September 8th, 2010 by admin

RISMEDIA, September 8, 2010—There is a lot of buzz right now in the industry about short sales and making sure you are certified to handle the short sale transaction. Regardless of whether or not you actually want to do a short sale transaction, education is a key element to help sellers with their specific needs. It is our role as real estate professionals to give the best information to the homeowner—even if the situation doesn’t result in a real estate sale.

Whether you want to handle the short sale transaction or you find you want to refer it off to another Realtor, the bottom line is that some listing appointments you go on may be candidates for the short sale route and getting certified teaches you to recognize those situations and understand what to do.

With that in mind, you may decide to become certified to understand this market and handle specific parts or all of the transaction. Here are some questions you can use to determine which certification best fits your needs:

1. How long have you been offering the short sale certification?
2. Who wrote the curriculum for the certification course and how was it designed?
3. What is the curriculum creator’s background, specific to real estate?
4. How do you choose the instructors to teach the course?
5. How do your instructors become qualified to teach the course?
6. What kind of free education do you provide after the actual certification course?
7. What training elements are covered in regards to shorting a FHA, VA transaction?
8. How do you let your certification members know of new updates that may affect the short sale real estate transaction?
9. What additional support do you provide after the certification process?
10. What levels of training can I take in addition to the certification to ensure a strong foundation for long-term success?

There are many great certifications out there. Choose the one that you connect with best and go for it. The more we are all knowledgeable in helping homeowners in our local market, the better. Once you have this education under your belt, don’t forget to include it in all your marketing efforts.

Tricia Andreassen is the CEO/Founder of Pro Step Marketing, a leader in brand and Web strategy for the real estate industry. As an industry expert, speaker and author, she has over 19 years’ experience in helping Realtors grow their business.

For more information, visit www.prostepmarketing.com.

RISMedia welcomes your questions and comments. Send your e-mail to: realestatemagazinefeedback@rismedia.com.

Copyright© 2010 RISMedia, The Leader in Real Estate Information Systems and Real Estate News. All Rights Reserved. This material may not be republished without permission from RISMedia.

For more top headlines on RISMedia.com, be sure to check out:
The Missing Link in Lifestyle Search
Reverse Mortgages Pros and Cons

RISMedia » Real Estate

September 8th, 2010 by admin

RISMEDIA, September 8, 2010—The Federal Housing Finance Agency (FHFA) has sent a final rule to the Federal Register establishing new housing goals for Fannie Mae and Freddie Mac (the Enterprises) for 2010-2011. The Housing and Economic Recovery Act of 2008 (HERA) required FHFA to establish housing goals for the Enterprises for targeted segments of the mortgage market.

In previous years, the Department of Housing and Urban Development (HUD) set overall goals that measured the combined performance of single-family and multifamily mortgages. In contrast, the new goals required by HERA target specific segments of those markets. The new goals also reflect essential conservatorship requirements to ensure the Enterprises focus on core business activities to support the mortgage market while minimizing losses on their existing mortgages.

The final rule establishes three single-family, owner-occupied home purchase mortgage goals for low-income families, very low-income families and families living in geographical areas with lower-income populations, areas with high concentrations of minority residents and federally-declared disaster areas. The latter goal also includes a specialized subgoal to ensure that the Enterprises address housing needs in lower-income and minority areas. The final rule also contains a goal for single-family, owner-occupied refinance mortgages for low-income families.

The home purchase and refinance goals are expressed as minimum goal-qualifying mortgage shares of home purchase or refinance mortgages acquired by the Enterprises. The benchmark goal levels for the low-income and very low-income home purchase goals did not change from the proposed housing goals rule, however, the final rule adjusts the low-income refinance goal downward reflecting recent market conditions.

The benchmarks for the four single-family goals are:
-27% for the low-income home purchase goal;
-8% for the very low-income family home purchase goal;
-A percentage to be set annually by FHFA for the low-income/high minority/disaster areas home purchase goal (with a subgoal of 13% to measure acquisitions in low-income/high minority areas only); and
-21% for the low-income family refinance goal. The final multifamily goals reflect the current market conditions and are lower than those proposed initially:
-Fannie Mae’ s goal is to acquire mortgages that finance at least 177,750 low-income rental units and 42,750 very low-income rental units.
-Freddie Mac’s goal is to acquire mortgages that finance at least 161,250 low-income rental units and 21,000 very low-income rental units.
-The Enterprises must also report on their acquisition of mortgages involving low-income units in small (5- to 50-unit) multifamily properties.

Consistent with the FHFA proposed housing goals rule, the final rule offers two measures for goal compliance. The final rule sets a prospective or benchmark measure as well as a retrospective market-based measure to assess each Enterprise’s performance relative to the actual goals-qualifying share of the primary mortgage market. An Enterprise can satisfy a particular goal if it meets either of these measures. Previously, the Enterprises’ housing goal levels were set only prospectively.

Consistent with the proposed rule, the final rule prohibits housing goals credit for purchases of mortgages in private-label securities, including commercial mortgage-backed securities. The final rule revises the counting treatment in the proposed rule for loan modifications by allowing credit under the low-income refinance goal for permanent Making Home Affordable loan modifications.

FHFA does not intend for the Enterprises to undertake economically adverse or high-risk activities in support of the goals, nor does it intend for the Enterprises’ state of conservatorship to be a justification for withdrawing support from these important market segments.

As noted in the final rule, FHFA expects to take future regulatory action to address the housing goals treatment of purchases of multifamily loans that aid the conversion of properties that have affordable rents to properties that have less affordable, market rate rents. FHFA also may solicit further comments on how the housing goals can further promote sustainable homeownership and how multifamily subordinate liens can be structured to benefit low-income residents. The final rule is effective 30 days after publication in the Federal Register.

For more information, visit www.fhfa.gov.

RISMedia welcomes your questions and comments. Send your e-mail to: realestatemagazinefeedback@rismedia.com.

Copyright© 2010 RISMedia, The Leader in Real Estate Information Systems and Real Estate News. All Rights Reserved. This material may not be republished without permission from RISMedia.

Be sure to check out these headlines on RISMedia.com:
The Google Pot of Gold That No One Is Claiming
Really, What Is a Credit Score?

RISMedia » Homeowner’s Toolkit

September 8th, 2010 by admin

RISMEDIA, September 8, 2010—The Federal Housing Finance Agency (FHFA) has sent a final rule to the Federal Register establishing new housing goals for Fannie Mae and Freddie Mac (the Enterprises) for 2010-2011. The Housing and Economic Recovery Act of 2008 (HERA) required FHFA to establish housing goals for the Enterprises for targeted segments of the mortgage market.

In previous years, the Department of Housing and Urban Development (HUD) set overall goals that measured the combined performance of single-family and multifamily mortgages. In contrast, the new goals required by HERA target specific segments of those markets. The new goals also reflect essential conservatorship requirements to ensure the Enterprises focus on core business activities to support the mortgage market while minimizing losses on their existing mortgages.

The final rule establishes three single-family, owner-occupied home purchase mortgage goals for low-income families, very low-income families and families living in geographical areas with lower-income populations, areas with high concentrations of minority residents and federally-declared disaster areas. The latter goal also includes a specialized subgoal to ensure that the Enterprises address housing needs in lower-income and minority areas. The final rule also contains a goal for single-family, owner-occupied refinance mortgages for low-income families.

The home purchase and refinance goals are expressed as minimum goal-qualifying mortgage shares of home purchase or refinance mortgages acquired by the Enterprises. The benchmark goal levels for the low-income and very low-income home purchase goals did not change from the proposed housing goals rule, however, the final rule adjusts the low-income refinance goal downward reflecting recent market conditions.

The benchmarks for the four single-family goals are:
-27% for the low-income home purchase goal;
-8% for the very low-income family home purchase goal;
-A percentage to be set annually by FHFA for the low-income/high minority/disaster areas home purchase goal (with a subgoal of 13% to measure acquisitions in low-income/high minority areas only); and
-21% for the low-income family refinance goal. The final multifamily goals reflect the current market conditions and are lower than those proposed initially:
-Fannie Mae’ s goal is to acquire mortgages that finance at least 177,750 low-income rental units and 42,750 very low-income rental units.
-Freddie Mac’s goal is to acquire mortgages that finance at least 161,250 low-income rental units and 21,000 very low-income rental units.
-The Enterprises must also report on their acquisition of mortgages involving low-income units in small (5- to 50-unit) multifamily properties.

Consistent with the FHFA proposed housing goals rule, the final rule offers two measures for goal compliance. The final rule sets a prospective or benchmark measure as well as a retrospective market-based measure to assess each Enterprise’s performance relative to the actual goals-qualifying share of the primary mortgage market. An Enterprise can satisfy a particular goal if it meets either of these measures. Previously, the Enterprises’ housing goal levels were set only prospectively.

Consistent with the proposed rule, the final rule prohibits housing goals credit for purchases of mortgages in private-label securities, including commercial mortgage-backed securities. The final rule revises the counting treatment in the proposed rule for loan modifications by allowing credit under the low-income refinance goal for permanent Making Home Affordable loan modifications.

FHFA does not intend for the Enterprises to undertake economically adverse or high-risk activities in support of the goals, nor does it intend for the Enterprises’ state of conservatorship to be a justification for withdrawing support from these important market segments.

As noted in the final rule, FHFA expects to take future regulatory action to address the housing goals treatment of purchases of multifamily loans that aid the conversion of properties that have affordable rents to properties that have less affordable, market rate rents. FHFA also may solicit further comments on how the housing goals can further promote sustainable homeownership and how multifamily subordinate liens can be structured to benefit low-income residents. The final rule is effective 30 days after publication in the Federal Register.

For more information, visit www.fhfa.gov.

RISMedia welcomes your questions and comments. Send your e-mail to: realestatemagazinefeedback@rismedia.com.

Copyright© 2010 RISMedia, The Leader in Real Estate Information Systems and Real Estate News. All Rights Reserved. This material may not be republished without permission from RISMedia.

Be sure to check out these headlines on RISMedia.com:
The Google Pot of Gold That No One Is Claiming
Really, What Is a Credit Score?

RISMedia » Home Buying 101

September 5th, 2010 by admin

RISMEDIA, September 3, 2010—(MCT)—For anyone under the age of 57, mortgage rates are now the lowest they’ve been during your life. This fact isn’t lost on a growing number of homeowners who have started a new wave of refinancings.

The Mortgage Bankers Association reported this month that refinancing applications are up 26% during the past four weeks and account for about 82% of all mortgage applications. Not since May 2009 has the volume of refinancing applications been higher.

“We are extremely busy, and it feels good,” said Charles DiPino, Jr., a senior vice president at New Penn Financial, a mortgage banker in Columbia, Md. “The phones are ringing off the hook.”

The calls started coming during the past month or so as rates continued to drop week after week. Mortgage giant Freddie Mac last week reported the average 30-year fixed-rate loan dropped to an average of 4.36%, a rate not seen since March 1953. (Harry S. Truman was president then, and the Academy Awards was shown on TV for the first time.)

Meanwhile, the 15-year fixed-rate mortgage hit a record low of 3.86% last week; while a one-year adjustable-rate mortgage averaged 3.52%, more than a percentage point lower than a year ago, according to Freddie Mac.

“Rates continue to hit new lows because of the weak U.S. economic recovery and the concern that it could fizzle altogether,” said Greg McBride, senior financial analyst with Bankrate.com.

But McBride and others advise against waiting to refinance in hopes that rates will fall further. If they do keep falling, that means the economy is getting even more anemic.

“You can win the battle and lose the war,” McBride said. “You might lose your job and not qualify for the lower rate.”

Refinancing to a lower rate, of course, can reduce your monthly payment. But some homeowners are refinancing to shorten the term of their loan, particularly baby boomers who don’t want this debt hanging over them in retirement, McBride said. And some want to trade in the uncertainty of an adjustable-rate mortgage for the dependability of a fixed-rate loan, he says.

Amy Crews Cutts, Freddie Mac’s deputy chief economist, said despite the uptick in refinancing applications, the numbers still aren’t as high as they should be, given the record-low rates.

Homeowners could be having difficulty qualifying, Cutts said. It could be their creditworthiness has deteriorated. Or their income dropped because of a loss of overtime or they were forced to take a new job that pays less, she says.

So who can qualify for these great rates?

“We’re still in a very tight credit market,” DiPino said. Homeowners with credit scores of 660 or 680 can qualify for refinancing, but the best rates are reserved for those with scores above 700, he says.

Also, generally if you don’t have a certain amount of equity in your home—20% for the very best rates—you might have to pony up more cash to get a new loan, McBride said. Homeowners’ equity has fallen along with a drop in home prices or because they took money out of their house the last time they refinanced, he says.

Some homeowners, though, won’t need that much equity in their homes to get super-low rates if they qualify for a streamlined refinancing program for loans owned by Freddie Mac or Fannie Mae, said DiPino, the mortgage banker. The program, which requires passing a credit check, is designed for those seeking a lower monthly payment, he says. In other words, you can’t refinance to tap the equity in your home.

Of course, there are other factors to consider, such as how long you’ll remain in the house before determining whether refinancing is for you. But with rates these low, it’s worth taking a look.

Should you refinance?
Mortgage rates hitting the lowest levels in decades have caused a rush of refinancing. Check out calculators at Bankrate.com to see if refinancing is worthwhile. The refinance calculator can tell you how much you’ll save and how long you must live in the house to recoup refinancing costs. The FICO score estimator will give you an idea of your credit score. To qualify for the best terms, you’ll need a score in the 700s.

(c) 2010, The Baltimore Sun.

Distributed by McClatchy-Tribune Information Services.

RISMedia welcomes your questions and comments. Send your e-mail to: realestatemagazinefeedback@rismedia.com.

Copyright© 2010 RISMedia, The Leader in Real Estate Information Systems and Real Estate News. All Rights Reserved. This material may not be republished without permission from RISMedia.

Don’t miss these headlines on RISMedia.com:
Reverse Mortgages Pros and Cons
Homeownership and Stable Communities Go Hand-in-Hand

RISMedia » Real Estate

September 4th, 2010 by admin

RISMEDIA, September 3, 2010—(MCT)—Some rooms scream “Help!” Others say nothing, and that’s a problem, too. Take the typical bedroom. Michael Payne has seen thousands. “The bedroom tends to get forgotten—you spend all your money elsewhere in the house,” said Payne, a celebrity interior designer and makeover specialist best known for his “Designing For The Sexes” series on HGTV. “You end up with a totally forgettable room that you don’t want your best friend to see.”

Helping people find indoor harmony—particularly at affordable prices—is a common challenge for designers. Instead of moving, homeowners are staying put and trying to make the most of their current house.

“This has been the busiest year I’ve ever had,” said Folsom, Calif., interior designer Jennifer FaGalde. “Absolutely, a lot of people are wanting to stay put and put money into their own home instead of moving. They’re creating a nest within their own space,” she added. “People are staying home more now than they did five, 10 years ago. They want a sanctuary where they can relax.”

But where should you start if you are looking to refurbish your home?

Paint, lighting and flooring are three of the easiest, quickest and least expensive ways to update a room, say the experts.

Arizona Tile’s in-house designer Emitt Isaacks advises people to start makeovers with a very basic question: Who lives in your home?

“A retired couple is very different than a family with young kids. They have different needs and considerations,” he said. “Don’t forget dogs and cats either, as pets influence design decisions, too. Then, start thinking about style—modern, traditional, old-school—and color.”

FaGalde points to two recent makeovers she completed in Sacramento, Calif. A typical home in the Pocket area needed a radical update for its kitchen and three bathrooms. A Land Park house started with a termite invasion and ended up with a remodeled family/living/dining room.

“The Pocket house was a real challenge,” she said. “The bathrooms all had walls separating the toilet area. They had a closed-in feeling, the style of homes 25 years ago. And the rooms were so dark.”

The answer: “We knocked down walls, gutted to zero and started from scratch,” she said. “We added new lighting. It made a huge difference.”

In the aftermath of fixing termite damage, the Land Park homeowners started with paint and flooring, but then decided to update with new window coverings, crown molding and fireplace tile.

“It really transformed the space,” FaGalde said.

Lighting is key, “especially in older homes,” she added. “Lighting enhances your space and shows off the investment you put into it. You spend money on paint and flooring, you want to be able to see it.”

Quick bedroom makeover:
Makeover specialist Michael Payne offers these suggestions:
1. Less is more. An uncluttered bedroom makes for a more restful space. Make use of the area under the bed for storage.
2. Remember: It’s a bedroom. The bed should be the dominant feature. Other furnishings are secondary, but look better if they match in style, wood and stain.
3. Start with the right bedspread or comforter. Use that to pick up colors for paint and carpeting. The result will be more harmonious.

(c) 2010, The Sacramento Bee (Sacramento, Calif.).

Distributed by McClatchy-Tribune Information Services.

RISMedia welcomes your questions and comments. Send your e-mail to: realestatemagazinefeedback@rismedia.com.

Copyright© 2010 RISMedia, The Leader in Real Estate Information Systems and Real Estate News. All Rights Reserved. This material may not be republished without permission from RISMedia.

For additional headlines on RISMedia.com, don’t miss:
Tax Credits Lead to Area Home Sales Bump
The Google Pot of Gold That No One Is Claiming

RISMedia » Homeowner’s Toolkit

September 2nd, 2010 by admin

RISMEDIA, September 3, 2010—Following a sharp drop in the months immediately after the expiration of the home buyer tax credit, pending home sales have modestly risen, according to the National Association of Realtors.

The Pending Home Sales Index, a forward-looking indicator, rose 5.2% to 79.4 based on contracts signed in July from a downwardly revised 75.5 in June, but remains 19.1% below July 2009 when it was 98.1. The data reflects contracts and not closings, which normally occur with a lag time of one or two months.

Lawrence Yun, NAR chief economist, cautioned that there would be a long recovery process. “Home sales will remain soft in the months ahead, but improved affordability conditions should help with a recovery,” he said. “But the recovery looks to be a long process. Home buyers over the past year got a great deal, and buyers for the balance of this year have an edge over sellers. For those who bought at or near the peak several years ago, particularly in markets experiencing big bubbles, it may take over a decade to fully recover lost equity.”

Yun added, “Affordability could reach a generational high in the second half of this year because of rock-bottom mortgage interest rates, helped partly by the Fed’s very accommodative monetary policy. The loan underwriting standards are tighter, but home buyers can improve their chances of getting a loan by staying well within their budget.”

The PHSI in the Northeast rose 6.3% to 62.5 in July but is 21.1% below a year ago. In the Midwest the index increased 4.1% to 66.7 but remains 25.7% below July 2009. Pending home sales in the South rose 1.2% to an index of 86.3, but are 15.6% lower than a year ago. In the West the index jumped 11.6% to 95.0 but is 17.6% below July 2009.

The national index had fallen 29.9% in May and another 2.8% in June.

For more information, visit www.realtor.org.

RISMedia welcomes your questions and comments. Send your e-mail to: realestatemagazinefeedback@rismedia.com.

Copyright© 2010 RISMedia, The Leader in Real Estate Information Systems and Real Estate News. All Rights Reserved. This material may not be republished without permission from RISMedia.

RISMedia » Home Buying 101

September 2nd, 2010 by admin

RISMEDIA, September 2, 2010—What’s the number one absolute best way to get more organic traffic to your real estate blog, website or lead capture pages?

Content creation. (“But, what on earth am I supposed to be writing about or videoing, and how will it get me business?”)

We’ve talked about this concept a number of times before, and a few months ago we detailed a plan for how this might work, called the 2010 Real Estate Broker Market Domination Plan. The plan itself lays out a strategy for how you might go about creating an architecture for leveraging agent created content to zoom the GCI of your office or team, but it doesn’t go too much into specifics about what kind of content you might create.

So here’s a list of possible topics you and your team might be contributing to a central real estate blog monster site on a regular basis.

9 killer niche content creation ideas for real estate agents and brokers:

Before you read the rest of this, imagine that you have one person on your team assigned to each of these ideas, with the requirement that they deliver the related content to the site you own on a regular basis. Or if you are a single person shop, simply pick one or more and make it your job to create one piece of content for your real estate blog or website each and every day.

1. Weekly market update – Take a 5 minute video or screencast interpreting data from your MLS and the general mood amongst buyers and agents in order to deliver a public update on the state of the local real estate marketplace

2. Daily/weekly transaction report - Cut and paste the reported transactions from your MLS as this will garner a lot of organic traffic especially long tail stuff related to property addresses in your area. Be sure to include “real estate sales transactions” in the title of each post—wherever you are, people are searching those keywords.

3. Restaurant of the week - Want to charm the pants off of a local restaurant owner and provide a valuable resource for folks relocating to your area? Do a restaurant review once a week and be sure to include a picture of your dish and why you loved it so much. Chances are good that especially for smaller restaurants and markets, your post will rank organically for people doing a direct search of the restaurant name.

4. Business of the week – This is the same as the restaurant idea listed above: recommend doing actual video tours of each business highlighting the coolest service/product to buy from the place. Can you see this helping you gain top of mind status with the local business owner, then a bunch of referrals as he talks you up to other patrons?

5. Local dog parks – People moving to your area with pets are going to do a search engine search for dog parks in the area. Talk about a non-competitive keyword.

6. “Where in (insert your area here)?” - Take a random photo of a person, place, or thing in your area and post it to your site. Offer a prize to the first reader who guesses what the picture is. Be sure to offer an e-mail signup for folks to receive your latest pictures so they can be one of the first to take a guess.

7. Weekly neighborhood news update – Give each agent in your office an assigned neighborhood and require a piece of hyper local content. Run with this for a month and see what happens to your recruiting/retention efforts.

8. Resident interviews – Interview someone in your area and ask them what they like about their town, what they like to do, where the best place to grab a drink with friends is and anything else along those lines. This is an easy way to generate content that’s interesting to onlookers.

9. Contract chronicles – Grab a clause from one of your real estate forms and tear it to pieces—a nice way to demonstrate competence while creating content that’s sure to be indexed and searched. If you don’t already have an article and a downloadable copy of the standard “Residential Lease” for your state on your website, be sure to get this on your site now.

Here’s the thing, the content you create today will most likely equal traffic to your website tomorrow, next week, next month, next year and probably years and years for now.

If you invest a few minutes creating content for your website today, it’ll pay off for years to come.

If you get 20-50-100 agents in your office each investing a few minutes a week to create content, it’ll pay off for years to come, help you establish local market dominance and make your website the most valuable asset your business has—your piece of cyberspace could be worth 6 figures a year from now if you play it right.

Now that we’ve given you nine great ideas, find out the simplest way to put those ideas into action (hint: its video) by visiting http://realestatevideotoolbox.com.

Josh Schoenly and Ryan Hartman are co-owners of ReTechulous, LLC.

RISMedia welcomes your questions and comments. Send your e-mail to: realestatemagazinefeedback@rismedia.com.

Copyright© 2010 RISMedia, The Leader in Real Estate Information Systems and Real Estate News. All Rights Reserved. This material may not be republished without permission from RISMedia.

For more top stories on RISMedia.com, be sure to visit:
The Missing Link in Lifestyle Search
Global Market Represents Golden Opportunity

RISMedia » Real Estate

September 1st, 2010 by admin

RISMEDIA, September 2, 2010—“The Federal Housing Administration (FHA) is giving homeowners and buyers until October 4, 2010 to lock in a low monthly insurance premium,” said Gibran Nicholas, chairman of the CMPS Institute, an organization that trains and certifies mortgage bankers and brokers. “After October 4, the monthly insurance premiums on FHA loans will increase by over 63%.”

What does this mean for home buyers?
A home buyer purchasing a 0,000 home using a 3,000 FHA mortgage before October 4 would pay an insurance premium of .46 per month. If the same home buyer waits until after October 4, the insurance premium would jump to 8.01.

“In this example, the home buyer would lose .55 per month, or ,146 over a ten year timeframe,” Nicholas said. “Although the upfront mortgage insurance premium is going down after October 4, the real impact to the home buyer is actually a net increase in their out of pocket costs because the monthly premium is going up by 63%. Remember, sellers can pay the upfront premium or it can be financed into the loan amount, so home buyers rarely pay the upfront premium out of pocket. On the other hand, the increase in the monthly premiums will be paid right out of the home buyer’s pocket with their mortgage payment each month.”

Ironically, home buyers who plan to be in the mortgage for less than three years and decide to pay the upfront fee themselves (instead of having the seller pay it for them), may actually save money by waiting until after October 4 to apply for an FHA loan. “Home buyers with a short term time horizon may actually benefit from this change because the upfront premium will be reduced to 1% from 2.25%,” Nicholas said. This change will impact over 30% of the home buyers in today’s market who use FHA-insured financing. Home buyers considering an FHA loan should find and contact a CMPS professional in their area to discuss their options and what this means for their situation. Also, you can follow CMPS Institute on Twitter to stay updated on these and other mortgage and housing industry developments.

For more information, visit www.cmpsinstitute.org.

RISMedia welcomes your questions and comments. Send your e-mail to: realestatemagazinefeedback@rismedia.com.

Copyright© 2010 RISMedia, The Leader in Real Estate Information Systems and Real Estate News. All Rights Reserved. This material may not be republished without permission from RISMedia.

Be sure to check out these headlines on RISMedia.com:
Housing Starts Rise 1.7 Percent in July
Federal Reserve Issues Final Rule on Loan Originator Compensation

RISMedia » Home Buying 101

September 1st, 2010 by admin

RISMEDIA, August 30, 2010—(MCT)—Maria Olmo doesn’t like her chances of paying off her new, 40-year mortgage. “I’ll die before it’s paid off,” said Olmo, who got her 30-year mortgage modified because she was at risk of losing her home to foreclosure. “This is the most ridiculous thing I’ve heard in years. They didn’t take my age or my income into consideration.” Since last year, companies servicing delinquent mortgages have been under orders from the federal government to modify the loans rather than foreclose on them.

The goal is to cut the monthly mortgage payments so they are less than 30% of the homeowner’s income.

More than half of the 390,000 mortgages already permanently modified through the federal government’s Making Home Affordable Program have lengthened loan terms—in most cases extended from 30 years to 40 years, according to lenders and federal reports.

Just six months earlier, in January, only about 42% of the loans modified at that point had been similarly lengthened. The U.S. Treasury Department has not released the number of struggling homeowners who have been put into 40-year loans, but lenders say that’s the predominant new term for modified mortgages.

Meanwhile, the number of mortgages that have been changed by trimming the principal on “underwater” houses held steady during that time between 27 and 28% of all modifications. All of the modified loans have had their interest rates reduced.

Orlando lawyer Matt Englett, who specializes in foreclosures, said he advises his older clients against lengthening their terms to four decades. “If you’re 60 and you’re in a 40-year note, you’re really just renting it from the bank, and you’re paying more than you would from someone else you could be renting from,” Englett said. “This is what the car dealers sell—they sell payments. That’s what the mortgage industry has gotten into.”

Rocky Stubbs, Chase vice president for homeowner preservation, said lenders participating in federal foreclosure-prevention programs are opting for interest-rate reductions and longer loan terms before principal write-offs because the government called for that specific, stepped approach to modifying home loans.

He noted that mortgage companies are prohibited by the federal Equal Opportunity Credit Act from considering the age of homeowners when putting them into loan products.

“We cannot look at the credit application of a 30-year-old customer any differently than we would a 90-year-old customer,” he said during a recent interview.

Homeowners who have agreed to go from a 30-year mortgage to a 40-year home loan can always pay more than the monthly minimum if they want to treat it like a 30-year loan and pay off the mortgage sooner, Stubbs added. The modifications typically don’t have any prepayment penalties.

But in east Orlando, Olmo said she can hardly afford her home’s new, ,300-a-month loan payments because she is struggling with less income since her husband is now unemployed. Rather than adding years onto the mortgage, she said, her lender should have accepted that the house has lost value and should have cut some of the loan’s principal.

Englett, the foreclosure lawyer, said 40-year loans make little sense financially, particularly for seniors who face paying the upfront interest possibly for the rest of their lives.

“If you look at the numbers, if someone is 60 years old and they extend their mortgage to 40 years, oftentimes they’re paying 50 percent more to own the house than they would pay if they were renting in the same neighborhood,” he said. “And when they go to sell, they still won’t have enough to pay it off.”

Despite such warnings, Englett said, most older clients opt for the reduced interest rate and longer term—”they get attached to the house and want to stay there.”

(c) 2010, The Orlando Sentinel (Fla.).

Distributed by McClatchy-Tribune Information Services.

RISMedia welcomes your questions and comments. Send your e-mail to: realestatemagazinefeedback@rismedia.com.

Copyright© 2010 RISMedia, The Leader in Real Estate Information Systems and Real Estate News. All Rights Reserved. This material may not be republished without permission from RISMedia.

For more top headlines on RISMedia.com, don’t miss:
Housing Remains Highly Affordable for Sixth Consecutive Quarter
School Performance Can Increase Home Value and Buyer Interest

RISMedia » Homeowner’s Toolkit

August 31st, 2010 by admin

RISMEDIA, September 1, 2010—With existing U.S. home sales diving to 15-year lows and millions of homes stagnant on the market, home sellers are suffering increasing anxiety, uncertainty and financial stress. To address these symptoms, motivational author Joan Gale Frank has published Home Seller’s Blues (And How To Beat Them).

“This is the first book of its kind to cheer people on and up when their home isn’t selling,” says Frank, a long-time real estate investor domestically and abroad. “It also provides hundreds of practical tips on how to sell a home faster using buyer/seller psychology.”

When her own Arizona home didn’t sell for a year, Frank gathered extensive home selling advice from top real estate experts, home stagers, landscape artists, psychologists and marketing whizzes. Her research paid off. Frank said, “I was able to pinpoint potential buyers and appeal directly to them, which helped sell my house faster. I also discovered how to be happy instead of miserable while waiting for a buyer.”

Home Seller’s Blues was created to share Frank’s findings with other frustrated home sellers. It features comprehensive home selling tips, including quick, inexpensive ways to make a house memorable, attracting more buyers, finding the best Realtor, win/win pricing, easy ways to get a house ready to show in minutes and identifying little problems that cause home rejection.

Several chapters of the book are dedicated to overcoming negative emotions ranging from fear and frustration to insomnia and helplessness. The book also emphasizes how to enjoy life during the entire home selling experience. “Ms. Frank’s insights into the emotions, psychology and real estate strategies of home selling are right on,” says Alexis Halmy, a Portland, Oregon Realtor.

Home Seller’s Blues is available for .99 at the Apple iBookstore, on Amazon’s Kindle, and at http://www.homesellersblues.com. Frank also provides inspiration and often humorous home selling advice on her blog, http://www.housesellingblues.com.

RISMedia welcomes your questions and comments. Send your e-mail to: realestatemagazinefeedback@rismedia.com.

Copyright© 2010 RISMedia, The Leader in Real Estate Information Systems and Real Estate News. All Rights Reserved. This material may not be republished without permission from RISMedia.

Don’t miss these headlines on RISMedia.com:
Harvard Researcher Shares Insights on Housing Comeback
The Real Estate Book Introduces New Search Tool for House Hunters on the Go, Launches App for iPhone, iTouch, iPad

RISMedia » How to Sell Your Home