Residential Loan News

30yr Fixed Rates Lowest in Past Five Years

2009-01-21T12:48:00.000-08:00

The Fed's (Federal Reserve) in late Nov 2008 announced they were launching a program to buy up to $500 BILLION ($600 B in total really) of securities backed by mortgages (essentially Fannie & Freddie guaranteed loans). As a result, I have watched 30 yr & 15 yr (long term money only...not ARM's..pricing is still way to inferior for all of our expectations) drop from around 6.00% in late October, to 4.50% - 4.875% depending on loan size, FICO score, LTV, etc.

If you currently owe less than $625,000 on your 1st (or even a combination of 1st & 2nd), the Fed's are extending the olive branch to a point right now that we have only seen since during an abbreviated period in '03 -- I'm sure some of you have have read, but mortgage rates have only been this low 2x's in the past 53 years -- TODAY & back in '03 (unreal that we have seen these extreme low's just in a 5 yr period).

There are some technicalities and nuances to qualifying. It's evident the Fed's are committed to lowering mortgage rates to stimulate not just housing, but a much bigger issue now...the economy. If you would like to assess and lock in "long term fixed" money at rates between 4.50% - 4.875% (principal & interest), please call me so we can work up your scenario. Lenders are getting flooded, so turn times are being compromised.

Other Points:

- Loans under $625,000 are currently around 4.875% (this is .625 in origination....approximates depending on individuals credit profile and equity in the house)

- Loans under $417,000 are currently around 4.50% - 4.625% (this is .625 in origination....approximates depending on individuals credit profile and equity in the house)

- I have some clients that are moving money to their HELOC to fall under the $625,000 limit or $417,000 to optimize and lock in the lion share of their money. This move depends on your personal situation -- we can review.

- This program is based on a minimum Debt to Income (DTI) of 45% with full documentation only

- Also available for 2nd homes & Investment property (although pricing is impacted accordingly but not much for 2nd homes and around 5.625% for non owner)

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If you would like to explore these opportunities, please take a moment to contact us using our confidential loan request form.

Best Regards,
Britt Miller
Vice President
Steelhead Capital

Real Estate Market Insights from Britt Miller

2008-07-29T15:05:00.000-07:00

Britt Miller

As the real estate markets continues to move through this current correction, the media continually apprises us of the status of defaults, foreclosures, lender tightening, Fannie Mae stimulus packages or lack there of, drop in sales volume and median home prices, mortgage & appraisal fraud, etc. There is definitely no shortage of information out there.

So what are we to make of all of this?

Over the past two years I have watched closely as the real estate ball started to unravel. Some of it was 100% anticipated, and some of it quite shocking. As I reflect back over this period, here are some of my personal take away’s that you might be able to benefit from:

Real estate is a LOCAL game - proximity to employment, available land, school test scores, diversified economy, type of neighborhood, access to transportation/airports, size of lot, size of home, number of bedrooms, quality of construction, etc., are all driving factors that effect real estate values. In the bay area, same zip codes can be dramatically affected based on test scores for grammar/high schools... just using one example. A broad brush approach does not apply when you drill down in real estate.

Core, well located, in fill markets are insulated from speculative home builders – Home builders buy land for a fraction of what individuals pay. Areas like Vacaville, Pittsburg, Antioch, Brentwood, Gilroy, and Salinas (to name just a few) saw huge run ups over the past four years because the economics and access to land made sense for builders and prices were attractive for buyers. When the tide turns, the builders still attempt to eek out a profit to the detriment of some initial buyers – when builders are buying land at $25k - $50k a lot, and building for $110 - $130/ft, you can see why the people who paid $300/ft (retail) for their house are vulnerable and sometimes walking away due to being completely upside down. Builders create an incredible wave on the way up, but when the tide turns they are "out".

Cash is King – Great buys are happening today for those that have cash. Lenders are rewarding people with strong reserves and highly motivated sellers are putting a huge premium on strong buyers – they are looking for certainty of execution.

Borrow when you don’t need to – there are a lot of people right now that need access to money. Unfortunately the rules of engagement have changed. No one has a crystal ball, but I can't tell you how many borrowers I have seen run their ARM down to the "last month or two" to preserve a rate. In a volatile market, the extra 30 – 60 days could cost you a refi or more realistically could cost you .5% in rate. Over the past 60 days, I have watched rates on ARMs go up .50% and lenders pull back from 85% - 75% LTV. Could be painful as you wait for the stars to align.

Don’t live beyond your means – this is pretty self explanatory. Our home is really the only visible asset to our friends/family/co-workers, etc – but don’t let it be your Achilles heel in pursuit of looking like you made it. Buy what you can truly afford.

Don’t buy based on terms, buy based on fundamentals – in the commercial world, an investor can pay a lot for a Jiffy Lube or a Walgreen’s because they have great credit which results in better than market terms from the lender. It's all great until Jiffy Lube becomes Al’s Oil Change and Walgreen's decides to move down the street and Bob's Pharmacy moves in. Don’t over pay for a property because you can get a teaser rate for 5.0% and all you care about is the monthly payment. Look at the fundamentals – how does it comp out. Time DOES NOT heal bad real estate buys – trust me.

If you can build your same house for less than what you paid for it, the headache could be worth it (contrary, if you can buy below "replace costs" you mitigate downside risk). This is a fundamental principle in real estate. We all put a premium on a turn key home. If you can buy a 2/1 for $725,000 on a 6,500 sqft lot, scrape it, and build a 2,500 sqft home for $600,000 ($1.325m total), DO NOT pay $1.55m for a inferior, older home, in the same market. You are economically disadvantaged the day you close. If you are okay with that, then just realize what you are getting into and you will have to find that "special buyer" when you sell. We all know it only takes one, just don’t be the "one".

HELOC's are the “bravado barometer” in the market – when lenders were giving out loans at 100% of the purchase price, the market was at its peak. In the future, let's be cognizant when HELOC's go to 100% LTV -- might be time to sell (or not if you plan on living in your home "forever").

Stated Income was the Hockey Stick – Look at values across the board in any market. The hockey stick effect was formed when stated income loans were introduced. Stated loans made up approximately 7% of loans originated in 2002 and the number ballooned to 45% in 2006. I personally don't think stated income loans will be back for many years unless you have an established banking relationship with a lender who really likes your liquidity and/or assets.

Lenders drive behavior – Sam Zell, a very prominent real estate investor out of Chicago, says liquidity drives value. Access to credit (i.e. credit cards), allows people to buy. Easy access to mortgage money, causes values go up. Very basic relationship.

ARM money – very appealing if rates make sense relative to longer term money (i.e. 30yr fixed) and a great solution if you foresee living in your home for 3-5 yrs. On the contrary, if the trade off between shorter term money (ARMs) and fixed rate (10yr, 15yr, 30 yr) is less than .25%, you should probably consider locking in longer term money especially if it's a residence you could live in for 5+ yrs.

LTV fuels appreciation – most borrowers would take more leverage/loan proceeds in lieu of higher interest rates. With the pull back in the lending market, buyers are being required to put down anywhere from 3% (conforming…up to $417k) to 20% (non conforming/jumbo) in equity.

Speculate in Vegas, invest in real estate – betting on "gut" only flies at the black jack table. Before you pull the trigger, do your homework!

Get comfortable with 6.25% - 7.0% money -- we are all reading about inflation. All indicators are pointing to higher rates over the next few years to offset a spike in inflation. Additionally, lenders are coming out of a seven year bull market by increasing their margins to price risk (short sales, foreclosures, defaults) into the interest rate equation.

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Overall, the market is going through a contraction and correction that was needed in order to bring everything back in line. There is risk in everything, and the day you are only buying and focusing on “the upside”, is the day we should probably hold off. The area that has surprised me the most, is the pull back in the secondary market for securitized residential loans. Wells, WAMU, Citi, and some of the other big institutional lenders, have priced their loan products where they have to make money.

While the indexes such as Libor, Treasury, MTA, COFI, are all down 30-35% from a year ago, lenders have priced the “new risk” into the margin – for example, if you want a 5yr, 6.5% interest rate on a jumbo loan at Wells Fargo, you have to be prepared to pay 3-5pts – this unfortunately is not a typo. Portfolio lenders such as Downey Savings and ING Direct, are able to utilize their deposits creating a pricing advantage in this market since they hold their loans on their books. i.e. 6.00% - 6.375% for the same loan.

In closing, here's to a great second half of the year and if you have any real estate questions or would like to review financing scenarios, please do not hesitate to call me or John Herndon (415-902-4188) who works with me.

Best Regards,
Britt Miller
Vice President
Steelhead Capital

IncyMac Siezed by Banking Regulators

2008-07-18T12:39:00.001-07:00

SOURCE: Reuters

A type of specialized mortgage that required minimal documentation was the downfall of IndyMac. IndyMac, a California-based bank became the fifth U.S. bank to fail so far this year as the housing bust and credit crunch put a strain on financial institutions. Adam Compton, co-head of global financial stock research at RCM in San Francisco said "IndyMac is a company that was pretty much 100 percent invested in mortgage assets, and we're in a bad mortgage market, and it had no capital. It's not complicated".

An investment banker with Westwood Capital In New York, Daniel Alpert, is predicting that IndyMac's takeover could be one of many to come. Ann Graham who is a former FDIC official said that it isn't unprecedented for the FDIC to run a bank after it fails. She said that this allows time for the FDIC to shop the bank around to potential buyers rather than having to hurry a sale. The FDIC is allowed to operate an institution for up to two years before selling it.

Even though IndyMac is the largest independent publicly traded U.S. mortgage lender, the Office of Thrift Supervision (OTS), who is IndyMac's primary regulator, said that they do not expect significant market impact from the IndyMac closure. The feel this is because the firm is not a systemic institution and is without numerous counterparties.

Read full report »

Construction Of New Homes On The Rise

2008-05-18T14:22:00.001-07:00

SOURCE: Yahoo News

The largest percentage increase in new home construction in over two years was reported for April. This is a rare bit of good news in the housing downturn. Even with the improvement in April, housing construction nationwide was 30.6% below the level of activity a year ago. Applications for building permits are considered a sign of future activity. April recorded an increase of 4.9% up to 978,000 units.

The Commerce Department reported Friday that housing construction rose by 8.2 percent in April to a seasonally adjusted annual rate of 1.03 million units. While apartment construction rose by 36 percent, building in the much larger single-family sector of the market fell by 1.7 percent, the 12th consecutive monthly decline, pushing single-family activity down to a 16-year low.

It is felt that this slump in housing will continue for a number of problems. One of the main difficulties includes banks tightening lending standards. Another is the reluctance of many people to make the commitment of buying a home when prices are still falling. Treasury Secretary Henry Paulson said Friday that he believed financial markets are "considerably calmer" now than they were in March.

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Stock in Fannie Mae Rising

2008-05-12T09:48:00.001-07:00

SOURCE: The New York Times

Even with Fannie Mae's recent announcement of quarterly losses investors are still optimistic about the company. The optimism felt is based on the belief that Fannie Mae will be able to pick and choose from the safest loans available in the marketplace. In fact they have also announced that they will raise an additional $6 billion to purchase additional loans.

"As the market recovers, we will be a prime beneficiary," Fannie Mae's president, Daniel C. Mudd, said in a conference call with analysts Tuesday morning. When the housing market finally stabilizes, the company will "feast" on the mortgages it is currently buying, he added. It is partly due to this belief that the stock price for Fannie Mae has increased by 9% up to a close of $30.81.

The Office of Federal Housing Enterprise Oversight also bolstered these sentiments by announcing that Fannie Mae had been released from growth limits that had been put in place in 2006. The capital reserves that Fannie Mae must hold have also been reduced which will allow it to invest more aggressively without having as large a cash cushion.

Both Fannie Mae and Freddie Mac are essential in today's housing marketplace. They buy more than 80% of all home loans made by banks and other lenders. This helps to provide financing for more home mortgages.

Read full report »

Home Builders May Get Break

2008-04-17T12:35:00.001-07:00

SOURCE: Wall Street Journal Online

A bipartisan provision unveiled Wednesday by Senate leaders would allow companies, including builders, to apply current losses to taxes paid four years ago, instead of the current two-year carry-back. That would help builders in particular because they can apply losses against the big profits they earned during the housing boom.

Some builders feel that the tax benefit will help them by preventing companies from rushing to sell off land at big discounts so that they can apply the losses to profits from two years ago. They feel that these fire sales are helping to drive down the property values and contributing to the number of foreclosures that are taking place. The National Association of Home Builders also said that the carry-back could prevent small builders from going out of business.

This carry-back is being proposed as part of a legislative package which is aimed at the housing market. It may also help other industries like banks and financial-service firms. They may also be able to apply the measure to the losses that they may experience in 2008 and 2009.

One of the most recent examples of builders unloading properties for a huge discount is Centex Corp and their sale of 8500 home sites. These were sold at 30% of their book value which has allowed the company to reap a $294 million tax refund. The carry-back legislation should help to stem this type of contribution to the falling prices.

WSJ Subscriber only report »

Home Sellers Doing Well In Some Cities

2008-04-04T19:54:00.000-07:00

SOURCE: Forbes

New York has historically set record prices for some residential properties and the price per square foot and median sales prices have seen new highs. There is a lot of new construction but vacancies are on the rise. Between the various indicators with the loosening market, job losses, and new construction projects adding to an already growing inventory, these all add to the mix when buyers are looking to make a purchase.

"What happens is that people tend to look at prices as a barometer of the health of the market," says Jonathan Miller, president of Miller Samuel, a Manhattan appraisal company. "But it's really how many people are in the market, and what you're seeing now are people dropping out because of affordability or because they can't get credit."

West coast sellers are faring better. Farther north, San Francisco's conforming loan limit jumped from $417,000 to the maximum $729,750, which makes getting credit a simpler affair for many of the city's home buyers.

The main thing to understand is that job growth, new construction, vacancy rates and the ability to get credit are important measures; the key is that when there are more buyers than sellers it should translate into a quicker sale. Even though this may mean a small or little price gain, it's still a sellers market in some areas.

Read full report »

Real Estate Speculators Were Out Of Control

2008-03-30T10:29:00.001-07:00

SOURCE: The Motley Fool

Everyone was buying real estate, even if they couldn't really afford it. These subprime borrowers, who just wanted a home, took advantage of the low-documentation loans that were being offered by mortgage originators. These lenders would then sell off the high risk loans to investment banks that dumped them into pension funds and others that were desperate for high yields.

Not only that, the ratings given by the ratings agencies on the mortgage securitizations, that originated using horribly inaccurate models, convinced investors to buy in. Of course the feds were no help either by allowing the interest rates to stay low for entirely too long. This contributed to the housing bubble which saw housing prices rise by more that 70% over eight years.

In the first quarter of 2006 speculation was truly out of control. Twenty-six percent of loans were of the interest-only or negative amortization variety... The statistics are damning. In 2005 and 2006, 20% of all mortgages were subprime, and a further 12% to 13% were low-documentation Alt-A loans.

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$200 Billion To Help Stabilize Mortgage Markets

2008-03-21T18:26:00.000-07:00

SOURCE: Reuters

Between relief to the Federal Home Loan Bank System as well as Fannie Mae and Freddie Mac, it is hoped that the mortgage markets may begin to stabilize. These changes in the rules and additional money being made available may be able to help dramatically.

Restrictions are being eased for both Fannie Mae and Freddie Mac. This will allow them to take on a larger role in helping to settle the mortgage markets. They will be able to guarantee about $2 trillion in mortgages this year as the Office of Federal Housing and Enterprise Oversight said the restrictions would be relaxed immediately.

The Federal Home Loan Bank System will be allowed to double their mortgage holdings to about $300 billion as more relief may be available to them as well. With these continued influxes of money to the mortgage market, it is hoped that the Fed's attempts to spur on the economy by lowering the overnight interest rates will make a difference to ease financial market stress.

Read full report »

The Current Credit Crisis And The Looming Debt Crisis Are Causing Worries

2008-03-15T11:25:00.000-07:00

SOURCE: The Motley Fool

With more and more borrowers walking away from their homes as well as their mortgages, it is even more difficult for housing sales to improve. With lenders generally being highly leveraged, managing a 1-2% default rate is fairly typical. If the default rate increases to 5-6%, it further reduces liquidity in the mortgage market.

If there is a 15% estimated decline in the housing market that will translate into 21% of people with mortgages who owe more than their house is actually worth. If a recession develops and the housing market falls 30%, then nearly two of every five mortgages will be underwater.

There really is only one good thing about this market which is that some stocks are now unbelievably cheap and could have fantastic returns in the next few years. That said, be extremely cautious in this market but keep looking for opportunities that could potentially provide huge gains when the market finally turns.

Read full report »

Bernake Says More Should Be Done To Help Prevent Mortgage Foreclosures

2008-03-07T16:52:00.000-08:00

SOURCE: NPR

While speaking to a banking group in Orlando Florida, Ben Bernake the chairman of the Federal Reserve said that more powers should be given to the Federal Housing Administration (FHA) and the Department of Housing and Development (HUD).

Bernake feels that by doing this, more strength would be given to the national housing market. This is important as rising foreclosures threaten the wider economy. Some economists fear that the country is on the verge of recession which makes these possible changes even more valuable.

"This situation calls for a vigorous response," Bernake said to the banking group. "Although lenders and servicers have scaled up their efforts and adopted a wider variety of loss-mitigation techniques, more can, and should be, done," he said. Reducing these preventable mortgage foreclosures may be possible by offering refinancing products to more borrowers.

Read full report »

Impact of Fed's Lowering the Federal Funds Rate

2008-02-26T11:49:00.000-08:00

I wanted to address the effect of the Fed lowering rates because it is a very logical question that a lot of people are asking.

The Fed's have lowered prime six times in the past four months, resulting in a reduction of interest rates for short term money (8.25% to 6.0% for prime since October 2007). While cheaper money is a great stimulant for the economy, there is not a direct correlation to fixed mortgage rates.

Below is some real dialogue I had with a borrower this week:

Borrower: "Hey Britt, just checking in... I am hearing that the Fed is poised to cut rates again in March and April. Does it make sense for us to wait to do the refi until then? I would be bummed to see my mortgage rate drop so siginificantly."

Britt Miller: "You raise a great point being asked by quite a few people. I am going to send out an email addressing it as a whole. But in short, mortgage rates are less impacted by prime, and more affected by bond market.

In actuality, the stock market responds well to a rate cut. This results in a sell off in the bond market as people move into the stock market. As funds leave the bond market, the US Treasury increases the interest they will pay on bonds in order to draw money back to the bond market. Mortgage rates tend to follow the trend of the 10 year Treasury bond. Mortgage rates are set depending on a number of data points, but the driver is the 10 year bond.

Net net, the market is so volatile, and there is no doubt the pinch on the consumer is going to impact wall street and a lot of companies. These potentially unfavorable reports (Payroll, job growth, unemployment, etc) will directly help us more in terms of mortgage rates, than the Fed lowering the federal fund rate another .50 pt this year.

We should proceed and see how the next 45 days shake out and if rates are compelling. I would advise you to 'lock in' -- it makes sense as of today.”

The 10yr has risen from 3.45% (4 weeks ago) to 3.91% today -- as a result, rates have moved up as well.

If you want to "watch rates" keep an eye on the 10 year go to Yahoo Finance and review at your leisure. It's a very volatile market, and one where I have seen .50% pt swings in one day. Timing the dips can be very difficult unless the file is ready to go.

Best Regards,
Britt Miller, Vice President
Steelhead Capital

New Conforming Residential Loan Size

2008-02-26T11:39:00.000-08:00

Congress passed the new stimulus plan put forth by President Bush, which allows Fannie and Freddie to buy loans up to $729,750 in Metropolitan Areas where this number represents 150% of the median priced home.

We still don't have a definitive on date and actual pricing -- probably 25-35 days out. Sources are saying that this particular "conforming" pricing may not be exact to what we are seeing at the $417,000 conforming level. Even if it isn't exact, it will most likely be an improvement of .50 - .75% vs. non conforming pricing today. It appears this elevated conforming limit will be in place until the end of 2008 -- so we will probably have a 8-9 month window to capitalize on this new limit.

To give you a baseline of comparison:

Wells Fargo Conforming Par Pricing Today
6.00% for a 30yr Fixed; 5.25% for a 5/1 ARM

Wells Fargo Non Conforming Par Pricing Today
7.125% for a 30yr Fixed; 6.75% for a 5/1 ARM

*** This is Full Doc pricing

This should illustrate the discrepancy that has been priced into the market and why there is a lot of buzz around the new conforming loan limits. The secondary market is still apprehensive about jumbo loans, which is why they are being priced accordingly -- the investors are demanding a healthy yield.

If you owe less than $850,000 on your 1st and 2nd loan, contact us today and we can review your profile to determine if this new pricing makes sense given your particular situation.

Respectfully,

Best Regards,
Britt Miller, Vice President
Steelhead Capital

January Sees Huge Spike In Refinancing

2008-02-25T10:15:00.000-08:00

SOURCE: Seeking Alpha

The first three weeks of January have brought a huge spike in residential mortgage refinancing. This can be attributed in part, to the stimulus package the government has been working on. This package has raised the limit on the size of mortgages that can be bought by the GSE's. Some of the spike could be a result of homeowners who are distressed or not taking advantage of the reduced interest rates.

Overall, financial providers have reduced their online advertising spending by 17% on a month to month basis. It isn't clear whether the reduction in advertising has been driven by the need for an overall budget cut, or if the backlog of refinances in the cue has prompted lenders to hold off on advertising until the number of people moving through the system has cleared.

No matter what, the current mortgage industry dynamics are changing and every lender will be doing everything possible to continue to provide loans for homeowners as well as achieve the lean business model that it will take to survive.

Read full report »

Green Housing Solutions Are Out There

2008-02-21T18:01:00.000-08:00

SOURCE: The Wall Street Journal

As the real estate market tightens some agents are learning about the eco-friendly options available in the housing industry. This is helping them to stand out for many purchasers.

The knowledge base provided can be a real asset to those considering a move. Not only can new homes be constructed with green materials and products, existing dwellings can be retrofitted as well. There area wide variety of green appliances and energy solutions that an educated agent will know about.

With today's market difficulties this is a positive way for agents to not only attract potential purchasers but also to make a bigger difference via educating potential homeowners. If only a portion of these purchasers give a thought to going green it will make an impact in the long term.

Read full report »

Credit Crisis Or Confidence Crisis: It's Really Not That Bad

2008-02-14T17:16:00.001-08:00

SOURCE: Forbes

The credit crisis isn't that bad according to Sam Zell. Zell has amassed a fortune due to the cycles that shape the commercial real estate industry. He feels that the current turmoil in the financial markets is more of an emotional reaction rather than a true credit collapse.

Zell says that there is still capital readily available for commercial real estate purchasers. This is unlike other real estate busts when there wasn't financing to be had at any price. Today, a commercial real estate broker still has many options for putting together a financing package. Zell argues that the excess liquidity that was available eight weeks ago is still there today.

Even though the real estate slump shouldn't have come as a surprise, Zell feels that the simple law of supply and demand still rules. This means that there is money to be made during this current real estate slowdown. Even though the financing available may have a different risk premium associated with it, a commercial real estate investor may still have access to it.

Read full report »

Low Interest Rates Spurs Mortgage Applications

2008-02-06T18:33:00.001-08:00

SOURCE: CNN

As interest rates drop, refinance rise. The overall volume jumped 8.3 percent in the week ending Jan. 18th, according to Mortgage Bankers Association's latest survey.

Purchase volume fell 4.6 percent, however refinance volume rose 16.9 percent. Refinance volume accounted for 66 percent of the applications.

The average interest rate for traditional, 30-year fixed-rate mortgages fell to 5.49 percent from 5.62 percent. The average rate for 15-year fixed-rate mortgages, which are often used to refinance a home, fell to 4.96 percent from 5.07 percent.

Read full report »

New Source for Super Jumbo Non Conforming Residential Loans in Bay Area

2008-01-31T10:25:00.000-08:00

I wanted to let everyone know about a new lender we sourced two weeks ago. Non conforming market ($417,000 +) is still working its way through this credit crunch. However, I have teamed up with a group out of New Mexico who is head and shoulders above the market -- and they portfolio all their loans. (They don't sell them off... meaning they don't have to find a buyer... key point given turbulent secondary market). They prefer loans of $1m+, but they will facilitate a $750k loan if it makes sense.

If you would like more information on this program, please contact us online today.

Here's to a prosperous and healthy 2008!

Best Regards,
Britt Miller
Vice President
Steelhead Capital

The New Rate Cut Hope To Restart The Housing Market

2008-01-30T18:23:00.001-08:00

SOURCE: Reuters

The new Federal Reserve rate cut and a stimulus plan that will expand the availability of home loans in hope of helping the U.S. housing market and in doing so, help economy along with it.

The interest rate cut of three-quarters of a percentage point has created a series of events that has left mortgage rates at their lowest level in nearly four years.

"The increase in the conforming loan limit should have a positive impact on the housing market, and overall I would say the package is large enough that it should have a notable impact on GDP growth," said Dean Maki, chief U.S. economist, Barclays Capital in New York.

Read full report »

Economists May Have Blundered On Housing Forecast

2008-01-17T16:11:00.000-08:00

SOURCE: CNN Money

Should we trust the experts predictions for a turn around in 2008?

Some of the nation's top economists felt that the mortgage market was going to begin a recovery in 2007. Boy, were they wrong. Not only didn't that occur, there have been record declines in every measure associated with the real estate market.

Even some of the big names, like Alan Greenspan the former Chairman of the Federal Reserve and his successor Ben Bernanke made predictions that were considerably off the mark. Economists are trying again this year to look into the future and have made some less than optimistic predictions for 2008.

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There Is An Art To Making An Aggressive Offer

2008-01-14T17:43:00.001-08:00

SOURCE: Market Watch

Sellers might accept a lowball offer - if made correctly.

In these tough times sellers aren't automatically turning up their noses at lowball offers.

Making sure to include data as to why the offer is low is one way to help avoid insulting the seller. Do your homework, study current interest rates closely and have your facts as to why the offer is being made at the price it is.

Read full report »

Foreclosures Increase 68% From Last Year

2008-01-11T16:57:00.000-08:00

SOURCE: USA TODAY

There were over 200,000 foreclosure filings for the month of November alone.

Even though there was one foreclosure filed for every 617 households last month, it was 10% less than in the month of October. This isn't all good news as the decline is most likely due to a lull in the rests of adjustable rate mortgages.

There will be another adjustable mortgage reset that takes place in May and June, so there will likely be another wave of foreclosures because homeowners are unable to make their payments at the higher interest rate. Approximately 2 million mortgages are to be reset at higher rates in the next seven months.

Read full report »

Cheaper Homes, When Are You Going To Buy?

2008-01-10T16:15:00.000-08:00

SOURCE: MSNBC News

Home buyers are reportedly waiting until the market bottoms out, according to MSNBC News.

Even though home prices are falling at a considerable rate, stricter residential lending standards only allow the best credit risks to borrow.

Only people that need to move are very motivated to buy right now. Most are waiting for the housing prices to drop even further.

Read full report »

Closing Costs Can Be Adjusted By Your Lender

2008-01-02T14:22:00.001-08:00

SOURCE: CNN

Some tips for reducing closing costs when buying or refinancing.

Comparing the mortgage terms offered by different lenders can be difficult when their up-front fees vary so greatly.

New regulations in the works hope to simplify the mortgage process and save consumers money. It is unclear as to when these rules will come into effect but there are things you can do now.

Read full report »

Getting Your Homework Done Always Pays

2008-01-02T14:20:00.000-08:00

SOURCE: Yahoo Finance

Before speaking with a real-estate agent, know your stuff.

There are more and more resources available for home buyers that will allow them to know a lot more about a prospective property than just the basics.

Everything from a detailed description of the home to the neighbors you'll have, and everything in between, can be found online. All this information is useful when determining which home and where to buy.

Read full report »