Real Estate Information

INSPIRATION FOR TODAY:
"Fear knocked at the door, faith answered. No one was there."
~ Unattributed

 
REPLACEMENT THERAPY!

Ever received one of those emails that contains a touching messsage, then suggests that if you forward it to ten more people you'll receive a "special blessing" or "ten million dollars in three days"? It usually also warns that the last person who didn't forward it met some terrible fate at the hands of unknown evil-doers. Remember how that last part - the veiled threat - made you feel? You didn't think something awful would really happen, but you resented being put in the position of wondering.

We've been told many times that our worst fears are of the "unknown." An unidentified fear sends our imagination into high gear, conjuring up vivid mental pictures of dastardly plots against us. We ruminate endlessly over the possibilities. Such fear is disruptive to our well-being, and leaves us tired and wrung-out.

So, how do you handle fear? One method is to identify the fear, so that once you do, it is no longer "unknown." That also means it is measurable, and can be logically quantified. Once you know what it is, your imagination can no longer dream up worse things that it is not. Once identified, it is possible to determine possible outcomes.

Most fears will never come to fruition. Those that do are divided into two categories: those we can control, and those we can't. If we have control, we also have the ability to survive our fears, and change their outcomes. Most fall into that category.

One mother's lifelong advice to her daughter who worried too much was to replace the worry thought with another more pleasant thought. The opposite of fear is hope, which also gives us courage. The next time you experience fear of the unknown, try replacement therapy. Think positive, hopeful thoughts when fear knocks at the door. Then, when you open the door - no one is there!

Brought to you by Randy Charlton of Century 21 Home Realtors.

Historically low interest rates and the extended federal tax credit have helped millions of buyers take advantage of one of the best buyers markets in history. Market conditions have improved considerably with the help of these stabilizing forces. Expect to see continued market activity through the winter and spring as savvy buyers take advantage of the extended $8,000 tax credit. Freddie Mac reports that 30 year conventional loans available in the high-4 to low-5 percent range.

Increased demand has shrunk inventory while slightly raising homes prices. The national median existing home price rose to $178,300 in December, up 1.5 percent over 2008 prices. The increase was attributed in part to an increase in mid- to upper-priced homes.

The reduction of housing inventory has brought stability to many parts of the country, creating more competition for available homes, and multiple offers in some areas.

Brought to you by Randy Charlton of Century 21 Home Realtors.

"Striking the right balance between managing the FHA's risk, continuing to provide access to underserved communities, and supporting the nation's economic recovery is critically important," said FHA Commissioner David Stevens.

FHA provides mortgage insurance on loans made by FHA-approved lenders. While borrowers must meet certain requirements established by FHA to qualify for the insurance, lenders bear less risk because FHA will pay the lender if a homeowner defaults on his or her loan.

The New Rules:
FHA-insured mortgages are attractive to borrowers because down payments are only 3.5%. That won't change under the new policies the FHA announced which are to take effect in spring or early summer. Among them:
- Borrowers will have to have a minimum credit score of 580 to qualify for a 3.5% down payment. Those with lower scores will have to make at least a 10% down payment. The average credit score of FHA-insured borrowers is 693.

- Allowable seller concessions will be reduced from 6% to 3% of the sale price. The change is intended to discourage inflated appraisals. On many home transactions the seller agrees to pay the closing costs of the buyer.

- Buyers will have to pay an upfront mortgage insurance premium of 2.25% of the total loan amount, up from 1.75% now. A $150,000 mortgage would require a payment of $3,375, or $750 more.

What It Means To Everyone! The general rule is: if someone cant' get financing to buy your home when you decide to sell, it's going to be difficult. To the extent that financing is available and markets function normally you have a better shot at selling. Even with these changes, FHA lending still will remain the largest source of home purchase financing.
These changes are designed to improve FHA's financial position and will ensure its long-term ability to guarantee affordable mortgages for families.  In the end these changes are also designed to engage borrowers who can reasonably afford a mortgage. From what we have seen in the recent past, guidelines that were lowered to promote homeownership backfired. This scenario is well reflected in the foreclosure problems now sweeping the marketplace.

Brought to you by Randy Charlton of Century 21 Home Realtors.

Foolproofing the sale of your home
The scenario is all-too-real for many home sellers today.  They put their home on the market. They're positive about the prospect of selling and settle on a price that meets their financial needs.

Six months later, however, they're left wondering, “Why hasn’t my home sold?” If you’re about to embark on the home-selling journey or you’re in it for the long haul – take note of these selling pitfalls and ways you can avoid them. 

Buyer’s Remorse
Purchasing a home is one of the biggest decisions one can make, which is why some people have trouble committing to a home they may love. In fact, some will look for reasons to pull out of the buying process. Savvy sellers and their agents remind the buyer why they were attracted to the home in the first place.

This might include pointing out the homes comparable value, the homes’ features that match the buyers’  needs or any additional features that help the home stand out.

Low Appraisals
Today, appraisers and the banks they represent are much more conservative when establishing fair market value. This may cause appraisers to issue a low appraisal of the home in question.

Sellers can combat the low appraisal, however, by doing several things. First, defend the price of the home by providing a list of the homes that were used to establish the home’s comparable value. Also, be sure to meet the appraiser at the home to point out any amenities or structural details that might not be obvious to the appraiser.

Conditions and Contingencies
Before the successful close of a transaction and during the escrow process, buyers and sellers must resolve certain conditions and contingencies. According to Trulia.com, a common condition of sale is the acceptance of an inspection report or the review of a preliminary title report. These issues can be problematic during escrow because they may be poorly written or do not include specific deadlines. One of the easiest ways to keep the sale from falling through the cracks is to ensure both parties are aware of the deadlines and conditions surrounding the contingencies.

Source: www.trulia.com

Extensions and Expansions
On November 9, 2009 President Obama approved the extension of the first-time homebuyer tax credit that was slated to expire on November 30, 2009. As part of the a $24 billion economic stimulus bill the program will now also offer a credit to homeowners who have lived in their current home for at least five years and are seeking to relocate. The new expansion also called to attention several special rules that apply to members of the military, the foreign service and the intelligence community.

These incentives couldn't come at a better time. If you're in the market for a home, and think you are among those who could benefit, be sure you understand the details of this great opportunity.

Make A Resolution To Redeem Your  Home-Buying Potential

If you’re looking to buy a house within the next 12 months, why not make one of your resolutions one that will improve your financial situation and position you as an ideal home buyer? That’s right – we’re talking about your credit score.

The lending world has changed considerably since the boom days and so has the credit score required to qualify for a loan, not to mention a low interest rate. "About two years ago, you could have had a score of about 620 or so to get a lender's best rate on something. Now, lenders are really looking at a rate of 760 at the least,” said Kelli Grant with SmartMoney.com. First-time homebuyers fare much better, needing a credit score of at least 660 unless they try for an FHA loan. The truth is, to be a “good” buyer in the eyes of lenders you need to keep a close watch on the state of your credit score. Here are several tips to maintain and improve upon your current number.

Get copies of your credit report--then make sure the information is correct.  Go to www.annualcreditreport.com.  This is the only authorized online source for a free credit report.  Under federal law, you can get a free report from each of the three national credit reporting companies every 12 months.

How many and what types of credit accounts do you have?  Many credit-scoring models consider the number and type of credit accounts you have.  A mix of installment loans and credit cards may impove your score.  However, too many finance company accounts or credit cards might hurt your score.  To learn more about credit scoring, see the Federal Trade Commission's website, Facts for Consumers.

Beware of credit-repair scams.  Sometimes doing it yourself is the best way to repair your credit. The Federal Trade “Credit Repair: How to Help Yourself” explains how you can improve your creditworthiness and lists legitimate resources for low-cost or no-cost help.

Source: http://www.federalreserve.gov/pubs/creditscore/default.htm

Brought to you by Randy Charlton of Century 21 Home Realtors.

Current Mortgage Rates As Of Today: 30 Year Fixed Rate Is 4.61%.

Brought To You By Randy Charlton Of Century 21 Home Realtors.

Top 5 Steps Toward Improving Your Credit Score

Home prices and interest rates are down, and your desire to buy a home is high. But many of my clients worry that their credit score just isn’t good enough for lenders to see them as a worthy credit risk, especially in light of today’s tougher credit and lending standards.

I am often asked if there is anything that can be done to improve your credit score. There are, in fact, several steps you can take. Here are five great suggestions from Bankrate.com:

1.Order your credit reports. You can do it for free once a year at annualcreditreport.com. If you've been denied credit, you are entitled to a copy of your report from the reporting agency. The company you applied to must supply the contact information and you have 60 days after denial to request a copy.

2.Examine your credit reports. Creditors do not necessarily report to each agency, so you may find differences in reports—and credit bureaus do not verify the information they get from creditors. Note any errors, such as incomplete or outdated information or inaccurate account histories. If you find errors, such as a paid-up account that was not reported or a difference in the amount owed, proceed to step number three.

3.Dispute and document. Complete the dispute form that came with the credit report or write a letter identifying each mistake and stating why it is wrong. Include a copy of the report with errors circled and copies of any supporting documents. Keep copies of everything you send. The credit bureau must investigate disputes within 30 days of receiving your letter. Items not verified as accurate by a creditor are removed and you will be sent a free, updated report.

4.Fix negatives. Call your creditors and ask for reduced monthly payments to help you keep current. See if the repayment schedule for fixed-rate loans can be extended. This may end up costing you more, but may keep you from being reported as delinquent. Arrange to pay off accounts in collection. Slowly close out unused credit accounts. Don’t cancel them all at once, as this may negatively affect your score. Remember, cutting up a card is not the same as closing the account.

5.Add positives. If you have a good credit history from a company that does not report to a credit bureau, ask them to do so. Apply for a secured credit card and build a solid payment history. Open a savings account to show creditors you are working to save and have reserves to help pay down debt.

Remember that your credit score is not always set in stone. There are actions you can take immediately to raise your score both in the short term and long term.

Brought To You By Randy Charlton with Century 21 Home Realtors

I've been getting a ton of questions lately regarding Foreclosure or Bank-Owned properties.

The biggest question: where did all the bank owned/reo inventory go?

Over the past few months the number of "new" bank owned properties to hit the market has decreased significantly here in our area.

Speculation is that the banks are holding on to this inventory and just releasing a small number of properties in order to drive up resale values.

Is this actually the case? Could be, but I also believe there are a number of successful "Loan Modifications" taking place. The banks aren't in the business to "take back" a large number of homes and then turn around and sell them. If they can process a successful loan modification it benefits them and more importantly the current homeowner.

I also believe that investment groups are buying the foreclosed homes at auctions prior to the bank taking them back as foreclosed inventory. You can read more about that and get an update on Foreclosure here in California by clicking here!

So what does the future hold for the reo inventory ... I don't think anyone has a solid answer and only time will tell. Are more foreclosed homes going to be released for sale? Yes. How many and when? Not sure.

Make it a great week!

Brought To You By Randy Charlton of Century 21 Home Realtors

Current Mortgage Rates As Of Today: 30 Year Fixed Rate Is 4.74%.

Brought To You By Randy Charlton Of Century 21 Home Realtors.

Current Mortgage Rates As Of Today: 30 Year Fixed Rate Is 4.73%. 

Brought To You By Randy Charlton Of Century 21 Home Realtors.