced (which is really not "true" because by the time a lot of folks who make way over 250k take advantage of legal tax deductions their taxable income is less than 250k...), is still the largest tax deduction most of us get!
That's the good news.
The bad news is that the new home owner doesn't "feel" that benefit until they file their taxes the following year.
We had gotten on to this subject because we were talking about "payment comfort level" and how buying can frequently be cheaper than renting one the tax consequences take ahold...
The concept here being that one can make a payment higher equal to or higher that one's rental payment and still it is "cheaper" because one's tax liability is significantly reduced.
"Significantly?", you ask.
"Yes.", replies your accountant as he then goes into accounting nuances that are unique and specific to each individual so I don't/won't go there.

So, anywho, she said, "Well, that's why I'll sock away $3,000 until that 'more money in my pocket' shows up next year and out of the $8,000 I'll still have enough money to pay off an irritating credit card bill and have the tuition for schooling for Medical Transcribing."

I took a 'lil poetic license there, but that's what she meant...I believe.

That sounds to me like what this Home Buying Stimulus Incentive is all about, huh!

Thanks, C.J.!

8k Stimulus Incentive Confusions

Penny Kast, my S.H.O.P. lender partner from First National Bank had a S.H.O.P. (Sensible Housing Opportunity Program) Workshop on Saturday and attendance was limited, but that's just part of the age old marketing dilemma of how do you get folks to attend????
The demise of the Rockey Mountain News speaks volumes for the ineffectiveness of print advertising.$8,000.00 is a goodly amount of cash and there are a some myths that need to go away!
Myth #1...You do not have to be a First Time Home Buyer, per se.A First Time Home Buyer is anyone who has not owned a home in the last 3 years!!!!!!! You could have owned 12 homes in the past but not owned one for the last three years and you're considered a 1st Time Buyer!Myth #2...The money does not have to be applied to the purchase of the home!!!!I'm working with a lady right now who wants to muse it for tuition!!!!
Myth #3...That it's a Tax Credit and not cash.It is...but it's not. It's funded along with you're IRS Refund. If you have a refund coming of $400.00, your refund check will be for $8,400. If you owe $400.00 you will get a check for $7,600.
In any event, you need to check with your accountant.
Lemme know if you have any thoughts or comments.
Gotta run....

Final Score: $8,000 for Homebuyers

Final Score: $8,000 for Homebuyers
By Les Christie, CNNMoney.com staff writer
Feb 17th, 2009
First-time purchasers get a tax credit windfall if they buy before December.
NEW YORK (CNNMoney.com) -- There's a nice windfall for some homebuyers in the economic stimulus bill signed into law this week by President Obama. First-time buyers can claim a credit worth $8,000 - or 10% of the home's value, whichever is less - on their 2008 or 2009 taxes.
A big plus is that the credit is refundable, meaning tax filers see a refund of the full $8,000 even if their total tax bill - the amount of witholding they paid during the year plus anything extra they had to pony up when they filed their returns - was less than that amount. But there has been a lot of confusion over this provision. Adam Billings of Knoxville, Tenn. wrote to CNNMoney.com asking:

"I will qualify as a first-time home buyer, and I am currently set to get a small tax refund for 2008. Does that mean if I purchased now that I would get an extra $8,000 added on top of my current refund?"
The short answer? Yes, Billings would get back the $8,000 plus what he'd overpaid. The long answer? It depends. Here are three scenarios:
Scenario 1: Your final tax liability is normally $6,000. You've had taxes withheld from every paycheck and at the end of the year you've paid Uncle Sam $6,000. Since you've already paid him all you owe, you get the entire $8,000 tax credit as a refund check.
Scenario 2: Your final tax liability is $6,000, but you've overpaid by $1,000 through your payroll witholding. Normally you would get a $1,000 refund check. In this scenario, you get $9,000, the $8,000 credit plus the $1,000 you overpaid.
Scenario 3: Your final tax liability is $6,000, but you've underpaid through your payroll witholding by $1,000. Normally, you would have to write the IRS a $1,000 check. This time, the first $1,000 of the tax credit pays your bill, and you get the remaining $7,000 as a refund.
To qualify for the credit, the purchase must be made between Jan. 1, 2009 and Nov. 30, 2009. Buyers may not have owned a home for the past three years to qualify as "first time" buyer. They must also live in the house for at least three years, or they will be obligated to pay back the credit.
Additionally, there are income restrictions: To qualify, buyers must make less than $75,000 for singles or $150,000 for couples. (Higher-income buyers may receive a partial credit.)
Applying for the credit will be easy - or at least as easy as doing your income taxes. Just claim it on your return. No other forms or papers have to be filed. Taxpayers who have already completed their returns can file amended returns for 2008 to claim the credit.
Lukewarm reception
The housing industry is somewhat pleased with the result because the stimulus plan improves on the current $7,500 tax credit, which was passed in July and was more of a low-interest loan than an actual credit. But the industry was also disappointed that Congress did not go even further and adopt the Senate's proposal of a $15,000 non-refundable credit for all homebuyers.
"[The Senate version] would have done a lot more to turn around the housing market," said Bernard Markstein, an economist and director of forecasting for the National Association of Homebuilders (NAHB). "We have a lot of reports of people who would be coming off the fence because of it."
Even so, the $8,000 credit will bring an additional 300,000 new homebuyers into the market, according to estimates by Lawrence Yun, chief economist for the National Association of Realtors.
The credit could also create a domino effect, he said, because each first-time homebuyer sale will lead to two more trade-up transactions down the line. "I think there are many homeowners who would be trading-up but they have had no buyers for their own homes," Yun said.
Who won't benefit, according to Mark Goldman, a real estate lecturer at San Diego State University, are those first-time homebuyers struggling to come up with down payments. The credit does not help get them over that hurdle - they still have to close the sale before claiming the bonus.
One state, Missouri, is trying to get around that problem by creating a short-term loan on the tax credit of up to $6,750. The state would loan borrowers the money so they could use it at closing as part of the downpayment. Then, when the buyers receive their tax credit from the IRS, they pay back the state. Other states may follow with similar programs, according to NAHB's Dietz.
Many may look at the tax credit as a discount on the home price, according to Yun. A $100,000 purchase effectively becomes a $92,000 one. That can reassure buyers apprehensive about purchasing and then watching prices continue falling, he added.
And it provides a nice nest egg for the often-difficult early years of homeownership, when unexpected repairs and expenses often crop up. Recipients could also use the money to buy new stuff for their home - a lawnmower, a rug, a sofa - and, in that way, help stimulate the economy.

$7,500 Tax Credit in the Stimulus Package

Homebuyers get a bonus in the stimulus bill
First time buyers could receive a $7,500 tax credit if they purchase soon.
By Les Christie, CNNMoney.com staff writer
Last Updated: January 29, 2009: 7:38 AM ET

NEW YORK (CNNMoney.com) -- If you're thinking of buying a home, there could be a big bonus for you in the economic stimulus bill that's now before Congress.
Among its many provisions is a $7,500 tax credit for first time home buyers. The House passed the $819 billion stimulus plan, including this tax credit, in a vote late Wednesday. The Senate may vote on its version of the bill some time next week.
Technically, the stimulus bill is actually changing the terms of the $7,500 tax credit that was issued as a part of the Housing Recovery Act, which Congress passed last summer. That legislation required that the tax credit be repaid over 15 years, making it more of a no-interest loan. Not surprisingly, the measure had little impact on the market. The stimulus bill now under consideration would make that tax credit a true credit that doesn't need to be repaid.
Many in the housing industry believe this credit could do a lot to jump start the moribund housing market.
"Our economists have studied the effect [of the credit] and they say there could be a 10% increase in home sales if it's implemented," said Mary Trupo, a spokeswoman for the National Association of Realtors. "It gives people who are sitting on the fence or who have inadequate funds for closing costs an incentive to act now."
A 10% increase would yield an extra half million sales this year.
Who qualifies
To be eligible, buyers cannot have owned a home for the past three years, and the new home has to be used as a primary residence. The credit phases out as income rises above $75,000 for singles and $150,000 for couples, and disappears entirely at $95,000 and $170,000, respectively.
Applying for it is easy, or at least as easy as doing your income taxes. Just claim it on your return. That's it. No other forms or papers have to be filed.
Both the Senate and the House versions of the new act remove the requirement that buyers repay the credit. The Senate bill applies retroactively to any purchase completed between January 1, 2009 and the end of August. The House version is also retroactive to the start of the year, and expires at the end of June. As long as buyers don't sell for at least 36 months, they keep the money.
And the credit is refundable, meaning that it can be claimed even if the amount of the credit earned exceeds the buyer's tax liability.So even if your total tax bill comes to just $5,000, you can still qualify for a full $7,500 refund.
The housing industry has been pushing this idea for many months, arguing that first-time homebuyers are the key to boosting home sales. First time buyers who purchase from existing homeowners free those sellers to trade up to bigger, better houses.
Buyers beware
But the credit has its drawbacks, according to Bob Williams, a spokesman for the Tax Policy Center, which gave it a mediocre C+ grade in its Tax Stimulus Report Card. Williams points out that buyers should beware that they won't actually receive any refund for a home purchased this year until after they file their 2009 income taxes in April 2010.
And he argues that the credit is poorly targeted because it goes to every first-time buyer, not just the ones who wouldn't buy without it. So, it merely provides a windfall for many people who would have purchased anyway.
And in the end, a $7,500 tax credit, regardless of the details, does nothing to address the issue that's holding most buyers back - the suspicion that prices are going to keep falling.
"As long as people are uncertain about what markets are going to do, this won't help much," said Williams. "It's not enough to change that."
The industry would like to make the tax credit stronger by making it available to all homebuyers, not just first-timers. And it's pushing to have the credit last through the end of the year, at least.
"By the time it's implemented," said Trupo, "there could be very few months left to act."
First Published: January 29, 2009: 4:45 AM ET

Find this article at: http://money.cnn.com/2009/01/29/real_estate/tax_credit_near/index.htm?postversion=2009012907

Foreclosure Scams are Happening Here, Too!

From the New York Times, January 14, 2009
January 15, 2009
Swindlers Find Growing Market in Foreclosures
By JOHN LELAND
As home values across the country continue to plummet, the authorities say a new breed of swindler is preying on the tens of thousands of homeowners desperate to avoid foreclosure.
Until recently, defrauders tried to bilk homeowners out of the equity in their homes. Now, with that equity often dried up, they are presenting themselves as “foreclosure rescue companies” that charge upfront fees to modify loans but often do nothing to stave off foreclosure.
The Federal Trade Commission brought lawsuits last year against five companies representing 20,000 customers, and state and local prosecutors have brought dozens more. In Florida, Attorney General Bill McCollum recently sued a company that he said had more than 600 victims.
“There’s no way for the consumer to sort out the legitimate companies,” said Mr. McCollum, who added that he had limited resources to fight what he called “a sheer volume question.”
The companies under suspicion typically charge an upfront fee of up to $3,000 to help borrowers get lower rates on their mortgages from their lenders. But borrowers often cannot afford the fees, the service can be bogus and, in the worst cases, the homeowners lose their chance to renegotiate with their bank or to file for bankruptcy protection because of the time wasted.
There are companies that provide legitimate foreclosure services, but the industry is largely unregulated, making it difficult for homeowners to separate the good from the bad. Some of the fraudulent companies — often run by former real estate agents or mortgage brokers — are local; others are national. Many have official-looking Web sites that suggest that the companies have government affiliations and give homeowners a false sense of security.
“That’s all I’ve been doing for the last year,” said Angela Rosenau, a deputy attorney general in California, citing more than 300 complaints about fraudulent companies last year, not counting those made to local prosecutors.
Experiences like those of Maria Martinez, of Stockton, Calif., are playing out with greater frequency across the country, the authorities say. Ms. Martinez struggled to pay her mortgage last summer. She had no shortage of people offering to help. Fliers for rescue companies filled her mailbox.
At a seminar for troubled borrowers near her home, one company offered a service that promised just what Ms. Martinez needed: for $1,000, the company said it would negotiate with her mortgage company to lower her interest rate.
“I was desperate,” said Ms. Martinez, 57, a clerk at the San Joaquin County Jail. She made an initial payment of $500 and paid another $500 a few weeks later.
Now the house is in foreclosure, and Ms. Martinez is waiting for the sheriff to evict her. She cannot reach the man she paid to modify her loan.
In California and 20 other states, including New York, companies are prohibited from collecting payment until they have completed their services, something Ms. Martinez did not know. In Colorado, the attorney general’s office has closed 15 mortgage rescue companies that charged fees up front.
Carol McClelland, 46, fell into foreclosure on her Chicago home when she lost her job as a waitress in two restaurants. She received a call from a company called Foreclosure Solutions Experts, promising to stop the foreclosure and lower her mortgage payments to around $550 a month, from $1,056, Miss McClelland said.
“She showed me other clients’ files, and they were paying $650 a month,” she said. The charge for the service was $1,300, which Miss McClelland paid in installments, borrowing the money from friends and relatives.
When the loan servicer notified her that the house was still in foreclosure, Miss McClelland said, the representative from Foreclosure Solutions Experts told her that the matter had been taken care of.
“She told me everything was all settled; I don’t have to worry about anything,” Miss McClelland said. “All I had to worry about was getting the rest of the money to her.”
According to a suit brought by the Illinois attorney general in November, Foreclosure Solutions Experts does little or nothing to help consumers, and when it does take action, the result is often a repayment plan unsuited to the borrower’s ability to pay. The suit alleges that the company never contacted Miss McClelland’s lender, HSBC.
Illinois is one of the states that bans upfront payments to foreclosure rescue companies. The attorney general’s office has received “thousands” of complaints about such companies, said Michelle Garcia, an assistant attorney general, and the suit against Foreclosure Solutions Experts is one of 22 filed by the state.
Stacy Strong, who runs Foreclosure Solutions Experts, did not return calls for comment.
Advocates say foreclosure rescue scams are particularly insidious because they prey on people’s desperation and because they victimize those who can least afford it.
Borrowers seeking loan modification are often frustrated that they cannot reach the right people at their lender or that the lender insists on a repayment plan they cannot keep, said Ira Rheingold, executive director of the National Association of Consumer Advocates.
“When you’re desperate, that’s when the crooks come out,” Mr. Rheingold said. “You’ve tried everything, and a guy calls you up on the phone or there’s an ad on TV, and you have no other options, what do you do? You go to those guys.
“People probably know in their heart of hearts that they may be getting ripped off, just like most people understood on their mortgages that they were getting in too deep, but bankers said yes, so it must be O.K. It’s the same thing. The real problem is that we continue to fail to have systems in place that help people.”
Ms. Rosenau, the California prosecutor, said that even when she told people that they had been swindled, “they don’t believe it, because they want it not to be true.”
“And any money they had to possibly work with the lender is now gone to the scam,” she said.
In Baltimore, where neighborhoods have been buffeted by successive waves of mortgage scams, Ann Norton, director of foreclosure prevention at the nonprofit St. Ambrose Housing Aid Center, said companies promising loan modifications started to multiply last summer.
“It’s the same people that joined the industry during the refinance boom, and now they’re making fees for submitting loan remediation forms,” said Ms. Norton, whose agency provides free help to borrowers.
Although Maryland was among the first states to enact legislation defining mortgage rescue fraud, Ms. Norton said, “it’s a growing industry, and it’s under the radar.”
Often the scammers represent themselves as having connections to government groups, or copy the name and typography of the Hope Now program, an alliance of nonprofit, government and lending agencies, said Marietta Rodriguez, director of national homeownership programs at NeighborWorks America, a nonprofit group that provides free government-certified foreclosure counseling through 235 local organizations.
“Several took the Hope Now Web site and just reskinned it with their own information, or they use government seals,” Ms. Rodriguez said. “They’re very crafty, and their marketing strategies are aggressive.”
Peggy L. Twohig, associate director of the financial practices division at the Federal Trade Commission, said consumers should be wary of companies that promise results, charge upfront fees or tell them not to contact their lender on their own. Ms. Twohig said consumers could get the same help free from nonprofit housing counselors.
“Our advice to consumers is to contact their loan servicers directly or to call Hope Now or HUD-approved housing counselors,” she said.
Last year, Congress approved $180 million in grants to nonprofit housing counselors.
As Ms. Martinez awaits eviction, the temptation to try another foreclosure rescue specialist remains. “There’s other agencies that say they can help,” she said, “but I’m scared that I can’t trust them.
“One man said, ‘You have to be persistent,’ ” she said. “But I’m scared to get someone else, because they probably won’t help me, or can’t.”