— Real Estate Guide For Today’s Market

White House Rescue Plan Announced Today–All $75 Billion Of It

Posted on February 18, 2009. Filed under: -- Economic Week In Review, -- Real Estate Guide For Today's Market, . More Resources For YOU! |


By Molly Greaves

 

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President Barack Obama on February 18 rolled out the White House’s Rescue Housing plan of $75 billion to help struggling families avoid foreclosure and to bring some order to the housing market.  The President said taxpayer money could help save  between 7 – 9 million families who are risking foreclosure because they cannot afford their mortgages.  The President continued on adding that “this problem does not just involve them, it involves all of us. All of us are paying a price for the home mortgage crisis and all of us will pay an even steeper price if we allow this crisis to continue—a crisis which is unraveling home ownership, the middle class, and the American Dream itself. But if we act boldly and swiftly to arrest this downward spiral, every American will benefit.”  

In a roughly 20-minute announcement, the President  laid out the 4 key elements in his $75 billion Homeowner Affordability and Stability plan which he says is necessary to help the economy. If taken together, he told the folks in Mesa, AZ where he delivered his speech and also to those of us around the world listening, “the provisions of this plan will help us end this crisis and preserve for millions of families their stake in the American Dream.”

In Barack Obama’s exact words, here is how his plan works:

First, we will make it possible for an estimated four to five million currently ineligible homeowners who receive their mortgages through Fannie Mae or Freddie Mac to refinance their mortgages at lower rates.

Second, we will create new incentives so that lenders work with borrowers to modify the terms of sub-prime loans at risk of default and foreclosure.

Third, we will take major steps to keep mortgage rates low for millions of middle class families looking to secure new mortgages.

Fourth, we will pursue a wide range of reforms designed to help families stay in their homes and avoid foreclosure.”

To read more on each key point, or to read his speech in its entirety, please click here.

One last important thing for you…

I went to the White House website to learn more about this for my readers, and came across a Q & A section for Borrowers about the Homeowner Affordability and Stability Plan.  I thought it would be useful and have copied it below for you. If you are risking foreclosure or even if you are current on your mortgage, you will find most likely find this useful. For those of you facing foreclosure, please scroll down to find your questions and answers. Just so you know, all of this information below is based on the official White House blog.

Borrowers Who Are Current on Their Mortgage Are Asking:

  • What help is available for borrowers who stay current on their mortgage payments but have seen their homes decrease in value?

Under the Homeowner Affordability and Stability Plan, eligible borrowers who stay current on their mortgages but have been unable to refinance to lower their interest rates because their homes have decreased in value, may now have the opportunity to refinance into a 30 or 15 year, fixed rate loan.   Through the program, Fannie Mae and Freddie Mac will allow the refinancing of mortgage loans that they hold in their portfolios or that they placed in mortgage backed securities.

  • I owe more than my property is worth, do I still qualify to refinance under theHomeowner Affordability and Stability Plan?

Eligible loans will now include those where the new first mortgage (including any refinancing costs) will not exceed 105% of the current market value of the property.   For example, if your property is worth $200,000 but you owe $210,000 or less you may qualify.  The current value of your property will be determined after you apply to refinance.

  • How do I know if I am eligible?

Complete eligibility details will be announced on March 4th when the program starts.  The criteria for eligibility will include having sufficient income to make the new payment and an acceptable mortgage payment history.  The program is limited to loans held or securitized by Fannie Mae or Freddie Mac.

  • I have both a first and a second mortgage.  Do I still qualify to refinance under theHomeowner Affordability and Stability Plan?

As long as the amount due on the first mortgage is less than 105% of the value of the property, borrowers with more than one mortgage may be eligible to refinance under the Homeowner Affordability and Stability Plan.  Your eligibility will depend, in part, on agreement by the lender that has your second mortgage to remain in a second position, and on your ability to meet the new payment terms on the first mortgage. 

  • Will refinancing lower my payments?

The objective of the Homeowner Affordability and Stability Plan is to provide creditworthy borrowers who have shown a commitment to paying their mortgage with affordable payments that are sustainable for the life of the loan.  Borrowers whose mortgage interest rates are much higher than the current market rate should see an immediate reduction in their payments.  Borrowers who are paying interest only, or who have a low introductory rate that will increase in the future, may not see their current payment go down if they refinance to a fixed rate.  These borrowers, however, could save a great deal over the life of the loan.  When you submit a loan application, your lender will give you a “Good Faith Estimate” that includes your new interest rate, mortgage payment and the amount that you will pay over the life of the loan.  Compare this to your current loan terms.  If it is not an improvement, a refinancing may not be right for you.

  • What are the interest rate and other terms of this refinance offer?

The objective of the Homeowner Affordability and Stability Plan is to provide borrowers with a safe loan program with a fixed, affordable payment.  All loans refinanced under the plan will have a 30 or 15 year term with a fixed interest rate.  The rate will be based on market rates in effect at the time of the refinance and any associated points and fees quoted by the lender.  Interest rates may vary across lenders and over time as market rates adjust.  The refinanced loans will have no prepayment penalties or balloon notes.  

  • Will refinancing reduce the amount that I owe on my loan?

No.  The objective of the Homeowner Affordability and Stability Plan is to help borrowers refinance into safer, more affordable fixed rate loans.  Refinancing will not reduce the amount you owe to the first mortgage holder or any other debt you owe.  However, by reducing the interest rate, refinancing should save you money by reducing the amount of interest that you repay over the life of the loan.

  • How do I know if my loan is owned or has been securitized by Fannie Mae or Freddie Mac?

To determine if your loan is owned or has been securitized by Fannie Mae or Freddie Mac and is eligible to be refinanced, you should contact your mortgage lender after March 4, 2009.

  • When can I apply?

Mortgage lenders will begin accepting applications after the details of the program are announced on March 4, 2009.   

  • What should I do in the meantime?

You should gather the information that you will need to provide to your lender after March 4, when the refinance program becomes available.  This includes:

  •  
    • information about the gross monthly income of all borrowers,  including your most recent pay stubs if you receive them or documentation of income you receive from other sources
    • your most recent income tax return
    • information about any second mortgage on the house
    • payments on each of your credit cards if you are carrying balances from month to month, and
    • payments on other loans such as student loans and car loans.

Borrowers Who Are at Risk of Foreclosure Are Asking:

  • What help is available for borrowers who are at risk of foreclosure either because they are behind on their mortgage or are struggling to make the payments?

The Homeowner Affordability and Stability Plan offers help to borrowers who are already behind on their mortgage payments or who are struggling to keep their loans current.  By providing mortgage lenders with financial incentives to modify existing first mortgages, the Treasury hopes to help as many as 3 to 4 million homeowners avoid foreclosure regardless of who owns or services the mortgage.

  • Do I need to be behind on my mortgage payments to be eligible for a modification? 

No.  Borrowers who are struggling to stay current on their mortgage payments may be eligible if their income is not sufficient to continue to make their mortgage payments and they are at risk of imminent default.  This may be due to several factors, such as a loss of income, a significant increase in expenses, or an interest rate that will reset to an unaffordable level.   

  • How do I know if I qualify for a payment reduction under the Homeowner Affordability and Stability Plan?

In general, you may qualify for a mortgage modification if (a) you occupy your house as your primary residence; (b) your monthly mortgage payment is greater than 31% of your monthly gross income; and (c) your loan is not large enough to exceed current Fannie Mae and Freddie Mac loan limits.  Final eligibility will be determined by your mortgage lender based on your financial situation and detailed guidelines that will be available on March 4, 2009.

  •  I do not live in the house that secures the mortgage I’d like to modify.  Is this mortgage eligible for the Homeowner Affordability and Stability Plan?

No.  For example, if you own a house that you use as a vacation home or that you rent out to tenants, the mortgage on that house is not eligible.  If you used to live in the home but you moved out, the mortgage is not eligible.  Only the mortgage on your primary residence is eligible.  The mortgage lender will check to see if the dwelling is your primary residence.

  • I have a mortgage on a duplex.  I live in one unit and rent the other.  Will I still be eligible?

Yes.  Mortgages on 2, 3 and 4 unit properties are eligible as long as you live in one unit as your primary residence.

  • I have two mortgages.   Will the Homeowner Affordability and Stability Plan reduce the payments on both?

Only the first mortgage is eligible for a modification.

  • I owe more than my house is worth.  Will the Homeowner Affordability and Stability Plan reduce what I owe?

The primary objective of the Homeowner Affordability and Stability Plan is to help borrowers avoid foreclosure by modifying troubled loans to achieve a payment the borrower can afford.  Lenders are likely to lower payments mainly by reducing loan interest rates.  However, the program offers incentives for principal reductions and at your lender’s discretion modifications may include upfront reductions of loan principal.

  • I heard the government was providing a financial incentive to borrowers.  Is that true?

Yes.  To encourage borrowers who work hard to retain homeownership, the Homeowner Affordability and Stability Plan provides incentive payments as a borrower makes timely payments on the modified loan.   The incentive will accrue on a monthly basis and will be applied directly to reduce your mortgage debt.  Borrowers who pay on time for five years can have up to $5,000 applied to reduce their debt by the end of that period.

  • How much will a modification cost me?

There is no cost to borrowers for a modification under the Homeowner Affordability and Stability Plan.  If you wish to get assistance from a HUD-approved housing counseling agency or are referred to a counselor as a condition of the modification, you will not be charged a fee.  Borrowers should beware of any organization that attempts to charge a fee for housing counseling or modification of a delinquent loan, especially if they require a fee in advance. 

  • Is my lender required to modify my loan?

No.  Mortgage lenders participate in the program on a voluntary basis and loans are evaluated for modification on a case-by-case basis.  But the government is offering substantial incentives and it is expected that most major lenders will participate.

  • I’m already working with my lender / housing counselor on a loan workout.  Can I still be considered for the Homeowner Affordability and Stability Plan?

Ask your lender or counselor to be considered under the Homeowner Affordability and Stability Plan.

  • How do I apply for a modification under the Homeowner Affordability and Stability Plan?

You may not need to do anything at this time.  Most mortgage lenders will evaluate loans in their portfolio to identify borrowers who may meet the eligibility criteria.  After March 4 they will send letters to potentially eligible homeowners, a process that may take several weeks.   If you think you qualify for a modification and do not receive a letter within several weeks, contact your mortgage servicer or a HUD-approved housing counselor.  Please be aware that servicers and counseling agencies are expected to receive an extraordinary number of calls about this program.

  • What should I do in the meantime?

You should gather the information that you will need to provide to your lender on or after March 4, when the modification program becomes available.  This includes:

    • information about the monthly gross income of your household including recent pay stubs if you receive them or documentation of income you receive from other sources
    • your most recent income tax return
    • information about any second mortgage on the house
    • payments on each of your credit cards if you are carrying balances from month to month, and
    • payments on other loans such as student loans and car loans.
  • My loan is scheduled for foreclosure soon.  What should I do?

Contact your mortgage servicer or credit counselor.  Many mortgage lenders have expressed their intention to postpone foreclosure sales on all mortgages that may qualify for the modification in order to allow sufficient time to evaluate the borrower’s eligibility.  We support this effort.

 

 

 

 

 

 

 

 


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AUSTIN RANKS #11 FOR FOREIGN REAL ESTATE INVESTORS

Posted on January 27, 2009. Filed under: -- Austin Related, -- Real Estate Guide For Today's Market | Tags: , |


By Molly Greaves

austonian

Sunday through Sunday construction is taking place all around the streets of Austin. Locals love it here as do non-locals, including real estate investors.  Investors from all over the globe are buying our real estate. Some of these folks are calling Austin their home, while others are buying up our real estate purely for investment, and may never even come to Austin if you can imagine that.

So many people are now buying in Austin for investment, that  Austin ranked 11th for  top cities for U.S. and global investment in 2009 according to the report from the Association of Foreign Investors in Real Estate.

Washington D.C. clinched the No. 1 spot on the ranking. New York is next, followed by San Francisco, Los Angeles and Houston for the top five. Austin’s 11th place standing tied it with Las Vegas, Phoenix, Orlando, Atlanta, San Diego and San Jose, Calif.

Survey respondents said the multifamily sector was the preferred property type for investment dollars, followed by office, industrial, retail and hotel properties. In the two previous years, office investment ranked first, but employment instability likely contributed to the flip-flop.

Click here to read the full article from the Austin Business Journal

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HOME SALES UP NATIONWIDE

Posted on January 25, 2009. Filed under: -- Real Estate Guide For Today's Market, -- Uncategorized | Tags: , , |


 

By Molly Greaves

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According to the Austin Business Journal, the number of foreclosures may be up, but there are people out there buying too.

Sales of previously owned homes rose 6.5 percent to 4.74 million last month, up from 4.45 million in November, according to the National Association of Realtors.

And while sales are up, prices continue to go down.

Nationwide, the median sales price fell to $175,400, down 15.3 percent from $207,000 a year ago.

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GOING GREEN? THEN TAKE THE RED…LINE THAT IS.

Posted on January 23, 2009. Filed under: -- Austin Related, -- Real Estate Guide For Today's Market |


By Molly Greaves

 

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Going Green? Then take the Red…Line that is.

I’m happy to note that the Capital Metropolitan Transportation Authority has released a tentative schedule for its new commuter rail service, the Capital MetroRail, aka the Red Line.

The Red Line will run on 32-miles of existing freight tracks between Leander and Downtown Austin.

Practice runs of the service will begin Feb. 12 along the entire 32-mile rail line and regular service is expected to begin in March! Frequency will be every 30 minutes.

Get this, “Sleek, new trains will take you to work in comfort and style, providing you with high-back seats, bicycle and overhead racks, and Wi-Fi connections. Capital MetroRail will offer service during morning and afternoon peak hours. Local routes and rail connector routes will whisk you to your final destination.”

 

Features

  • Holds 200 Passengers, 108 seated
  • ADA accessible
  • Bicycle racks
  • Tables or pull-down trays
  • Luggage racks
  • WiFi service
  • Automated station announcements
  • Message boards with real-time passenger information
  • Travels up to 75 mph

 

Finish this article and get the complete schedules by visiting the MetroRail’s website  here .

See you there!

Capital MetroRail Red Line.ai

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Report outlines decline in Texas construction

Posted on January 22, 2009. Filed under: -- Austin Related, -- Real Estate Guide For Today's Market, Texas | Tags: , , |


By Molly Greaves
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According to the Austin Business Journal today, they report that Texas is expected to experience a considerable slowdown in construction activity in 2009, according to a report issued by McGraw-Hill Construction.

The outlook for the coming year calls for construction spending of roughly $54.4 billion in Texas, down 13 percent from 2008, the report indicates. However the building of the giant Motiva and Valero refineries in Port Arthur that created 5,000 jobs buoyed the numbers in 2008.

McGraw-Hill researchers forecast that construction of housing units will drop 4 percent statewide in 2009, surpassing the 3 percent national decline. But population growth, cost advantages and the relative buoyancy of the Texas economy should help the state recover more quickly than the rest of the nation in the residential sector when demand improves.

Finish the story here!

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HOME SALES DROP IN AUSTIN. HOW FAR DID THEY GO?

Posted on January 20, 2009. Filed under: -- Austin Related, -- Real Estate Guide For Today's Market | Tags: , |


By Molly Greaves

NEWS-US-USA-ECONOMY-HOUSING

Guess what percent single-family home sales in the Austin metro area were down in December 2008?

21 percent compared with the same month last year, according to the Austin Board of Realtors. They also add that mediam prices declined 4 percent compared with December 2007, according to their research. 

But the drop in single-family home sales for December isn’t as severe as the 40 percent drop in sales logged in November 2008 as compared with November 2007.

Year-end numbers from ABoR (pronounced “A”-Bore) show the median price for single family homes in Central Texas rose 2 percent from the year-end 2007 price of $189,000. Overall in 2008, single family (SF) home sales declined 20% to total 20,199, compared with sales in 2007.

Finish the article here!

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WONDERING IF YOU SHOULD REFINANCE YOUR MORTGAGE?

Posted on January 19, 2009. Filed under: -- Building Wealth, -- Real Estate Guide For Today's Market, -- Saving Money And YOU, -- Uncategorized | Tags: , , , , |


Posted by Molly Greaves 01__what_is_a_home_loan2
According to Money Magazine’s January 2009 issue, they say you should use these three things to help you decide if it makes sense for you or not.
Last year, the average rates on 30-year fixed loans plunged to 5.1%, their lowest level in decades.  IF the three statements below describe you, a refi might pay off…at least according to Amanda Gengler at Money Magazine.
1.  You dont need a jumbo mortgage.  Rates havent come down as much as for loans more than $417,000 (up to $525,00 in some markets).
2. Your current rate is 6.1% or higher.  A refi will cost you a few grand, but if you’ll drop a full percentage point, you’ll likely come out ahead over time.
3.  You have at least 20% equity.  You typilcally need that much of a stake (plus a credit score of a 740 plus) to land the lowest rates with no points. 
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AUSTIN RENTAL OCCUPANCY DOWN IN Q3…Only the second time in history that occupancy has fallen during a 3RD quarter

Posted on October 25, 2008. Filed under: -- Austin Related, -- Real Estate Guide For Today's Market, -- Uncategorized | Tags: , , |


By Molly Greaves

I’m on a newsletter mailing list and thought this was good to post for my real estate investor friends, AND of course anyone else that happens to be checking out my blog and interested in reading further.

“…After 15 consecutive quarters of increasing rental rates, third quarter put the brakes on Austin’s momentum causing rental rates to stand still and, even more surprising, occupancy to stumble. While not declining a significant amount, down .21%, this is only the second time in our recorded history that occupancy has fallen during a third quarter. Usually, this time frame is bolstered by returning students and in-migration, however an influx of new units left many of the “student-heavy” sectors with little to no gains this time around.

And the new units will keep on coming. Currently there are over 12,000 units already under construction and developers expect to complete over half of these during the next two, historically slow quarters. Expect occupancy and rents to  continue to struggle as the new units are added to the inventory.

To learn more or to obtain the full Multi-Family Trend Report click here: www.apartmenttrends.com.

I use this website a lot and really enjoy their email updates.

 

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Why Ask For An FHA Loan?

Posted on September 20, 2008. Filed under: -- Money Help (in simple terms), -- Real Estate Guide For Today's Market, -- Saving Money And YOU, -- Uncategorized | Tags: , , , , , , |


 

 

 

 

 

By Molly Greaves

With participating and studying in real estate investing, I’ve been spending a lot of time learning about first time home buying, Down Payment Assistance, etc. so I can help others figure out how to become a qualified home-owner while taking advantage of as many financial assistance programs as possible that are available to them.

Here are some important things to know about FHA. Many people are unclear of what FHA means or why someone should get an FHA loan. Please give Hud.gov a visit for more information.

Why Ask For An FHA Loan?

There are lots of reasons to ask your lender for an FHA loan instead of taking a conventional or an expensive and risky sub-prime mortgage loan. Why not take advantage of the many benefits and protections that only come with FHA:

Easier to Qualify – Because FHA insures your mortgage, lenders are more willing to give loans with lower qualifying requirements so its easier for you to qualify.

Less than Perfect Credit – Even if you have had credit problems, such as bankruptcy, its easier for you to qualify for an FHA loan than a conventional loan.

Low Downpayment – We have a low 3% downpayment, and that money can come from a family member, employer or charitable organization. Other loans don’t allow this.

Costs Less – Many times, FHA loans have competitive interest rates because the loans are insured by the Federal Government. Always compare an FHA loan with other loan types.

 

 

 

 

 

 

 

 

 

 

 

 

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WORST 25 U.S. HOUSING MARKETS

Posted on September 14, 2008. Filed under: -- Austin Related, -- Real Estate Guide For Today's Market, -- Top 10..., -- Uncategorized | Tags: , , , , , |


By Molly Greaves      

Hopefully you’ve read, or are planning to read my other blog, the Top 25 APPRECIATING Markets in the US. I got this information from HousingPredictor.com and they have some wonderful resources on their website. I thought this information was valuable and worth sharing with you.  Hopefully if your in Ontario, Vegas or Miami you can stay kah-put with your real estate investments and aren’t having to cash out while times are tough.

 

Top 25 US Appreciating Real Estate Markets
 Rank   Real Estate Market   2008 Forecast
    1.    Ontario, CA     − 24.5%
    2.    Las Vegas , NV     − 23.7%
    3.    Miami , FL     − 22.1%
    4.    Detroit , MI     − 19.7%
    5.    Phoenix , AZ     − 19.6%
    6.    Sacramento, CA     − 19.1%
    7.    Los Angeles , CA     − 18.5%
    8.    Anaheim, CA     − 17.4%
    9.    San Diego, CA     − 16.7%
   10.    Palm Beach, FL     − 14.7%
   11.    Naples , FL     − 13.9%
   12.    Fresno, CA     − 12.9%
   13.    Cleveland, OH     − 12.1%
   14.    Atlanta, GA     − 11.2%
   15.    Boston, MA     − 10.9%
   16.    Bakersfield, CA     − 10.8%
   17.    Dewey Beach, DE     − 10.7%
   18.    Cambridge, MA     − 10.3%
   19.    Reno, NV     − 10.2%
   20.    Fort Lauderdale, FL     − 10.1%
   21.    Lawrence, MA     −   9.5%
   22.    San Jose, CA     −   9.1%
   23.    Indianapolis , IN     −   9.0%
   24.    Portland, OR     −   8.9%
   25.    Grand Rapids, MI     −   8.9%

 

Detroit, Michigan
San Diego, California

Fall Forecast to Accelerate      

The pain associated with the real estate crisis is more evident in California than any where else in the country. The Worst 25 Housing Market forecast, updated at mid-year for 2008 is led by Ontario, California once considered to be a distant suburb of Los Angles. Many bought homes in the Inland Empire to get a larger house for the money.

As Southern California grew the Inland Empire became a huge part of the California dream for many. But the area is now one of the hardest hit housing markets in the country in terms of foreclosures.

Las Vegas, which experienced more subprime lending than any other single urban market in the country has moved up to the second position. Prices on Las Vegas homes are falling at the fastest rate in history. The once booming market, which had become a top destination for real estate speculators, is developing into one of the worst busts in the country. But hard hit lenders are making some great deals in Las Vegas on foreclosures.

Miami is dominated by a condominium market that has gone from an all-time boom to a record breaking bust, amid foreclosures on nearly every street. Record foreclosures have been triggered by new creative adjustable rate mortgages in the conventional market and subprime. The majority of markets on the Worst 25 are experiencing rapidly spiraling rates of deflation.

Weakened by job losses in the auto business Detroit, Michigan is now fourth, followed by Phoenix, Arizona, which had the second highest rate of subprime mortgages and the highest number of new creative conventional adjustable rate mortgages for investors behind Las Vegas.

Phoenix is experiencing a worse crash in its market than during the U.S. Savings and Loan Fraud Crisis in the late 1980’s. Many other markets across the country are expected to follow suit. CLICK HERE TO GO TO HOUSE PREDICTORS homepage to learn more! It’s a great site. 

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