More flexibility available to help borrowers avoid foreclosure

On Dec. 8, Fannie Mae announced it was giving mortgage servicers more flexibility and more loss mitigation options to minimize foreclosures. The changes will allow servicers to act earlier to avoid potential delinquencies. The changes affect mortgages in mortgage backed securities (MBSs) and mortgages held by Fannie Mae in portfolio.

The changes "build on and complement" the Streamlined Loan Modification Program (SLMP) that takes effect on December 15, 2008, and is described elsewhere in this week's Washington Report. Highlights of the changes include:

Authority for servicers to apply loss mitigation tools for borrowers facing reasonably foreseeable, imminent default, so they don't have to wait until they are late making payments.

A new Early Workout program that allows servicers to pre-negotiate a loan modification that takes effect and becomes permanent after the borrower successfully completes a trial period.

Clarification that a loan can remain in a pool even if it is 24 months delinquent, if there is ongoing activity to address the problem.

Elimination of the requirement that a loan must proceed to foreclosure after a specified period of delinquency.

Fannie Mae has also announced a new Single Family Master Trust Agreement that will allow servicers, for new MBSs, to remove a loan that is 30 days delinquent from the MBS to modify the loan.

Freddie Mac guidelines also permit servicers to address problems faced by borrowers who are at risk of imminent default. It is not known whether Freddie is considering enhancing this policy to complement the SLMP.

Source: Ohio Association of Realtors

New York Times "It May Be Time to Think About Buying a House"

In The New York Times article "It May Be Time to Think About Buying a House" written December 6th, the author warns potential first-time homebuyers not to miss this golden opportunity. Housing prices are down and although the bottom of the market can only be seen in hindsight there are many reasons why now is the time to buy. If you want a new home, many builders are running specials right now that probably won't last until the busier spring market. The $7500 tax credit available to anyone who hasn't owned a home in the last 3 years ends in April. Interest rates have actually come down more since the time this article was written and are now below 5% for a 30 year fixed rate conventional loan. Of course you'll also have the freedom of customizing your home without first consulting your landlord!

sold!

I just sold 886 White Willow Lane! Thank you to my seller, Timberly, for giving me the opportunity to sell it, and welcome to the neighborhood, Patricia!

Columbus: 7th best city to conduct business

CNN named Columbus the 7th best city to conduct business. Here is an excerpt from the article:

'This state capital is one of two cities new to the top 10 this year, rising from 14th place a year ago with a 26-point gain.

The home of Ohio State University, Limited Brands (LTD) and Big Lots Inc. (BIG) also benefited from a broader survey of small-business figures. The city moved up 10 slots in that category.

And the addition of two financial firms, Diamond Hill Investment Group (DHIL) and ProCentury Corp. (PROS), to the Russell 2000 index helped Columbus surge 11 spots in that category.

The region has managed to avoid the Rust Belt troubles that hit other Ohio cities like Cleveland, said Steve Mangum, the interim dean of Ohio State's business school. Columbus has built an entire economy around the university -- the country's biggest by enrollment -- using its research and educational might to fuel various types of industry.

The university also is a cornerstone of Columbus residents' down time, bringing art and culture to the region, as well, of course, as the beloved Buckeyes football team.

Locals like the intimate nature of the city.
"It has a small-town feel to it, but it's the [30th] largest city in the country," Mangum said. "There's something about the spirit of this place."'

https://webmail.cboki.com/exchange/karen.schneider/Inbox/FW:%20Columbus%20article.EML/1_multipart_xF8FF_2_Emailing:%20Players-Shift,-but-Twin-Cities-Still-Best-for-Business.htm.eml/Players-Shift,-but-Twin-Cities-Still-Best-for-Business.htm/C58EA28C-18C0-4a97-9AF2-036E93DDAFB3/Players-Shift,-but-Twin-Cities-Still-Best-for-Business.htm?attach=1

renovation lending

Have you ever seen a house you really like, one that needs some work but has great potential? Some people feel like they would have to pass up an opportunity like this just because they don't have the money to invest in the repairs. Have no fear, there is a solution! FHA offers two products a full 203k and a streamline 203k. If the house just needs a few upgrades like new carpet, new appliances, or a remodeled bathroom, the streamline 203k is probably the right product for you. You can receive a loan for up to 110% of the after improved value of the house, with up to $35,000 in repair funds and can receive up to 50% of the repair funds within 10-14 days after closing, before the work even begins! There is no minimum amount to borrow and the process of getting the money is very easy. Keep in mind though, that you can't make structural changes with this loan. If you need to make structural changes you'll need a full 203k loan. This loan program is a little more paperwork-intensive, but definitely worth it. You'll line up your contractors and estimates before closing, then the mortgage company will send payments to these contractors out of your loan money. Now there's no reason to pass up a fixer-upper!

Federal Housing Finance Association announces forclosure initiative

The Federal Housing Finance Association has developed a new program to help borrowers who are in danger of foreclosure. Here are some details of this program:

The program targets borrowers who have missed three or more payments, own and occupy the property as a their primary residence, and has not filed for bankruptcy.

The program will modify the borrowers loan so that the payment is no more than 38 percent of monthly gross income, which will be achieved through a mix of reducing the mortgage interest rate, extending the life of the loan or deferring payment on part of the principal.

Fannie Mae and Freddie Mac loan servicers will be responsible for implementing the program by Dec. 15 and will receive $800 for each loan modified through the program.

Best Places to Raise your Kids: Columbus, OH

In a recent Businessweek article Columbus, OH was named as one of the Best Places to Raise your Kids. The survey studied cities with at least 50,000 people that had a median household income between $40,000 and $100,000. The most important factors in the analysis were school performance, affordability, and safety. But they also gave weight to cost of living, air quality, job growth, racial diversity, and local parks, ball fields, zoos, recreation centers, museums, and theaters.

Click here for the full article: http://www.businessweek.com/investor/content/nov2008/pi2008117_238652.htm

credit flaws for FHA

If you have a blemish on your credit report, you may be able to get approved for an FHA loan by following these requirements:

Borrower may apply for FHA mortgage:



Chapter 13: 1 year from discharge with one full year
of timely payments made to creditors
Borrowers seeking Consumer Credit
Counseling Services (CCCS) are generally
considered comparable to a Chapter 13.


Chapter 7 & 11: 2 years from discharge
Borrower must have re-established good
credit

Foreclosures &
Deed in Lieu of
Foreclosure: 3 years from release

Short sale: 3 years required if showing on the credit
report as a pre-foreclosure or as a
mortgage settled for less than full amount

Source: COLDWELL BANKER HOME LOANS

credit flaws?

Do you have a blemish on your credit report that you think might prevent you from getting a loan? Here are the requirements for how long you must wait before you can be pre-approved for a conventional mortgage.

Borrower may apply for a Conventional Mortgage:


Chapter 13: 2 years from discharge date or
4 years from dismissal date

Chapter 7 & 11: 4 years from either the discharge or
dismissal date

Foreclosure: 5 years from the completion date
for a primary residence with 10% down
payment and a minimum 680 credit score

Deed-in-Lieu of
Foreclosure: 4 years from completion date
for a primary residence or 2nd home with
a minimum of 10% down

Short Sale: 2 years required to re-establish credit
Based on pre-foreclosure action and
if the “short sale” shows on the credit
report as a comment to the reporting of
delinquency and is typically reflected as
“Paid in Full Less than Full Balance” or "Deficient Payoff/Settlement”

Source: COLDWELL BANKER HOME LOANS

Proposed Four Point Housing Stimulus Plan

The National Association of Realtors has proposed a new housing stimulus plan. If passed, this plan would:

*Make the $7500 first-time homebuyer tax credit available to all buyers and eliminate repayment requirements. The credit's limited availability and repayment requirement severely limit the credit's use and effectiveness.

*Make the 2008 FHA, Fannie Mae and Freddie Mac loan limits permanent. New rules for 2009 will reduce them. Now is not the time to limit mortgage affordability.

*Get the Treasury relief program back on track and target more funds to mortgage relief. Create a federal mortgage interest buy-down program to make below-market rates available and stabilize home prices.

*Permanently bar banks from engaging in real estate brokerage and management. The banks have proven they have enough to do to simply manage the loan process. Banks should not manage home sales and purchases.

The "New" FHA

If you haven't dusted off your understanding of the FHA loan program now is the time to do so. There have been many changes made to the FHA Loan Program designed to modernize the loan for today's real estate environment -- Streamlined Processing, Reformed Appraisal Requirements and Standardized Automated Underwriting to name a few. These improvements coupled with the current challenges in our economy heighten the importance of educating potential home-buyers about the benefits of FHA Financing.

Did you know…

• FHA Loans only require a 3% Investment
  
• FHA Loans allow for Gift Funds
  
• FHA Loans still allow the Seller to contribute up to 6% of the purchase price
  
• FHA Loans offer the most Flexible Credit Standards and No Income Limits
  
• FHA Loans have an Assumption Feature
  
• The FHA Loan Limit in Franklin and surrounding Counties is $341,250.00.
  

Whether you are looking to purchase your first home or fourth home, FHA Financing makes your goals easier to reach.

Source: Brian Snyder, Wells Fargo

Top Ten Credit Do's and Don'ts During the Loan Process

Did you know that most lenders pull your credit report a couple of times during the loan process? Keep in mind that we typically pull a new credit report prior to closing the loan, and if your credit scores have dropped, you may no longer qualify for the rate or program that you are attempting to get. Credit scores are very important as all lenders qualify you by your credit score as to which criteria you fit and every loan has different criteria attached. The loan to value, the debt to ratio, and so on, etc.

Why it Matters: Knowing what you should and shouldn't do can affect the terms of your loan. It is always best to be as educated as possible in the loan process to ensure you are getting the best deal.

What you need to know: Following are some helpful tips to avoid the credit mistakes that many borrowers make during the loan process.

Don't apply for new credit of any kind. Including those "You have been pre-approved" credit card invitations that you receive in the mail. Every time that you have your credit pulled by a potential creditor or lender, you lose points from your credit score immediately. Depending on the elements in your current credit report, you could lose anywhere from 2-50 points for one hard inquiry.

Don't pay off collections of charge offs during the loan process. Paying collections will decrease the credit score immediately due to the date of last activity becoming recent. If you want to pay off old accounts, do it through escrow, and make sure that 1) you validate that the debt is yours, and 2) that the creditor agrees to give you a letter of deletion.

Don't close credit card accounts. If you close a credit card account it will appear to the FICO that your debt ratio has gone up. Also, closing a card will affect other factors in the score such as length of credit history. If you have to close a credit card account, do it after closing, and make sure it is a more recent account.

Don't max out of over charge on your credit card accounts. This is the fastest way to bring your score down 50-100 points immediately. Try to keep your credit card balances below 30% of their available limit at all times during the loan process. If you decide to pay down balances, do it across the board. Meaning, make an extra payment on all of your cards at the same time.

Don't consolidate your debt ratio onto 1 or 2 credit cards. It seems like it would be the smart thing to do, however, when you consolidate all of your debt onto one card, it appears that you are maxed out on that card, and the system will penalize you as mentioned above in 4. If you want to save money on credit card interest rates, wait until after closing.

Don't do anything that will cause a red flag to be raised by the scoring system. This would include adding new accounts, co-signing on a loan, changing or your name or address with the bureaus. The less activity on your reports during the loan process, the better.

Do stay current on existing accounts, like your mortgage and car payments. One 30-day late can cost you anywhere from 30-75 points.

Do continue to use your credit as normal. Red flags are raised easily with the scoring system. If it appears that you are changing your pattern, it will raise a red flag, and your score could go down.

Do call your lender if you receive something in the mail from a creditor or collection agency that you believe may affect your score during the process. We may be able to supply you with the resources you need to stop any derogatory reporting to the bureaus.

Do get a free copy of your credit report. www.annualcreditreport.com is a free resource to the public that allows you to get a complimentary copy from each of the three credit bureaus every 12 months.

Source: Lynn Kaster Coldwell Banker Home Loans

The Fed drops rates and mortgage rates move higher. Why????

The Fed lowers rates to spur economic activity, which is inflationary. An expanding economy has inflationary tendencies. Inflation erodes the value of money received in the future, therefore bond holders demand a higher yield whenever inflation is a concern – pushing mortgage rates up.

Rates are still around 6.5% which is great. Compare that to rates up to 18% in the early 80's and it looks even better!

The Time is Now for Real Estate

In the article, "The Time is Now for Real Estate" Rich Levin, a real estate coach, suggests this is the best time for first-time homebuyers and investors to purchase property. Interest rates continue to stay low, around 6% and mortgage money is still readily available, usually with only a 3-5% down payment. Don't forget about the $7,500 federal tax credit for first-time homebuyers until April 2009. Foreclosed homes are quickly being purchased by investors who cannot pass up such a great deal. There is pent-up demand in the market since many lifestyle changes including marriages, divorces, births, deaths, young adults going away to college, or getting their first jobs lead to necessary housing changes. Also, the inflation rate has gone up recently, pulling housing prices up with it. Don't miss out on this opportunity!

Affordability is Key

This article, "Affordability is Key" by Lawrence Yun, NAR Chief Economist explains why the housing market continues to improve despite the economic recession.

"The U.S. economy has entered a recession and will contract for the next three quarters. The recovery, beginning in the second half of 2009, will be tepid. The unemployment rate will peak at 6.7 percent by mid next year before steadily heading down.

Despite these challenging economic times, existing home sales will be rising. Why? The answer, in a word: affordability. Currently, the most important factor driving home sales is affordability. With home prices falling in many parts of the country and mortgage rates still near historic lows, affordability conditions have markedly improved. Even with rising unemployment, nearly 93 percent of households will have jobs. These 93 percent of the working households (rather than 95 percent during good economic times) respond to home buying incentives. Measures such as the recently enacted first-time homebuyer tax credit and a larger number of mortgage loans that qualify for purchase by Fannie Mae and Freddie Mac and through the FHA program will further bring homebuyers to the marketplace.

I say this because we have history as a lesson. Back in the prior recession (2001-2003) the economy shed nearly 2 million net jobs. Even during those years, existing-home sales rose from 5.2 million to 6.2 million just as jobs were being cut. New home sales, likewise rose from 900,000 to 1.1 million. Mortgage rates were falling. Housing affordability increased. While those 2 million job cuts were painful, the economy still had 130 million job holders. And given the right incentives, they purchased homes."

Read the entire story here: http://www.realtor.org/research/reinsights/forecast

McCain, Obama solidify stands on housing

Both presidential candidates have announced plans to help voters deal with the challenging housing economy.

Here are their ideas as posted on their election Web sites:

Sen. John McCain:

• Direct assistance to homeowners. No taxpayer money should go to real estate speculators who made bad decisions about investments.
  
• Reform financial and lending systems to prevent a repeat.
  
• Require participating lenders to forgive part of subprime borrowers' loan principals and place them into new 30-year Federal Housing Administration loans.
  
• Give financing to municipal and civic groups trying to solve problems within their own communities.

Sen. Barack Obama

• Create a standardized disclosure plan that allows for full-disclosure of loan costs and provisions.
  
• Crack down on mortgage fraud.
  
• Give a mortgage credit to those who don't itemize deductions.
  
• Create a fund to help homeowners who face foreclosure refinance.
  
• Allow bankruptcy courts to modify a homeowner's mortgage payments.
  

Source: The San Diego Union-Tribune, Lori Weisberg

Columbus: Best Place to Retire

Columbus was named the Best Place to Retire according to Forbes.com! The survey looked at affordability to stretch the retirement nest egg. Columbus has reasonably priced housing and a low inflation rate. The survey also took into consideration medical services, recreation, and the availability of jobs that could be second careers for those who work past age 65. Here are the top five cities:

1. Columbus, Ohio
2. Dallas, Texas
3. Minneapolis, Minn.
4. Houston, Texas
5. Salt Lake City, Utah

How is the housing market?

I think this is the most common question I hear. “Sales are not as high as they were during the boom years but they are in keeping with pre-boom levels,” says Greg Hrabcak, president of the Columbus Board of Realtors. “That, in and of itself, is really good news, because theoretically, we should be experiencing much lower sales to compensate for the inflated numbers we saw back in 2004, 2005 and 2006.

As fewer homes were added to the market in September than in August, the number of homes for sale continued to decrease. With 16,598 homes on the market in September, the area’s inventory was at its lowest point since February,

“The housing market follows the same basic principles of supply and demand, so as inventory continues to decline from what were record high numbers just a few years ago, sales prices will increase and central Ohio will again see a market that is balanced in favor of both buyers and sellers,” Hrabcak added.

In central Ohio the housing market continues to balance. Coldwell Banker actually had 3.7% more sales in September 2008 than September 2007. Overall, the Columbus market had only 1.5% fewer sales in September 2008 versus September 2007.

The average sale price of a home in September was $160,755, down 4.5 percent year to date, but only 1.7 percent behind what the average home sold for last September.

Despite all of the negative news in the media, the housing market in Columbus is stable.

http://www.columbusrealtors.com/16482.cfm

Free first-time homebuyer workshop

Homes on the Hill CDC will hold the homebuyer education course, A Home of Your Own, geared toward first-time homebuyers. The course is open to the public and free of charge. The workshop will cover topics ranging from financial literacy, credit and mortgage loans to how to choose a realtor, home inspections, and the closing process. Guest speakers will include area professionals in the fields of lending, real estate, and housing. This workshop may be a requirement for some down payment assistance programs and first time homebuyer loan programs. It is held at the Vineyard Community Center, 6000 Cooper Road, Westerville, Ohio 43081 on November 1st and 8th from 9 am to 1 pm. You must sign up in advance by calling 275-4663 ext. 100. It is located just down the street from The Edge condos, which are great for first-time home buyers, so stop by on your way home. I've taught the Realtor portion of these classes and am very impressed with the program. Please consider taking the classes if you are considering the purchase of a home.

Homes on the Hill CDC (HOTH) is a nonprofit organization providing decent, affordable housing for low and moderate income individuals and families and helping to strengthen their neighborhoods.

down payment assistance

The Ohio Housing Finance Agency (OHFA) had one of the few and perhaps the only program left where first-time home buyers could receive a second loan to borrow the 3% down payment that is now required. As of this week, OHFA has temporarily had to stop this program. The only way to get a loan without a 3% down payment now is to receive it as a gift. As of January first, the down payment amount increases to 3.5% so if you are thinking about purchasing a home this winter, you might consider buying a little earlier.

Some builders have also started a work equity program where buyers can actually help build their own home in lieu of the 3% down payment.

One other good thing to know...sellers can still contribute up to 3% of the purchase price for a conventional loan or 6% for an FHA loan to go toward the buyer's closing costs or discount points, but not the down payment. If you're selling a home now, this could be a great incentive to get it sold!

Open House!

This Sunday from 2-4 pm I am holding an open house at 886 White Willow Lane. Look for my blog about it and I'll look for you there!

Sold!

Another happy buyer and seller! My listing at 893 Caniff Place closed today for $141,092.

My seller is happy to have it sold and to move to Dayton to be closer to family, but will miss all the great years in this house and her neighbors here. Best wishes in your new home!

Open House

Hi Readers,

I am having an open house at my listing at 906 Caniff Road this Sunday, October 12th from 2 to 4 pm. Check out my post from a few weeks ago for more information about the house. It doesn't have many updates, but it's really a great deal for the price. Plus, interest rates are lower than they have been, making this an excellent time to buy. If you put some money into updates it could be worth around $180,000 or it could be a great rental property as is. I really think it's a great floor plan and a great neighborhood. Come see me on Sunday!

Karen

886 White Willow Lane

I just got a new listing in the Village at Willow Brook at 886 White Willow Lane. It's a 3 bedroom unit with two bedrooms and bathrooms on the first floor and a third bedroom on the second floor. The great room, living room, and dining room have an open floor plan. I love the windows around the fireplace and the way the afternoon sun shines in! You can enjoy this beautiful fall weather from the fenced patio or on the front porch. Upstairs, the bedroom has two HUGE closets, one with plumbing and wiring already installed if you want to add a bathroom. The two car attached garage and first floor utility room are very convenient.

I think the best part is the neighborhood. It has the best condo association I've ever experienced. They have so many social events like potlucks, playing cards, Bible studies, book clubs, and more. The neighbors care so much to keep the condo fees low that they actually volunteer to plant and maintain the flowers at the entrance and monitor the pool all season. For a condo fee of $148 per month you get trash pickup, water, a clubhouse, exercise room, pool, insurance, exterior building maintenance, snow removal, and landscaping!

You'd probably like to know the price, right? It's $198,500. Let me know if you know of anyone who might be interested in seeing it!

Columbus Housing Facts

Check out www.ColumbusHousingFacts.com for good news about the Columbus housing market. Here are a few of my favorites:

• The first half of 2008 has seen steadily increasing home sales, according to the Columbus Board of Realtors, with 8.6% more homes sold in June than in May. This continues the pattern of increasing home sales each month of 2008 over the previous month.
• The average sale price of homes in central Ohio increased from May to June by more than 7% with an average of $180,399.
• The central Ohio housing market continued to stabilize in June as the area saw its lowest "month's supply" level since summer 2007. The fact that central Ohio's month's supply continues to decrease shows that the market is becoming more balanced. Buyers still have a tremendous selection, but a lower month's supply also means good news for sellers.
• Columbus was recently named one of the 66 markets in the country where it makes more sense to buy a home than to rent, according to an article on MSN.com.
• Columbus is the most affordable market for homebuyers in the US among the 46 metropolitan areas studied, reported The Columbus Dispatch in a story on May 29. This information is based on a study by Moody's Economy.com that looked at home prices versus rental fees. "Owning a home a pretty good deal in Columbus," the Dispatch headline read.

Columbus is affordable

I was reading an interesting article from Business First of Columbus called "Study: Columbus and Midwest more Affordable than National Average." The study compared 4 bedroom, 2 1/2 bathroom 2,200 square foot houses across the country. At an average price of $236,924, Columbus is the second highest market in Ohio, second to Cincinnati with an average price of $243,583. Akron and Canton each had averages between $135,000 to $140,000. The Midwest had 8 out of 10 most affordable markets, while California had 8 out of 10 most expensive with the highest in La Jolla with an average of $1.84 million. The nationwide average of the 315 metropolitan areas studied is $403,738.

Fannie and Freddie rescue

The federal government took over Fannie Mae and Freddie Mac this past Sunday. Fannie and Freddie depend on investors so they can get more money to issue new loans. With the uncertainty in the market and the number of failing mortgages, there are fewer investors out there. The government took over to make sure there is enough money out there to lend to keep the housing market moving.

During these last few days, interest rates have dropped dramatically from about 6.6% to about 6.1%! If you have been "on the fence" trying to decide if it's the right time to buy or not, now is the time to pick a house and lock in the lower rates!

This doesn't mean that it's any easier to get a loan. Lenders are requiring buyers to have higher credit scores and larger down payments than in recent years. Also, the lenders are charging higher fees for those buyers with lower credit scores or smaller down payments. Call your lender for more information and call me if you're ready to buy because now is the time!

So busy I forgot to blog!

Sorry, readers! I got busy and forgot to blog these last few weeks! Here are a few updates. First, I got a new listing at 893 Caniff Place. It's a really nice one-story brick house in Northwest Columbus, near Kenny Road and North Broadway. It has 3 bedrooms, 1.5 bathrooms, a family room, living room, dining room, and screened porch and was listed at $147,000. We had a showing on it every day for the first week and it went into contract that week! Here is a picture.

Then, I got another listing in that same neighborhood. This one is still available, so let me know if you're interested! It also has 3 bedrooms, 1.5 bathrooms, a family room, living room, dining room, screened porch, plus utility room and an attached one car garage. This one is a brick split-level house with plenty of storage space in the attic and crawl space. They're asking $152,700. Here is a picture of that one. Both are great deals in a neighborhood with easy access to 315, Upper Arlington, OSU, Riverside Hospital, and downtown, where houses sell for up to $180,000!

Another housing stimulus update

I just looked at my last posting and realized that we need another update to the update. The housing stimulus package passed! Here are the two biggest changes that affect first-time homebuyers the most:

1. Tax credit of up to $7,500. It's not just a deduction, you actually get the money! Here's the fine print: It's only for first-time homebuyers or people who haven't owned a home in the last 3 years. You must purchase the home between April 9, 2008 and July 1, 2009. Individuals who earn more than $75,000 per year may not qualify for the full amount. You don't actually get to keep the money. It's an interest-free loan that must be paid back within 15 years.
2. Down payment requirements. The down payment required for FHA loans will increase from 3% to 3.5% as of October 1. Also, you are no longer able to receive down payment assistance from the seller. Many builders of new homes are offering down payment assistance now, so if you're thinking about purchasing a new home or if you are planning to negotiate for the seller to pay your down payment on an existing home, you better act quickly!

Housing stimulus package update

There is a housing stimulus package circulating through Congress now. Here is a general overview of the bill. First, there is a tax credit proposal that should lead one million more families to purchase a home. This will decrease the number of foreclosures and the surplus of inventory on the market. Second, more FHA products are being proposed, especially aimed toward helping first-time homebuyers. It will eliminate the higher down payment that is required if a home is located in a "declining market."

bad market?

I have great news!

I'm in the top 10% of individual agents in my office for the second quarter of 2008!

Even better yet, I am one of 5 agents out of about 85 who is having a better first half of 2008 than 2007!

I was really excited to see that. :-)

Housing market update from NAR's chief economist

The chief economist of the National Association of Realtors, Lawrence Yun believes that in many places, the housing market will turn around by the end of this year. He blames the current problems on subprime loans. "It had gotten to the point where anybody who showed up at the door got a loan," he says. Fifty-three percent of foreclosed homes are those acquired by subprime loans. The markets with the highest percentage of subprime loans saw the greatest price inflation, then the greatest depreciation.

Yun predicts that sales will pick up in the second half of 2008 because:

• Improving affordability
• FHA to become prevalent at low rates
• Jumbo loans improving
• Revisiting the "declining market" policy
• Economy expected to improve
• Permanently higher GSE and FHA loan limits are possible
• Possible enactment of a homebuyer tax credit

He says that the home sales activity has stabilized, however it is now at the same level as in 1998. This current level is unsustainable because the population has increased by 25 million, 13 million new jobs have been created, and the market has higher home prices, but lower interest rates. The vast middle America is under priced based on the fundamentals of income and mortgage rates. Within 5 years 99% of the population will see higher values than they do today.

Realtor Care Day 2008

About 500 Realtors volunteered their time on 24 different community service projects throughout central Ohio. They received $23,000 in financial contributions and an additional $24,000 in donated labor and materials to make a difference! The Northwest Area Realty Association cleaned up 2745 Camden Road. Look at these before and after photos!

Today Homes

I have started selling condos for a second builder, Today Homes! They offer two bedroom, two bathroom, garden style condos. They have several locations around Columbus, including the southeast, southwest, Dublin, Polaris, and Westerville. I'll be at The Edge in Westerville, but can sell you a condo in any of the locations. Don't forget that I also sell Portrait Homes and that I'm a Realtor who can help you buy or sell any home!

Look at these views! Alum Creek and the bike trail are right in your backyard! This is what you see when you look out your rear windows! Oh, and don't worry about flooding. They call it The Edge for a reason!

http://www.today-homes.com/theedge.asp

Good News about Central Ohio

The Columbus Board of Realtors compiled a list called "Good News about Central Ohio." They searched articles from various media outlets to prove that we have a steady housing market and a great place to live. Here are a few of my favorite points:

• Most Americans feel "Now is a Good Time to Buy a House," according to a Reuters/Zogby poll released April 16th.
• GQ Magazine features Columbus as an art destination (11/07).
• New York Post author David Landsel reported on his top five travel destinations of 2007: Budapest, Ontario, Venice, New Orleans, and Columbus.
• Columbus is the 9th most affordable place to "live well," according to Forbes.com. our city was given the honor based on our housing affordability, low cost of living, entertainment options, and overall quality of live. (11/6/07)
• Columbus is the nation's 3rd most stable housing market, according to a study by Forbes.com and MoodysEconomy.com. Researchers chose us based on the strength of our economy, plans for construction, low foreclosure rates, local credit markets, home sales rates, and the affordability of available housing.
• The job market in central Ohio is extremely bright, which is important for creating a continual flow of prospective home buyers. According to the Bureau of Labor Statistics, in the past 16 months central Ohio has seen more than 5,100 jobs created--11,200 over the past 24 months.
• Columbus will boast the nation's 8th fastest home sales rate in 2008, predicts Forbes.com and Moodys.com. They also predict that home prices here will increase 3.49%. (10/1/07)
• Columbus is the #1 up-and-coming tech city according to Forbes.com. (3/10/08)
• Columbus is acknowledged by the Washington Post as a "full blown metropolis" in an article that highlights the Topiary Garden, North Market, and Columbus Zoo. (10/3/07)
• The Chicago Tribune asks "Who knew Columbus was so cool?" What begins as a hotel review of The Lofts in the Arena District becomes praise for Nationwide Arena, The Convention Center, The North Market, and more. (11/11/07)
• Columbus is the 9th best city for blacks, according to Black Enterprise magazine. (4/07)
• Columbus is the 14th best city in the nation to do business in, according to MarketWatch.com.
• Columbus is the 19th best city for singles, according to Forbes Magazine.
• Short North is the 22nd Best Place to Retire in the US according to CNN.
• Columbus is the 23rd Best City for Young Professionals, according to Forbes.com.
• Population in the Columbus region has grown by 455,000 (36%) during the last 26 years-- 12% faster than the national average and six times faster than the state of Ohio.

Just Sold!

I just sold this condo at 1825 D Northwest Court in Windgate Village! The buyers are relocating to Columbus to attend OSU's vet school this fall. They are very excited about their new home and to start the next chapter in their lives!

Forbes names Columbus the Number One Up-and-Coming Tech City

In order to have a healthy economy and housing market you need to have job growth and stability. Looking at the science and technology industries, Columbus is growing nicely. Battelle Memorial Institute is leading much of that growth in almost all areas of emerging technology, especially life sciences and energy research. Ohio's largest research center came to Columbus in 1997 with a budget of $1 billion. Now it oversees seven major laboratories for different federal agencies with a budget of $4 billion.

http://www.forbes.com/entrepreneurstechnology/2008/03/10/columbus-milwaukee-houston-ent-tech-cx_wp_0310smallbizoutlooktechcity.html

NAR Chief Economist predicts better economy in the second half of 2008

The National Association of Realtor's Chief Economist Lawrence Yun is predicting a stronger economy in the second half of 2008. He says that the economy is "crawling" now, not in a recession. He thinks that the economy will improve for several reasons. First, the government rebate checks have historically stimulated the economy temporarily. Also, aside from the housing industry, many companies are experiencing high profits. Because of the weak dollar the U.S. is exporting more than usual. There is a pent-up demand for housing, partly because of consumer pessimism, and partly because of the disappearance of the sub-prime market. More buyers are getting FHA loans now and it helps that the government recently increased the upper limits of the loan amounts.

He also predicts that several markets with decreasing home values will soon turn around. Many baby boomers will be retiring over the next few years and retirees tend to move to the "sunshine" states, including those where the housing market has been struggling since the end of subprime loans, like Florida and California. The home values have already been steadily increasing in several states, especially in the Northwest and Mountain states. If you're thinking about buying a home, now is the time to get started!

City Living Network

Coldwell Banker King Thompson has partnered with several local organizations to form the City Living Network. They provide information on affordable housing, first-time homebuyer programs, down payment assistance programs, financial literacy programs, and community development. Take a look at their website at http://www.citylivingnetwork.org/.

licensed inspectors

When you purchase a home it's a good idea to have the home inspected so you are aware of any problems or maintenance issues that your home may need. However, how do you choose a trustworthy inspector when there are so many people out there who claim they can do the job? Well, the process may become a little easier. A bill requiring inspectors to be licensed has just passed in the Ohio House of Representatives and is on its way to the Senate. Until it's passed, it's a good idea to ask your Realtor or friends or relatives to refer you to a reputable home inspector.

Does The Lower Fed Lending Rate Result In Lower Mortgage Rates?

I found this article by Tim and Julie Harris from Broker Agent News and thought that this article is too good to paraphrase. Here it is for your enjoyment (or just to answer your questions):

"The Federal Reserve has been lowering rates to bail out the economy. Does this mean that that mortgage rates will fall?

In some cases yes, in most cases no...read on.

Lets start with the 30-year fixed rate mortgage. The 30-year fixed rate mortgage is not tied to short-term treasuries. Fixed mortgage rates are tied to long-term bond yields that move based on the outlook for the economy and inflation. True, even as the Fed has lowered rates, the 30-year fixed has come down, but that's because of the outlook for slower economic growth in the months ahead. While the decline in treasury yields has helped push mortgage rates lower, the decline in long term rates hasn't been in lockstep thanks to the fact that these mortgages are securitized and sold on the global market. Investors now demand a higher risk premium on these mortgages due to higher delinquencies and foreclosures.

Next lets take a look at 7 and 5-1 Adjustable Rate Mortgages (ARMs) Yes, this is good news if your 5-year (or 7 year) ARM is pegged to a treasury index. So if you're facing a reset on, say, a $200,000 loan, you're now getting a payment increase of about $150 a month, as opposed to $370 a month, which you would have had before the Fed started cutting rates.

Do the Fed Rate Drops Help Sub-Prime mortgage Holders?

Nope. Unfortunately if you have a sub-prime ARM it is more than likely pegged to LIBOR, which has moved in the opposite direction. Because of the liquidity issues in global financial markets, LIBOR rates have actually increased at the same time that treasury and other benchmark yields have been declining, so the Fed lowering rates today would not help too many sub-prime mortgage holders.

How are Home Equity Lines of Credit Effected?

How about my Home Equity Line of Credit (HELOC): Yes, if you have that home equity line of credit that you used to renovate your bathroom/kitchen recently, then when the Fed lowers rates, your rate comes down as well. That’s because HELOCs are predominantly pegged to the prime rate, which moves in step with the Federal Reserve. "

Just Sold!

Some of my first-time homebuyers just purchased a condo in Jamestown of Grandview. This desirable condo community is located near Grandview Avenue. These condos have been selling very quickly since their conversion from apartments just a few months ago and now are nearly sold out. Look for them on your favorite real estate website or call me for more information!

There are many reasons to be optimistic.

The job market in central Ohio, which plays an important role in creating a continual flow of prospective home buyers, is extremely bright. According to the Bureau of Labor Statistics, in the past 16 months central Ohio has seen more than 5,100 jobs created - 11,200 over the past 24 months.


Columbus will boast the nation's 8th fastest home sales rate in 2008, predicts Forbes.com and Moodys.com. A recent study by these credible sources also sees that home prices here will increase 3.49% in 2008.


Columbus was ranked the nation's 6th most stable market by Standard & Poor's. According to this report, our market has less than a 10% chance of experiencing falling home prices.


Sales in central Ohio will rise in 2008, according to the Chief Economist of the National Association of REALTORS®, Lawrence Yun. This is not expected to happen in every market.


Unlike the erratic home prices in California that have more than tripled since 1995, prices in central Ohio have been solid and stable. Therefore, we did not experience the same dramatic decline as cities like San Diego when people began to see that prices were out of line with the economy.


Because our housing market is "sure and steady," we may be the first region of the United States to see a significant boost in appreciation, according to the Chief Economist of the National Association of REALTORS®.


The high interest rates that have characterized past recessions are nowhere in sight. Therefore, The National Association of REALTORS® predicts that economic expansion will slow in 2008, yet we should avoid a recession.


We hear encouraging news every day about central Ohio's economy. In early March Forbes.com, named Columbus the "#1 Up-and-Coming Tech City."
Information taken from www.columbushousingfacts.com.

Foreclosure

There's been a lot of coverage in the media about foreclosures. So, what should you do if you find yourself in a situation where you can't make your payments? Here is a list of ten steps released by the U.S. Department of Housing and Urban Development (HUD) that you should take. Remember, the bank doesn't want your house back and wants to work with you to keep it!

1. Don't ignore the problem.
2. Contact your lender as soon as you realize that you have a problem.
3. Open and respond to all mail from your lender.
4. Know your mortgage rights.
5. Understand foreclosure prevention options.
6. Contact a non-profit housing counselor.
7. Prioritize your spending.
8. Use your assets.
9. Avoid foreclosure prevention companies.
10. Don't lose your house to foreclosure recovery scams!

http://www.hud.gov/news/release.cfm?content=pr07-105.cfm

Portrait Homes

The condos at Gabriel's Landing have been selling quickly! Just within the last week we're written three contracts. If you're thinking about Gabriel's Landing, don't hesitate to put a hold on a condo because your favorite unit may soon be gone!

Just Sold!

Just Sold! Two of my first-time home buyers purchased this Dominion Home! Everything went well and they are very excited about moving in this week! Congratulations, guys!

locking your interest rate

Did you know that many lenders let you lock in your loan at today's low interest rates so you can spend the next few days, weeks, or a month looking for the perfect home? Even if the rates go down while you are looking or in contract, you might be able to get a one-time "float-down" option any time before the transaction closes. It's a win-win situation!

Spring market

The spring market is finally here! This graph depicts the number of showings on Coldwell Banker King Thompson listings. As you can see, things were pretty slow during the holidays, then picked up significantly in January. They started to slow down again with the snowfall in recent weeks, but look at the number spiking up this past week. I think that spring is finally breaking through and people are coming out of hibernation to start looking at houses again. With all of those buyers out there if you were thinking about putting your home on the market this spring, now is the best time to make sure you get the most buyers looking at it!

Regional Home Maintenance Guide

Being a homeowner comes with its own set of challenges, particularly as it relates to home maintenance. The American Society of Home Inspectors (ASHI) recognizes that geography is a significant contributor to maintenance issues and encourages homeowners to familiarize themselves with common issues in their region.

While some maintenance issues, such as poor drainage, leaky roofs and old plumbing are common to all areas of the country, others are driven by geography, climate, weather conditions and the quality of the contractor who built or renovated the home. Below is a snapshot of prevalent maintenance issues homeowners should look for.

Regional defects in the Midwest

Water intrusion is a common issue for homeowners in the Midwest. Wood rot is very common in trim and siding. The prevalence of basements in this region also makes it a hot spot for water intrusion.

Plumbing issues are also prevalent. It’s not uncommon to see water heaters serving as both a furnace and water heater. Issues arise, however, when plumbers forget to attach venting fixtures or drains when new water heaters are installed.

Decks are another area of concern. This widely enjoyed add-on can be attached incorrectly when built by eager Do-It-Yourselfers.

Article taken from the Ohio Association of Realtors.

SOLD!

The Home of the Week that I last posted about is SOLD!

Ignore the Headlines

Finance costs will rise as the economy recovers, so trying to time real estate might not pay off!

Here are a few good points that I have taken from this Time Magazine article:

"Let's say you are emotionally ready to be a homeowner. You have good credit, plan to stay put for five years and have been waiting for the perfect entry point. It's time to get serious--before an inevitable rise in interest rates wipes out your advantage. "The thing that will make home prices stop falling is the very same thing that will push mortgage rates higher," says Jim Svinth, chief economist at mortgage firm Lending Tree. So anything you gain by a further drop in prices might be offset by rising financing costs.

Consider a typical home that sells for $218,900. You put down 20% and get a 30-year fixed-rate mortgage at today's rate of 5.5%. Monthly principal and interest come to $994.31. Let's say that 12 months from now the same house goes for 10% less, or $197,010. But by then the recession is history and the Fed is jacking up rates to stem inflation. If mortgage costs rise a point, to 6.5%, your monthly payment would be $994.94 and you'd have saved nothing. Meanwhile, home prices might steady and sellers might become less willing to negotiate. And you have spent a year living someplace you'd rather not be."

http://www.time.com/time/magazine/article/0,9171,1713483,00.html

Lower rates for Ohio's heroes!

The Ohio Housing Finance Agency has announced lower rates for Ohio's heroes. If you are active in the military or a military veteran, firefighter or emergency medial technicians-paramedic, healthcare worker, police officer or teacher, you can now get an interest rate 1/4% lower than OHFA's standard first-time homebuyer rate on a 30 year fixed-rate loan! This first-time homebuyer program may even apply to you if you have owned a home, but not in the past three years. Veterans may be eligible for a temporary exemption even if you have owned a home during the past three years.

www.ohiohome.org.

Home of the Week!

Portrait Homes has a new program called the Home of the Week. Until Sunday night, you can get our Laurel with 42 inch cabinets, painted railings with spindles, and a BASEMENT for only $105,990!! That's $400o off the regular price and all you have to do is come in and sign for it before the end of the week! Contact me for more details.

Economic Stimulus Package 2008

Yesterday President Bush signed the Economic Stimulus package into law. This means that most tax-payers will receive payments from the government and most small business investors will receive tax incentives.

This package also includes increases to GSE and FHA loan limits. With the GSE reforms we will immediately have more liquidity in the mortgage market and see an additional 300,000 home sales. With the FHA reform, it is projected that an additional 138,000 Americans will purchase homes and 200,000 will be able to refinance safely and affordably.

A Bright Light in the Big Cities: How Urban Home Sales Boost Profits

Here is a great article about Coldwell Banker's New Homes and Condos Division. It highlights several cities, including Columbus, where the trend has been to build or renovate downtown condos. This urban lifestyle seems to be attracting several demographics, from young professionals to empty-nesters. They want to be within walking distance to work, shopping, and recreational activities offered downtown.

http://rismedia.com/wp/2008-02-05/a-bright-light-in-the-big-cities-how-urban-home-sales-boost-profits/

FHA reform

The House of Representatives, along with Treasury Secretary Paulson, on behalf of the Bush Administration, announced a bipartisan economic stimulus package with provisions that can help jumpstart the housing market and protect some current homeowners.

An overhaul of the Federal Housing Administration’s mortgage insurance program and an increase in the size of mortgage loans that Fannie Mae and Freddie Mac can purchase are key housing components included in the economic stimulus package announced yesterday. As late as last week, there was uncertainty on whether housing finance was going to be part of the stimulus package. However, NAR and its members did not give up, focusing on continued education and communications with Members of Congress both in Washington, D.C. and in their home districts.

FHA Reform will:

• Stimulate new-home sales and refinancing
• Reduce the number of families facing foreclosure
• Give families who want to purchase a home a safer alternative to many of the riskier mortgage products of the past
• Help more people refinance into less-expensive FHA-backed loans
• Allow more families to buy a home because of lower downpayment requirements

Information taken from the following article: NAR Successful In Injecting Housing Components in Federal Economic Stimulus Package

What the rate cut means for home loans

This past Tuesday, the Federal Reserve cut interest rates by .75%! That's the biggest cut since 1984. This is great news if you have a credit cards, car loans, an adjustable rate mortgage, or a home equity line of credit. For long-term rates, however, this could mean the beginning of the end of the lowest rates since 2005. Let’s look at the impact of a few recent Fed Funds Rate cuts and the corresponding impact to home loan rates to see what this could mean for you:

January to June 2001: Federal Rate Cut 2.25% Home Loan Rate Rose 0.10%

October to December 2001: Federal Rate Cut 0.75% Home Loan Rate Rose 0.45%

May to August 2003: Federal Rate Cut 0.25% Home Loan Rate Rose 0.78%

If you are waiting for long-term mortgage rates to fall further from here, don’t count on it. Your best chance to lock in the lowest mortgage rates since 2005 is now. Getting your application in process will allow you to capture a rate near all time lows.

Source: Regina Elmers, Coldwell Banker Home Loans

Homebuilders get Coldwell Banker's sales assist

Despite the slowdown in new home sales, Coldwell Banker King Thompson's New Homes and Condo Division is growing rapidly. In addition to Portrait Homes where I have been working, Coldwell Banker also has partnerships with Village Communities, Dominion Homes, Maronda Homes, Heitmeyer Homes, and several other private developers. These partnerships allow agents to expand our business into the new homes segment of the market while helping the builders with their staffing and marketing issues. They know the importance of building relationships with Realtors who will bring their clients to these new home communities. Many of these builders see the value of Coldwell Banker's internet marketing and know that more and more buyers are looking for virtual tours rather than print ads.

http://columbus.bizjournals.com/columbus/stories/2007/12/24/story6.html?page=1

Tax time

Are you still trying to decide if you should rent or buy a home? Think about these tax benefits of being a home owner.

1. At purchase: In many cases the points and origination fees on your loan are tax deductible. Look at lines 801 and 802 on your settlement statement to see how much you paid.

2. Mortgage interest: You can deduct the interest paid on your mortgage and home equity loans. In the beginning of the loan, this is a large chunk of the monthly payment and you could be saving almost a third of the interest expense through deductions. Also, if you are paying private mortgage insurance and purchased or will purchase your home between January 1, 2007 and December 31, 2010, the private mortgage insurance is tax deductible too. Don't forget about your property taxes. You can get deductions for the property taxes in the year it is paid, not the year you put it in your escrow account.

3. At sale: If you owned and occupied your home as your principle residence for 2 of the last 5 years you can earn up to $500,000 on the sale for married couples or $250,000 for singles and pay no federal income tax at all. So that means you can buy a fixer-upper, work on it for nights and weekends for two years (while living in it) then sell it for a nice profit, tax free!

http://new.realtor.com/Basics/Buy/ClosePossess/TaxBenefits.asp?poe=realtor
http://www.bankrate.com/brm/itax/news/taxguide/sweet-home1.asp?caret=4b

Falling even more!

Shortly after posting my last blog, I received an e-mail from Wells Fargo advertising even lower rates! They are offering 30 year fixed FHA loans at 5.5% and 30 year fixed conventional loans at 5.625%. If you've been thinking about buying a home, now is the time!

Interest rates are falling!

Now is a great time to buy! There is still plenty of inventory out there and interest rates have fallen! Coldwell Banker Home Loans is now offering 30 year fixed FHA loans with no points at an interest rate of 5.92% and 30 year fixed conventional loans with no points at an interest rate of 5.72%!

3 Signs of Predatory Lending

Subprime lending was started to give credit to buyers who otherwise would not be able to qualify for a loan. Although this sounds good, predatory lenders often charge such high interest rates and fees that it is not in the best interest of these buyers. Here are three signs of a predatory lender:

1. Choose easy targets: Predatory lenders tend to go after elderly people, immigrants, minorities, and individuals with low credit scores because they believe that these groups may be less educated about lending practices.

2. Charge unnecessary fees: Add unnecessary fees or services, like overpriced insurance.

3. Give misleading or no information: The terms of the loan may seem too good to be true. They may offer very low prices in the beginning then change the terms at the last minute.

Always make sure that when you are looking for a loan compare several lenders and ask your real estate agent for advice before choosing a lender. Usually you will find that the legitimate lenders offer very similar terms and rates. If it seems too good to be true, it probably is!

http://www.realtor.org/rmomag.NSF/pages/Excerpt200801?OpenDocument