LACK OF ENFORCEMENT IS THE REAL CAUSE

We are told and shown again and again that the lack of enforcement is the real cause of the "mess" we are in and throwing more regulations which end up ultimately costing the customer more is really not the answer!

Mortgage Industry Update

Attached is a video on "Red Lining" and REO property advise for realtors.

THANK YOU

FHA Loan Requirements About to Get Stricter -- baltimoresun.com

FHA Loan Requirements About to Get Stricter -- baltimoresun.com

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TBWS - Video Marketing and Mortgage News Designed for Mortgage and Real Estate Sales

TBWS - Video Marketing and Mortgage News Designed for Mortgage and Real Estate Sales


Click on this link to see the MBS video.

Man of the Year 2009

Why TIME Chose Ben Bernanke

FED: Rates to Stay Low !!

The federal reserve met today and choose to keep the Fed Funds rate at or near zero .......at least for the the near future.

My blog yesterday was supposed to say "Rates Stay Low Until 2011, not 2001" typo.

Rates may stay low until 2001 ??

Rates may stay low until 2001 ??

The Mortgage Lender Implode-O-Meter News Pick-ups: Obama’s Foreclosure Program Run by Morons… and Trial Modifications are the Biggest Loan Mod Scam Ever

The Mortgage Lender Implode-O-Meter News Pick-ups: Obama’s Foreclosure Program Run by Morons… and Trial Modifications are the Biggest Loan Mod Scam Ever

FHA to toughen rules for borrowers - washingtonpost.com

FHA to toughen rules for borrowers - washingtonpost.com

FHA is on the road to tightening up !!

I hate to think where we are headed in the Real Estate Market if FHA raises the down payment required on an FHA mortgage? The other option I have heard to help raise the reserves fund for FHA, which remains dangerously low, is to consider raising the UFMIP and Monthly factors. This would be much more "gentle" as this would slightly raise overall mortgage payment to the borrower without removing the purchase option altogether which is what I'm afraid an increase in down pmt would do.

Time To Buy or Refi ??

Interest rates have declined over the last couple weeks but edged higher on Tues Dec 1st - is it time to "Get off The Fence"? Contact me and we can go over the many options available to you.

Interest Rates

Steven DeMorett Interest rates have declined over the last couple weeks but edged higher on Tues Dec 1st - is it time to "Get off The Fence"? Contact me

Expect tightening from the FHA - washingtonpost.com

Expect tightening from the FHA - washingtonpost.com

HAPPY THANKSGIVING TO ALL !!

HAPPY THANKSGIVING TO YOU AND YOUR FAMILIES !!

Government Responds to Economic Woes by Making More Bad Mortgage Loans

Government Responds to Economic Woes by Making More Bad Mortgage Loans

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USDA Rural Development

Please contact me about this program if you are interested in a:
No Money Down, low interest rate loan for the purchase of a primary residence!
You DO NOT have to be a first time homebuyer.
With the inventory of homes on the market, the prices at the lowest level and GREAT rates---people are finding it easier than ever to qualify!

Work Every Deal

I was able to work a deal that was turned down by another bank/broker/lender. If we work though every deal we sometimes come up with a new solution. What a Great Feeling When That Happens!

Training for the January 1st RESPA changes

HUD has firmly stated that they will NOT delay the effective date of January 1, 2010 - BUT they will not enforce sanctions in the first 120 days, as long as the company has shown a "good faith effort" to comply with the "Good Faith Estimate" ;-)

We have scheduled an in-depth online training with two RESPA attorney experts. To get details, go to:

www.RESPA-Training.com

GFE and HUD-1

Some POSITIVE news to start our morning.!!!

HVCC over the next couple days and now this --- EVERYONE should keep an eye and hear out and please report any news you have and I can distribute it.

**** I will be looking into the validity and following the discussions on this but this NEW GFE AND HUD-1 EFFECTS EVERY TRANSACTION and a delay would be a start.

HAVE A GREAT DAY!

HVCC--IMPORTANT

HVCC -- There should be a segment on HVCC this Wed and possibly again Thurs morning on Fox news network ( more info on time will follow if I can get it). The petition that has been circulating and signed by several thousand to contest "Home Valuation Code of Conduct" is being presented to Mr. Cuomo on Wednesday afternoon. We hope to see a lot of news outlets covering these events in the coming days--it will be very interesting to see what happens.

HUD and the new RESPA Laws

HUD / FHA websites

HUD on FaceBook: http://www.facebook.com/HUD HUD on Flickr: http://www.flickr.com/photos/opahud/HUD on YouTube: http://www.youtube.com/HUDchannelHUD on Twitter: http://portal.hud.gov/portal/page/portal/FHA_Home/twitterFHA Wiki: http://en.wikipedia.org/wiki/Federal_Housing_Administration

Do you heat with Propane?

A customer who was purchasing a rural home asked me yesterday what the cost of propane is per gallon. Since I don't heat with propane I had no idea of the cost. I thought, no problem, I'll just google "cost of propane in Minnesota"

I was suprised how hard it was to find specific information. The attorney general's office made reference to a weekly table of current, average propane costs, but they made it hard to find and hid it at the bottom of a bunch of other figures that had nothing to do with propane -- at least from my point of view.

This is the link to the chart and below is what I learned.

The lowest price in Minnesota for propane on November 2nd, 2009 was $1.32 per gallon

The highest price was $2.51 per gallon.

The average price was $1.64 per gallon

I also learned:

If you own your propane tank you can shop around for fuel at the cheapest price.
If you rent your tank you might be charged more by your provider just because they know you can't shop around.

I was going to supply a link to the article that tells about this but I can't find it again even though I know exactly what I'm looking for - the state needs to spend a little effort on making it possible to find things -- good grief!

The AG makes it sounds like buying propane could be tricky business. They make a point of saying "shop around".

The two bedroom house that started me on this search has a 750 gallon tank. At the average of $1.64 per gallon you would think it would hold $1,230 worth of propane, but you can only fill a propane tank a little more than three quarters of the way which brings the value down to $1,155. I doubt you'd want to let your tank go empty so it seems to me $1,000 would be an expensive fill for a 750 Gallon tank.

The next question, which I can't answer, is how many times a year do you have to fill a 750 Gallon tank for a 1200 sq ft house? I know that natural gas is a little cheaper than propane to heat with and a lot of 1200 square foot houses average more than $100 per month for natural gas. I would bet that for this 1200 square foot house with a 750 Gallon propane tank, the gas man would come at least twice a year to fill the tank.

It would be nice if someone who uses propane in this part of the country would share what they know.

Here's a link to the energy web site: http://www.state.mn.us/portal/mn/jsp/home.do?agency=Energy

Here's another link to a report on some of the AG's actions related to propane:
http://www.state.mn.us/mn/externalDocs/Commerce/Propane_Prebuy_Program_Report_062708011030_PropanePreBuy.pdf

A message from Steve at SJD Mortgage

The legislature did extend the $8,000 homebuyer tax credit to contracts signed by April 30 and closed by June 30.
The Senate's bill also creates a $6,500 credit for those who buy a home after living in their current house at least five years. That measure would also apply to contracts signed by April 30 and closed by June 30. The current credit defines a first-time homebuyer as someone who has not owned a residence within the past three years. ( this information is coming from the cnn.money.com site ).

In this market- how long is reasonable to have our house listed?

Question:

"We're priced in our comp range - and have been told our home shows really well - so I think we've done all WE can to get our house ready. Our Realtor has done a great job advertising and having open houses, but property is just not moving. We really just want to upgrade while prices and interest rates are low, but don't HAVE to move/sell because of jobs or anything.
How long is reasonable to leave our house on the market these days? We won't lower our price because we're already at a pretty narrow profit margin and to go down $5K would not leave us with enough profit to make a down payment on a bigger house. Also, we don't want to live in limbo forever. We have a toddler, and keeping the house "show ready" all the time is a challenge. We had planned on taking our house off the market after 90 days (June 1st) - but I'm now wondering if that was reasonable. We've been listed since March 3 - have had several lookers, but no offers. What are your thoughts?"

Answer:

If you plan on moving to a more expensive home it may be a good time to make the move even if you take a loss. The more expensive home that you are looking at moving into is probably at a more discounted price than your house. When prices start to go up the price differential between your house and the more expensive one will likely increase.

The problem, as you mentioned, with discounting your current house is that the price drop will come directly from the equity you'd like to use for a down payment. So it may not be realistic for you to move now.

90 days is a pretty short list period in these times. If you are serious you might consider giving it longer. If you can put up with having your house on the market another 90 days might be a good idea.

The weather has finally warmed up, interest rates are low and there are signs of life in the real estate market. Give your agent a chance to get the job done.

Here's a link to a listing of homes on the market in your area, Rochester Minnesota

How long should I wait for a Short Sale

Question:

Here's a question that comes up frequently with regard to purchasing "Short Sale" properties:
"We have a signed purchase agreement to purchase a property from the bank..."

"it has been over 60 days I have not heard anything yet :( so far..the seller's agent was suppose to hear something a week ago..but no news yet..I am wondering if I should bail..we have to keep changing the close date :(..and also what if the condo going into foreclosure while I am waiting what will happen then?"

Answer:

You got further than a lot of people. Banks often take a long time just to repond to an offer. I discourage buyers from getting involved with short sales at all because what you are going through is common.
Don't assume that banks will behave logically or even in their own best interest. If this is the only house you are interested in and you have all of the time in the world you could wait and see what happens. Otherwise I would move on(assuming you are not legally bound by your contract) and avoid anything that is a short sale in the future.
Typically when a property is foreclosed in Minnesota tha bank hast to wait for the six month redemption period before they can sell the property. In some cases, if the property has been abandoned, the bank can get this time period accelerated, but other times banks seem to forget a property exists and it can just sit for over a year before anything happens.

We want to put a REALLY low offer on a home that has been in foreclosure for 2 years what is too low?

This question was posted on Trulia, Here is my response.

There are two ways you can look at a house when you make an offer on it. The first is as an investment. Your offer is based on the numbers. If things don't work out you move on to the next one and so on until you get an offer that works. With this approach you might be willing to make a very low offer because it's no big deal if you lose it. Make enough really low offers and you'll get lucky every once in a while. If a house is a really good buy at the list price it is probably obvious. In that case even an investor might make a full priced offer.
Most people, even investors, have an attachment of some sort to the house they are trying to buy. Once you put the effort into evaluating a house and making an offer its probably a waste of time to make a very low offer. You need to look at the market and decide if it's a good deal. If the house is priced right and if you would feel bad if someone else got it for a dollar more than your offer, make a higher offer.
Ask the agent what they think. If your agent is not the listing agent ask him/her to ask the listing agent for you. Just by asking the question you might find out things that will help in your negotiation.
Looking at the homes on the market in Robbinsdale I can see there are 28 homes under $100,000. There are also a lot of new listings. You should take into account the prices of other similar options.

The Rise of FHA

Back in January of this year I wrote a post saying I didn't think there was a housing bubble. I pointed out that the cost of building a house had not dropped and that with the price of oil was going up which could only lead to an increase in the cost of raw materials.
Well, if a housing bubble is defined as rapidly dropping prices, I was wrong. Oil prices have dropped and the glut of foreclosed homes persists. We are at a moment in history that will be remembered for some time. With a recession in full bloom and a cascade of more bad financial news it seems the housing slump will never end. Credit is tight making it much harder to buy a home. A year ago a home buyer with less than perfect credit could finance 100% of the cost of a house and have the seller pay closing costs. It was just like a late night TV show, "get in with nothing down". FHA loans had fallen from popularity. Putting 3% down and paying mortgage insurance premiums was unattractive.
Today, if you have limited cash, you can hardly beat FHA. If you have 20% or more down payment FHA is not the way to go. Real Estate agents and Banks are boning up on FHA mortgages because in many cases they are the only way to get a house sold.
With this talk of doom and gloom comes a silver lining. Home prices are historically low(this is an understatement) and they are sure to increase at some point.
Because of the slow economy oil prices have dropped, factories have closed and demand for everything is unnaturally low. When the economy begins to swing oil prices will shoot up and inflation will start to rise. When all of the empty foreclosed houses are finally sold, people in middle and higher priced homes will suddenly be able to sell and move up or build.
Builders will not be able to respond to demand and prices will be driven up further. This is the next economic challenge. It seems like this whole scenario will lead to high inflation. Real Estate is a good investment in such a climate.
If I was a true believer I would be buying rental homes, but I'm not. This is the stuff of history, things could still get worse. If you can afford a house, need a house and have a steady job, I'm not sure how you could miss in today's market. Those who are speculating today could hit it big, but they are braver than me.

Saving money with Solar Power

There has been a lot of talk about energy lately. Most recently I heard a story about the residents of Juno Alaska who had their electric bills increase by 500% this summer.

I have a solar panel cost about $300 in 2005, and the specialized purpose I bought it for no longer exists. Why not put it into service and take a chunk of my electric bill?

There are technical problems to overcome. I won't spend much time on that except to say that to use my solar panel I also need deep cycle batteries, a charge controller, an inverter and some wiring at a minimum. The cost of all these items together is in the neighborhood of $1,000.

The good news is that I just need buy some wire, I already have the other stuff. In fact, I'm thinking maybe I should by some more solar panels to go with the one I already have.


I dug out the electricity bill. On the last bill we spent about ten cents per kilowatt hour. A 100 watt light bulb burning for ten hours will use about a kilowatt hour. A computer in use might use the same or slightly more electricty than the 100 watt bulb. If its sleeping, My Dell only uses a small percentage of this.

An energy pig is writing this . Our household uses 23 kilowatt hours per day, last month we used about 800 kilowatt hours for a bill of about $80.

Now comes the fun part. How much will I save?

On a clear Minnesota day in the summer I think my solar cell will run for 8 hours producing 64 watts of electricity. In a day that amounts to about half a kilowatt of electricity generated by my solar cell or five cents savings per day. In twenty days I'll save a buck, in twenty thousand days this setup will generate enough power to pay for itself. By my calculations thats about 54 years.

If I ship my solar equipment to Juno, Alaska where power is temporarily at fifty cents per kilowatt hour it will generate twenty five cents of power per day -- in the summer.



Another way to look at it is that I need 46 solar cells like the one I have and some really big batteries to take care of my energy needs.

Here is what I think it would take to make solar cells economically interesting to me. Electricity costs similar to those in Juno this summer, solar panels at one quarter the cost they are today. If an aditional solar panel cost $75 and could save me twenty five cents a day it would pay itself back in about a year. Batteries are expensive, they require mainteneance and they wear out. Fuel cells would provide strorage using hydrogen allowing energy to be stored more efficently.

While I wait for these things to happen conservation seems to be the best course of action. In fact, it seems that the secret of living off the grid depends more on conservation than cool energy technology. The technology provides a certain amount of energy, but most of the savings comes from limmiting the use of power to start with.

How Many Houses Should I Look At?

What are the chances the first house you look at is going to be the one you want? There is always a chance that could happen. No matter how many houses you look at, how do you know the next one is not going to be just a little better? You don't know.
If you really like the first house you see, go see some more as soon as possible. If the first one is still your favorite arrange to see it again. There are always new things you notice the second time around.

Make a list of questions and get them answered. If you are ready to buy don't delay just because you found something good right away. Among the motivated buyers I work with, people who are ready to go right now, it's very common for them to see fewer than eight houses before they make an offer. In some markets there aren't even eight homes of a particular type and price range to look at.