Weekly Recap (04/25/11-04/30/11)by Tim Manni
Can’t say I haven’t heard that before, especially these days. While today’s real estate market is primed for homebuyers, given the low mortgage rates and cheap real estate prices, it can be a constant struggle for those trying to sell their homes.
If your house is currently on the market, or you’ve tried to sell your home in the past, I’m sure you’ve heard all the typical advice before: don’t underestimate your home’s curb appeal, declutter, clean, and depersonalize your home. Yet a lot of times, especially today, that advice just isn’t enough to get your house sold.
Given all the competition out there, between the massive inventory of homes for the sale and all the discounted properties that are available, we knew we had to provide our readers with some “outside-the-box” ideas to get that sold sign on those front lawns…
Allow me to start off by answering that question with a resounding “no.”
Recent comments from Tea Party Nation President Judson Phillips have ruffled a lot of feathers. Mr. Phillips, basing his comments off the language of our Constitution, questioned whether Americans who rent should be allowed to vote.
As Judson Phillips explains, the Founding Fathers “put certain restrictions on who gets the right to vote. It wasn’t you were just a citizen and you got to vote. Some of the restrictions, you know, you obviously would not think about today. But one of those was you had to be a property owner. And that makes a lot of sense, because if you’re a property owner you actually have a vested stake in the community. If you’re not a property owner, you know, I’m sorry but property owners have a little bit more of a vested interest in the community than non-property owners”…
In 2008, with the housing market in tatters, the government passed such bills as the Economic Stimulus Act of 2008 (ESA) and the Housing and Economic Recovery Act of 2008 (HERA). The basic purpose of these laws was to increase the amount of mortgage financing we defined as “conventional,” from $417,000 to as much as $729,750 in “high cost” areas within the 48 contiguous states.
This new definition of a jumbo loan–now financing above $729,750 and not just in excess of $417,000–meant that we lowered the cost to buy a mini-mansion. This happened because there’s generally a premium for “jumbo” financing, say an interest rate which is .50 percent higher than the rate for conventional loans…
If you were unsuccessful at modifying your home loan, perhaps this will sound familiar: while you were making your trial payments, your servicer simultaneously began the foreclosure process.
A chance to remodify your loan mod
Due to the federal penalties against mortgage servicers and a recent court ruling in California, a new wrinkle to the foreclosure prevention effort has emerged. If you were delivered a foreclosure notice while making trial payments, you may qualify for a ”remod”–a term Mortgage Servicing News describes as the new buzzword in the mortgage servicing industry…
One of the strangest new requirements coming out of Washington is that borrowers must actually have the ability to repay their mortgages.
At first this sounds entirely ridiculous because mortgage lenders would seem to have an obvious interest in getting repaid. Unfortunately, given no-doc loan applications and other short-cuts that lead to the mortgage meltdown, the sense in Washington is that baseline mortgage requirements must be spelled out in detail–otherwise lenders will bend or evade the rules.
The Federal Reserve has now come out with four proposed standards that it says lenders can use to meet the new “ability-to-repay” requirements needed to originate a qualified residential mortgage or QRM. Unfortunately, a careful look at the standards suggests that huge loopholes and escape clauses still remain…
Two weeks ago I suggested that homebuyers be ready to act swiftly if mortgage rates dipped, since most experts are predicting that rates will remain on an upward trend as we look forward. I hope you potential homebuyers out there were listening because mortgage rates did ease last week, and current market conditions have made things quite affordable.
Yet still, despite the ripe conditions — historically-low mortgage rates, cheap home prices, plenty of inventory to choose from with very little competition — homebuyers are still sitting on the sidelines. It seems that these “ripe” conditions are what’s holding back the majority of the buying market…