Archive for the ‘Mortages and Loans’ Category
Did First Time Buyer Tax Credit Help Sellers?
The $8000 Tax Credit for first time home buyer’s (people who have not owned a home in the last 3 years) expires on November 30, 2009. With the expiration date drawing near, the Realtor and builder lobby groups are pushing lawmakers to extend the program for another 6 months. If they are successful, it will cost taxpayers of nearly $15 BILLION.
“Yea” or “Nay”??? Before we cast our vote, we decided to find out whether the tax incentive successful or not? Specifically, did it persuade people to jump into the market? Would it be a good investment for taxpayers going forward?
According to a poll conducted by Zillow, the tax credit was persuasive.
- 18 percent of home buyers said the tax credit was the main reason they pushed to buy a home before November 30, 2010.
- Based on the number of first time buyer’s in the marketplace, a 6 month extension could persuade another 335,000 (18 percent) buyers to buy a home of their own.
- If the first time buyer credit is extended, home sales would likely increase 5 percent. Without it, sales would be down as much as 2 percent.
- Only 31 percent of first time buyers said the credit had no influence on their decision to purchase.
- 69 percent of buyers said the tax credit was important in motivating them to buy a home this year.
Thank you for visiting InfoTube.net homes for sale and rent website. If you have an opinion about extending or expanding the tax credit for homebuyer’s we would love to hear from you. Click the Comment link below. Your privacy is completely protected.
Foreclosures Up. Home Prices Predicted to Fall Further
In August, InfoTube warned its readers about the New Wave of Foreclosures that would be pounding the market, further driving up inventory and eroding prices. Today, we learn that the Wall Street Journal agree’s with our accessment of the future market conditions for real estate.
Excerpt from the Wall Street Journal:
“The size of this shadow inventory is a source of concern and debate among real-estate agents and analysts who worry that when the supply is unleashed, it could interrupt the budding housing recovery and ignite a new wave of stress in the housing market . . . Analysts who track the shadow market have focused primarily on the gap between the number of seriously delinquent loans and the number of foreclosed homes for sale by mortgage companies. A loan is considered seriously delinquent, which typically means it is headed to foreclosure, if it is 90 days or more past due.
As of July, mortgage companies hadn’t begun the foreclosure process on 1.2 million loans that were at least 90 days past due, according to estimates prepared for The Wall Street Journal by LPS Applied Analytics, which collects and analyzes mortgage data. An additional 1.5 million seriously delinquent loans were somewhere in the foreclosure process, though the lender hadn’t yet acquired the property. The figures don’t include home-equity loans and other second mortgages.
Moreover, there were 217,000 loans in July where the borrower hadn’t made a payment in at least a year but the lender hadn’t begun the foreclosure process. In other words, 17% of home mortgages that are at least 12 months overdue aren’t in foreclosure, up from 8% a year earlier.”
What this means for Home Seller’s: Time is not your friend. The shadow of inventory of distressed property will continue to place downward pressure on home prices. Based upon our years of experience, we predict that home prices will fall an average of 7 percent in 2010.
If you need to sell your home, DO NOT chase the market down. Price your property aggressively, then market the home to as wide an audience as possible. To learn about the best way to reach the mass buying market, CLICK HERE.
Thank you for visiting InfoTube.net. We have been connecting buyers with sellers since 1989. We can help you, too.
New Wave of Foreclosures Coming
Bank of America, along with other lenders, report that a huge wave of new foreclosures will flood the market, once again. The second wave in foreclosures is due to the slowing of the loan modification program and the new release of properties that the banks have been holding.
Currently, 1.5 million homes are in foreclosure. More Worrisome…an additional 3.5 – 4 Million home loans are “Seriously” delinquent or are in default. Many of these loans are newer, high quality loans that have fallen into trouble due to job losses. Job losses mean no income, so modifying or saving the loan is not an option for these homeowners.
Buyer Alert: The $8000 Tax Credit for Buying a Home Expires in Only 90 Days. If your loan does not close on or before November 30, 2009, you lose $8000 Grand. Period. With loans currently taking 90 or more days to close, you must buy a home now, in order to qualify.
Thank you for visiting InfoTube.net. We have been in the business of helping buyers and sellers for 20 years. We can help you, too.
5 Tips for Smarter Home Buying
Record low interest rates, combined with deeply discounted home prices, have bottom fishers swimming frantically, in search of the perfect deal on the perfect home. But, before you strike, beware. Read our 5 Tips to Avoid Getting Hooked in a bad way.
- 1. Think Long Term: This is a market for smart bottom fishers, not flippers. In this market, our advice is that you should plan to buy a home to live in, then hold it for 3-5 years, at the minimum. Our reasoning, first, prices have not fully stabilized at these levels. Secondly, there is no indication that prices will rise any time soon. Last of all, we are still facing a rise in foreclosures in 2010, which will keep downward pressure on the market.
- It’s All About the Local Market: We have all heard the golden rule of successful real estate investing…Location, Location, Location. In other words, if you have a choice between a bigger home in an ‘iffy’ area, or a smaller home in a better one, always pick the the Good Location. Remember, when comparing locations, real estate markets are entirely a Local matter. There are big differences within neighborhoods, zipcodes, school systems and suburban towns. Focus on the hottest area’s and the ones that are conveniently located near major employment centers. In rough sea’s, these area’s will always rebound the fastest and appreciate the most.
- Be Wary of Foreclosures: While some foreclosures may be a great buy, many of these properties are “cheap” for good reasons. Many of the homes weren’t great to begin with and most have been terribly neglected. Carefully look for mold, water penetration, structural problems, missing appliances, soiled carpets and flooring underlayments, broken windows and glass, strange odors and any evidence of illegal drug trade. Also, never get emotionally attached to a foreclosure home. Banks are notoriously hard to deal with and they can take forever to respond to offers. Some buyer’s report a wait of several months before the bank approved an offer, or not.
- Get Pre-Qualified for a Loan: Submit your letter of loan approval with any offer you make on a home. Banks always require a letter of pre-qualification before considering a bid, as will any serious seller. With proof of funds in hand, you will be taken much more
seriously by all seller’s, and you will in the end, get a much better deal on the house. Getting Pre-Approved for financing is no lose proposition. - Don’t Take Chances. Buyer’s are in the drivers seat and a lot of great values are available, but please don’t overspend. The job market and general ecomony are uncertain. Make sure you can afford the property, even if you find yourself in a bad or unexpected situation. Even the perfect property can turn into a nightmare, if you can’t reasonably afford it.
Thank you for visiting InfoTube.net homes for sale and rent website. Property Owners can place free listings on InfoTube.net. Buyers can search the site in complete privacy (no registration) for great deals seen no where else without pesky popups and dead links.
How to Handle a Low Appraisal
Low Appraisals and Appraisal problems are causing a lot of headaches for sellers, buyers and agents. For a look at one customer’s problem with an appraisal and some practical solutions to solve the matter, CLICK HERE.
Thank you for visiting InfoTube.net. We invite you to place a Free Property Listing or Search for some great deals on our site. We have listings seen no where else and we have NO dead links or come on ad’s.
Tip for Faster Closings
If you are selling a home that qualifies for FHA financing, you are required to complete a Transfer Disclosure Statement (TDS), before the buyer’s loan can close. With closings taking up to 90 days to happen, it is imperitive that you don’t hold up your sale. See the criteria below to determine if you need to complete this form.
- If the home qualifies for FHA financing, and you occupy the home, you MUST complete this form in order to sell your property.
- If you are advertising your home as a “short sell” and live in the home, you MUST complete this form in order to sell your property.
- For those homes listed by an agent or broker, the agent only has to request the form from the seller 3 times and they are off the hook.
- This form is not required for non-owner occupied housing (ie: foreclosures and bank owned).
With the first time buyer tax credit expiring in a couple of months, you don’t want to lose a sale because you have not completed this simple form. Make sure you complete it and provide it to all buyer’s.
Thank you for visiting InfoTube.net. We are here to help you buy and sell real estate. Post a Free Ad on our website or Search our database, in complete privacy, for some great deals on houses. Home sales are definitely picking up, don’t let the end of the selling season pass you by. Have a great weekend and happy selling!!
What is the Shadow Inventory of Homes?
A recent news article by Reuters states that “The percentage of U.S. homeowners who owe more than their house is worth will nearly double to 48 percent in 2011.”
Meaning? Half of us will be upside down, underwater, or whatever you want to call it over the next 2 years? Pretty scary. How do they know that? One indicator they use may be the Shadow Inventory of Homes, which will eventually enter the market place over the next 3 years.
So, what is a Shadow Inventory of Homes and How Does it Affect Future Home Values? Technically, a property is not in foreclosure until the lenders files against a deliquent loan. Lenders are purposefully not filing to foreclose, in order to control the present inventory by keeping homes off the market. This creates a Shadow Inventory of Homes in Default. Why do they do this? Simple economics, really. Less supply creates more demand (ie: higher prices) for the property they already have for sale.
Since, we know lenders are holding back the number of homes that should be in foreclosure, how many “shadow” distressed properties will come into the market in the future? Truefully, we can’t know the exact number. That is the reason it is referred to as a Shadow Inventory. We can all see that the problem is lurking out there, but we can’t identify the exact numbers or the amount of future damage because “only the shadow knows…”.
Thank you for visiting InfoTube.net homes for sale and rent website. We invite you to Place a Free Property Listing or Search for Thousands of Great Deals from the Privacy of your Home.
Home Appraisals. Something is Wrong.
InfoTube has been blogging that Something is Wrong with real estate appraisals for quite some time now. A new rule, called “Home Valuation Code of Conduct”, which went into effect on May 1st, has derailed sales and wrecked havoc on homeowners and buyers, with the worst possible timing.
The intent of the new rule for loan funding was to eliminate inflated appraisals. Lawmakers found that lenders, such as Washington Mutual, pressured appraisers to inflate values in order to make more money on higher priced loans. Although accurate appraisals are necessary to prevent fraud, the policy has had unintended, devastating effects on the entire real estate industry.
Take the case of the Mann family from San Jose, CA. David and Penny Mann decided to sell their downtown Victorian home in order to move to a retirement community closer to their children and grandchildren. They knew the market was tough, but they priced the home to sell and they were rewarded with back to back offers. They accepted an offer for $560,000 from an excited young couple, buying their first home.
The Mann’s home appraised for full value, but it was deemed to be invalid, because it was done before the new rule took effect. The second appraiser, sent by an appraisal management company, came in $100,000 below the contract price, resulting in the buyer being turned down for their loan. After the initial tears and panic, both parties did some frantic research. They discovered that the appraiser didn’t live in San Jose and had never worked there. Both buyer and seller decided to take action versus lying down and rolling over.
The buyer’s, a lawyer and student, toured at least 40 homes before buying the Mann’s house, and had lived in San Jose their entire lives. They knew that the 100 year old home was perfect for them and they insisted that the management company send an appraiser, from the 408 area code to value the property. The 33 year old lawyer said, “I am an educated person.” …”I’ve lived in the Bay Area my whole life”. “I had no question it was worth $560,000, plus. Neither did my agent or the mortgage broker or the first appraiser. “Nor, as it turned out, did a third appraiser”,… who valued the property at the full sales price.
After all the drama, buyer and seller recently celebrated their victory at the Mann house. The first time buyer’s brought the wine. The Mann’s provided fresh peaches from the tree in the backyard. Finally, a happy ending.
Unfortunately, not all victims of the new appraisal law are as fortunate as these couples. 75 percent of Industry professionals said they have had at least one low appraisal problem since May 1st, with the average loss being around $13,000. In addition, 90 percent of real estate professionals site that at least one transaction had fallen apart because of the new law.
Something is definitely wrong, but you can take action:
To read more about what you can do if you are the victim of a low ball appraisal, Click Here.
To sign a petition to repeal the law, Click Here. Gary Miller, Rep from California is co-sponsoring legislation.
Thank you for visiting InfoTube.net homes for sale and lease website. If you have experienced a financial loss due to the new law, please leave a comment in the space below. Your identity is completely confidential.
Homeowners can always place a Free Property Listing on InfoTube.net. Thousands of home buyers search our site for their dream home.
Should You Use List Prices or Sales Data when Pricing Your Home?
A frequent question we receive about correctly pricing a home is “Should we use Comparable Listing Prices or Comparable Sales Data to correctly price our home?”
The answer is overwhelming, Comparable Sales Data.
Looking at the prices of listed property is a big mistake, when determining the correct asking price for a home. Take a moment and think about it. If the neighbors list price was motivating, the property would be Sold, not Still for Sale.
Always use accurate a Comparable Market Analysis (CMA) to correctly price your home. A CMA features only properties that have sold for all cash or a funded loan. This is important because many properities aren’t appraising or closing for anything near their “under contract” price. In our declining market, a home that is worth $250,000 today, may only be worth $220,000, 60 days later when it closes. Appraisers are aware of this fact and generally appraise very conservatively these days.
Click here To Read more about Appraisal Problems and What you Can do About it.
To obtain accurate Sales data about competing properties in your neighborhood, visit your local county tax assessor website. Or, research MLS data which can be viewed at sites like zillow.com.
Thank you for visiting InfoTube.net. We are here to help you sell your home. Feel free to place a free property listing on our site or search for a great value on your dream home.
Frank Wants Condo Loan Rules
In what could be a “Here we go, again” scenario, Barney Frank (D) and Anthony Weiner (D) have ask Fannie Mae and Freddie Mac to back off on tightening loan standards for condominum’s.
In March, Fannie and Freddie announced that they would no longer underwrite mortgages on condo’s located in buildings where less than 70 percent of the units were Sold. Their previous policy required that 51 percent of the units be Sold, before loans were guaranteed.
In addition, the mortgage giants announced that they will not purchase mortgages in buildings that have more than a 15 percent deliquency on association dues, or those in which one owner owns more than 10 percent of the units in the complex.
In a letter to both companies, Frank and Weiner warned that …70 percent occupancy…”may be too onerous” and the rules could have a “real chill on the ability to get these condos sold”. The two law makers asked the two companies to “make appropriate adjustments” to their underwriting standards for condos.
Is the tail wagging the dog, yet again??? On one hand, Fannie and Freddie have done their research on past loan failures and determined that their new underwriting criteria is essential in avoiding future financial trouble. On the other hand, Frank and Weiner fear the restrictions may stop condo sales in new developments where they are desperately needed.
Fannie and Freddie could not be reached for comment, but according to the Wall Street Journal, both are preparing a response to the lawmakers.
What do you think about relaxing the new loan standards for condo’s?? Thousands of our readers would love to know.
Thank you for visiting InfoTube.net homes for sale and rent website. Ask a question. Leave a Comment. Post a FREE property listing or search for great deals.
Housing Tidbits from President of the NAR
Charles McMillan, president of the National Association of Realtors, spoke in Ft. Worth, TX and reported to attendee’s that ”The dream of homeownership is alive and well in the US.”
Mr. McMillan began his real estate career in Ft. Worth, TX in 1983, one year after the Texas real estate market crashed in 1982. Although McMillan did not address it, Texas home prices have not recovered to pre-1982 levels over the past 27 years.
Highlights from the speech include:
- Consumers will buy houses if two conditions are met. The home and financing costs must be at a bargain, basement price levels.
- Keeping interest rates low and stable are necessary to stabilize the housing market.
- The tax credit is working. 43 percent of all property sales have been first-time buyers.
- Thanks to distressed property price declines of up to 52 percent, sales of existing home inventory has increased in CA, NV, AZ and FL.
- The two biggest issues facing the real estate industry going forward are appraisal issues and healthcare. Half of all real estate agents have no insurance.
Thank you for visiting InfoTube.net homes for sale and rent website. Search for thousands of properties or post your listing for FREE!
Housing Crash Robs Senior Citizens
The worst housing market since the Great Depression is taking a huge toll on senior citizens in this country. The crash in housing values, especially in retirement haven’s such as Nevada, Florida, California and Arizona, is robbing these long, hard working Americans of their retirement and adequate health care.
While most people believe that seniors have no mortgage on their homes, the reality is that hundreds of thousands of retiree’s owe money on their homes. Even for those lucky enough to own their house outright, the unprecedented drop in home values means they have less equity to live on or exchange for a move to retirement housing or health care facilities.
- According to the AARP, 25.5 million people over the age of 50 have a mortgage on their home. More than 680,000 (which represents 30 percent of all distressed property) baby boomers are deliquent on their mortgage or are in the process of foreclosure.
- Many seniors have little saved, other than the equity in their homes. 36 percent of all retiree’s state that their savings and investment nest egg is less than $25,000, excluding home equity and benefit plans.
- Seniors banked on rising home prices and leveraged their primary asset through equity loans and reverse mortgages. Those that leveraged assets to afford retirement owe an average of $150,000 on their houses.
- Retirement communities and long term care facilities are suffering from the housing market, too. Seniors usually sell their homes to finance admission into senior housing facilities. Dire market conditions often mean no sale at all, or one at substantially discounted prices. Many people are left with no choice or options, forcing them to cancel plans to move to housing that fits their changing needs.
Although seniors and retiree’s are often overlooked in the news, the housing and stock market crash have taken a huge toll on their lives and well being. Most have worked all their lives to build secure nest eggs for their golden years, only to discover that half a lifetime of work and savings vanished in the blink of an eye.
Click Here to Read More from USA Today
Thank you for visiting InfoTube.net homes for sale or rent website. Property owners can place a FREE home listing on our site and reach thousands of buyer’s searching for their dream home. Good luck on your home sale and please let us know if we can assist you with marketing it successfully.
Appraisal Problems Hurt Homeowners and Kill Sales
Low home appraisals are becoming a huge obstacle for homeowners and sellers.
After years of succumbing to pressure to inflate appraisals for greedy lenders, anxious to make loans, it seems that appraisers have done an “about face”. Now, the biggest obstacle to selling a home or refinancing one is the appraisal. Like with all back lashes, it seems that the recently lax appraiser has now “over corrected” the problem to the determent of the housing market.
To read more about how to address low appraisal issues, Click HERE.
Thank you for visiting InfoTube.nethomes for sale website. Property owners can place a Free Property Listing on our site and Buyers can search for thousands of homes seen no where else on the web. Check it out today!
Sellers Should Lower Price Expectations
In light of a new wave of foreclosures and distressed property sales, home seller’s may need to lower their expectations about home asking prices.
Recent reports find that nearly one in every four current home sellers (not seller’s of bank owned property) have dropped asking prices an average of 10.6 percent from their original listing price. In dollar terms, that is equal to another $27.4 BILLION, yes BILLION, slash in the equity of US homes. Ouch!
The good news for home seller’s is that higher interest rates and a rapidly approaching deadline for an $8000 tax credit is creating urgency among buyers. A recent uptick in sales proves that homes priced aggressively are selling very fast. But, homes priced above the competition continue to sit and languish on the market for months on end. Simply put, there is great demand in the market now…at the right price. Seller’s may need to sharpen their pencils, but buyers are actively purchasing homes.
Thank you for visiting InfoTube.net homes for sale or rent website. Please feel free to place a free property listing or search our database for great values on US real estate.
Bullish Signs for Housing Sales
Although all the news about real estate, housing and lending isn’t particularily bullish, there are some compelling new motivations for buying now. Rising interest rates, Inventory Decreases and the $8000 tax credit which expires December 1.
- Interest rates are soaring, as the dollar falls. Economists predict that the low rates we saw only a month ago, aren’t likely to return anytime soon. In April, 30 year fixed rate mortgages averaged 4.5 percent. Last week, rates hit 4.98 percent. And, this week, Bankrate.com is quoting 30 year fixed rates for prime borrowers at just over 5 percent. Note: An increase of only 1/2 percent in interest rates raises the mortgage payment for a $170,000 loan by $52/month, $624/year or $18,720/over the life of the loan.
- The deadline for qualifying for an $8000 tax credit is rapidly approaching. Although, the December 1st deadline may seem a long way off, in real estate terms it really isn’t. A lot of people are sitting on the sidelines, waiting to see if prices will drop another 1 or 2 percent over the next 6 months. Lenders are already warning us that when all those buyers rush into the market in August or September, the backlog in loan applications will mean a wait of 60-90 days to close an average loan. Note: Given that the average buyer in this market looks at over 30 homes, over a 3 month period, buyers who don’t want to miss the boat on their $8000 gift, should get serious now.
For those buyer’s hoping to time the market perfectly, we think their ship may be sailing by. Home inventories are dropping, prices are stabilizing, interest rate increases erase potential gains made by a further fall in prices and $8 grand is on the line, if the December 1 closing deadline can’t be met. Serious buyer’s should jump on board now, before they find out that the ship has sailed and they missed the boat!!
Thank you for visiting InfoTube.net homes for sale or rent website. Sellers can place a free property listing, download legal forms, print brochures and more. Buyer’s can search for great deals on property from the privacy of their own homes and benefit from dealing directly with the owner or builder. Check advantage of FREE today!!!