http://mortgage.windermerecitygroup.com/Cascade Mortgage Branch Manager (509) 232-7725en-usWed, 04 Aug 2010 10:17:00 GMT10GDRSSFeeds v1.0http://mortgage.windermerecitygroup.com/blog/2010/08/04/waiting-to-buy-may-cost-you&nbsp;<span style="line-height: 115%; font-size: 12pt">Still waiting for prices to drop a few more bucks before you buy?&nbsp;There is no doubt you may save on the purchase price by waiting.&nbsp;But will it really save you money in the end?&nbsp;Possibly Not.&nbsp;</span> <div><span style="line-height: 115%; font-size: 12pt">Let's take one example at look at the numbers.&nbsp;There is a home that is currently listed for $150,000.&nbsp;The current interest rate for an FHA 30-year, fixed rate mortgage is 4.250%.&nbsp;You are approved FHA and can buy the home now but you would like to see the price drop another $10,000.00 so you wait.&nbsp;</span> <div>&nbsp;</div> <span style="line-height: 115%; font-family: Wingdings; font-size: 12pt">&#216;&nbsp;</span><span style="line-height: 115%; background: yellow; font-size: 12pt">$150,000 price</span><span style="line-height: 115%; font-size: 12pt"> with the minimum 3.5% down payment with an FHA rate of&nbsp;<span style="background: yellow">4.25%</span> equals a principal, interest and monthly mortgage insurance payment of <span style="background: yellow">$796.85.</span> (APR 5.349%)</span></div> <div><span style="line-height: 115%; font-size: 12pt">You wait a couple of months and the price drops $10,000 so you decide to move forward with an offer.&nbsp;Your patience paid off.&nbsp;Unfortunately, interest rates have increased.&nbsp;Now rates can increase at a rapid pace (the saying goes "rates move down on the escalator, but UP on the elevator").&nbsp;For this example, let's just say they went up a modest 1% to 5.25%.&nbsp;</span> <div>&nbsp;</div> <span style="line-height: 115%; font-family: Wingdings; font-size: 12pt">&#216;&nbsp;</span><span style="line-height: 115%; background: yellow; font-size: 12pt">$140,000</span><span style="line-height: 115%; font-size: 12pt"> price with a minimum 3.5% down payment with an FHA rate of <span style="background: yellow">5.25%</span> equals a principal, interest and monthly mortgage insurance payment of <span style="background: yellow">$824.57</span> (APR 6.335%)</span></div> <div><span style="line-height: 115%; font-size: 12pt">In the end, waiting to save $10,000 on the price will cost you $27.72 a month or $332.64 a year or a total of $9,979 over 30 years.&nbsp;You didn't save $10,000, it cost you $10,000.&nbsp;</span> <div>&nbsp;</div> <span style="line-height: 115%; font-family: Wingdings; font-size: 12pt">&#216;&nbsp;</span><span style="line-height: 115%; background: yellow; font-size: 12pt">If rates were to increase to 1.5% more than now, the yearly increase in payment would be $852.00!</span></div> <div><span style="line-height: 115%; font-size: 12pt">Work with professional and educated Realtors and Lenders to find out if buying now is best for your situation.&nbsp;For some, waiting is a must and there is nothing you can do about it.&nbsp;But for many, waiting may just end up costing you more in the long run.&nbsp;Remember, interest rates are volatile.&nbsp;We have seen historic lows and have gotten used to seeing them "low".&nbsp;This won't last forever. When rates go up, home prices tend to follow.</span> <div>&nbsp;</div> <div>Call me at 509.232.7725 or email me at <a href="&#109;&#97;&#105;&#108;&#116;&#111;&#58;&#100;&#103;&#101;&#105;&#98;&#101;&#108;&#64;&#99;&#97;&#115;&#99;&#97;&#100;&#101;&#109;&#111;&#114;&#116;&#103;&#97;&#103;&#101;&#119;&#97;&#46;&#99;&#111;&#109;">dgeibel@cascademortgagewa.com</a> if you have questions regarding rates or programs.</div> </div><P><a href="http://mortgage.windermerecitygroup.com/blog/2010/08/04/waiting-to-buy-may-cost-you" target="_blank">Permalink</a> | <a href="http://mortgage.windermerecitygroup.com/blog/2010/08/04/waiting-to-buy-may-cost-you#comments" target="_blank">Comments</a></P>Denelle Geibelhttp://mortgage.windermerecitygroup.com/blog/2010/08/04/waiting-to-buy-may-cost-youWed, 04 Aug 2010 10:17:00 GMThttp://mortgage.windermerecitygroup.com/blog/2010/07/01/home-buyer-tax-credit-closing-date-extended-to-sept-30th<p>Better late than never - as the saying goes!&nbsp; Yesterday, at the end of the day, the Senate passed H.R. 5623 Homebuyer Assistance and Improvement Act.&nbsp; This bill allows those buyers that qualify for the FTHB&nbsp;Tax Credit and entered into a binding contract by April 30, 2010, to extend the closing of their loan until September 30, 2010.</p> <div> <p>H.R. 5623 would extend the homebuyer tax credit of up to $8,000 for the purchase of a principal residence before October 1, 2010.&nbsp; The current benefits apply to cover buyers who enter into contracts before April 30 and close by June 30.&nbsp; This bill would extend the closing date to September 30, 2010.</p> <p>The bill would provide any homebuyer who entered into a contract on a home by April 30, 2010, but have been unable to go to closing within the required 60 days; the provision would extend the closing date for an additional 90 days.&nbsp; This provision is estimated to cost $140 million</p> <p>The bill would enhance information sharing to prevent prisoners from claiming the Homebuyer tax credit.</p> <p>The bill would apply a bad check penalty to electronic checks.&nbsp; Under current law, taxpayers who submit a bad check or money order to the IRS must pay a penalty of 2% of the amount of the check or money order.&nbsp; If the amount is less than $1,250, the penalty is the lesser of $25 or the amount of the check.&nbsp; Effective after the date of enactment, the provision would apply the penalty to all commercially acceptable instruments of payment.</p> <p>This bill would modify Travel Promotion Act of 2009.&nbsp; This provision would extend the authority of the Department of Homeland Security to implement fees related to the recently-enacted Travel Promotion Act for one year, through fiscal year 2011. This provision would reduce the deficit by $95 million over 11 years.</p> <p>Please email me at <a href="&#109;&#97;&#105;&#108;&#116;&#111;&#58;&#100;&#103;&#101;&#105;&#98;&#101;&#108;&#64;&#99;&#97;&#115;&#99;&#97;&#100;&#101;&#109;&#111;&#114;&#116;&#103;&#97;&#103;&#101;&#119;&#97;&#46;&#99;&#111;&#109;" mce_href="mailto:dgeibel@cascademortgagewa.com">dgeibel@cascademortgagewa.com</a> with any questions.</p> </div><P><a href="http://mortgage.windermerecitygroup.com/blog/2010/07/01/home-buyer-tax-credit-closing-date-extended-to-sept-30th" target="_blank">Permalink</a> | <a href="http://mortgage.windermerecitygroup.com/blog/2010/07/01/home-buyer-tax-credit-closing-date-extended-to-sept-30th#comments" target="_blank">Comments</a></P>Denelle Geibelhttp://mortgage.windermerecitygroup.com/blog/2010/07/01/home-buyer-tax-credit-closing-date-extended-to-sept-30thThu, 01 Jul 2010 08:32:00 GMThttp://mortgage.windermerecitygroup.com/blog/2010/06/28/monday-morning-update<p>What a great weekend.&nbsp; The weather finally realized it was Summer and brought us perfect conditions for Hoopfest and Ironman!&nbsp; There was a ton of news from Washington last week.&nbsp; We have been recovering from the deepest financial crisis since the Great Depression. The government, led by the Fed, has been firing on all cylinders ever since. In my opinion, they started a bit late and that became part of the problem as we were convinced the markets could survive what was then termed a "sub-prime crisis." Well, it became much more than that. Since this late start, the Fed has been doing just about everything besides washing America’s dishes. &nbsp;&nbsp;From day one, this has been a crisis of confidence. The public and the markets must be convinced that the economy will recover. We must not think or speak negative thoughts. It may take some time, but employment will grow and as employment grows, Americans will purchase houses and cars. Then our worry will be when will the Fed raise rates and how will we pay for all the money we have spent. Meanwhile, today we have an unprecedented opportunity to take advantage of bargains courtesy of the Federal Reserve Board.</p> <p><span style="color: #00ccff" mce_style="color: #00ccff;">&nbsp;</span><strong><span style="color: #00ccff" mce_style="color: #00ccff;">Last Week in Review</span> - </strong><strong>What happens in Washington <em>doesn't</em> stay in Washington!</strong> And there was a lot happening in Washington this past week, between the Fed’s two-day meeting and actions in Congress. So how will all of these happenings impact you…and home loan rates, which are near all-time lows? Read on for details.</p> <p>Last week, the Fed decided to keep the Fed Funds Rate at 0.25%, and also reiterated in its Policy Statement that economic conditions warrant keeping the Fed Funds Rate low for an “extended period”. First, what is the Fed Funds Rate? It is the lending rate banks charge each other for the use of overnight funds, and it is used as a base rate that many other lending rates are based on, for consumer and business loans.</p> <p>And second, why is the “extended period” language significant? The Fed has to time very carefully any action – or even hints of action – on raising the Fed Funds Rate, which they have held at the lowest levels in history for the last year and a half. If the Fed raises the Fed Funds Rate too soon, it could slow economic activity and cause a "double dip" recession. However, if the Fed waits too long to raise the Fed Funds Rate, inflation could result.</p> <p>Congress was just as busy as the Fed last week. On Thursday, the Financial Reform Bill was finally reconciled between the House and Senate. The final draft includes a Consumer Financial Protection Agency, which will have the authority to police banks for mortgage lending and credit-card abuses. The bill will move to the President for his signature once both houses of Congress approve the final version.</p> <p>However, Congress did not pass the extension of the Home Buyer Tax Credit. <strong><em>Note: This extension was only going to be for people who were under contract by the initial April 30th deadline, extending their June 30th closing deadline to September 30th.</em></strong> The extension was part of the larger Jobs Bill, which included State aid and an extension of unemployment benefits for people out of work more than six months – and would have added $33B to the deficit. Meanwhile, the National Association of Realtors is saying that up to 30% of homes that went under contract by the April 30th deadline of the Homebuyer Tax Credit will likely not close by the current June 30th deadline.</p> <p>There was other housing news last week, as both New Home Sales and Existing Home Sales were well below expectations. While a decline in sales was expected after people were racing to qualify for the April 30th Tax Credit deadline, the numbers are still a bit of a disappointment.</p> <p><strong><em>However – home prices remain affordable, and home loan rates are far from disappointing at the moment...last week they reached all time low levels! If you or anyone you know would like to learn more about this exceptional opportunity, please don’t hesitate to call or email. Or forward this newsletter on to anyone you think may benefit and I’d be happy to consult with them free of charge.</em></strong></p> <p><strong><span style="color: #00ccff" mce_style="color: #00ccff;">Interest Rates</span> -</strong>Rates fell to their lowest levels since Freddie Mac started tracking them in 1971. Freddie Mac announced that for the week ending June 24, 30-year fixed rates averaged 4.69%, down from 4.75% the previous week. The average for 15-year fixed fell to 4.13%.</p> <p><strong><span style="color: #00ccff" mce_style="color: #00ccff;">Forecast for the Week</span> -</strong>There will be plenty happening this week, ahead of the Independence Day holiday. The week may start with a bang, as Monday’s <strong>Personal Income</strong> and <strong>Personal Spending Reports</strong> arrive, giving us a look at the <strong>Core Personal Consumption Expenditure (PCE) Index</strong> as well...which just happens to be the Fed's favorite gauge of inflation. Rest assured the Fed will be watching this report very closely. Any hint that inflation is heating up could definitely impact the Fed’s decision on rates and the “extended period” language at future Fed meetings.<strong></strong></p> <p>Thursday brings another Initial Jobless Claims Report. Initial Jobless Claims came in at 457,000 last week and Continuing Claims at 4.55 Million. In addition, an additional 4.73M people are claiming EUC (Emergency Unemployment Compensation) benefits. The continuing high level of unemployment claims is disturbing, but things will improve. Remember, job losses come in the thousands as companies endure sweeping layoffs, but individuals are hired back one at a time. And remember – since the Jobs Bill has not been passed, more people will start to drop off extended unemployment benefits – and rejoin the workforce as formally unemployed.</p> <p>And there could be some real fireworks on Friday, as the Labor Department releases the Jobs Report for June. Last month’s Jobs Report showed 431,000 jobs created in May. While on the surface this seems positive, the number was below expectations and also was primarily made up of temporary census workers…who will once again join the ranks of the unemployed when the 2010 Census has been completed. The Unemployment Rate did drop from 9.9% to 9.7%, but overall May’s Jobs Report was disappointing.</p><P><a href="http://mortgage.windermerecitygroup.com/blog/2010/06/28/monday-morning-update" target="_blank">Permalink</a> | <a href="http://mortgage.windermerecitygroup.com/blog/2010/06/28/monday-morning-update#comments" target="_blank">Comments</a></P>Denelle Geibelhttp://mortgage.windermerecitygroup.com/blog/2010/06/28/monday-morning-updateMon, 28 Jun 2010 09:48:00 GMThttp://mortgage.windermerecitygroup.com/blog/2010/06/25/extension-to-close-for-first-time-home-buyer-tax-credit-fails<p>A bill that would have extended unemployment benefits, as well as extended the closing date for the first time homebuyer tax credit to September 30th, and extended a variety of other tax credits, failed&nbsp;to get enough&nbsp;votes yesterday.&nbsp;</p> <p>The amendment to extend the closing date for the tax credit was attached to a much larger Jobs Bill that would add an estimated $35B to our already burgeoning deficit.&nbsp; The Jobs Bill also would have extended unemployment benefits for people out of work more than six months.</p> <p>The White House said that the President will continue to try and move the Bill through Congress.&nbsp; Hopefully the extension can be passed as a stand-alone measure or attached to a less controversial bill.</p> <p>For now, those that qualify for the First Time/Repeat Buyer Tax Credit must close their loans by June 30, 2010.</p> <p>Please feel free to email me at <a href="&#109;&#97;&#105;&#108;&#116;&#111;&#58;&#100;&#103;&#101;&#105;&#98;&#101;&#108;&#64;&#99;&#97;&#115;&#99;&#97;&#100;&#101;&#109;&#111;&#114;&#116;&#103;&#97;&#103;&#101;&#119;&#97;&#46;&#99;&#111;&#109;" mce_href="mailto:dgeibel@cascademortgagewa.com">dgeibel@cascademortgagewa.com</a> or call me at 509-232-7725 with any questions.</p><P><a href="http://mortgage.windermerecitygroup.com/blog/2010/06/25/extension-to-close-for-first-time-home-buyer-tax-credit-fails" target="_blank">Permalink</a> | <a href="http://mortgage.windermerecitygroup.com/blog/2010/06/25/extension-to-close-for-first-time-home-buyer-tax-credit-fails#comments" target="_blank">Comments</a></P>Denelle Geibelhttp://mortgage.windermerecitygroup.com/blog/2010/06/25/extension-to-close-for-first-time-home-buyer-tax-credit-failsFri, 25 Jun 2010 09:16:00 GMThttp://mortgage.windermerecitygroup.com/blog/2010/06/10/congress-considers-tax-credit-extension-for-some-home-buyers<p style="line-height: normal; background: white"><span style="color: black">Congress is considering an extension for would-be home buyers who are racing to close home sales in order to receive a federal tax credit.</span></p> <p style="line-height: normal; background: white"><span style="color: black">The real-estate industry has warned that tens of thousands of buyers who rushed to buy homes to qualify might not close before the deadline imposed by Congress, meaning they could miss out on receiving credits worth thousands of dollars without action from Congress.</span></p> <p style="line-height: normal; background: white"><span style="color: black">Congress last fall extended an $8,000 tax credit for first-time home buyers and added a smaller $6,500 credit for current homeowners who were buying a primary residence. To qualify for the credit, buyers had to sign purchase contracts by April 30 and must close on the transaction by June 30.</span></p> <p style="line-height: normal; background: white"><span style="color: black">But there are so many transactions in the pipeline that the companies responsible for handling the sales, including mortgage lenders, appraisers and title insurers and real-estate brokers, say the last-minute home-buying rush in April has created bottlenecks. </span></p> <p style="line-height: normal; background: white"><span style="background: yellow; color: black">On Thursday, Senate Majority Leader Harry Reid (D., Nev.) said he would back a measure to extend the June 30 closing date to Sept. 30 for buyers who had met the April contract deadline.</span></p> <p style="line-height: normal; background: white"><span style="color: black">The National Association of Realtors estimates that between 55,000 and 75,000 home buyers who are under contract won't be able to close in time to claim the tax credit. The trade group is lobbying </span></p> <p style="line-height: normal; background: white"><span style="color: black">One particular worry is that short sales, where a lender allows a home to sell for less than the amount owed, won't receive requisite approvals in time to meet the closing deadline. Unlike normal sales where only two parties&#239;&#191;&#189;the buyer and the seller&#239;&#191;&#189;negotiate the price, short sales are more time-consuming affairs because they require note-holders to agree on price.</span></p> <p style="line-height: normal; background: white"><span style="background: yellow; color: black">Some of the delay reflects new rules related to disclosure and appraisal requirements enacted to correct the excesses of the bubble years. The new regulations have prompted lenders to take extra caution at every step, stretching closing timelines.</span></p> <div style="line-height: normal; background: white"><span style="color: black">It is unclear how many sales would fall through for those who miss out on the tax credit. Buyers could be hard-pressed to void sales contracts unless they have made their closing contingent on receiving the tax credit or are willing to forgo any deposits.</span> <div>Source:&nbsp; Wall Street Journal</div> </div><P><a href="http://mortgage.windermerecitygroup.com/blog/2010/06/10/congress-considers-tax-credit-extension-for-some-home-buyers" target="_blank">Permalink</a> | <a href="http://mortgage.windermerecitygroup.com/blog/2010/06/10/congress-considers-tax-credit-extension-for-some-home-buyers#comments" target="_blank">Comments</a></P>Denelle Geibelhttp://mortgage.windermerecitygroup.com/blog/2010/06/10/congress-considers-tax-credit-extension-for-some-home-buyersThu, 10 Jun 2010 14:29:00 GMThttp://mortgage.windermerecitygroup.com/blog/2010/05/28/new-fannie-mae-rules-require-two-credit-reports<div>If you are thinking about applying for a home loan this year, here is some important news: Beginning June 1, your lender is likely to order a second full credit screening immediately before closing. The last-minute credit report will be designed to find out whether you've obtained, or even shopped for, new debt between the date of your loan application and the closing. </div> <div>&nbsp;</div> <div>If you've made applications for credit of any type, for furnishings and appliances for the new house, a car, landscaping, a home equity line, a new credit card, the closing could be put on hold pending additional research by the lender. If you've taken out new loans that are sizable enough to affect the debt-to-income ratio calculations used in your original loan approval, the deal could fall through. The added debt load could render you ineligible for the loan because you suddenly appear unable to handle the payments without a strain on your household budget. </div> <div><br /> &nbsp;</div> <div>Fannie's "loan quality initiative" will require lenders not only to pull two credit reports for each transaction but to perform additional verifications of borrower occupancy plans for the property, Social Security numbers and Individual Taxpayer Identification Numbers, among other changes.</div><P><a href="http://mortgage.windermerecitygroup.com/blog/2010/05/28/new-fannie-mae-rules-require-two-credit-reports" target="_blank">Permalink</a> | <a href="http://mortgage.windermerecitygroup.com/blog/2010/05/28/new-fannie-mae-rules-require-two-credit-reports#comments" target="_blank">Comments</a></P>Denelle Geibelhttp://mortgage.windermerecitygroup.com/blog/2010/05/28/new-fannie-mae-rules-require-two-credit-reportsFri, 28 May 2010 10:33:00 GMThttp://mortgage.windermerecitygroup.com/blog/2010/05/27/usda-to-approve-loans-will-lenders-follow-suit<p><font face="Arial"><span style="font-family: 'Arial', 'sans-serif'"><img style="width: 68px; height: 103px" alt="" align="left" src="http://investors.windermerecitygroup.com/images/New_Image__WinCE_.JPG" width="68" height="103" />USDA just issued a Lender notice about five minutes ago providing guidance on the funding for the Section 502 Single Family Housing Guarantee Program.</span></p> <p><span style="font-family: 'Arial', 'sans-serif'">I will give you the entire USDA Lender Notice below, but in a nutshell, they will continue to issue Conditional Commitments after funds are exhausted.&nbsp;However, this <u>DOES NOT</u> mean Lenders will continue to fund Guarantee Loans.&nbsp;</span></p> <p><span style="font-family: 'Arial', 'sans-serif'">Why?&nbsp;Because there is still a large risk to the Lender during the interim.&nbsp;</span></p> <p><span style="font-family: 'Arial', 'sans-serif'">USDA loans are guaranteed by USDA.&nbsp;This is the reason mortgage insurance is not required.&nbsp;When the USDA office approves a loan and issues a Conditional Commitment, they reserve the funds for that borrower.&nbsp;&nbsp; Very soon after the loan closes, USDA (Agency) issues a Loan Note Guarantee.&nbsp;The problem right now is there are no funds to reserve as money has been exhausted and not yet replenished.&nbsp;Therefore, USDA will "obligate" the money but the :<strong><em>The Lender will assume all loss default risk for the loan until funds are available for Rural Development to obligate, and the Loan Note Guarantee is subsequently issued."</em></strong></span></p> <p><span style="font-family: 'Arial', 'sans-serif'">Another potential issue for Lenders is the when funds are replenished and the Lender requests the Loan Note Guarantee, the Lender must certify that "<strong><em>there have been no adverse changes in the borrower's financial condition since the date the Conditional Commitment was issued by the Agency."</em></strong>&nbsp;Now this may not be an problem if it takes place quickly, but what if takes a while and the borrower loses a job, hours are reduced or buys a car?</span></p> <p><span style="font-family: 'Arial', 'sans-serif'">The final concern is the Guarantee Fee charged the borrower.&nbsp;The Guarantee Fee is currently 3.5%; of which the borrower pays 2.0% and the government subsidizes the remaining 1.5%.&nbsp;The current debate in DC is (1) will the government continue to subsidize and if so, how much and (2) what should the fee be going forward.&nbsp;Some politicians feel the fee should be higher than 3.5%.&nbsp;</span></p> <p><span style="font-family: 'Arial', 'sans-serif'">As of the end of April, the fee was going to increase to 3.5% and the borrower would cover the entire amount.&nbsp;This debate is pretty much the major obstacle in getting the bill passed and funds replenished.</span></p> <p><span style="font-family: 'Arial', 'sans-serif'">So, how much does a Lender charge the borrower?&nbsp;If they don't charge enough, they must cover the difference.&nbsp;If they charge too much, the Lender is responsible for to refund the borrower.</span></p> <p><span style="font-family: 'Arial', 'sans-serif'">There are some Lenders that will proceed forward and start closing USDA loans; others may ride this out until clear terms have been met and funds are replenished.&nbsp;I personally feel as though the entire debate will end sooner rather than later and it will be a moot point.&nbsp;My hope is we can begin offering the program in June.</span></p> <p><span style="font-family: 'Arial', 'sans-serif'">Feel free to read the entire <span style="color: #140a0a"><a style="color: #0000ff" href="http://cascademortgagewa.com/files/6/4/6403a71a7ff18e4a3cfa806e5b40e181/11022-lender-notice-ccs-------.pdf" target="_blank">USDA Lender Notice</a> </span>issued by USDA today.</span></p> <div><span style="font-family: 'Arial', 'sans-serif'">If you have any questions regarding this, please don't hesitate to email me at <a href="&#109;&#97;&#105;&#108;&#116;&#111;&#58;&#100;&#103;&#101;&#105;&#98;&#101;&#108;&#64;&#99;&#115;&#99;&#97;&#100;&#101;&#109;&#111;&#114;&#116;&#103;&#97;&#103;&#101;&#119;&#97;&#46;&#99;&#111;&#109;">dgeibel@cscademortgagewa.com</a> or call (509) 232-7725.</span> <div>&nbsp;</div> <div><img alt="" align="left" src="http://investors.windermerecitygroup.com/images/New_Image__WinCE__01.JPG" width="240" /></div> </div> </font><P><a href="http://mortgage.windermerecitygroup.com/blog/2010/05/27/usda-to-approve-loans-will-lenders-follow-suit" target="_blank">Permalink</a> | <a href="http://mortgage.windermerecitygroup.com/blog/2010/05/27/usda-to-approve-loans-will-lenders-follow-suit#comments" target="_blank">Comments</a></P>Denelle Geibelhttp://mortgage.windermerecitygroup.com/blog/2010/05/27/usda-to-approve-loans-will-lenders-follow-suitThu, 27 May 2010 12:39:00 GMThttp://mortgage.windermerecitygroup.com/blog/2010/05/25/usda-reversed-course-no-commitments<p>On May 11, 2010 USDA's&nbsp;Office of Rural Development announced the Guaranteed Rural Housing Program would once again accept loan applications and issue approvals! All new&nbsp;conditional commitments&nbsp;must be modified to read:</p> <p>Loan approvals are &#239;&#191;&#189;<strong>subject to the availability of funds and Congressional authority</strong> to charge a 3.5% guarantee fee for purchase loans and a 2.25% guarantee fee for refinance loans&#239;&#191;&#189;.</p> <p><strong>To put it simply,&nbsp;</strong> the USDA would continue to issue Section 502 Loan Guarantees when the Congressional vote was final.&nbsp; All indications were that the vote was just a formality.&nbsp;</p> <p>Well it wasn't a&nbsp;"sure thing"&nbsp;and the legislation has not yet been passed.</p> <div>On&nbsp;May 12, 2010 the USDA's Office&nbsp;of Rural Development issued an announcement recalling and voiding the guidance offered on May 11, 2010. The press release has been removed from the Rural Development website, along with the May 11th announcement.&nbsp; However, this is what was sent to me on the 12th of May, 2010 <span style="color: #ff0000"><a style="color: #ff0000" href="http://cascademortgageblog.com/wp-content/uploads/2010/05/USDA-Notice.docx" mce_href="http://cascademortgageblog.com/wp-content/uploads/2010/05/USDA-Notice.docx"><span style="color: #0000ff"><span style="color: #0000ff">USDA Notice</span></span></a></span> <div><span style="color: #0000ff"></span>&nbsp;</div> <strong>WHAT HAPPENED?</strong></div> <p>USDA offers 100% financing to qualified buyers in eligible areas of the U.S.&nbsp; The borrower is charged a Guarantee Fee equal to 2% of the loan amount.&nbsp; This fee may be financed into the loan as long as the final loan amount does not exceed 102% of the appraised value.&nbsp;&nbsp;This fee is actually 3.5%, however, the government has been kicking in 1.5%.&nbsp; &nbsp;The new legislation essentially removes the 1.5% government subsidy and puts the entire 3.5% guarantee fee on the shoulders of the borrower.&nbsp;&nbsp;Some politicians think the guarantee fee should be larger.&nbsp; As a result the bill is still stuck in committee, the USDA is not issuing new loan approvals,&nbsp; and lenders are not taking new loan applications.</p> <p>H.R. 5017:&nbsp; Rural Housing Preservation and Stablization Act of 2010</p> <p><strong>Latest Major Action</strong>: 4/28/2010 Referred to Senate committee.<br /> <strong>Status</strong>: Received in the Senate and Read twice and referred to the Committee on Banking, Housing, and Urban Affairs.&nbsp;</p> <p>Congress goes on Memorial Day break from May 31-June 4th.&nbsp; If a decision is not made before the 31st, we are well into the 2nd week of June before legislation is passed.&nbsp;</p> <p>If you have questions on USDA or other financing options available, please call my office at (509) 232-7725 or email me at <a href="&#109;&#97;&#105;&#108;&#116;&#111;&#58;&#100;&#103;&#101;&#105;&#98;&#101;&#108;&#64;&#99;&#97;&#115;&#99;&#97;&#100;&#101;&#109;&#111;&#114;&#116;&#103;&#97;&#103;&#101;&#119;&#97;&#46;&#99;&#111;&#109;" mce_href="mailto:dgeibel@cascademortgagewa.com">dgeibel@cascademortgagewa.com</a>.</p><P><a href="http://mortgage.windermerecitygroup.com/blog/2010/05/25/usda-reversed-course-no-commitments" target="_blank">Permalink</a> | <a href="http://mortgage.windermerecitygroup.com/blog/2010/05/25/usda-reversed-course-no-commitments#comments" target="_blank">Comments</a></P>Denelle Geibelhttp://mortgage.windermerecitygroup.com/blog/2010/05/25/usda-reversed-course-no-commitmentsTue, 25 May 2010 08:58:00 GMThttp://mortgage.windermerecitygroup.com/blog/2010/05/11/fha-how-can-they-help-you<div>I think most people have heard of FHA but I am not sure if they are aware of all they have to offer the future homebuyer!&nbsp; <br /> </div> <div>Here are some things FHA can help you with:</div> <div>&nbsp;</div> <ul> <li>Purchase a HUD REO property with a $100 down payment</li> <li>Allow you to purchase your home and do some improvements with one loan</li> <li><font face="Verdana, Geneva, Arial, Helvetica, sans-serif">Law enforcement officers, pre-Kindergarten through 12th grade teachers and firefighters/emergency medical technicians can receive a 50% discount on list price</font><br /> </li> </ul> <div>Here are some details for each program:</div> <div><br /> &nbsp;</div> <div><strong><u>$100 Down:</u></strong>&nbsp; You may be able to purchase a HUD home utilizing an FHA loan with a down payment of $100.&nbsp; A HUD home is a 1-to-4 unit residential property acquired by HUD as a result of a foreclosure action on an FHA-insured mortgage. HUD becomes the property owner and offers it for sale to recover the loss on the foreclosure claim.</div> <p>HUD Homes are initially offered to owner-occupant purchasers (people who are buying the home as their primary residence). Following the priority period for owner occupants, unsold properties are available to all buyers, including investors.</p> <p>All properties available for purchase by the public are offered for sale on an Internet site maintained by management companies under contract to HUD. Any real estate broker registered with HUD may submit an offer and contract to purchase on your behalf. HUD pays the real estate broker's commission, if included in the contract.</p> <div>HUD Homes are offered for sale at fair market value, based on a recent appraisal. Generally, HUD Homes are sold in what is known as an "Offer Period," during which a potential buyer's offer must be made. At the end of the Offer Period, all offers are opened and the bid providing the highest acceptable net return to HUD may then be accepted. Following the initial "Offer Period" homes remaining unsold are offered on an "extended" basis which means offers may be submitted any business day. If a bid on one of these homes is acceptable, the broker will usually be notified within 48 hours of HUD's acceptance of the offer.</div> <div><br /> &nbsp;</div> <div><strong><u>203K or StreamlineK</u></strong>:&nbsp; FHA offers two programs in which you can purchase and repair/remodel with one loan.&nbsp; They are both similar; one is for a major remodel and the other for a more simple repair/remodel.&nbsp; The Streamline K is the most commonly used program in today's market.&nbsp; FHA allows a maximum of $35,000 to be added to your loan to make any FHA required repairs, wanted repairs or improvements.&nbsp;&nbsp; The regular 203K allows for more extensive repairs, remodels or additions to be done to the home.&nbsp; There is far more details on this program than I will list here, so please get in touch with me if you want me to send you more!</div> <div>&nbsp;</div> <div><strong><u>Good Neighbor Next Door Program (GNND):</u></strong>&nbsp; This program allows for <font face="Verdana, Geneva, Arial, Helvetica, sans-serif">Law enforcement officers, pre-Kindergarten through 12th grade teachers and firefighters/emergency medical technicians can receive a 50% discount on list price</font> of certain HUD REO properties.&nbsp; These properties must be in what HUD considers to be a "revitalization area".&nbsp; How this program works is the borrower will obtain two mortgages when purchasing their home.&nbsp; The first mortgage is for 50% of the list price while the 2nd mortgage is for the remaining 50%.&nbsp;&nbsp; FHA will forgive and equivalent of 33% of the 2nd mortgage after the first 12 months, another 33% after the 24th month and the entire 2nd lien is released after the 36th month.&nbsp; This does require the borrower to remain living in the home for th entire three years.&nbsp; If they move out early, say after year two, then the remaining 1/3 of the 2nd lien would have to be paid.&nbsp; During the first three years the borrower resides in the home, there is no payment due on the 2nd mortgage.</div> <div>&nbsp;</div> <div>If you have questions on FHA financing or other types of financing that are available, please contact me at <a href="&#109;&#97;&#105;&#108;&#116;&#111;&#58;&#100;&#103;&#101;&#105;&#98;&#101;&#108;&#64;&#99;&#97;&#115;&#99;&#97;&#100;&#101;&#109;&#111;&#114;&#116;&#103;&#97;&#103;&#101;&#119;&#97;&#46;&#99;&#111;&#109;">dgeibel@cascademortgagewa.com</a> or 509.232.7725.</div> <p>If you would like more information on FHA financing or HUD homes, please call me at 509.232.7725 or email <a href="&#109;&#97;&#105;&#108;&#116;&#111;&#58;&#100;&#103;&#101;&#105;&#98;&#101;&#108;&#64;&#99;&#97;&#115;&#99;&#97;&#100;&#101;&#109;&#111;&#114;&#116;&#103;&#97;&#103;&#101;&#119;&#97;&#46;&#99;&#111;&#109;" mce_href="mailto:dgeibel@cascademortgagewa.com">dgeibel@cascademortgagewa.com</a>.</p><P><a href="http://mortgage.windermerecitygroup.com/blog/2010/05/11/fha-how-can-they-help-you" target="_blank">Permalink</a> | <a href="http://mortgage.windermerecitygroup.com/blog/2010/05/11/fha-how-can-they-help-you#comments" target="_blank">Comments</a></P>Denelle Geibelhttp://mortgage.windermerecitygroup.com/blog/2010/05/11/fha-how-can-they-help-youTue, 18 May 2010 07:40:00 GMThttp://mortgage.windermerecitygroup.com/blog/2010/05/11/usda-will-continue-to-issue-commitments<p>USDA just announced they predict current appropriated funds to be exhausted by May 12, 2010 or shortly thereafter.&nbsp; What this means is they will be out of money.</p> <p>As I explained earlier, this is "business as usual" for USDA.&nbsp; They typically run short each year, but funds are always replenished so business is never interrupted.&nbsp; This year is different.&nbsp;</p> <p>USDA must issue what is called a Conditional Commitment once they approve the loan.&nbsp; This is the key document Lenders need in order to close the loan.&nbsp; USDA announced earlier this year that they would NOT issue Conditional Commitments once funds were depleted.&nbsp; The reason for this is there was great uncertainly as to when/if funds would be available again.</p> <p>Well just this afternoon, USDA announced that they have authorized their state offices to continue to issue Conditional Commitments "subject to the availability of funds and Congressional authority to charge a 3.5% guarantee fee for purchases loans and a 2.25% guarantee fee for refinance loans".</p> <p>What does that mean?&nbsp;</p> <p>The "subject to availability of funds" is standard language provided each year when funds are depleted.&nbsp; This just means they will "guarantee" the loan once they have the money to do so.</p> <p>The "Congressional authority to charge a 3.5% guarantee fee for purchases loans and a 2.25% guarantee fee for refinance loans" is new.&nbsp;</p> <p>Currently, USDA charges a Guarantee Fee equal to 2.0% of the loan amount for purchase transactions.&nbsp; Buyer's have the option to pay for this as part of their closing costs, ask the Seller to pay or add it into their loan as long as the final loan amount is not more than 102% of the purchase price.&nbsp;</p> <p>USDA has asked for Congressional approval to increase the fee to 3.5% for purchases.&nbsp; This has not yet been passed, but based on USDA's current stance, it appears as though it will pass.</p> <p>Purchaser's will now pay a fee equal to 3.5% of the loan amount.&nbsp; USDA has not issued anything that provides guidance as to how this fee may be paid.&nbsp; As of this posting, I do not know if the maximum loan amount will increase to 103.5% of the appraised value or if it will remain at 102%.&nbsp; If the later is true, then the borrower would need to cover the additional 1.5% (or ask the Seller to pay).</p> <p>Either way, USDA offers one of the most attractive ways to finance your home.&nbsp; There is no down payment required and no monthly mortgage insurance.&nbsp;</p> <p>Now the one thing to keep in mind is even if USDA says they will continue with business, it doesn't mean a Lender is willing to do so right yet.&nbsp; Some Lenders may want to wait until Congress has approved and the details are worked out.&nbsp; Buyers need both USDA and the Lender to sign on the dotted line!</p> <p>If you have questions regarding USDA loans or other type of financing, please feel free to email me at <a href="&#109;&#97;&#105;&#108;&#116;&#111;&#58;&#100;&#103;&#101;&#105;&#98;&#101;&#108;&#64;&#99;&#97;&#115;&#99;&#97;&#100;&#101;&#109;&#111;&#114;&#116;&#103;&#97;&#103;&#101;&#119;&#97;&#46;&#99;&#111;&#109;" mce_href="mailto:dgeibel@cascademortgagewa.com">dgeibel@cascademortgagewa.com</a> or give me a call at 509.232.7725.</p><P><a href="http://mortgage.windermerecitygroup.com/blog/2010/05/11/usda-will-continue-to-issue-commitments" target="_blank">Permalink</a> | <a href="http://mortgage.windermerecitygroup.com/blog/2010/05/11/usda-will-continue-to-issue-commitments#comments" target="_blank">Comments</a></P>Denelle Geibelhttp://mortgage.windermerecitygroup.com/blog/2010/05/11/usda-will-continue-to-issue-commitmentsTue, 11 May 2010 15:07:00 GMThttp://mortgage.windermerecitygroup.com/blog/2010/04/26/why-cant-i-have-the-lowest-advertised-rateDo you ever wonder why you are quoted a rate different than what you saw advertised or heard on the radio?&nbsp;It isn't because of a "bait-and-switch" scheme (hopefully not).&nbsp;It has more to do with what is called "Loan Level Pricing Adjustments" (LLPA). <p>LLPA is where the lender imposes additional charges/costs based on your personal risk traits.&nbsp;These charges are set by Fannie Mae and Freddie Mac and were first introduced in April 2008.&nbsp;They have expanded the risks and charges for those risks over the past 2 years.</p> <p>For most consumers, LLPA isn't on the front page of the paper or talked about much in the news.&nbsp;And for the most part, it is never mentioned in those "low rates" announcements you here on the radio.&nbsp;So how is a consumer to understand LLPA?&nbsp;Think of auto insurance.</p> <p>You can buy the same car as your neighbor but pay a higher premium.&nbsp;Why? Because your record has a speeding ticket.&nbsp;Or maybe you are a young driver with little experience. &nbsp;Now think of the car insurance as mortgage rates.&nbsp;If you have credit that has blemished (aka speeding tickets), you may pay a higher rate (or fees).&nbsp;Maybe you have little credit (young driver) so your credit scores are lower, you will pay a higher rate or higher fees.&nbsp;You are putting down less money which is providing a greater risk to the Lender (drive a riskier car), you may pay a higher rate or fees.&nbsp;The more risk the higher the rate or fees.</p> <div>A few of the risk factors than can increase your rate or fees are:&nbsp;</div> <div>&nbsp; </div> <div style="margin-left: 0.75in; text-indent: -0.25in"><span style="font-family: Wingdings">&#216;&nbsp;</span>A credit score below 740</div> <div style="margin-left: 0.75in; text-indent: -0.25in"><span style="font-family: Wingdings">&#216;&nbsp;</span>Cash-out mortgage with less than 40% equity in the home</div> <div style="margin-left: 0.75in; text-indent: -0.25in"><span style="font-family: Wingdings">&#216;&nbsp;</span>Having a 2^nd mortgage</div> <div style="margin-left: 0.75in; text-indent: -0.25in"><span style="font-family: Wingdings">&#216;&nbsp;</span>Investment property</div> <div style="margin-left: 0.75in; text-indent: -0.25in"><span style="font-family: Wingdings">&#216;&nbsp;</span>A condo with less than 25% down (or equity)</div> <div style="margin-left: 0.75in; text-indent: -0.25in"><span style="font-family: Wingdings">&#216;&nbsp;</span>Multi-family-&nbsp;2,&nbsp;3 or 4-unit home</div> <div style="margin-left: 0.75in; text-indent: -0.25in">&nbsp;</div> <div>Historically, each one of these traits adds an additional risk to the loan and a greater chance of your default on the mortgage.&nbsp;Therefore, Fannie &amp; Freddie charge fees to offset the potential for future losses.</div> <p>The loan professional will determine what fees are imposed for your particular situation and then provide you with the option of paying those fees as additional closing costs or increasing your rate in lieu of paying the fees; the choice is always yours!&nbsp;Most typically the consumer elects the higher rate as the fees can add up quickly.</p> <p>&nbsp;LLPA is a mandatory cost based on risk factors for each individual; they are not junk fees or "padding" by the Lender.&nbsp;If you have questions on <span style="color: #3366ff"><a href="https://www.efanniemae.com/sf/refmaterials/llpa/pdf/llpamatrix.pdf">Fannie Mae Loan-Level Pricing Adjustments</a><a href="https://www.efanniemae.com/sf/refmaterials/llpa/pdf/llpamatrix.pdf">,</span></a> please be sure to give me a call at 509.232.7725 or shoot an email to <a href="&#109;&#97;&#105;&#108;&#116;&#111;&#58;&#100;&#103;&#101;&#105;&#98;&#101;&#108;&#64;&#99;&#97;&#115;&#99;&#97;&#100;&#101;&#109;&#111;&#114;&#116;&#103;&#97;&#103;&#101;&#119;&#97;&#46;&#99;&#111;&#109;">dgeibel@cascademortgagewa.com</a>.&nbsp;</p><P><a href="http://mortgage.windermerecitygroup.com/blog/2010/04/26/why-cant-i-have-the-lowest-advertised-rate" target="_blank">Permalink</a> | <a href="http://mortgage.windermerecitygroup.com/blog/2010/04/26/why-cant-i-have-the-lowest-advertised-rate#comments" target="_blank">Comments</a></P>Denelle Geibelhttp://mortgage.windermerecitygroup.com/blog/2010/04/26/why-cant-i-have-the-lowest-advertised-rateMon, 26 Apr 2010 13:40:00 GMThttp://mortgage.windermerecitygroup.com/blog/2010/03/12/usda-financing-in-jeopardy&nbsp; <p style="margin: 0in 0in 0pt"><span style="font-size: 10pt; font-family: 'Arial','sans-serif'">I received some news from USDA yesterday that may directly impact those buyers seeking to use this type of mortgage to finance their home purchase.&nbsp; I wanted to do some checking with my investors before I posted something and here it is!</span></p> <p style="margin: 0in 0in 0pt">&nbsp;</p> <div style="margin: 0in 0in 0pt"><span style="font-size: 10pt; font-family: 'Arial','sans-serif'">USDA offers what I believe to be one of the best mortgage programs out there.&nbsp; It is 100% financing (which is almost unheard of these days) and does not require the buyer to pay mortgage insurance (MI) .&nbsp; The reason MI does not need to be paid is the government "Guarantees" the loan to the Lender.&nbsp; This means if the buyer defaults on the loan, the government is there to insure the loan to the Lender.&nbsp; Hence, no need for mortgage insurance.&nbsp; <br /> <br /> The program has been around for a very long time and has provided thousands upon thousands will the opportunity to purchase a home with little money out of their pocket, low fixed rates and an extremely affordable payment.<br /> <br /> USDA typically &#239;&#191;&#189;runs out of funds&#239;&#191;&#189; each year for this program.&nbsp; The government then provides additional funding and off we go.&nbsp; USDA must issue a Conditional Commitment to the Lender&nbsp;with each loan they approve.&nbsp; Even when they have not had money available in the past, they continue to issue the commitments as they know money is on the way.&nbsp; However, that is not the case this year.</span></div> <p style="margin: 0in 0in 0pt">&nbsp;</p> <p style="margin: 0in 0in 0pt"><span style="font-size: 10pt; font-family: 'Arial','sans-serif'">USDA posted that they may be out of money by the end of April.&nbsp;However, unlike in years past they will NOT be issuing any committments after the funds run dry.&nbsp; WIthout a Conditional Committment, Lenders will not be able to complete the loan.</span></p> <p style="margin: 0in 0in 0pt">&nbsp;</p> <p style="margin: 0in 0in 0pt"><span style="font-size: 10pt; font-family: 'Arial','sans-serif'">At this time we are unsure of the status of the program.&nbsp; We are working with USDA to find out more information and I will pass this along to you as soon as I have it.</span></p> <p style="margin: 0in 0in 0pt">&nbsp;</p> <p style="margin: 0in 0in 0pt"><span style="font-size: 10pt; font-family: 'Arial','sans-serif'">If this program is important to you,&nbsp;please make&nbsp;contact with the following offices to express your concern over the lack of funding for this program.</span></p> <p style="margin: 0in 0in 0pt">&nbsp;</p> <p style="margin: 0in 0in 0pt"><strong><span style="font-size: 10pt; font-family: 'Arial','sans-serif'">Secretary of Agriculture: Tim Vilsack&nbsp; 202-720-3631</span></strong></p> <div style="margin: 0in 0in 0pt"><strong><span style="font-size: 10pt; font-family: 'Arial','sans-serif'">Undersecretary of Agriculture: Dallas Tonsager&nbsp; 202-720-458</span></div> <div style="margin: 0in 0in 0pt">&nbsp;</div> <div><font size="2">If you have questions regarding USDA financing or any other type of mortgage financing, please feel free to call me at (509) 232-7725 or shoot me an email at <br /> <a href="&#109;&#97;&#105;&#108;&#116;&#111;&#58;&#100;&#103;&#101;&#105;&#98;&#101;&#108;&#64;&#99;&#97;&#115;&#99;&#97;&#100;&#101;&#109;&#111;&#114;&#116;&#103;&#97;&#103;&#101;&#119;&#97;&#46;&#99;&#111;&#109;">dgeibel@cascademortgagewa.com</a>.</font> </div> <div>&nbsp;</div> </strong><P><a href="http://mortgage.windermerecitygroup.com/blog/2010/03/12/usda-financing-in-jeopardy" target="_blank">Permalink</a> | <a href="http://mortgage.windermerecitygroup.com/blog/2010/03/12/usda-financing-in-jeopardy#comments" target="_blank">Comments</a></P>Denelle Geibelhttp://mortgage.windermerecitygroup.com/blog/2010/03/12/usda-financing-in-jeopardyFri, 12 Mar 2010 12:41:00 GMThttp://mortgage.windermerecitygroup.com/blog/2010/02/01/monday-morning-update<p><strong>"THE NINE MOST TERRIFYING WORDS IN THE ENGLISH LANGUAGE ARE: `I'M FROM THE GOVERNMENT, AND I'M HERE TO HELP.`" </strong><em><strong>Ronald Reagan</strong></em><strong>.</strong></p> <p>It is rare that we have the Federal Reserve Board reporting on the economy and a State of the Union Address in the same week, let alone the same day. Yet, that is just what happened last week. First the Fed met and released a statement. The fact that they left rates where they were was no surprise as said that they will "stay the course" and keep rates low despite the fact that the economy is starting to recover. The Fed repeated its earlier forecast that conditions are "likely to warrant exceptionally low levels of the federal funds rate for an extended period." There is no indication that the recovery will be anything but moderate and fragile and increasing rates now could put this recovery in jeopardy. The Fed did say that they will let some stimulus measures expire, including halting their purchase of securities backed by home loans. Potentially, this could cause rates to increase on these loans if the markets can't absorb the supply.</p> <p>The State of the Union Address also did not contain many surprises. The President's focus was jobs. The recovery can't sustain itself until it starts to produce jobs. While we were losing hundreds of thousands of jobs on a monthly basis 12 months ago and the losses are much lower now, the economy must start creating jobs. This is a tall order, especially considering the fact that we have already spent trillions trying to rescue the economy from oblivion. There are just not enough resources left to provide significant future stimulus. It is expected that future measures will be very specific and focused upon job creation, such as the proposed employee tax credit specifically for small businesses. If last year was a year of survival, this year will be the year of making sure we build a strong foundation to sustain a long-term economic recovery. The market's initial reaction to the government's statements were not positive when mixed in with other news, partially because they have heard this song before. One day later, the strong 4th quarter preliminary economic growth figures released did not reverse that negative trend. Look for the employment numbers due to be released at the end of this week as the next big statistical release.</p> <p><strong>Interest Rates &#239;&#191;&#189;</strong></p> <p><em>The Markets.</em> Rates were slightly lower in the past week. Freddie Mac announced that for the week ending January 28, 30-year fixed rates averaged 4.98%, down from 4.99% the week before. The average for 15-year fixed eased to 4.39%. A year ago 30-year fixed rates were at 5.10%. Rates held steady this week ahead of the Federal Reserve's (Fed) policy committee meetings, " said Frank Nothaft, Freddie Mac vice president and chief economist. The Fed announced on January 27th that economic activity has continued to strengthen. It also noted that with substantial resource slack continuing to restrain cost pressures and with longer-term inflation expectations stable, inflation is likely to be subdued for some time.<em>" Rates indicated do not include fees and points and are provided for evidence of trends only. They should not be used for comparison purposes.</em></p> <p><strong>Forecast for the Week</strong> -</p> <p>This will be a busy week for economic reports, starting off with the Personal Consumption Expenditures report on Monday. This report measures consumer price changes, and also gives us a look at inflation.</p> <p>We'll also get a glimpse at Personal Income and Personal spending on Monday, as well as the Institute of Supply Managers Index, which is the king of all manufacturing indices, and is considered the single best snapshot of the factory sector.</p> <p>By mid-week, the labor market will lead the big news. In addition to the latest Initial Jobless Claims numbers, ADP's Employment Report will also be delivered. These two data points will lead the way to Friday's official Jobs Report from the Labor Department. This report includes the latest information on job losses and the unemployment rate, as well as the average work week and hourly earnings. With all the recent talk about the job market, it will be important to get a current read on the situation.</p> <p>Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result.</p> <p>Mortgage Bonds traded in a tight technical range last week between a ceiling of resistance at the 100-Day Moving Average and a floor of support at the 200-Day Moving Average - and as always, I'll be watching carefully to see which way Bonds and home loan rates are headed.</p><P><a href="http://mortgage.windermerecitygroup.com/blog/2010/02/01/monday-morning-update" target="_blank">Permalink</a> | <a href="http://mortgage.windermerecitygroup.com/blog/2010/02/01/monday-morning-update#comments" target="_blank">Comments</a></P>Denelle Geibelhttp://mortgage.windermerecitygroup.com/blog/2010/02/01/monday-morning-updateMon, 01 Feb 2010 08:31:00 GMThttp://mortgage.windermerecitygroup.com/blog/2010/01/20/hud-announces-policy-changes<p>As I told you last fall, HUD announced it would make some changes to FHA financing in the 1^st and/or 2^nd quarter of 2010.&nbsp; It appears as though they have hashed out most of the details and they announced this morning FHA Policy Changes that will start to go into effect this Spring.&nbsp; FHA will officially release a Mortgagee Letter tomorrow with more details on the time-frame of these changes.</p> <p>FHA borrowers must now look better on paper and may need more cash at closing.</p> <p>In their announcement this morning, FHA said it is trying to "better position the FHA to manage its risk while continuing to support the nation's housing market".</p> <p>HUD did not change the minimim down payment which was on the drawing board last fall.&nbsp; They did however, roll out a number of changes:&nbsp;</p> <ul> <li><strong>Mortgage insurance premium (MIP) will be increased to build up capital reserves and bring back private lending</strong> <ul> <li>Increase the Upfron Mortgage Insurance Premium (MIP) from 1.75% to 2.25%.</li> <li>Congressional request to increase monthly MIP </li> </ul> </li> <li><strong><strong>Reduce allowable seller concessions from 6% to 3%</strong></strong></li> <li><strong><strong>Increase enforcement on FHA lenders</strong></strong></li> <li><strong>Minimum Credit Score of 580 </strong> <ul> <li>A 10% down is required for those who fall below 580 </li> </ul> </li> </ul> <p>Now keep in mind, just because FHA allows a 580 score, doesn't mean the Lender will approve the loan.&nbsp; Many Lenders/Banks have imposed additional "risk layers" in their underwriting of both FHA and Conventional loans due to investor requirements.&nbsp; Most Lenders/Banks already have minimum scores for FHA loans.&nbsp; Lenders/Banks use FHA's guidelines&nbsp;as the starting point and then they add additional underwriting rules.&nbsp; And they have good reason to do so.</p> <p>HUD is pursuing legislative authority that would require all require all approved mortgagees to assume liability for all of the loans that they originate and underwrite.&nbsp; And if a&nbsp;Lenders/banks defaults exceeds the mean by a certain number, FHA terminates the Lender/bank.&nbsp;</p> <p>This is one of the reasons why someone might not get approved for an FHA loan at one place, but can someplace else.&nbsp; Guidelines will vary from Lender to Lender.&nbsp;</p> <p>If you have any questions or would like to know if you can qualify for an FHA loan, please call me at 509-232-7725.</p><P><a href="http://mortgage.windermerecitygroup.com/blog/2010/01/20/hud-announces-policy-changes" target="_blank">Permalink</a> | <a href="http://mortgage.windermerecitygroup.com/blog/2010/01/20/hud-announces-policy-changes#comments" target="_blank">Comments</a></P>Denelle Geibelhttp://mortgage.windermerecitygroup.com/blog/2010/01/20/hud-announces-policy-changesWed, 20 Jan 2010 10:18:00 GMThttp://mortgage.windermerecitygroup.com/blog/2010/01/19/foreclosures-are-down-for-spokane-county<p>Realty Trac released their statistics&nbsp;on January 14, 2010&nbsp;and foreclosures in Spokane County fell in 2009 compared to the two previous years.&nbsp; It is a nice boost for Spokane.&nbsp; Unfortunatley, the same cannot be said for Kootani County.&nbsp;</p> <p>There were 979 properties in Spokane subjet to a foreclosure notice; this is a 15% decerease from 2008 and a 3% decrease from 2007.&nbsp; A total of one-half of one percent of homes in Spokane County received a notice of a trustee sale or was repossessed by a bank.</p> <p>For Kootenai County, RealtyTrac reported 1,552 foreclosure filings.&nbsp; This is an 87% increase from 2008 and a whopping 310% jump from 2007.&nbsp; Only 46 properties received a notice in 2006!&nbsp; This accounts for 2.6% of homes in Kootenai County receiving a notice of default or trustee sale.</p> <p>Both the Spokane and Coeur d' Alene assocations of Realtors suggest both markets were showing signs of improvement at year's end.</p><P><a href="http://mortgage.windermerecitygroup.com/blog/2010/01/19/foreclosures-are-down-for-spokane-county" target="_blank">Permalink</a> | <a href="http://mortgage.windermerecitygroup.com/blog/2010/01/19/foreclosures-are-down-for-spokane-county#comments" target="_blank">Comments</a></P>Denelle Geibelhttp://mortgage.windermerecitygroup.com/blog/2010/01/19/foreclosures-are-down-for-spokane-countyTue, 19 Jan 2010 08:41:00 GMThttp://mortgage.windermerecitygroup.com/blog/2010/01/19/temporary-waiver-of-huds-90-day-flipping-policy<div style="font-size: 12pt; font-family: Times New Roman"><span style="font-size: 12pt; color: black; font-family: 'Times New Roman','serif'; letter-spacing: -0.15pt; mso-fareast-font-family: 'Times New Roman'; mso-bidi-font-size: 10.0pt; mso-ansi-language: EN-US; mso-fareast-language: EN-US; mso-bidi-language: AR-SA"><span style="font-family: Courier"><span style="font-size: 10pt; font-family: Arial"><span style="font-size: 12pt"><img style="width: 86px; height: 131px" height="131" src="http://investors.windermerecitygroup.com/images/New_Image__WinCE_.JPG" width="86" align="right" alt="" />HUD Secretary Shaun Donovan announced on Friday, January 15, 2010, a temporary policy that will expand access to FHA mortgage insurance and allow for the quick resale of foreclosed properties.&nbsp;Effective February 1, 2010 there will be a one-year temporary suspension of the 90-day flipping policy.</span></span></div> <div style="font-size: 12pt; font-family: Times New Roman"><span style="font-size: 12pt">&nbsp;</span></div> <div style="font-size: 10pt; font-family: Arial"><span style="font-size: 12pt">HUD's current policy states any resale of a property may not occur 90 or fewer days from the last sale to be eligible for FHA financing.</span></div> </span></span> <div style="font-size: 12pt; font-family: Times New Roman"><span style="font-family: Courier"><span style="font-family: Arial"><span style="font-size: 12pt">&nbsp; </span></span></span></div> <p style="font-size: 12pt; margin: 0in 0in 12pt; line-height: normal; font-family: Times New Roman"><span style="font-size: 10pt; font-family: 'Lucida Sans Unicode','sans-serif'"><span style="font-family: Courier"><span style="font-family: Arial"><span style="font-family: Arial"><span style="font-size: 12pt">The waiver will take effect on February 1, 2010 and is effective for one year, unless otherwise extended or withdrawn by the FHA Commissioner. To protect FHA borrowers against predatory practices of "flipping" where properties are quickly resold at inflated prices to unsuspecting borrowers, this waiver is limited to those sales meeting the following general conditions:</span></span></span></span></span></p> <div style="font-size: 12pt; font-family: Times New Roman"> <ul type="disc"> <li style="line-height: normal; margin-right: 0in"><span style="font-size: 10pt; font-family: 'Lucida Sans Unicode','sans-serif'"><span style="font-family: Arial"><span style="font-size: 10pt"><span style="font-size: 12pt"><span style="font-family: Courier"><span style="font-family: Arial">All transactions</span></span> must be arms-length, with no identity of interest between the buyer and seller or other parties participating in the sales transaction. </span></span></span></span></li> <li style="color: #4f4f4f; line-height: normal; margin-right: 0in"><span style="font-size: 12pt"><span style="font-family: Arial"><span style="font-size: 10pt"><span style="font-size: 10pt; color: windowtext; font-family: 'Lucida Sans Unicode','sans-serif'">In cases in which the sales price of the property is 20 percent or more above the seller's acquisition cost, the waiver will only apply if the lender meets specific conditions. -</span><span style="font-size: 10pt; color: red; font-family: 'Lucida Sans Unicode','sans-serif'">see below</span></span></span> </span></li> <li style="font-size: 10pt; line-height: normal; margin-right: 0in"><span style="font-size: 10pt; font-family: 'Lucida Sans Unicode','sans-serif'"><span style="font-family: Arial"><span style="font-size: 10pt"><span style="font-size: 12pt">The waiver is limited to forward mortgages, and does not apply to the Home Equity Conversion Mortgage (HECM) for purchase program. </span></span></span></span></li> </ul> </div> <div><span style="font-size: 10pt; color: red; font-family: 'Lucida Sans Unicode','sans-serif'"><span style="font-family: Arial"><span style="font-size: 10pt"><span style="font-size: 12pt">Lender conditions if sold for more than 20% than seller's acquisition cost-</span></span></span></span></div> <div><span style="font-size: 12pt">&nbsp;</span></div> <div><span style="font-family: Arial"><span style="font-size: 10pt"><span style="font-size: 12pt"><span style="font-size: 10pt; color: red; font-family: Symbol"><span style="font: 7pt 'Times New Roman'">&nbsp;</span></span><span style="font-size: 10pt; font-family: 'Lucida Sans Unicode','sans-serif'">Lender orders a property inspection report at borrower or seller's expense</span></span></span></span></div> <ul> <li><span style="font-size: 12pt"><span style="font-size: 10pt; font-family: 'Lucida Sans Unicode','sans-serif'"><span style="font-family: Arial"><span style="font-size: 10pt">Appraiser has to explain why the value has increased since previous sale</span></span></span> </span></li> <li><span style="font-size: 12pt"><span style="font-size: 10pt; font-family: 'Lucida Sans Unicode','sans-serif'"><span style="font-family: Arial"><span style="font-size: 10pt">Lender may require a 2^nd appraisal to justify increase in valuue</span></span></span> </span></li> <li><span style="font-size: 12pt"><span style="font-size: 10pt; font-family: 'Lucida Sans Unicode','sans-serif'"><span style="font-family: Arial"><span style="font-size: 10pt">Seller may have to provide documentation to justify increase in value</span></span></span> </span></li> </ul> <div><span style="font-family: Arial"><span style="font-size: 10pt"><span style="font-size: 10pt; font-family: 'Lucida Sans Unicode','sans-serif'"><span style="font-size: 12pt">To read the entire announcement from HUD, click </span><span style="color: #3366ff"><span style="font-family: Arial"><span style="font-size: 10pt"><span style="font-size: 10pt; font-family: 'Lucida Sans Unicode','sans-serif'"><a style="color: #3366ff; text-decoration: underline" href="http://portal.hud.gov/portal/page/portal/HUD/press/press_releases_media_advisories/2010/HUDNo.10-011"><span style="font-size: 12pt">here</span></a></span></div> <div>&nbsp;</div> <div></span></span></span></span></span></span><span style="font-family: Arial"><span style="font-size: 10pt"><span style="font-size: 10pt; font-family: 'Lucida Sans Unicode','sans-serif'"><span style="font-size: 10pt"><span style="font-family: Arial">This is great new for buyers looking to purchase a recently foreclosed property.</span> <div>If you have questions concerning this, please give me a call at (509) 232-7725.</div> <div></span></span></span></span><span style="font-size: 10pt; font-family: 'Lucida Sans Unicode','sans-serif'"><span style="font-family: Arial">&nbsp;</div> </div> <div> <div>Denelle</div> <div><img alt="" src="http://investors.windermerecitygroup.com/images/New_Image__WinCE__01.JPG" width="240" align="left" /></div> </span></span></div><P><a href="http://mortgage.windermerecitygroup.com/blog/2010/01/19/temporary-waiver-of-huds-90-day-flipping-policy" target="_blank">Permalink</a> | <a href="http://mortgage.windermerecitygroup.com/blog/2010/01/19/temporary-waiver-of-huds-90-day-flipping-policy#comments" target="_blank">Comments</a></P>Denelle Geibelhttp://mortgage.windermerecitygroup.com/blog/2010/01/19/temporary-waiver-of-huds-90-day-flipping-policyTue, 19 Jan 2010 08:27:00 GMThttp://mortgage.windermerecitygroup.com/blog/2010/01/15/respa-impact-on-consumers&nbsp;I&nbsp;must forewarn you, this is a long post but contains information you need to know. <p>First, let me do my best to briefly explain RESPA.&nbsp; RESPA stands for Real Estate&nbsp;Settlement Procedures Act and was established in 1974 by the Department of Housing and Urban Development (HUD) as&nbsp;a consumer protection statute.&nbsp; It has been revised numerous times, 1976, 1983, 1990, 1992 and 1996.&nbsp; Attempted to be revised in 2002 but never passed.&nbsp;</p> <p>However, there was a major overhaul of RESPA in 2009 which went into full effect January 1, 2010.&nbsp; The main goal was to help borrowers shop for a loan more efficiently by clarifying and simplifying the process.&nbsp; RESPA estimated each individual borrower can save between $518 to $670 per transaction.&nbsp; How, I am not sure.</p> <p>As a consumer what can you expect to see differently when purchasing a home?&nbsp; The major two changes are the Good Faith Estimate (GFE) and the HUD-1 settlement statement you receive at closing; with the GFE getting the major overhaul.</p> <p>For anyone who has purchased or refinanced a home in, lets say the last ten years to throw out a number, you may recall receiving a GFE.&nbsp; The GFE listed the costs associated with purchasing your home, your impounds or escrow items, the estimated house payment, down payment and total funds needed to complete the transaction.&nbsp; It would also reflect any credits you would be receiving from the lender, Realtor or seller.&nbsp;</p> <p>The GFE of 2010 will no longer reflect all of this information.&nbsp;&nbsp;&nbsp;</p> <p>Now, don't think I am not all for change as I think the lending industry as a whole was in need of (1) more monitoring, (2) licensed and <span style="text-decoration: underline">educated</span> loan officers (originators) and (3) tighter guidelines.&nbsp; However, I am not sure the new RESPA rules help the consumer understand what is going on or save you money.</p> <p>The new GFE does provide more clearer details regarding your loan program and how your payment may or may not change in the near future.&nbsp; It does provide you with an opportunity to compare costs with other lenders.&nbsp; And it does provide some protection for your pocket book by limiting how much some of the fees can increase from what was originally disclosed to you by your loan originator.</p> <p>However, the main guts of the GFE that lists everything are so confusing, HUD has needed 52 pages of Frequently Asked Questions to help Lenders and Originators complete the form.&nbsp;&nbsp;&nbsp; Remember what I said in the beginning about RESPA's main goal in making these major changes was to help consumers.."<strong><em>shop for a loan more efficiently by clarifying and simplifying the process".&nbsp;</em></strong>&nbsp;&nbsp; 52 pages of explanations does not seem simple to me?</p> <p>O.K. so what do you need to know?&nbsp; First, the charges from your Lender <strong><span style="text-decoration: underline">cannot</span></strong> change one dime from the time they issue the GFE unless your loan amount changes or your rate is not locked at the time the GFE is issued.&nbsp; All charges from the Lender or Broker are now lumped into one lump sum; i.e, origination charge, processing fee, underwriting fee, etc.&nbsp;&nbsp; The GFE does not provide a place for&nbsp;the Lender/Broker to breakdown the fees.&nbsp; If you are paying points to buy the rate down, it is clearly stated and added to the Lender/Broker fees.&nbsp; If your Broker is receiving added money from the Lender for the rate charge, it is clearly listed and credited back to you to reduces your overall fees.&nbsp; <strong>**NOTE**&nbsp;Very Important</strong> ** If you receive a GFE with a credit from the Broker for your fees and you opt <span style="text-decoration: underline">NOT</span> to lock in your rate, this credit may decrease if the market worsens.&nbsp; Make sure you have constant communication with your loan officer to understand the daily changes of mortgage rates.</p> <p>Moving on-The next few sections of your GFE is where it will get a little confusing.&nbsp;</p> <p>Your Lender will now list charges for services that you are required to obtain from their providers.&nbsp; This will be items such as an appraisal or&nbsp;credit report.&nbsp; You have to have these items completed and you don't get to choose who you use.&nbsp; The fees listed in this section generally cannot increase more than 10% from what was originally quoted unless there is an event that was not expected; i.e, a 2nd appraisal was needed, items needed to be repaired on your credit report that resulted in additional fees.</p> <p>Title charges and escrow charges are now listed as one lump sum even though they may be two separate entities/companies.&nbsp; There is no place to break down how much you are paying for title insurance and how much the escrow company is charging you.</p> <p>Owner's Title Policy -&nbsp;This is something that is typically paid by the Seller.&nbsp; The Purchase &amp; Sale Contract for Spokane County specifically states the Seller will pay this.&nbsp; However, HUD wants the amount listed on the GFE for the buyer.&nbsp; At closing, you will be charged this amount and then credited the same amount from the Seller to offset the charge.</p> <p>Services that you can shop for, such as home or pest inspection, well tests, etc., will all be listed in one section with corresponding charges for each item.&nbsp; The loan officer will need to provide you with a list of their preferred providers for these services.&nbsp; If you elect to use someone on this list, then the quoted fees go into a buck of charges than cannot increase more than 10% of what was originally quoted.&nbsp; Unless of course a changeable event occurs.</p> <p>Transfer tax is a hot topic right now.&nbsp; What is transfer tax?&nbsp; Each Lender is answering the question differently.&nbsp; HUD requires the Lender to list the transfer tax charge on the GFE.&nbsp; In Spokane and surrounding counties, Sellers will pay an excise tax for selling the property. This is a Seller cost; not a buyer's costs.&nbsp; Is an excise tax the same as a transfer tax?&nbsp; HUD doesn't address this specifically in their 52 page document.&nbsp; So, some lenders are being very cautious and listing the excise tax amount on the GFE for the buyer.&nbsp; Then once again, the buyer will receive a credit for this same amount for the Seller.&nbsp; Some Lenders have clearly defined the excise tax is not a transfer tax are leaving it off all together.&nbsp; Why does it matter?&nbsp; Read on</p> <p>The rest of the GFE will list the total deposit that will need to be made into your escrow account if your loan program has one.&nbsp; It will also list your annual premium for homeowner's insurance and any interest you will pay on your new loan for the month in which you close your loan.</p> <p>Then all the figures will be totaled and listed at the bottom.&nbsp; No where can the loan officer indicate what items the seller or lender/broker will be paying on your behalf.&nbsp; It also will not list your down payment.&nbsp;</p> <p>Now let's talk about how you will see the Seller's credits.&nbsp; When you go to sign your final loan papers, the first document you will review will be the HUD-1 Settlement (HUD for short).&nbsp; Page 2 of the HUD lists all the fees that were included on your GFE.&nbsp; If the Seller is paying any of the fees on your behalf, you will be given a one-lump sum credit on page one.&nbsp; Page one is where it will list your purchase price, add your costs and then deduct your loan amount and credits to come up with the total amount you need to purchase the home.&nbsp;</p> <p>Here is where it may get sticky.&nbsp; Oftentimes, the Seller agrees to pay for a portion or all of the buyer's closing costs as a condition of the sale of the property.&nbsp; The amount they will pay is listed in the Financing Addendum to the Purchase &amp; Sale Agreement.&nbsp; At closing, the escrow officer will not credit the buyer for any more than what is listed in the contract.&nbsp; Unfortunately, the escrow officer will now be forced to add in the cost of the Owner's Title Policy as HUD now requires this cost to be shown as a buyers expense and a seller credit.&nbsp; If your Realtor does not specify that the credit for the Owner's Title Policy is NOT to be included in what is paid by the Seller, you can be short changed at closing.&nbsp; Here is an example:</p> <p>Loan officer tells&nbsp; buyer their down payment is $5,000 and their costs will be $4,000; they will need $9,000 to purchase home.&nbsp; Seller agrees to pay $3,500 towards buyers costs now reducing the total amount needed from buyer to $5,500.&nbsp; On the HUD, the escrow officer will indicate a credit of $3,500 for the buyer and total closing costs of $4,500.&nbsp; The extra $500 in costs is for the Owners Title Policy which was never their cost to begin with but HUD requires it to be listed on the buyer's side.&nbsp; Now the buyer needs $500 more than was told.&nbsp;</p> <p>How do you fix it?&nbsp; Make sure your Real Estate Agent is specific on the Financing Addendum.&nbsp; Clearly state that the Seller's credit will NOT include the Owner's Title Policy or the Excise Tax (remember some Lenders are requiring this to be listed on the buyer's side as well).&nbsp;</p> <p>Wrap up -</p> <ol> <li>Be informed.&nbsp; Make sure you are using a reputable, experienced and most importantly educated loan officer to finance your mortgage.&nbsp; A good one will have a separate form that clearly lists the total costs, house payment, credits and total amount you will need.&nbsp; If they don't; walk away.</li> <li>See your loan officer BEFORE you decide to buy.&nbsp; Do all your comparison shopping before you find the perfect house.&nbsp;</li> <li>USE a Realtor!&nbsp; Again, use a good one.&nbsp; Ask around and see who you know used or ask your loan officer for some good recommendations.&nbsp; Now more than ever, you need to use someone who understands the complexities of our industries.</li> <li>Ask Questions.&nbsp; Make sure you understand the GFE to the best of your ability.&nbsp; Know what can change and when it change.&nbsp;</li> <li>Lock your loan.&nbsp; Waiting around for the rates to drop an extra 1/8th could cost you thousands in the long run.&nbsp; Once you lock, get everything requested by your loan officer immediately.&nbsp; Not closing on time could result in you needing more money at closing.</li> <li>Expect to pay a little more.&nbsp; Since there are so many areas in which fees cannot change or can change very little, we have seen an immediate increase in fees that both Lenders and service providers now charge.&nbsp; </li> </ol> <p>HUD had great intentions with the new RESPA rules but somewhere along the line, I feel they have made things a bit more confusing to both the consumer and the lenders.&nbsp; The best we can do is work with what we have and move forward.&nbsp; As I mentioned in the beginning, there are some very good improvements to the new GFE.&nbsp; If nothing else, HUD is providing you with the to become more informed and educated regarding the lending industry.&nbsp; Just make sure the right person is&nbsp;teaching you.</p> <p>If you have any questions at all regarding this information, please get in touch with me.&nbsp; I can be reached at 509-232-7725.&nbsp; Denelle</p><P><a href="http://mortgage.windermerecitygroup.com/blog/2010/01/15/respa-impact-on-consumers" target="_blank">Permalink</a> | <a href="http://mortgage.windermerecitygroup.com/blog/2010/01/15/respa-impact-on-consumers#comments" target="_blank">Comments</a></P>Denelle Geibelhttp://mortgage.windermerecitygroup.com/blog/2010/01/15/respa-impact-on-consumersFri, 15 Jan 2010 14:52:00 GMThttp://mortgage.windermerecitygroup.com/blog/2009/12/07/monday-morning-update<p><strong>HI HO, HI HO, IT'S OFF TO WORK WE GO!" </strong>And even those who have been feeling grumpy about the weak labor market found something to smile about last Friday. The official Jobs Report for November was released - and the improving numbers were a big surprise to the markets.According to the Labor Department, only 11,000 jobs were lost in November, despite expectations of 125,000 jobs lost. As you can see from the chart below, this marks the least number of jobs lost in nearly two years - since December 2007. Adding to the favorable news, the Unemployment Rate improved to 10.0%, when expectations were for it to remain at the 10.2% level.While the news was good for the economy and helped Stocks improve sharply, it wasn't so favorable for Bonds...and as a result, <strong><u>home loan rates moved slightly higher on the news, continuing their worsening trend for the week overall.</u></strong></p> <p><img class="aligncenter size-full wp-image-316" title="payroll" height="304" alt="payroll" src="http://cascademortgageblog.com/wp-content/uploads/2009/12/payroll.jpg" width="515" mce_src="http://cascademortgageblog.com/wp-content/uploads/2009/12/payroll.jpg" /></p> <p>In other news, based on early numbers, 195 Million shoppers hit the stores and websites on Black Friday, which was up from last year's 172 Million. Cyber Monday - the online equivalent of Black Friday - also showed an increase in web shoppers, up by 6% from last year. It appears that the shopping traffic was up, but the dollars-per-shopper may be down a bit. This might be indicative of not only consumers being conservative...but also the fact that with all the deep sales taking place to incent buyers, fewer dollars may be spent to get the very same merchandise as a year ago.</p> <p><strong>Real Estate News.&nbsp; </strong>The U.S. Treasury Department announced new guidelines last week designed to make short sales go more smoothly. To qualify under these new guidelines: The property must be the home owner’s principal residence; The home owner must be delinquent on their loan or close to defaulting; The loan must have been made before Jan. 1, 2009, and be for less than $729,750; and The borrowers’ total payment must exceed 31 percent of their before-tax income. Under the plan, borrowers will receive $1,500 from the government for selling homes for less than the amount of their loans. Loan-servicing companies will get $1,000 for each completed short sale. Second-lien holders can receive up to $3,000 of the sales proceeds in exchange for releasing their liens. Investors who hold the first lien can collect up to $1,000 from the government for allowing the payments. Borrowers who complete a short sale under the program must be "fully released" from future liability for the debt, according to the guidelines. <em>Sources: Associated Press and The Wall Street Journal</em></p> <p><strong>The Markets.&nbsp; </strong>Rates moved down to record lows in the past week. Freddie Mac announced that for the week ending December 3, 30-year fixed rates averaged 4.71%, down from 4.78% the week before. The average for 15-year fixed fell to 4.27%. A year ago 30-year fixed rates were at 5.53%. &nbsp;<em>Rates indicated do not include fees and points and are provided for evidence of trends only. They should not be used for comparison purposes.</em></p> <p><em></em><br /> <strong>Forecast for the Week.&nbsp; </strong>The week ahead starts out a bit sleepy in terms of economic reports, with no major releases due until Thursday when the Initial Jobless Claims report and the Balance of Trade report will both arrive.Friday will bring another shot of economic news when the Retail Sales Report - the most-timely indicator of broad consumer spending patterns - is released. We'll also get a look at the Consumer Sentiment Index for an updated snapshot of how consumers are feeling about the economy.In addition to these reports, the markets will be watching the latest round of Treasury auctions. This week's auctions include longer-term maturities such as 10-year Notes and 30-year Bonds that compete with Mortgage Backed Securities or Mortgage Bonds. So as we've been seeing of late, the auctions could cause some volatility, depending on how well they are received.<strong><u>Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result.</u>&nbsp; </strong>Mortgage Bonds hit a high for 2009 on November 27th, but traded lower last week due to financial news and a better-than-expected Jobs Report.</p><P><a href="http://mortgage.windermerecitygroup.com/blog/2009/12/07/monday-morning-update" target="_blank">Permalink</a> | <a href="http://mortgage.windermerecitygroup.com/blog/2009/12/07/monday-morning-update#comments" target="_blank">Comments</a></P>Denelle Geibelhttp://mortgage.windermerecitygroup.com/blog/2009/12/07/monday-morning-updateMon, 07 Dec 2009 09:00:00 GMThttp://mortgage.windermerecitygroup.com/blog/2009/12/04/jobs-report-not-good-for-rates<p>The Jobs Report was released today and while it looks good for the overall economy it was not good for mortgage rates.</p> <p><img class="aligncenter size-full wp-image-310" title="JOBLESS" height="512" alt="JOBLESS" src="http://cascademortgageblog.com/wp-content/uploads/2009/12/unemployment2.jpg" width="240" mce_src="http://cascademortgageblog.com/wp-content/uploads/2009/12/unemployment2.jpg" /></p> <p>&nbsp;The Labor Department reported this morning that there were only 11,000 jobs lost in November.&nbsp; This number is far less than the 125,000 job losses that were expected.&nbsp; And then they also announced that in the last two months there were actually 159,000 fewer jobs lost than were originally reported&nbsp;after revisions were made.&nbsp;The economy has now lost jobs for 23 straight months but the small decline in November indicates the nation could begin generating jobs soon. Many economists think it will happen in the first quarter of next year.</p> <p>And the final piece of good news was that the Unemployment Rate improved to 10.% .</p> <p>All of this data is building economic optimism on Wall Street.&nbsp; While this is great for the overall good of the economy&nbsp;and for stocks&nbsp;- it is awful for mortgage rates.&nbsp; As I have mentioned in the past, good news is good for the economy, bad for rates.&nbsp; The mortgage market just got slammed this morning and there is a massive sell off of bonds pushing mortgage rates higher.&nbsp;</p> <p>Now let's keep this in perspective... yes rates moved higher quickly this morning and are now anywhere from .125% to .375% higher than yesterday.&nbsp; But are rates HIGH?&nbsp; Absolutely not.&nbsp; Today just illustrates how volatile the market can be and how quickly it can move.</p> <div>If you are under contract or considering a refinance, please speak with your mortgage professional about rates right away.&nbsp; Keep in mind, rates go up on the elevator down on the escalator!</div> <div>&nbsp;</div> <div>Denelle Geibel</div><P><a href="http://mortgage.windermerecitygroup.com/blog/2009/12/04/jobs-report-not-good-for-rates" target="_blank">Permalink</a> | <a href="http://mortgage.windermerecitygroup.com/blog/2009/12/04/jobs-report-not-good-for-rates#comments" target="_blank">Comments</a></P>Denelle Geibelhttp://mortgage.windermerecitygroup.com/blog/2009/12/04/jobs-report-not-good-for-ratesFri, 04 Dec 2009 11:13:00 GMThttp://mortgage.windermerecitygroup.com/blog/2009/12/03/fha-changes-are-coming<p>Rumors have been swirling around that FHA will be the next big thing to go under in the Lending industry.&nbsp;&nbsp; Why?&nbsp; Well an FHA loan is simply a mortgage that is insured by HUD against default, to protect the lender.&nbsp; FHA's reserve funds are dwindling as the default rates on FHA loans are increasing.&nbsp; If HUD were to run out of money to insure these loans, then FHA would be no more!</p> <p>As HUD Secretary Shaun Donvoan said yesterday before the House Committee on Financial services, this is unlikely to happen.&nbsp; However, HUD must make some changes in order to keep things humming along.</p> <p>Nothing is set in stone yet, but HUD has suggested some changes that are likely to be implemented in 2010.&nbsp; Here are some highlights of proposed changes:</p> <ul> <li><strong><em>Increased Down Payment</em></strong> - Currently an FHA buyer must contribute a minimum down payment of 5%.&nbsp; HUD has made it very clear they want FHA buyers to have more "<em>skin in the game".&nbsp; </em>And to do this they want to increase the cash required from buyers.&nbsp; How they will do this is still not clear, it may be an increase in the down payment to 5% or a <u>combination</u> of down payment and closing costs to equal a minimum of 5%; either way buyers will need more money to buy.</li> <li><strong><em>Seller Conessions to be lowered</em></strong>- Currently a Seller may contribute up to 6% of the sales price to pay closing costs, pre-paids or points for the buyer.&nbsp; HUD is considering lowering this to 3% which is the current maximum for Fannie Mae conventional loans.&nbsp; In days of past, 3% would pretty much cover all the costs for the buyer.&nbsp; However, with prices increasing everwhere, including lending, this doesn't cover all the costs for a lot of buyers.&nbsp; Depending upon the price of the home, the Seller may not be able to cover all the costs.</li> <li><strong><em>MIP Premiums to Increase</em></strong>- Private mortgage companies insure the loan for the lender for a monthly fee that is paid by buyers who have less than 20% down.&nbsp; FHA has a similar monthly fee, however, it can be as much as 40% less than a conventional premium depending upon the buyer's situation.&nbsp; FHA also has an Up Front Mortgage Insurance Premium that is charged at the time the loan closes and is added to the loan amount.&nbsp; This up front premium, along with the monthly premium, &nbsp;is what is used to replenish HUD's insurance pool so that they can insure against defaults.&nbsp; Currently, FHA collects 1.75% of the loan amount as the Up Front MIP and then charges an additional .55% of the loan amount annually, as part of the monthly mortgage payment.&nbsp; HUD did not announce what they will increase or how much but I speculate they will increase the Up Front MIP and keep the montly premium the same.&nbsp;</li> <li><strong><em>Increase minimum FICO scores</em></strong>-This is almost a mute point and I will explain.&nbsp; Currently FHA does not have a minimum credit score to qualify for an FHA loan.&nbsp; However, nearly all lenders have imposed their own minimum credit scores usually ranging from 620-640; some as high as 680.&nbsp; HUD is now &nbsp;considering implementing a minimum credit score.&nbsp; No word on what that will be but my guess is it will be in the 620-640 range.</li> </ul> <p>We have seen changes in almost every facet of lending, and HUD appears to be following suit.&nbsp; FHA financing will become more costly and more difficult in the future.&nbsp; There are plenty of&nbsp; reasons that scream "buy now" - historically low rates, tax credit and housing prices - this is just another reason to get out and act now!</p> <p>Please feel free to call me if you have any questions regarding purchasing or financing a home.</p><P><a href="http://mortgage.windermerecitygroup.com/blog/2009/12/03/fha-changes-are-coming" target="_blank">Permalink</a> | <a href="http://mortgage.windermerecitygroup.com/blog/2009/12/03/fha-changes-are-coming#comments" target="_blank">Comments</a></P>Denelle Geibelhttp://mortgage.windermerecitygroup.com/blog/2009/12/03/fha-changes-are-comingThu, 03 Dec 2009 13:00:00 GMThttp://mortgage.windermerecitygroup.com/blog/2009/11/30/monday-morning-update<div><strong><u><span style="color: #0000ff" mce_style="color: #0000ff;"><br /> <img style="width: 90px; height: 137px" height="137" src="http://investors.windermerecitygroup.com/images/New_Image__WinCE_.JPG" width="90" align="left" alt="" />Economic Commentary-</span></u></strong></div> <p><span style="font-size: 10pt; font-family: 'Arial','sans-serif'" mce_style="FONT-SIZE: 10pt; FONT-FAMILY: 'Arial','sans-serif'">It is now December. Therefore, it is right that we start looking at the first of the year. We are not trying to downplay the data released in December. However, for example, the employment numbers tend to be skewed by seasonal factors and even though there are adjustments, this year the adjustments may be hard to analyze because of the rapidly changing environment. Witness the precipitous drop in the weekly unemployment claims reported the last week in November. The volatility of the markets the Friday after Thanksgiving was due to the Dubai debt crisis and certainly it did not help that many participants were on the sidelines for the Holiday. </span></p> <p><span style="font-size: 10pt; font-family: 'Arial','sans-serif'" mce_style="FONT-SIZE: 10pt; FONT-FAMILY: 'Arial','sans-serif'">Come the first of the year we will have a whole new ball game. By the end of January and early February, we will have retail sales figures that measure Holiday spending. We will also have the first reading on the economy in the last quarter of the year. Finally, we will have the first "post-Holiday" employment report. If we are indeed recovering and not in danger of a double-dip, these numbers will be critical. Meanwhile, the downward revision in the third quarter economic growth was widely expected. The fact that it was partially due to a paring down of inventories actually bodes well for future growth. Of course, this brings us back to the future. If the markets are to stay strong as they have for most of this year, rates will have to stay low as they have for all of this year. Right now rates on home loans are at record lows. And we must show that the economy will stay in positive territory but not overheat so that rates do not rise. </span></p> <p><span style="font-size: 10pt; font-family: 'Arial','sans-serif'" mce_style="FONT-SIZE: 10pt; FONT-FAMILY: 'Arial','sans-serif'"><span style="color: #0000ff" mce_style="color: #0000ff;"><strong><u>The Markets</u></strong>-</span>&nbsp;</span></p> <p>Rates moved down to record lows in the past week. Freddie Mac announced that for the week ending November 25, 30-year fixed rates averaged 4.78%, down from 4.83% the week before. The average for 15-year fixed fell to 4.29%. Adjustables were mixed with the average for one-year adjustables staying at 4.35% and five-year adjustables decreasing to 4.18%. <span style="background-color: yellow">A year ago 30-year fixed rates were at 5.97%</span>. "Long-term rates eased for the fourth consecutive week to record levels," said Frank Nothaft, Freddie Mac vice president and chief economist." Rates for 30-year fixed loans tied an all-time record low while both 15-year fixed and 5-year ARMs broke their corresponding records. Rates for 30-year fixed-rate loans are currently 0.8 percentage points below this year’s peak set in mid-June, which shaves roughly $100 off the payments on a $200,000 mortgage. House prices are slowly beginning to firm now. For instance, annual house price declines slowed for the sixth consecutive month in September, down only 3 percent, and represented the smallest decline since February 2008, according to the Federal Housing Finance Agency’s purchase-only house price index. Moreover, 11 of the 20 major metropolitan areas experienced monthly house price increases between August and September, based on the S&amp;P/Case-Shiller 20-city house price indices." <em>Rates indicated do not include fees and points and are provided for evidence of trends only. They should not be used for comparison purposes.</em></p> <p align="center">Current Indices For Adjustable Rate Mortgages<br /> Updated November 27, 2009</p> <table cellpadding="0" border="1"> <tbody> <tr> <td>&nbsp;</td> <td><em>Daily Value</em></td> <td><em>Monthly Value</em></td> </tr> <tr> <td>&nbsp;</td> <td><em>Nov 25</em></td> <td><em>October</em></td> </tr> <tr> <td><em>6-month Treasury Security </em></td> <td><em>0.14%</em></td> <td><em>0.16%</em></td> </tr> <tr> <td><em>1-year Treasury Security</em></td> <td><em>0.26%</em></td> <td><em>0.37%</em></td> </tr> <tr> <td><em>3-year Treasury Security</em></td> <td><em>1.23%</em></td> <td><em>1.46%</em></td> </tr> <tr> <td><em>5-year Treasury Security</em></td> <td><em>2.11%</em></td> <td><em>2.33%</em></td> </tr> <tr> <td><em>10-year Treasury Security</em></td> <td><em>3.28%</em></td> <td><em>3.39%</em></td> </tr> <tr> <td><em>12-month LIBOR</em></td> <td>&nbsp;</td> <td><em>1.234% (Oct)</em></td> </tr> <tr> <td><em>12-month MTA</em></td> <td>&nbsp;</td> <td><em>0.544% (Oct)</em></td> </tr> <tr> <td><em>11th District Cost of Funds</em></td> <td>&nbsp;</td> <td><em>1.272% (Sept)</em></td> </tr> <tr> <td><em>Prime Rate</em></td> <td>&nbsp;</td> <td><em>3.25% (Dec)</em></td> </tr> </tbody> </table> <p><span style="color: #0000ff" mce_style="color: #0000ff;"><strong><u>Real Estate News</u></strong> -</span>&nbsp;</p> <p>Baby boomers considering where they’ll spend their retirement say they prefer single-story living in suburbia, according to a survey conducted by the National Association of Home Builders and the MetLife Mature Market Institute. The survey of owners and renters 55 and older identified some interesting preferences: One-third would choose a close-in suburb; another third prefer an outlying suburb; 25 percent desire a rural community; and 9 percent want to live in the center city. About 79 percent want a single-story home, 15 percent prefer a two-story, and 6 percent want a split level. Most respondents say they’d like their next home to be the same size as their current one. <em>Source: MetLife Mature Market Institute</em></p> <p><span style="background-color: yellow">Homeowners</span> in the United States were <span style="background-color: yellow">more optimistic about the future of the housing market </span>last quarter than they have been in 18 months, according to the Zillow Q3 Homeowner Confidence Survey. According to the Seattle-based company’s study, <span style="background-color: yellow">41 percent believe their home’s value will increase in the next six months</span>. An additional 43 percent say their home’s value will remain the same, with only 17 percent expecting their home’s value to drop. “Homeowners are clearly confused about the housing market, and with good reason,” said Stan Humphries, Zillow’s chief economist. “Home values in different parts of the country have shown varied performance in the third quarter." <em>Source: DSNews</em></p> <p>Housing industry consultant John Burns says low rates and the home buyer tax credit, plus the availability of FHA loans – “the new subprime,” as he calls it – will combine to keep housing transaction levels at “near normal” through Spring 2010. First-time homebuyers are about half of the market, he says, while the expansion of the housing tax credit will get senior buyers “off the fence” and buying retirement properties. What would have happened if Congress hadn’t extended the tax credit? “I think we would see housing<span id="_marker">&nbsp;</span></p> <p><span style="font-size: 10pt; font-family: 'Arial','sans-serif'" mce_style='font-size: 10pt; font-family: "Arial","sans-serif";'>Baby boomers considering where they’ll spend their retirement say they prefer single-story living in suburbia, according to a survey conducted by the National Association of Home Builders and the MetLife Mature Market Institute. The survey of owners and renters 55 and older identified some interesting preferences: One-third would choose a close-in suburb; another third prefer an outlying suburb; 25 percent desire a rural community; and 9 percent want to live in the center city. About 79 percent want a single-story home, 15 percent prefer a two-story, and 6 percent want a split level. Most respondents say they’d like their next home to be the same size as their current one. <em><span style="font-family: 'Arial','sans-serif'" mce_style='font-family: "Arial","sans-serif";'>Source: MetLife Mature Market Institute</span></em></span></p> <p><span style="font-size: 10pt; font-family: 'Arial','sans-serif'" mce_style='font-size: 10pt; font-family: "Arial","sans-serif";'>Homeowners in the United States were more optimistic about the future of the housing market last quarter than they have been in 18 months, according to the Zillow Q3 Homeowner Confidence Survey. According to the Seattle-based company’s study, 41 percent believe their home’s value will increase in the next six months. An additional 43 percent say their home’s value will remain the same, with only 17 percent expecting their home’s value to drop. “Homeowners are clearly confused about the housing market, and with good reason,” said Stan Humphries, Zillow’s chief economist. “Home values in different parts of the country have shown varied performance in the third quarter." <em><span style="font-family: 'Arial','sans-serif'" mce_style='font-family: "Arial","sans-serif";'>Source: DSNews</span></em></span></p> <p><span style="font-size: 10pt; font-family: 'Arial','sans-serif'; mso-fareast-font-family: Calibri; mso-fareast-theme-font: minor-latin; mso-ansi-language: EN-US; mso-fareast-language: EN-US; mso-bidi-language: AR-SA" mce_style='font-size: 10pt; font-family: "Arial","sans-serif"; mso-fareast-font-family: Calibri; mso-fareast-theme-font: minor-latin; mso-ansi-language: EN-US; mso-fareast-language: EN-US; mso-bidi-language: AR-SA;'>Housing industry consultant John Burns says low rates and the home buyer tax credit, plus the availability of FHA loans – “the new subprime,” as he calls it – will combine to keep housing transaction levels at “near normal” through Spring 2010. First-time homebuyers are about half of the market, he says, while the expansion of the housing tax credit will get senior buyers “off the fence” and buying retirement properties. What would have happened if Congress hadn’t extended the tax credit? “I think we would see housing crater,” Burns said. Burns clients include home builders, lenders, and equity investors. <em>Source: The Wall Street Journal</em></span></p><P><a href="http://mortgage.windermerecitygroup.com/blog/2009/11/30/monday-morning-update" target="_blank">Permalink</a> | <a href="http://mortgage.windermerecitygroup.com/blog/2009/11/30/monday-morning-update#comments" target="_blank">Comments</a></P>Denelle Geibelhttp://mortgage.windermerecitygroup.com/blog/2009/11/30/monday-morning-updateMon, 30 Nov 2009 08:13:00 GMThttp://mortgage.windermerecitygroup.com/blog/2009/11/24/are-you-paying-too-much-in-property-taxFor so many of us, our home's value has gone down in the past couple of years.&nbsp; So why doesn't our property tax fall with it?&nbsp; If you think you are paying too much for your property tax, there is a simple fix:&nbsp; Dispute your home’s assessment.&nbsp; Simple, but not always easy.&nbsp; Washington State Department of Revenue provided me with some basic information and steps to appeal your taxes. <p>We must first understand how your property is assessed.&nbsp; State law requires assessors to value all taxable property at 100 percent of its true and fair market value in money according to the highest and best use of the property using one ore more acceptable appraisal methods:&nbsp;</p> <ul> <li>Market or sales comparison</li> <li>&nbsp;Cost approach</li> <li>Income capitalization approach for income producing property or</li> <li>A&nbsp;combination of all three mentioned.&nbsp;</li> </ul> <p>Once the assessor determines the assessed value of your property, a&nbsp; Change of Value Notice is sent to you.&nbsp; Real property must be reassessed at least once every four years.&nbsp;</p> <p>You can contact your county assessor’s office to review your valuation whenever you have questions about your property value.&nbsp; Property owners can often settle disagreements at this level without continuing the appeal process.&nbsp; However, you still need to preserve your appeal rights by timely filing your appeal.</p> <p>To file an appeal against an assessor’s property valuation, you must complete a Board of Equalization appeal form in the county where the property is located.&nbsp; Filing for an appeal is free.&nbsp; Appeal forms are available at&nbsp;<a href="http://www.dor.wa.gov/" mce_href="http://www.dor.wa.gov/">Department of Revenue</a>.&nbsp; The filing deadline for an appeal is the latter of:</p> <ul> <li>July 1 of the assessment year or</li> <li>Within 30 days of when the Change of Value Notice was mailed by the assessor’s office.</li> </ul> <p>An appeal form must include specific reasons why you believe the assessor’s valuation is incorrect.&nbsp; You may include a recent appraisal of your property or sales of similar properties reflecting a lower value than your property.&nbsp; You can get comparable sales information from records at the county assessor’s office, realtors or title companies.&nbsp; You should use property sales that are most comparable to your property and which sold closest to the assessment or appraisal value of your property.&nbsp;</p> <p>The clerk of the board of Equalization will notify you about the date, location an time of your scheduled hearing.&nbsp; The hearing is an informal review that allows property owners to represent themselves without an attorney.&nbsp; Keep in mind the county assessor, by law, is presumed to be correct.&nbsp; The burden of proof is on you, the taxpayer, to show that the assessed value is not correct.&nbsp; You must present clear and convincing evidence to support&nbsp;your estimate of market value.</p><P><a href="http://mortgage.windermerecitygroup.com/blog/2009/11/24/are-you-paying-too-much-in-property-tax" target="_blank">Permalink</a> | <a href="http://mortgage.windermerecitygroup.com/blog/2009/11/24/are-you-paying-too-much-in-property-tax#comments" target="_blank">Comments</a></P>Denelle Geibelhttp://mortgage.windermerecitygroup.com/blog/2009/11/24/are-you-paying-too-much-in-property-taxWed, 25 Nov 2009 11:07:00 GMThttp://mortgage.windermerecitygroup.com/blog/2009/11/24/update-to-fthb-tax-credit<div>I <span style="font-size: 11pt">have been fielding numerous questions regarding the FTHB Tax Extension.&nbsp; I am going to address three of the most talked about items:</span> <ol> <li> <div style="line-height: 14.25pt; margin-right: 0in"><span style="font-size: 11pt">Do repeat buyers have to sell their current primary residence to qualify for the tax credit?</span></div> </li> <li style="line-height: 14.25pt; margin-right: 0in"><span style="font-size: 11pt">Do we use the same forms to request the credit that were used in the past?</span></li> <li style="line-height: 14.25pt; margin-right: 0in"><span style="font-size: 11pt">Are there special provisions for military personnel?</span></li> </ol> <p style="line-height: 14.25pt; margin-right: 0in">&nbsp;<u><span style="font-size: 11pt">1.&nbsp;&nbsp;NO - you do not need to sell your home!&nbsp; &nbsp;Here it is directly from the IRS:</span></u></p> <p style="line-height: 14.25pt; margin-right: 0in"><strong><span style="font-size: 11pt; color: black">Q:&nbsp; I'm already a homeowner.&nbsp;If I buy a replacement home after Nov. 6, 2009, to use as my principal residence, do I have to sell my home to qualify for the homebuyer tax&nbsp;credit?</span></strong></p> <p style="margin-right: 0in"><span style="font-size: 11pt; color: black">A:&nbsp; If you meet all of the requirements for the credit, the&nbsp;law does not require you to sell or otherwise dispose of your current principal residence&nbsp;to qualify for a credit of up to $6,500 when you buy a replacement home&nbsp;to use as your principal residence. The requirements are that you must buy, or enter into a binding contract to buy,&nbsp;the replacement principal residence after Nov. 6, 2009, and on or before April 30, 2010, and close on the home by June 30, 2010. Additionally, you must have lived&nbsp;in the same principal residence for any five-consecutive-year period during the eight-year period that ended on the date the&nbsp;replacement home is purchased. For example, if you bought a home on Nov. 30, 2009, the eight-year period would run from Dec. 1, 2001, through Nov. 30, 2009. (11/17/09)</span></p> <p style="line-height: 14.25pt; margin-right: 0in"><u><span style="font-size: 11pt">2.&nbsp; NO.&nbsp; You must use a newer version of form 5405 if you purchase your home after November 6, 2009</span></u><span style="font-size: 11pt">.</span></p> <p style="line-height: 14.25pt; margin-right: 0in"><span style="font-size: 11pt">A new version of Form 5405, First-Time Homebuyer Credit, will be available in the next few weeks. A taxpayer who purchases a home after Nov. 6 must use this new version of the form to claim the credit. Likewise, taxpayers claiming the credit on their 2009 returns, no matter when the house was purchased, must also use the new version of Form 5405. Taxpayers who claim the credit on their 2009 tax return will not be able to file electronically but instead will need to file a paper return.&nbsp; You MUST supply proof of your purchase with a certified copy of your settlement agreement (aka HUD-1).</span></p> <p style="line-height: 14.25pt; margin-right: 0in"><span style="font-size: 11pt">A taxpayer who purchased a home on or before Nov. 6 and chooses to claim the credit on an original or amended 2008 return may continue to use the current version of Form 5405. </span></p> <p style="line-height: 14.25pt; margin-right: 0in"><u><span style="font-size: 11pt">3.&nbsp;&nbsp;There are new benefits for members of the military and certain other federal employees:</span></u></p> <ul type="disc"> <li style="line-height: 14.25pt; margin-right: 0in"><span style="font-size: 11pt">Members of the military and certain other federal employees serving outside the U.S. have an extra year to buy a principal residence in the U.S.&nbsp;and qualify for the credit. Thus, an eligible taxpayer must buy, or&nbsp;enter into a binding contract to buy, a principal residence on or before April 30, 2011. If a binding contract is entered into by that date, the taxpayer has until June 30, 2011, to close on the purchase.&nbsp; Members of the uniformed services, members of the Foreign Service and employees of the intelligence community are eligible for this special rule. It applies to any individual (and, if married, the individual's spouse) who serves on qualified official extended duty service outside of the United States&nbsp;for at least 90 days during the period beginning after Dec. 31, 2008, and ending before May 1, 2010.</span></li> </ul> <ul type="disc"> <li style="line-height: 14.25pt; margin-right: 0in"><span style="font-size: 11pt">In many cases, the credit repayment (recapture) requirement is waived for members of the uniformed services, members of the Foreign Service and employees of the intelligence community. This relief applies where a home is sold or stops being the taxpayer’s principal residence after Dec. 31, 2008, in connection with government orders received by the individual (or the individual’s spouse) for qualified official extended duty service. The credit is still allowable even if this happens during the year of purchase. Qualified official extended duty is any period of extended duty while serving at a place of duty at least 50 miles away from the taxpayer’s principal residence (whether inside or outside the U.S.) or while residing under government orders in government quarters. Extended duty is defined as any period of duty pursuant to a call or order to such duty for a period in excess of 90 days or for an indefinite period.</span></li> </ul> <p style="line-height: 14.25pt; margin-right: 0in"><span style="font-size: 11pt">Continue to ask these great questions so I can get this information out!&nbsp; Have a great Thanksgiving!</span></p> </div><P><a href="http://mortgage.windermerecitygroup.com/blog/2009/11/24/update-to-fthb-tax-credit" target="_blank">Permalink</a> | <a href="http://mortgage.windermerecitygroup.com/blog/2009/11/24/update-to-fthb-tax-credit#comments" target="_blank">Comments</a></P>Denelle Geibelhttp://mortgage.windermerecitygroup.com/blog/2009/11/24/update-to-fthb-tax-creditTue, 24 Nov 2009 15:09:00 GMThttp://mortgage.windermerecitygroup.com/blog/2009/11/24/conforming-loan-limits-for-2010<p>For the 5th consecutive year, the 1-unit conforming mortgage limit for Spokane County is $417,000.</p> <p>As we are well aware, lending standards have tightened considerably the past couple of years.&nbsp; However, loan limits have stayed the same!</p> <p>Just released by the Federal Housing Financing Agency, the offocial 2010 conforming loan limits:</p> <ul> <li>1-unit properties:&nbsp; $417,000</li> <li>2-unit properties:&nbsp; $553,850</li> <li>3-unit properties:&nbsp; $645,300</li> <li>4-unit properties:&nbsp; $801,950 </li> </ul> <p>The maximum loan size does vary by market.&nbsp; The limits quoted above are for Spokane County.&nbsp; Counties in which typical home prices are way above the norm will also have higher conforming loan limits.&nbsp;&nbsp; There are only 197 designated high-cost areas in the U.S. - only 6% of the country.&nbsp; Here are some other areas in Washington State and their loan limits:</p> <ul> <li>Snohomish,Pierce &amp; King County:&nbsp; $567,600</li> <li>San Juan County:&nbsp; $593,750</li> <li>Jefferson County:&nbsp; $437,500 </li> </ul> <p>So what happens if you happen to be looking at a loan that exceeds the loan limits for your county?&nbsp; Well, then you would move into what is called "jumbo" loans.&nbsp; Pricing is typically a bit higher on this size of a loan and the minimum down payment is usually 20%.&nbsp; However, there is great financing options available, you just need to know where to look!</p> <p>If you would like to find your local market's loan limit, please go to&nbsp;<a href="http://www.fanniemae.com/aboutfm/loanlimits.jhtml" mce_href="http://www.fanniemae.com/aboutfm/loanlimits.jhtml">fanniemae</a>&nbsp;website.</p> <p>Denelle</p><P><a href="http://mortgage.windermerecitygroup.com/blog/2009/11/24/conforming-loan-limits-for-2010" target="_blank">Permalink</a> | <a href="http://mortgage.windermerecitygroup.com/blog/2009/11/24/conforming-loan-limits-for-2010#comments" target="_blank">Comments</a></P>Denelle Geibelhttp://mortgage.windermerecitygroup.com/blog/2009/11/24/conforming-loan-limits-for-2010Tue, 24 Nov 2009 10:42:00 GMThttp://mortgage.windermerecitygroup.com/blog/2009/11/23/monday-morning-update<div>Well it isn't technically morning anymore!&nbsp; I couldn't finish the day without posting my Monday blog.&nbsp; Here it is!!</div> <div>&nbsp;</div> <div><strong><em><u>Economic Commentary:</u></em></strong>&nbsp; It has been a rough year for many around the world. The economic crisis which started three years ago as a downturn in an overheated United States real estate market has spread world-wide. Many would ask what they have to give thanks for in a year in which so many have lost their jobs and houses. Well, we believe there is a lot to give thanks for. For one, after declaring that the economy could withstand the downturn, the government soon came to realize that we must apply strong medicine. Starting in 2008, we did apply this medicine in a variety of ways from record low rates to making sure that the banking system did not collapse. We have not addressed the long-term issue of deficit spending, but most would agree strong measures were warranted.</div> <div> <p>In every challenge there are opportunities. For example, the down market has made real estate a bargain and millions are becoming owners for the first time. The recent extension and expansion of the tax credit shows the government will continue to apply strong medicine. Low rates, low prices and a government subsidy point to a bargain that many have not seen for many years. Even the recent lull in housing starts bodes well for the long-term prospects of real estate because analysts agree that the market will not rebound permanently until the excess inventory is off the shelves. As the bad news has brought opportunities for millions, the good news of a rebounding real estate market can also create problems. For one, don’t expect record low rates to be with us forever. The Federal Reserve Board has kept short-term rates close to zero and also has brought long-term rates down as well by purchasing mortgage securities. As the market rebounds, less help will be needed and when the government backs off, the record sale on real estate we have witnessed may be over.</p> <p><strong><u>The Markets.</u></strong> Rates moved down in the past week. Freddie Mac announced that for the week ending November 19, 30-year fixed rates averaged 4.83%, down from 4.91% the week before. The average for 15-year fixed fell to 4.32%. Adjustables were also down with the average for one-year adjustables falling to 4.35% and five-year adjustables decreasing to 4.25%. A year ago 30-year fixed rates were at 6.04%. “Rates on 30-year fixed-rate loans fell for the third consecutive week to the lowest since the week ending May 21st, while 15-year fixed rates were the lowest since our records began in 1991,” said Frank Nothaft, Freddie Mac vice president and chief economist. “Low fixed rates throughout the third quarter prompted an estimated $1.1 trillion in refinancing activity, saving homeowners about $10 billion in aggregate payments over the first 12 months of their new loan. Moreover, for the fourth consecutive quarter, more than 95 percent of prime borrowers who originally had an ARM selected a conventional fixed-rate in the third quarter of this year. Meanwhile, new home building showed some weakness in recent months. Residential construction eased 10.6 percent (annualized) between September and October, largely driven by a 33.3 percent decline in new condominium and apartment buildings and represented the slowest pace since records began in 1959." <em>Rates indicated do not include fees and points and are provided for evidence of trends only. They should not be used for comparison purposes.</em></p> <p align="center">Current Indices For Adjustable Rate Mortgages<br /> Updated November 20, 2009</p> <table cellpadding="0" border="1"> <tbody> <tr> <td>&nbsp;</td> <td><em>Daily Value</em></td> <td><em>Monthly Value</em></td> </tr> <tr> <td>&nbsp;</td> <td><em>Nov 19</em></td> <td><em>October</em></td> </tr> <tr> <td><em>6-month Treasury Security </em></td> <td><em>0.14%</em></td> <td><em>0.16%</em></td> </tr> <tr> <td><em>1-year Treasury Security</em></td> <td><em>0.27%</em></td> <td><em>0.37%</em></td> </tr> <tr> <td><em>3-year Treasury Security</em></td> <td><em>1.24%</em></td> <td><em>1.46%</em></td> </tr> <tr> <td><em>5-year Treasury Security</em></td> <td><em>2.18%</em></td> <td><em>2.33%</em></td> </tr> <tr> <td><em>10-year Treasury Security</em></td> <td><em>3.35%</em></td> <td><em>3.39%</em></td> </tr> <tr> <td><em>12-month LIBOR</em></td> <td>&nbsp;</td> <td><em>1.234% (Oct)</em></td> </tr> <tr> <td><em>12-month MTA</em></td> <td>&nbsp;</td> <td><em>0.544% (Oct)</em></td> </tr> <tr> <td><em>11th District Cost of Funds</em></td> <td>&nbsp;</td> <td><em>1.272% (Sept)</em></td> </tr> <tr> <td><em>Prime Rate</em></td> <td>&nbsp;</td> <td><em>3.25% (Dec)</em></td> </tr> </tbody> </table> <p><strong><em><u>Real Estate News:</u></em></strong>&nbsp; Given the success of the first-time homebuyer tax credit and its extension into next year, the National Association of Realtors is forecasting that existing home sales will jump 13.6% in 2010 after a 2% increase in 2009. First-time buyers will account for a record 47% of home sales in 2009, according to NAR chief economist Lawrence Yun. "In fact the credit is working better than first projected — it now looks like we’ll have 2.3 million to 2.4 million first-time buyers this year," he said. The National Association of Home Builders estimates the tax credit has generated 200,000 extra sales. Mr. Yun expects sales of previous owned homes will hit 5.7 million in 2010, up from 5.0 million in the previous year. Congress recently extended the $8,000 first-time homebuyer tax credit to April 30 and it gives buyers with a binding sales contract an extra 60 days to close. The lawmakers also created a new $6,500 tax credit for repeat or move-up buyers. Bernard Markstein, NAHB director of economic forecasting, expects the extended/expanded tax credit, which goes into effect Dec. 1, will generate 180,000 extra sales, including 40,000 new home sales. <em>Source: National Mortgage News </em></p> <p>Home loan rates below 5 percent are about to disappear, predicted Denis Salamone, COO of Hudson City Bancorp, the nation’s largest thrift. "I don’t think the market will stay this low for many more months," Salamone said Tuesday. Salamone said that despite the Federal Reserve’s decision to keep short-term rates low, if the Fed buys fewer mortgage-backed securities, loan rates will rise. It will take another 12 to 24 months to sell off excess inventory, Salamone said. <em>Source: Reuters News </em></p> <p>Home builders who sold or walked away from properties at the height of the housing meltdown are back in the market for choice parcels to develop in places like Las Vegas, Southern California, and Orlando, Fla. "In the past, (builders) had really been the ones that had been feeding the market and selling lots to investors," says Tom Dallape, a principal at The Hoffman Co., a land brokerage firm based in Irvine, Calif. "Now all of a sudden they are rushing back in." Among builders buying aggressively are Ryland Group Inc. and Meritage Homes Corp. Pulte Homes Inc., which acquired Centex this year, is working off that builder’s inventory. Analysts observing the market point out that these purchases could be regrettable. "There is certainly some risk that if the market tails off again or we start to see cancellations pick up, some of those deals that previously penciled may not pencil anymore," says Megan McGrath, an analyst with Barclays Capital. <em>Source: Associated Press</em></p> </div><P><a href="http://mortgage.windermerecitygroup.com/blog/2009/11/23/monday-morning-update" target="_blank">Permalink</a> | <a href="http://mortgage.windermerecitygroup.com/blog/2009/11/23/monday-morning-update#comments" target="_blank">Comments</a></P>Denelle Geibelhttp://mortgage.windermerecitygroup.com/blog/2009/11/23/monday-morning-updateMon, 23 Nov 2009 15:32:00 GMT