Westchester County Home News

Expanding Prosperity

2011-07-08T08:34:00.001-04:00

You may feel prosperous today. While this is a positive mind-set to possess, you may wish to take care that it doesn’t lead you to spend money excessively or indulge too much in luxuries you will later regret. Instead, you may want to focus on experiencing other types of abundance. You could visit a lush botanical garden and enjoy the bounty of nature, take a trip to an art museum to connect with the spirit of creativity, or attend a musical concert and allow the melodies to fill you with a sense of joy and inspiration. Since your relationships are also a source of abundance in your life, you may wish to ask a friend or loved one to accompany you on your excursions today, as this could enable you to experience several kinds of abundance at once.

Engaging in inspirational activities can enhance our feelings of abundance and joy and lend a greater sense of fulfillment to our lives. We often connect thoughts of abundance with money and material objects, but our surroundings offer many more opportunities to feel plentiful. By focusing our attention on activities that make us feel inspired and enriched, we are increasing our sense of abundance. This positive focus allows us to feel fulfilled and be able to enjoy the more precious moments in life, rather than feeling the need to acquire material objects. By finding creative ways to explore your feelings of abundance today, you can expand your perception of prosperity and enrich your life.

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Focus on what you want

2011-07-06T12:27:00.001-04:00

“A good intention clothes itself with power.”

-- Ralph Waldo Emerson

Our minds are incredibly powerful. We put that power to work for us when we consciously set an intention to be or do something. Get into the practice of consciously setting an intention for every activity in which you are involved.

Your intention might support efficiency – for example, to complete a job or project by a specific time. Your intention might support your personal growth, e.g., to undertake a task that scares you. Or it might support more soul connection, e.g., to see beauty in the chaos of your day.

When we make an effort to set an intention, no matter how trivial it may appear, we are taking the time to choose what we want for ourselves. And clearly, this is essential for our growth – to actively, thoughtfully choose what we want for ourselves.

“By becoming a conscious choice-maker, you begin to generate actions that are evolutionary for you.”

-- Deepak Chopra

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Things You Need to Know About Automobile Tire Care and Safety

2011-06-10T16:11:00.001-04:00

Tires are designed and built with great care to provide thousands of miles of excellent service. But for maximum benefit, they must be maintained properly.

The most important factors in tire care are:

Proper Inflation Pressure
Proper Vehicle Loading
Regular Inspection
Good Driving Habits
Vehicle Conditions

The Benefits of Proper Inflation

With the right amount of air pressure, your tires wear longer, save fuel and help prevent accidents. The "right amount" of air is the pressure specified by the vehicle manufacturer for the front and rear tires on your particular model car or light truck. The correct air pressure is shown on the tire placard (or sticker) attached to the vehicle door edge, door post, glove box door or fuel door. If your vehicle doesn't have a placard, check the owner's manual or consult with the vehicle manufacturer, tire manufacturer or your local tire dealer for the proper inflation.

The tire placard tells you the maximum vehicle load, the cold tire pressures and the tire size recommended by the vehicle manufacturer.

If you don't take proper care of your tires, the results can be serious. Most tire companies are either supplying a handbook or are molding a safety warning right onto the tire sidewall. A typical warning is shown.

WARNING
Serious injury may result from tire failure due to underinflation / overloading. Follow owner's manual or tire placard in vehicle. Explosion of tire/rim assembly. Only specially trained persons should mount tires.

As you see, it points out that serious injury may result from tire failure due to underinflation or overloading. Motorists are strongly advised to follow the vehicle owner's manual or the tire placard in the vehicle for proper inflation and loading.

Never try to mount your own tires. Only specially trained persons should mount or demount tires. An explosion of a tire and wheel assembly can result from improper or careless mounting procedures.

If you do mount your own tires, make sure you have the right equipment, the right training and the right information before proceeding. Always use a restraining device when mounting a tire on a rim, and be sure to stay back from the tire when inflating it. Make sure to follow the inflation instructions.

Always replace a tire with another tire of exactly the same bead diameter designation and suffix letters. For example: A 16" tire goes on a 16" rim. Never mount a 16" tire on a 16.5" rim. A 16.5" tire goes on a 16.5" rim. Never mount a 16.5" tire on a 16" rim.

While it is possible to pass a 16" diameter tire over the lip or flanges of a 16.5" size diameter rim, it cannot be inflated enough to position itself against the rim flange. If an attempt is made to seat the tire bead by inflating, the tire bead will break with explosive force and could cause serious injury or death.

Remember, mounting and demounting tires and wheels should be left to skilled professionals who are aware of the safety hazards involved and who have the proper tools and equipment to do the job safely.

Your Own Tire Pressure Gauge

Tires must be properly inflated. Use an accurate tire pressure gauge to determine your tire pressure. You can't tell when tires are "low," or underinflated, just by looking. Air meters at service stations may be inaccurate due to exposure or abuse. You should have your own personal tire gauge to be sure. Purchase an accurate tire gauge from your tire dealer, auto supply store or other retailer.

Inflation Tips

Check tire inflation pressure (including the spare) at least once a month and before every long trip. Tires must be checked when they are cold; that is, before they have been run a mile. If you must drive over one mile for air, before you leave home, measure the cold inflation pressure of each tire and record the actual underinflation amount for each tire.

Upon arriving at the service station, measure each tire's inflation again and then inflate the warm tire to a level that is equal to this warm pressure, plus the cold underinflation amount.

Underinflation

Tires lose air normally through the process of permeation. Changes in outdoor temperature can affect the rate at which your tire loses air. This change is more pronounced in hot weather. Generally speaking, a tire will lose one or two pounds of air per month in cool weather, and even more in warmer weather. Underinflation is the leading cause of tire failure, so check inflation pressure regularly.

Never "bleed" or reduce air pressure when tires are hot. It is normal for pressures to build up as a result of driving.

Make sure all tire valves and extensions are equipped with valve caps with rubber gaskets to keep out dirt and moisture. Have a new valve stem assembly installed whenever a tire is replaced. Underinflation or overloading creates excessive heat, and can lead to tire failure, which could result in vehicle damage and/or serious injury or death. Proper inflation extends tire life and saves fuel. Maintain the inflation pressure listed in the vehicle owner's manual or on the tire placard.

Proper Vehicle Loading

In addition to showing the vehicle manufacturer's recommended cold inflation pressure, the tire placard also shows the maximum load of the vehicle. Do not overload your vehicle. Remember, baggage carried on top of any vehicle counts as additional load.

If you are towing a trailer, remember that some of the weight of the loaded trailer transfers to the towing vehicle. That reduces the load which can safely be placed in the towing vehicle. The only sure way to prevent overload is to weigh, axle by axle, the fully loaded vehicle on reliable platform scales.

Inspect Your Tires Regularly

At least once a month, inspect your tires closely for signs of uneven wear.

Uneven wear patterns may be caused by improper inflation pressures, misalignment, improper balance or suspension neglect. If not corrected, further tire damage will occur.

Most likely, the cause can be corrected at your tire dealer or other service facility. If you find a problem and correct it in time, your tires may be able to continue in service.

Certain uneven wear patterns may indicate that the tire has suffered internal structural damage and requires the immediate attention of your tire dealer.

When the tread is worn down to one-sixteenth of an inch, tires must be replaced. Built-in treadwear indicators, or "wear bars", which look like narrow strips of smooth rubber across the tread, will appear on the tire when that point of wear is reached. When you see these wear bars, the tire is worn out and it's time to replace it.

Inspect your tires frequently. Look for any stones, bits of glass, metal or other foreign objects wedged in the tread. These may work deeper into the tire and cause air loss.

If any tire continually needs more air, have it taken off the vehicle and checked to find out why it is leaking. Damage to the tire, wheel or valve may be the problem.

Good Driving Habits

The way you drive has a great deal to do with your tire mileage and safety. So cultivate good driving habits for your own benefit.

Observe posted speed limits.
Avoid fast starts, stops and turns.
Avoid potholes and objects on the road.
Do not run over curbs or hit the tire against the curb when parking.

When You're Stuck

The forces created by a rapidly spinning tire can cause an explosion by literally tearing the tire apart. These forces impact the whole tire structure and can rupture the entire casing. Some vehicles are capable of bringing a tire to this failing point in 3 to 5 seconds.

When stuck on ice, snow, mud or wet grass, the vehicle should be rocked gently back and forth by repeatedly shifting the gear lever from drive to reverse on automatic transmissions, or reverse to second on manual transmissions. This should be done with the least amount of wheel spinning. If that doesn't free the vehicle, get a tow.

Highway Hazards

No matter how carefully you drive, there is always a possibility that you may eventually have a puncture and wind up with a flat on the highway. Drive slowly to the closest safe area out of traffic. This may further damage the flat tire, but your safety is more important.

Follow the vehicle manufacturer's instructions for jacking up the vehicle, taking off the wheel and putting on the spare. Then drive to a place where the flat tire can be inspected for possible repair or replacement.

After a tire has received a severe impact, such as hitting a curb or pothole, you must have it removed from the wheel and inspected both inside and out for impact damage.

An impact-damaged tire may appear serviceable on the outside, but can fail later after the road hazard injury.

Spare Care

Many late-model vehicles are equipped with temporary spare tires and wheels which are different from your regular tires and wheels. Some may require higher inflation pressure, or the use of special canisters to inflate the tire.

You may operate a vehicle with such a tire within the limits indicated on the tire's sidewall, until it is convenient to repair the disabled tire or replace it with one of the same size designation and construction as the other tires on the vehicle.

Always check the inflation in your spare tire every time you check all the others. A spare tire with no air in it is no help to you in an emergency. If you have an inflatable spare, be sure to check the aerosol air inflation pressure canister to be sure it has not been damaged. If so, have it checked by an expert.

Remember, improper mounting and overinflation may damage the tire or wheel and can result in an explosion that could cause serious injury and death.

Aerosol Inflators

Do not depend on tire aerosol sealants and inflators to fix a damaged tire permanently. These products are designed to provide only a temporary, emergency repair to help get you off the road and to the nearest tire repair facility.

Some aerosol products of this type use flammable gases, such as butane, propane or isobutane, as propellants. Follow all directions and precautions printed on the canister when using these products. Be sure to inform tire service personnel that you have used a flammable aerosol to inflate your tire.

Vehicle Conditions Affecting Tires

There is a close working relationship between your tires and several mechanical systems in your vehicle. Tires, wheels, brakes, shock absorbers, drive train, steering and suspension systems must all function together to give you a comfortable ride and good tire mileage.

Balance

An unbalanced wheel and tire assembly may create an annoying vibration when you drive on a smooth road and may result in irregular treadwear.

Alignment

Misalignment of wheels in the front or rear, improperly operating brakes or shock absorbers, bent wheels, worn bushings and other mechanical problems cause uneven and rapid treadwear and should be corrected by a qualified mechanic. Front-wheel-drive vehicles, and those with independent rear suspension, require special attention with alignment of all four wheels.

These systems should be checked periodically as specified by the vehicle owner's manual or whenever you have an indication of trouble.

A bad jolt, such as hitting a pothole, can throw your front end out of alignment even if you had it checked an hour earlier. Such an impact can also bend the rim, causing a loss of air pressure, and damage your tires with little or no visible external indication.

Tire Rotation

Sometimes irregular tire wear can be corrected by rotating your tires. Consult your car owner's manual, the tire manufacturer or your tire dealer for the appropriate pattern for your vehicle.

If your tires show uneven wear, ask your tire dealer to check for and correct any misalignment, imbalance or other mechanical problem involved before rotation.

Sometimes front and rear tires on a vehicle use different pressures. After rotation, adjust individual tire air pressure to the figures recommended by the vehicle manufacturer for the new locations -- front or rear -- as shown on the tire placard in the vehicle.

The purpose of regularly rotating tires is to achieve more uniform wear for all tires on a vehicle. Before rotating your tires, always refer to your individual owner's manual for rotation recommendations. If no rotation period is specified, tires should be rotated approximately every 6,000 miles.

However, rotate your tires earlier if signs of irregular or uneven tire wear arise, and have the vehicle checked by a qualified technician to determine the cause of the wear problem. The first rotation is most important.

The Sidewall Story

Your tire contains very useful information molded into the sidewall. It shows the name of the tire, its size, whether it is tubeless or tube type, the maximum load and maximum inflation, the important safety warning and much other information.

Passenger Tires

Here is information about the sidewall of a popular "P-metric," speed-rated auto tire. "P" stands for passenger, "215" represents the width of the tire in millimeters; "65" is the ratio of height to width; "H" is the speed rating; "R" means radial; and "15" is the diameter of the wheel in inches. Some speed-rated tires carry a Service Description, instead of showing the speed symbol in the size designation. The Service Description, 89H in this example, consists of the load index (89) and speed symbol (H).

Treadwear

The treadwear grade is a comparative rating based on the wear rate of the tire when tested under controlled conditions on a specified government test track.

A tire graded 200 would wear twice as long on the government test course under specified test conditions as one graded 100.

It is wrong to link treadwear grades with your projected tire mileage. The relative performance of tires depends upon the actual conditions of their use and may vary due to driving habits, service practices, differences in road characteristics and climate.

Traction

Traction grades, from highest to lowest, are A, B and C. They represent the tire's ability to stop on wet pavement as measured under controlled conditions on specified government test surfaces of asphalt and concrete.

Temperature

The temperature grades, from highest to lowest, are A, B and C. These represent the tire's resistance to the generation of heat when tested under controlled conditions on a specified indoor laboratory test wheel.

Replacement Tire Selection

IMPORTANT: Always check the vehicle manufacturer's recommendation before replacing a tire with a different size and/or construction.

When buying new tires, be sure your name, address and tire identification number are recorded and returned to the tire manufacturer or its record-keeping designee. Tire registration will ensure that you will be notified promptly in the event the tire manufacturer needs to contact you.

When tires need to be replaced, don't guess what tire is right for your vehicle.

For the answer, first look at the tire placard. As you will see, that placard tells you the size of the tires which were on the vehicle as original equipment.

Tires should always be replaced with the same size designation, or approved options, as recommended by the automobile or tire manufacturer. Never choose a smaller size, with less load-carrying capacity than the size on the tire placard. Always have tires mounted with the same size and construction designations on the same axle. It is recommended that all four tires be of the same size, speed rating and construction (radial or non-radial). However, in some cases, the vehicle manufacturer may require different-sized tires for the front and rear axles. When two radial tires are used with two non-radials, put the radials on the rear axle.

Speed Ratings

Some tires are now marked with letters to indicate their speed rating, based on laboratory tests which relate to performance on the road. Tires may be marked with one of eight speed symbols, M, S, T, U, H, V, Z or W, to identify the particular tire's speed rating.

When replacement of tires is required, consult the vehicle manual for proper size and speed rating (if required).

If the vehicle manual specifies speed-rated tires, the replacement tires must have the same or higher speed rating to maintain vehicle speed capability.

If tires with different speed ratings are mounted on the same vehicle, the tire or tires with the lowest rating will limit the tire-related vehicle speed.

Tire speed ratings do not imply that vehicles can be safely driven at the maximum speed for which the tire is rated, particularly under adverse road and weather conditions, or if the vehicle has unusual characteristics. Never operate a vehicle in an unsafe or unlawful manner.

Types of Tire Construction

Tires should be of the same size, construction (radial, non- radial) and speed rating, unless specified otherwise by the vehicle manufacturer. Tires influence vehicle handling and stability.

Match tire size designations in pairs on an axle (or four tires in dual application), except for use of a temporary spare tire.

If radial and non-radial tires are used on a vehicle, put radials on the rear. If radial and non-radial tires are used on a vehicle equipped with dual rear tires, the radials may be used on either axle. Never mix radial and non-radial on the same axle except for use of a temporary spare tire.

Snow tires should be applied in pairs (or as duals) to the drive axle (whether front or rear) or to all positions. Never put non-radial snow tires on the rear if radials are on the front, except when the vehicle has duals on the rear. If studded tires are used on the front axle, they must also be used on the rear axle.

Match all tire sizes and constructions on four-wheel-drive vehicles.

COLD-WEATHER DRIVING

Here are some things you should know about cold-weather driving.

How Cold Temperature Affects Tires

Every time the outside temperature drops 10 degrees Fahrenheit, the air pressure inside your tires goes down about one or two pounds per square inch.

You should check your tire pressures frequently during cold weather and add the necessary air to keep them at recommended levels of inflation at all times.

Never reduce tire pressures in an attempt to increase traction on snow or ice. It does not work and your tires will be so seriously underinflated that driving will damage them.

If one of the drive wheels becomes stuck, the centrifugal forces created by a rapidly spinning tire can cause an explosion by literally tearing the tire apart. Never exceed the 35 mph indicated speedometer speed or stand near the spinning tire.

If your vehicle is stuck and a tow truck is not readily available, gently rock your vehicle back and forth, repeatedly shifting the gear lever from drive to reverse on automatic transmissions, or reverse to second on manual transmissions, while applying gentle pressure to the accelerator. Caution: If you have an anti-lock braking system (ABS) in your car, follow the operational instructions in your owner's manual.

Snow Tires

In snowy areas, many cities and counties have "snow emergency" regulations which are invoked during heavy snowfalls. Check with authorities for the rules in your area. Under some rules, motorists are subject to fines if they block traffic and do not have snow tires on their vehicles.

You can avoid this by equipping your vehicle with snow tires marked with "MS," "M&S," and "M+S" on the sidewall. The letters "M" and "S" stand for mud and snow.

If you change to snow tires, be sure they are the same size construction type as the other tires on the vehicle.

Snow tires should be used in pairs (or as duals) on the rear axle or on all four wheel positions. If purchasing 2 new tires it is recommended that you install them on the back of the car. If you install a high traction tire on the front drive axle, you are leaving the lighter end of the vehicle (the rear) with no traction improvement. Most tire manufacturers recommend that front wheel drive vehicles have all four tires of equal traction. In all cases, install new tires on the rear axle. If your front tires lose grip first, your vehicle will tend to lose control by going straight, even in a turn. This is understeer, which can be controlled by slowing down and steering in the direction of the turn...this will allow your car to come back into line. But if the rear tires lose grip first, your vehicle, could spin, which is oversteer and more difficult to control, this requires you to make quick, precise steering corrections in the opposite direction of the turn, not a natural reaction. It is easier to control understeer than oversteer.

In areas where heavy snowfalls are frequent, many drivers carry chains for use in emergencies, or have their tire dealer apply studded snow tires. When studded snow tires are mounted on the front axle, studded tires also must be placed on the rear axle. Most states have time limits on the use of studs or ban them altogether. Before installing studded tires, check the regulations in your area. If you use chains, make sure they are the proper size and type for your tires, otherwise they may damage the tire sidewall and cause tire failure.

SERVICE ASSISTANCE

When you have a question about tires, or a problem, consult your tire dealer. The dealer is the best source of general information and professional service on tires.

Your dealer has service manuals, wall charts and other industry publications on tire load and inflation, tire repair and tire replacement. Your dealer can provide you with the replacement tires your vehicle needs, balance your tires and repair damaged tires which are repairable. Let the dealer inspect your tires periodically and diagnose any problem you may have.

Loss of Tire Pressure

When you discover a tire losing air, it must be removed from the wheel by an expert for complete internal inspection to be sure it is not damaged. Tires run even short distances while severely underinflated may be damaged beyond repair.

Punctures up to 1/4 inch, when confined to the tread, may be repaired by trained personnel. These tires must be removed from the wheel, inspected and repaired, using industry-approved methods which call for an inside repair unit and a plug.

Plugs vs. Patches

A PLUG BY ITSELF IS AN UNACCEPTABLE REPAIR. The repair material used - for example, a "combination patch and plug" repair - must seal the inner liner and fill the injury to be considered a permanent repair. Never use a tube in a tubeless tire as a substitute for a proper repair.

Individual tire manufacturers may differ on whether the speed category applies to speed-rated tires that have been repaired. Consult the tire manufacturer for recommendations.

Serviceable Tire Injuries

Injuries larger than 1/4 inch must be referred to a full service repair facility. No repairs to the sidewall of a tire should be made without consulting the tire manufacturer. After a tire has been repaired, check for leaks or other damage not detected at the time of repair. Improper repairs can cause sudden tire failure.

Air loss due to punctures can ruin tires that might have been saved had they been removed in time for proper repair. Gradual air loss raises a tire's operating temperature. This can cause some of the components to separate, or damage the tire body in ways that create rapid or sudden air loss.

Such internal damage may not always be readily apparent, and rapid loss of air may still occur despite later installation of a proper repair.

STORAGE TIPS

Tires should be stored upright and in a dry, cool place, away from sunlight and sources of ozone, such as electric motors.

However, if you must store tires flat (one on top of the other), make sure you don't stack too many on top of each other. Too much weight can damage the bottom tire.

Also be sure to allow air to circulate around all sides of the tires, including underneath, to prevent moisture damage.

If storing tires outdoors, protect them with an opaque waterproof covering and elevate them from the ground. Do not store tires on black asphalt, other heat absorbent surfaces, snow covered ground or sand.

Posted via email from WESTCHESTER COUNTY DISTRESSED PROPERTY INFORMATION

Untitled

2011-05-08T07:59:00.001-04:00

http://online.wsj.com/article/SB10001424052748704810504576307551540613850.htm...

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10 Pieces of Paper You Must Round Up to Buy (or Sell) a Home

2011-03-24T12:12:00.001-04:00

Home buyers and -sellers alike often bristle with anticipatory irritation at the mere thought of all the paperwork they expect they’ll have to come up with to do their transaction, above and beyond the basic loan application, contract, disclosures and closing docs. And these worries start way in advance; it’s as though, before they even start visiting open houses, buyers begin to visualize - and dread - spending hours upon hours in the dank catacombs of the Vatican (à la Da Vinci Code) combing through ancient files, seeking some rare and precious artifact documenting their childhood dental history or genealogy.

In some respects, this vision of the experience of obtaining a home loan might not be far off - there are oodles of hoops through which to jump and, occasionally, the loan underwriter requests something sort of bizarre. But more commonly, there’s a pretty finite universe of documents you’ll really need to scrounge up to get your home bought - or sold. Here they are:

ID (e.g., driver’s license, state-issued ID, passport). Who must produce it? Buyers and sellers. Why? Uh, hello!?! Lender wants to know that you are who you say you are, buyers, and the title insurance company wants to make sure, sellers, that you actually have the right to sell the home. Funny enough, this commonly goes unrequested until you get to the closing table, when the notary requests to see it before signing, but some mortgage brokers and even some real estate brokers and agents may ask to see it earlier on.
Paycheck Stubs. Who must produce it? Any buyer financing their purchase with a mortgage. Sellers, usually only in the case of a short sale. Why? Buyers’ purchase price ranges are determined, in part, by their income. And short sellers have to prove an economic hardship.
Two months’ bank account statements. Who must produce it? Buyers getting financing; sellers selling short. Why? Buyers’ lenders now require proof of regular income and proof that the down payment money is your own. Short sellers? It’s all about the hardship.
Two years’ W-2 forms or tax returns. Who must produce it? Mortgage-seeking buyers and short selling sellers. Why? Banks want to see a stable, long-term income. They also limit you to claiming as income the amount on which you pay taxes (attn: all business owners!). And in short sales, again, they want documentation of every single facet of your finances.
Updated everything. Who must produce it? Buyer/mortgage applicants. Why? Because things change, and because the time period between the first loan application and closing can be many months - even years! - on today’s market. During the time between contract and closing it’s not at all unusual for underwriters to demand buyers produce updated mortgage statements, checks stubs, and such - and its quite common for them to call your office the day before closing to request a last minute verification of employment!
Quitclaim deed. Who must produce it? Married buyers purchasing homes they plan to own as separate property. Married sellers selling homes that they own separately, or joint owners selling their interests separately. Why? With the Quitclaim Deed, the other spouse or owner signs any and all interests they even might have had in the property over the the selling owner, making it possible for the title insurer to guarantee clear, undisputed title is being transferred in the sale.
Divorce decree. Who must produce it? Buyers and sellers who need to document their solo status or the property-splitting terms of their divorce. Why? Again, to ensure that the seller has the right to sell. Recently single buyers might need to prove that they shouldn’t be held to account for their ex’s separate debts or credit report dings.
Gift letters. Who must produce it? Buyers using gift money toward their down payment. Why? The bank wants to be sure the gift came from a relative, and is their own money to give. They also want the relative to confirm in writing that it’s a gift, not a loan - a loan would need to be factored into your debt load.
Compliance certificates. Who must produce it? Usually sellers, but sometimes buyers, by contract. Why? Some local governments require various condition requirements be met before the property is transferred, like some cities which require a sewer line be video scoped and repaired, cities which require a checklist of items be met before a certificate of occupancy be issued (usually relevant to brand new and really old homes, the latter of which are often subject to lead paint concerns) and energy conservation ordinances which require low-flow toilets and shower heads to be installed. Ask your real estate pro for advice about which, if any, such ordinances apply in your area.
Mortgage statements. Who must produce it? Any seller with a mortgage. Why? the escrow holder or title company will need to use them to order payoff demands from any mortgage holder who has to get paid before the property’s title can be transferred.

By no means is this an exhaustive list. Agents: what documents do you see buyers and sellers struggle to scrounge up during their home buying transactions?

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IRS Introduces New Policy for Removal of Tax Liens on Credit Reports

2011-03-15T10:49:00.001-04:00

Tax liens whether paid or open can have a devastating effect on credit scores especially when they are newly posted on the credit reports. Many consumers going through the mortgage approval process have found great difficulty in obtaining funding due to the reduction in scores caused by tax liens. The IRS, with this in mind, has recently made a wise decision giving consumers incentive to pay overdue tax debt in full.

In February of 2011 the IRS put out a press release describing a new policy that will give consumers who have open tax liens the ability to have negative public records on their credit profiles removed. The IRS is expecting to collect more money from debtors by trying out this positive method. The new program gives consumers a chance to rehabilitate credit when they either pay tax liens in full or enter into a payment plan that will end in payment in full. Not all will qualify for this option, only those owing less than $25,000.

Since credit scores are highly affected by the timing of negative information, if a new negative account (including a tax lien) is updated on a credit report the Fico Score could drop over 100 points. This is a major problem when applying for financing of any kind, especially in today's restrictive banking environment. The higher a Fico credit score the more the impact of a derogatory will reduce a score. As time goes by the score starts to increase but it could take well over 2-3 years to really see major recovery. Even paying a tax lien, judgment, or getting current on an individual account that has been late will not take away the impact of the initial negative mark. For many, the cost of paying in full to the IRS rather than a higher monthly mortgage payment, over many decades will be the better choice.

The cleansing of the credit reports is not an automatic response to payment. Consumers must request the withdrawal before making payment in full or entering into a payment plan. Once the IRS files a withdrawal the credit bureaus will then clear the lien from the credit profile. Not all consumers will qualify for this opportunity and CPA's must educate their clients before making payment or they will miss out on this opportunity. Having this knowledge to pass on to clients can equal enormous savings on future money borrowed.

The IRS has also raised the minimal amount of tax debt that prompts the filing of a tax lien from $5,000 to $10,000.

Posted via email from WESTCHESTER COUNTY DISTRESSED PROPERTY INFORMATION

13 Extra Costs to be Aware of Before Buying a Home

2011-03-14T11:54:00.001-04:00

13 Extra Costs to be Aware of Before Buying a Home

"The last thing you need are unbudgeted financial obligations cropping up hours before you take possession of your new home."

Whether you're looking to buy your first home, or trading up to a larger one, there are many costs - on top of the purchase price - that you must figure into your calculation of affordability. These extra fees, such as taxes and other additional costs, could surprise you with an unwanted financial nightmare on closing day if you're not informed and prepared.

Some of these costs are one-time fixed payments, while others represent an ongoing monthly or yearly commitment. Not all of these costs will apply in every situation, however it's better to know about them ahead of time so you can budget properly.

Remember, buying a home is a major milestone. Whether it's your first, second or tenth home, there are many important details to address, during the process. The last thing you need are unbudgeted financial obligations cropping up hours before you take possession of your new home.

Read through the following checklist to make sure you're budgeting properly for your next move.

1. Appraisal Fee

Your lending institution may request an appraisal of the property which would be your responsibility to pay for. Appraisals can vary in price from approximately $175 -$ 300.

2. Property Taxes

Depending on your down payment, your lending institution may decide to include your property taxes in your monthly mortgage payments. If your property taxes are not added to your monthly payments, your lending institution may require annual proof that your taxes have been paid.

3. Survey Fee

When the home you purchase is a resale (vs. a new home), your lending institution may ask for an updated property survey. The cost for this survey can vary between $700- $1,000.

4. Property Insurance

Home insurance covers the replacement value of your home (structure and contents). Your lending institution will request proof that you are insured as it protects their investment on the loan.

5. Service Charges

Any new utility that services your hook up, such as telephone or cable, may require an installation fee.

6. Legal Fees

Even the simplest of home purchases should have a lawyer involved to review all paperwork. Shop around, as rates vary greatly depending on the complexity of the issues and the experience of the lawyer.

7. Mortgage Loan Insurance Fee

Depending upon the equity in your home, some mortgages require mortgage loan insurance. This type of insurance will cost you between 0.5% -3.5% of the total amount of the mortgage. Usually payments are made monthly in addition to your mortgage and tax payment.

8. Mortgage Brokers Fee

A mortgage broker is entitled to charge you a fee in order to source a lender and organize the financing. However, it pays to shop around because many mortgage brokers will provide their services free to you by having the lending institution absorb the cost.

9. Moving Costs

The cost for a professional mover can cost you in the range of:

$50-$100/hour for a van and 3 movers, and
10-20% higher during peak demand seasons.

10. Maintenance Fees

Condos charge monthly fees for common area maintenance such as grounds keeping and carpet cleaning in hallways. Costs will vary depending on the building.

11. Water Quality and Quantity Certification

If the home you purchased is serviced by a well, you should consider having your water checked by your local experts. Depending upon where you live, determines whether or not a fee is charged, to certify the quantity and quality of the water.

12. Local Improvements

If the town you live in has made local improvements (such as the addition of sewers or sidewalks), this could impact a property’s taxes by thousands of dollars.

13. Land Transfer Tax

This tax is applied whenever property changes hands and the amount that is applied can vary.

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Government Programs cancelled

2011-03-14T11:30:00.001-04:00

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5 Mortgage and Foreclosure Myths

2011-03-10T09:28:00.001-05:00

in a mortgage market that changes as quickly as this one, today’s fact is tomorrow’s fiction. For buyers, misinformation can be the difference between qualifying for a home loan or not. Sellers and owners, knowledge is foreclosure-preventing, smart decision-making power! Without further ado, let’s correct some common mortgage misconceptions.

1. Myth: Buyers with bad credit can’t qualify for home loans. Obviously, mortgage guidelines have tightened up, big time, since the housing bubble burst, and they seem likely to tighten even further over the long-term. But just this moment, they have relaxed a bit. In the last couple of weeks, two of the nation’s largest lenders of FHA loans announced that they’ve dropped the minimum FICO score guideline from 620 (which allows for some credit imperfections) to 580, which is actually a fairly low score.

At a FICO score of 620, buyers can qualify for FHA loans at many lenders with only 3.5 percent down. With a score of 580, the lenders are looking for more like 5 to 10 percent down – they want to see you put more of your own skin in the game, and the higher down payment lowers the risk that you’ll default. However, if your credit has taken a recessionary hit, like that of so many Americans, this might create a glimmer of hope that you’ll be able to take advantage of low prices and interest rates without needing years of credit repair.

2. Myth: The Mortgage Interest Deduction isn’t long for this world. Homeowners saved over $85 billion in 2008 by deducting their mortgage interest on their income tax returns. A few months ago, the National Commission on Fiscal Responsibility and Reform caused a massive wave of fear to ripple throughout the world of real estate consumers and professionals when they recommended Mortgage Interest Deduction (MID) reform, which would dramatically reduce the size of the deduction.

Fact is, the Commission made a sweeping set of deficit-busting recommendations to Congress, a few of which are likely to be adopted. Fortunately for buyers and sellers, MID reform is not one of them. Very powerful industry groups and economists have been working with Congress to plead the case that MID reform any time in the near future would only handicap the housing recovery. Congress-folk aren’t interested in stopping the stabilization of the real estate market. As such, the MID is nearly universally thought of as safe – even by those who disagree that it should be.

3. Myth: It’s just a matter of time before loan guidelines loosen up. The US Treasury Department recently recommended the elimination of mortgage industry giants Fannie Mae and Freddie Mac. I won’t get into the eye-glazing details of it here, but the long and the short is that (a) this is highly likely to happen, and (b) it will make mortgage loans much harder and costlier to get, for both buyers and homeowners. It’s possible that loans are as easy to get as they’re going to get. So don’t expect that if you hold out, zero-down mortgages will c

4. Myth: If you don’t have equity, you can’t refi. Much ado is being made about how stuck so many people are in their bad loans, because they don’t have the equity to refinance their way out of them. If you’re severely upside down (meaning you own much, much more than your home is worth), stuck may be the situation. But there are actually a couple of ways homeowners can refi their underwater home loans. If your loan is held by Fannie or Freddie (which you can find out, here), they will actually refinance it up to 125% of its current value, assuming you otherwise qualify for the loan. That means, if your home is worth $100,000, you could refinance a loan up to $125,000, despite the fact that your home can’t secure the full amount of the loan.

If your loan is not owned by Fannie or Freddie, you might be a candidate for the FHA “Short Refi” program. While most mortgage workout plans are only available to people who are behind on their loans, the Short Refi program is only available to homeowners who are current on their mortgages and need to refinance up to 115 percent of their homes’ value. So, if you owe $250,000 on your home, you can refinance via an FHA Short Refi even if your home’s value is as low as $217,000. If you think you’re a good candidate for a short refi, contact your mortgage broker, stat – there are some in Congress who think that this program is so underutilized (only 245 applications have been submitted since it rolled out in September – no typo!) that its funding should be diverted to other needy programs.

5. Myth: If you’ve lost your job and can’t make your mortgage payment, you might as well mail your keys in. Until recently, this was essentially true – virtually every loan modification and refinancing opportunity required that your economic hardship be over before you could qualify. And documenting income has always been high on the requirements checklist. But there are some new funds available in the states with the hardest hit housing and job markets, which have been designated specifically for out-of-work homeowners.

The US Treasury Department’s Hardest Hit Fund allocated $7.6 billion to the states listed below – all of which are now using some portion of these funds to offer up to $3,000 per month for up to 36 months in mortgage payment assistance to help unemployed homeowners avoid foreclosure. Contact the state agency listed below if you need this sort of help:

Alabama: http://www.hardesthitalabama.com/
Arizona: https://www.savemyhomeaz.gov/
California: https://www.keepyourhomecalifornia.org/
Florida: https://www.flhardesthithelp.org/
Georgia: http://www.dca.state.ga.us/housing/homeownership/programs/hardesthitfund.asp
Illinois:http://www.ihda.org/
Indiana: http://www.877gethope.org/
Kentucky: http://www.kyhousing.org/
Michigan: http://www.michigan.gov/mshda/buyers/save_the_dream/helping+hardest+hit+homeowners+-+contact+your+mortgage+servicer+for+assistance
Mississippi: http://www.mshomecorp.com/firstpage.htm
Nevada: http://www.nahac.org/
New Jersey: http://www.state.nj.us/dca/hmfa/home/foreclosure/homekeepers.html
North Carolina: http://www.ncforeclosureprevention.gov/
Ohio: http://www.savethedream.ohio.gov/
Oregon: http://www.oregonhomeownerhelp.org/
Rhode Island: http://www.hhfri.org/
South Carolina: http://www.scmortgagehelp.com/
Tennessee: http://www.thda.org/
Washington D.C.: http://www.dchfa.org/

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Real Estate

2011-03-09T19:42:00.001-05:00

Thornwood NY Beautiful Lot!!!

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1 in 4 Home Owners Underwater on Mortgages

2011-03-09T13:14:00.001-05:00

1 in 4 Home Owners Underwater on Mortgages
Nearly a quarter of home owners with a mortgage owe more than their house was worth by the end of last year, according to a report released Tuesday by CoreLogic.

About 11.1 million households or 23.1 percent of home owners were underwater in the October-December quarter of 2010. That number marks an increase compared to the previous quarter where 22.5 percent of home owners--or 10.8 million households--were underwater.

What's more, an additional 2.4 million home owners are inching near being underwater on their mortgages, CoreLogic reports.

Generally, in a stable housing market, about 5 percent of home owners are underwater.

The state with the highest number of underwater mortgages in the country was Nevada, where about two-thirds of home owners had negative home equity. Arizona, Florida, Michigan, and California have up to 50 percent of home owners underwater on mortgages.

Only nine states reported percentages less than 10 percent of underwater mortgages; Oklahoma had the smallest percentage at 5.8 percent.

Source: “Underwater Mortgages Rise as Home Prices Hit Post-Bust Lows in 11 of 20 Major U.S. Cities,” Associated Press (March 8, 2011)

Read More:

A Disaster Recovery Plan

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Top 5 Ways to Maximize Your Open House

2011-02-14T08:40:00.001-05:00

If your home is currently on the market, you may be considering whether or not to work with your real estate agent to host an open house. You may have heard that open houses are ineffective or "old-fashioned" in today's world of online marketing.

As a Member of the Top 5 in Real Estate Network®, however, I, along with my team, know first-hand that it takes a combination of different marketing strategies to sell your home quickly and for the best possible price. While online marketing and mobile technology are certainly critical parts of the equation, an open house can have a tremendous impact on a successful sale -- when done correctly, that is. Here are our Top 5 tactics for a successful open house. Make sure your agent is incorporating all — or at least some — of these strategies for your home's open house:

1. Staging well in advance - Don't bother having an open house if your home is not properly staged both inside and outside. Now is the time to work with a professional landscaper because curb appeal will never be more important -- prospective buyers won't bother coming in if they don't like what they see from the outside.

2. Proper advertising - These days, people are so inundated by life and media that unless your open house is promoted far and wide — and frequently — they will never even know about. Your agent should be: advertising in newspapers; using social media to promote your open house; networking with other agents in the area to make them aware; circulating direct mail to neighbors and nearby communities; and personally inviting key prospects.

3. Enlist the neighbors - Start polling your neighbors on what they like best about your neighborhood: the schools, the convenience, the community services, the people, etc. Compile this into a handout for your agent to distribute at your open house. After all, what better testimonial could you ask for than the next-door neighbor?

4. Consider a theme - Some of our fellow members in the Top 5 Network have hosted some unbelievably creative open houses. Consider inviting local restaurants to set up food stations so visitors can experience a "taste" of the community; ask a local antiques shop to stage the home with their showcase items; invite a local gallery to create an art exhibit throughout the home; or highlight something of interest about your home. One Top 5 member, for example, listed the home of an antique car collector and put all the owner’s cars on display and invited car enthusiasts.

5. Have the right materials on hand - Your open house will be for naught if you don't have the proper materials on hand, such as: a guest directory that asks for names and e-mails (find a creative incentive for guests to leave their e-mail addresses, such as entry into a drawing for a local restaurant gift certificate); professionally done photo brochures of your home or even a DVD of a video tour; payment and financing information.

Be sure to ask your agent how he or she intends to follow up with open house visitors -- this is the most important factor of all. Without a quick and effective follow-up system in place, you could very well pass over a potential buyer.

If you'd like more information on creating an effective open house, please e-mail our team. Feel free to forward this e-mail on to any friends and family who might be planning an open house in the near future.

via Posterize

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Top 5 credit score killers: What you don't know can hurt you

2011-02-14T08:11:00.001-05:00

Mistake #1: Foreclosure.

"I foolishly believed my attorney (and the rising real estate market) when I didn't force my former husband to refinance or sell our house during our divorce proceedings, and [he] left my name on the mortgage," Cynthia Burnham of Descanso, California says. As a result, when her ex stopped making payments, the bank came after her, and her credit score took a beating.

Burnham is not exactly sure where her score stands today, but she recalls that it was in the high 700s before the fiasco began.The lower score hit her most severely when it came to her credit limits; she had one card's limit slashed from $14,000 to $2,000, while another one went from $5,000 to $2,000. "I've always been proud to maintain my credit as excellent," Burnham says. Having to deal with the fallout once her credit wasn't good anymore left her "irritated and angry."

Shane Fischer of Winter Park, Florida, is also struggling with the fallout of a low credit score due to foreclosure. "The foreclosure killed any chance I have of getting a new car loan or even a credit card," Fischer says. "My car is getting older, and I'd like to consider trading it in, but with my bad credit, no bank will give me the time of day."

Not surprisingly, foreclosure is the big kahuna when it comes to actions that can sink your credit score. According to Barry Paperno, consumer operations manager at FICO, "In addition to a foreclosure preventing someone from obtaining a new mortgage for at least a couple of years -- regardless of the score – this person could expect to lose anywhere from 80 to 160 points, depending on his score level prior to the foreclosure." Ouch.

Foreclosure is a "scarlet letter," adds Gary Nitzkin, a debt-collection lawyer in Southfield, Michigan.

Mistake #2: Being a guarantor on someone else's loan.

Nitzkin, who is hired by creditors to collect on debts, says this is another no-no that's sure to take a bite out of your credit score. If the person you're guaranteeing the loan for - a child, close friend or other relative - defaults on the loan, you could be responsible for paying it back all at once. Not only would this likely cause significant financial hardship for you, you potentially could see your credit score plummet by as much as 100 points.

Mistake #3: Making a late payment on a credit card debt.

While foreclosure and debt settlements might sound like drastic steps, you may be surprised to learn that the next biggest credit-killer is actually something almost all of us have done from time to time. Making a late payment on a credit card debt doesn't seem like such a bad thing -- until you learn just how much it can affect your credit score.

As Nitzkin explains, "If a consumer has a [score of] 750 or above and they're late with just one payment, their score can drop to 650." However, FICO's Paperno adds, someone who already has a few late payments on their report as a result of previous late payments would be more likely to lose less (somewhere between 60 and 80 points).

Mistake #4: Maxing out one of your credit cards.

While it may be surprising to find out a late payment can drop your score anywhere from 60 to 100 points, you might be even more shocked to learn that even actions that are allowed by lenders can hurt your score. "The act of maxing out a single card could drop your high FICO score by as much as 50 points," Paperno says. People with lower scores could see theirs drop by up to 30 points, although it's likely they'd have much lower minimums than their high-score counterparts.

Mistake #5: Settling with a debtor for less than the amount owed.

This is another major strike against your score that Paperno says can drop your credit score by as much as 160 points. While we've written about people who've settled their debts for less and found the option to be a godsend, it's important to keep in mind that this isn't an action without consequences. Reaching an agreement with a lender to settle a debt for less than what you owe can certainly free you from a crushing debt, but the trade-off is that you'll have a lower credit score to show for it.

Getting - and keeping - your score high is an uphill battle for many people these days, Nitzkin says. "Lenders don't like to lend money to people who need it."

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Investor Deals Available in Westchester County NY

2011-02-09T11:30:00.001-05:00

Mount Vernon Bank Owned- $122,400

Peekskill -$79,900

Newburgh. - $30,000

White plains $200,000

Croton falls $150,000

Lake Peekskill- $89,900

New Windsor Orange County Single family Short Sale $140,000

Ossining Rehab Single family $85,000

Poughkeepsie Single Family Rental Property $89,925

Mount Vernon Short Sale 3 Family $180,000

Yonkers 4 family Short Sale $180,000

Poughkeepsie 2 Family Short Sale $115,925

Condo Studio Yorktown- $60,900

Bronx 1 Bedroom Condo- $60,000

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No Risk Home Selling

2011-02-04T14:43:00.001-05:00

A No Risk Home Selling Offer!
Do you feel you have no control when selling your home?

Do you know most Brokers will Charge you the same fee no matter how your home sells? Would you believe, even if you find the buyer?

Are you worried about signing a 180 Day listing or longer?

We remove the risk of which Realtor to choose

We have come up with the industries best commission structure. No other Real estate company will advertise the commission like we do.

Another agent represents the buyer. Our commission is 1% and the other agent receives 2%.

We find the buyer and write the contract. There is no other agent involved. Our commission is just 3%

You find the buyer and there is no other agent involved. We write the contract and walk it through closing for you. Our commission is 1%.

You find the buyer and there is no other agent involved. You don’t want our assistance and you pay nothing.

Sell your property yourself, while it is listed with Crecco Real Estate and pay no commission.

This does not apply to a buyer exposed to the property by my office or by another agent.

Cancel the Listing At Anytime

Either you or I can cancel by calling and simply saying “I want to cancel the Listing”. The cancellation becomes effective at the time you call. Please allow two business days to have the sign removed and the listing withdrawn from the Multiple Listing Service.

No Advance Fee of Any Kind

You only pay if Crecco Real Estate procures an offer that is acceptable to you.

No Pressure Presentation

I will never allow you to be pressured by the buyer’s agent. All offers will be faxed or emailed to my office and presented to you by phone, fax or email so that you can make your decisions privately.

Benefits with A No Risk Listing

You get the flexibility that most agents don’t or won’t offer. If you list with just any other agent they can lock up your listing for up to 180 days, whether you are happy with their performance or not. That is just not fair.

Staying in Touch

We follow up on every showing with other agents. We then contact you with the feedback so you know what’s going on. Marketplace feedback is a valuable tool in procuring the most money for your home. Most agents neglect this.

Helping You get Top Dollar

As your agent is my duty and help negotiate the best possible price and terms for you. Because of our research and finger on the pulse of the market we have the experience and awareness of the marketplace to guide your decisions.

Complete Market Analysis

Anybody can press a button a computer program and churn out data showing comps. In fact there are a number of online programs for the home seller to do just that. While it is important to know what has sold, It is equally important is what the current competition is, as well as who has failed to sell. This information becomes even more meaningful when interpreted through the eyes of experience. Much like evaluating x-rays, without the doctor’s experience and training the information can be misdiagnosed. This is how we determine the ceiling of what the market will bear, as well as the average marketing time for your neighborhood.

Setting the Right Price

No marketing on earth can overcome a bad price. Key components to a fast sale include: Pricing correctly, the home on lockbox (with easy access) and correct information in the MLS. Add to that a knowledgeable, skilled agent, and your home will sell.

Possible Changes That Can Make You Money Sometimes $200 – $300 wisely spent can net you $2000 – $3000 extra at closing.

Handling the Detail Work

*Professional Sign Installed

* Listing Properly Filled Out and Correctly Entered Into MLS

* Multiple Property Photos to All Websites * Follow up Contact All Agent That Show Property

* Daily Lockbox Readouts

* Negotiations of Contract and Explanation of Options

* Written Estimate of Cost of Sale

* Working with Appraisers to Obtain Maximum Value

* Monitoring Buyer’s Loan approval Process

* Negotiating the Results of Home Inspections

* Wood Destroying Organisms (Termite etc.) Report

* Final Walk Through

* Review of Title Company Settlement Figures

*Maximum Exposure  install an electronic MLS lock box so licensed agents can show your property even when you can’t be home

* Network with other agent to make them aware of Your Listing

* Exposing your home to our buyers Data base

* Handling sign calls from Potential buyers and pre-qualifying them when possible

* Flyers featuring Property highlights

* Our Internet exposure is 2 to none

Never Too Busy For You

Although we are proud of the number of we are able to assist with their housing needs, we never lose sight of the fact that each and every transaction matters. No matter how large or small.

Special No-Risk Offer:

You keep more money in your pocket with A No Risk Listing exclusively with Crecco Real Estate. Most Brokers will charge you the same fee no matter how your home sells…. even if you find the buyer. With the A No Risk Listing you have complete flexibility… from “Full Service” to “Do it yourself”. Does that sound fair? Yea, that’s what we thought too. So if you want a fair deal, with NO RISK? We are the only Choice.

Anthony J. Crecco

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In the news this week (January 31 - February 4, 2011)

2011-02-03T09:51:00.003-05:00

The markets will continue to watch the political unrest in Egypt closely this week. In addition, a number of high-impact reports will hit this week with the big news coming on Friday. We’ll discuss the impact of these reports in next week’s newsletter.

We started the week off right away Monday morning with reports on Personal Spending and Personal Income, as well as the Personal Consumption Expenditures (PCE) Index, which is the Fed's favorite gauge of inflation.
Manufacturing was also in the news this week. On Monday, we saw the Chicago PMI, which surveys more than 200 Chicago purchasing managers about the manufacturing industry and is a good indicator of overall economic activity. Then on Tuesday, the ISM Index was released. This is the king of all manufacturing indices and is considered the single best snapshot of the factory sector.
The big topic of the week will be employment. First up was the ADP National Employment Report on Wednesday, which measures non-farm private employment.
The ADP report will be followed by another round of Initial Jobless Claims on Thursday. In last week’s report, Initial Jobless Claims came in well above expectations. We shouldn’t read too much into that spike, since weather could have played a sizable role in the jump. However, if readings over the next couple weeks don't settle back down closer to the 400,000 level, there may be reason for concern.
Finally, the busy week culminates in the all-important Jobs Report on Friday. This report features new data regarding non-farm payrolls, the average work week, hourly earnings and the unemployment rate. Needless to say, this report can be a big market mover.

As you can see in the chart below, bonds received a bit of a bump at the end of last week, helping home loan rates recover from losses earlier in the week. This boost was prompted by political turmoil in Egypt that had investors seeking the safety of bonds.

Chart: Fannie Mae 4.0% Mortgage Bond (Friday, January 28, 2011)

Economic calendar for the week of January 31 – February 4, 2011

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Weekly Economic Summary - February 3, 2011

2011-02-03T09:51:00.001-05:00

The housing market received a serving of good news last week, as New Home Sales reportedly rose 17.5% in December to come in better than expectations. Overall, the report demonstrated that housing continues to recover – albeit slowly. Despite that good news though, the markets were keyed in on another important event last week-- the release of the Fed’s Interest Rate Decision and Monetary Policy Statement.

As expected, the Fed made no change to the Fed Funds Rate and even the Policy Statement was pretty much the same. But that didn’t stop the markets from getting a little fired up about the release.

It’s important to understand that the Fed has to be very careful with how bullish their economic comments are, as they don't want to see long-term rates move higher. The Fed's comments couldn’t be categorized as bullish as they said "employers remain reluctant to add to payrolls" and "the housing sector remains depressed."

So why did bonds initially improve nicely on the news and then crumble later in the day? The answer is: not everyone in the trading pits is buying what the Fed is saying. Instead, some people believe the Fed is talking down the true underlying strength of the economy, so that it can justify injecting the full $600 billion of quantitative easing into the economy.

Last week, President Obama delivered his State of the Union Address to members of Congress. Although the President’s call for a freeze on discretionary spending for five years may appear to be bond bullish in that any reduction in the deficit would be good for bonds, the reality is that so much more has to be done to really get our long-term debt in check. And some of last week’s weakness in bonds was likely attributed to the feeling that the speech came and went without any real sense that the deficit is going to be reduced in a meaningful way, especially in the near term. The bond market probably would have liked the word "cut" in spending rather than "freeze," since a “freeze” suggests only a temporary halt in spending at current levels.

In the end, the news last week demonstrated that economic conditions are improving, but they are doing so gradually. As a result, the market remains volatile, as bonds and home loan rates move up and down depending on what reports or speeches hit the news wires. The good news is that despite the volatility, home loan rates remain extremely low for now.

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Mortgage Rates Rise

2011-02-02T16:16:00.001-05:00

A sudden spike in Treasury yields drove up the interest rate on 15- and 30-year mortgages in December. Rates rose despite the Federal Reserve's efforts to keep them low and ease economic conditions by purchasing up to $900 billion in Treasury bonds. Treasury yields were propelled higher by encouraging news regarding economic growth and the prospect of a larger federal budget deficit stemming from the recent tax compromise. For the week ending December 16, the average interest rate on a 30-year, fixed-rate mortgage was 4.83%, up from 4.61% the previous week-but still lower than the average rate of 4.94% one year earlier, according to Freddie Mac. The average 15-year fixed interest rate was 4.17%-up from 3.96% the previous week, but down from 4.38% during the same week in 2009.

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Foreclosures Intrigue Home Buyers Looking for Deals

2011-01-22T11:35:00.001-05:00

RISMEDIA, December 20, 2010—(MCT)—Last spring, in the waning days of the first-time home buyer tax credit, Stephen Ploski made an offer on a foreclosed home in Farmington Hills, Mich. He said the 1,400-square-foot home was livable, but needed serious updates. He was willing to do the work, and take the risk. In exchange, he got a deal. The three-bedroom, one-bathroom home was his for $49,000. He lives in the home with his wife, Ashley and their daughter Lana.

“I wanted to buy a home because the market conditions were right,” said Ploski. “This is my first home for my family. But if you do it with an investor’s mind instead of getting emotionally attached, you can get money out of it.”

Despite strong interest in buying foreclosures, supply is expected to continue to outstrip demand in the coming year.

In a survey released last week, conducted by Harris Interactive, on behalf of Trulia and RealtyTrac, nearly half, or 49% of U.S. adults admitted they were at least somewhat likely to consider buying a foreclosed property. That’s up from 45% in May.

Ploski, a builder and remodeler, said the house had a bit of mildew, but mostly needed updates. He put in a new furnace and hot water heater, ran new wiring and installed some new drywall and insulation. He also removed two walls in the dining room to create an open floor plan with the kitchen and living room.

The improvements cost $4,000 because he did the work himself. But he figures he added roughly $11,000 to the value of the home. And when the $8,000 tax credit comes through, he’ll use that to update the kitchen. “We will sit on this one for three to five years because that’s how long you have to stay with the home buyer tax credit,” he said. “We’ll find another diamond in the rough and do the same thing.”

Carol Wagner, a REALTOR® with Real Estate One in Commerce Township, Mich., said that one of the biggest drawbacks in a buying a foreclosure is that it comes without seller’s disclosures. “So some people don’t want to buy them because they don’t know what’s involved,” she said. “Most people looking at foreclosures now are investors.”

Kevin Suksi, a financial services industry recruiter by day and real estate investor by night who lives in Dearborn, Mich., said that investors rarely buy the move-in ready foreclosures. Those largely go to owner-occupants who are willing to offer more money.

Instead, investors look for houses with bruises they can fix and sell or rent for income. “Everyone wants a deal right now, but what will they deal with?” Suksi said. “I think people will deal with paint and carpet and things like that, but when it comes to major structural problems they steer clear.”

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Weekly Economic Summary

2011-01-20T11:32:00.001-05:00

Last week in review
(January 3 - 7 2011)

The Labor Department reported that 103,000 jobs were created in December, and private job growth was 113,000. While these numbers were below the recently ramped up expectations, they do show that the trend in the labor market is improving. Also noteworthy are the upward revisions to the prior two months readings, showing 70,000 more jobs created than had been previously reported.

While unemployment figures could expect to be lower when job-growth increases, the real shocker in the report was the size of the decline in the unemployment rate to 9.4%, which is the lowest unemployment rate since May of 2009.

So what did we learn from this Jobs Report?

While positive news, this jobs number was still soft enough to support the Fed continuing their plans for a full dosage of QE2 for the economy and this won’t be good for bonds and home loan rates, as it carries some inflation threat down the road.
The recent tax package and lower tax rate extensions have not yet had enough time to be seen or felt in the economy, so those factors should help provide further improvement in the labor market in future months but also will create inflation – bad news for bonds and home loan rates.

The Fed seems intent on creating inflation, lowering the unemployment rate and raising stock prices. QE2 will likely keep coming until the employment picture improves significantly, and this is all going to be unfriendly for bonds and home loan rates ahead.

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Get A Read On Radon

2011-01-19T11:00:00.001-05:00

Radon escapes naturally from soil as a colorless, odorless, radioactive gas that can seep through the foundation of your home and reach toxic levels. How toxic? Radon contributes to 21,000 lung-cancer deaths annually, according to the Environmental Protection Agency (EPA). By comparison, carbon monoxide kills an average of 439 persons each year. The EPA sets the maximum acceptable radon exposure at 4 picocuries per liter of air (pCi/L). However, because there's no "safe" level, the EPA recommends you take action when the level in your home reaches 2 pCi/L. Outdoor radon levels average about .4 pCi/L.

Choose the best test
You can test for radon two ways:

DIY tests. Buy radon test kits at home centers or through National Radon Program Services. Testing takes two days to a year in a closed-up house before you return the test to a laboratory for the results. Radon levels vary daily, so longer tests mean greater accuracy. Retest after making repairs.
Professional tests. A trained radon professional's electric monitor shows how radon levels fluctuate during the test period. Home buyers may trust professional tests more because they are performed independently of home sellers.

Fix the problem
In general, treat radon reduction like any home improvement and obtain multiple bids before hiring a contractor. Fixing most radon problems costs $800 to $2,500, according to the National Radon Safety Board, one of two organizations maintaining lists of radon contractors. The National Environmental Health Association offers a list of questions to ask your radon contractor. The EPA has links to your state's radon control agency.

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Get A Read On Radon

2011-01-18T15:41:00.001-05:00

Choose the best test
You can test for radon two ways:

DIY tests. Buy radon test kits at home centers or through National Radon Program Services. Testing takes two days to a year in a closed-up house before you return the test to a laboratory for the results. Radon levels vary daily, so longer tests mean greater accuracy. Retest after making repairs.
Professional tests. A trained radon professional's electric monitor shows how radon levels fluctuate during the test period. Home buyers may trust professional tests more because they are performed independently of home sellers.

Posted via email from WESTCHESTER COUNTY DISTRESSED PROPERTY INFORMATION

Real Estate Investing

2011-01-18T09:37:00.001-05:00

Real Estate Investing is by now the last investment people is considering to do due to the mortgage and housing crisis. But the truth is that no one wants to rent if they can buy, and having their own home is part of the American Dream.

Real estate investment can get tricky and contains many traps. One of these is for example, the house that is not worth fixing and should be demolished down instead. Small houses built in between the 30s and the 40s with not standard building materials and practices. A house poorly built can be a nightmare later on.

There are many of investors that are new into the game of the slum business. Slum owners get old and think of retirement, so they decide to sell their houses. But the issue is that many of these houses are sub standard and many are condemnable. There have been many people that fall into this pitfall. When talking about real estate investment, investors have to make sure that money invested remains invested for an indefinite amount of time.

If a house is worth investing in, someone will eventually want it and buy it. But a mistake that many investors do is buying two houses when they can only pay for one. And at the end the one of the houses ends up selling at a loss to get out under the mortgages.

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4 Tricks and Traps Foreclosure Buyers Need to Know

2011-01-13T12:30:00.001-05:00

Interest in buying a foreclosed home is on the rise, but so are concerns about the risk involved in the process. In a December survey, Trulia found that 49 percent of Americans were at least somewhat likely to consider buying a foreclosure, up from 45 percent in May 2010. But the number of US adults who believed there are disadvantages to buying foreclosures had also increased, from 78 percent to 81 percent over the same time frame. Among those folks who had qualms about purchasing a foreclosure, the top concerns were:

that buying a foreclosure might involve hidden costs,
that the buying process itself is risky, and
that the home might continue to lose value, after escrow closes.

While there certainly are risks that run with buying a foreclosed home, the most risky way to do it is also the least common method: at the foreclosure auction itself. Auction buyers often don't have the opportunity to fully vet the foreclosure to ensure that they are receiving clear title and/or to make sure they're not getting a lemon. With that said, most foreclosures are resold not at the foreclosure auction, but as an REO (short for Real Estate Owned - by the bank), listed by a real estate broker on the Multiple Listing Service and on Trulia!

When you buy an REO in this way, you have lots of opportunities to use some tricks of the trade, so to speak, to avoid some of the traps you may fear. Here are my Top 4 Tricks and Traps for Foreclosure Buyers:

1. As-is means as-is, period. (Most of the time.) Banks have very little interest, inclination or even the logistically necessary resources to execute repairs on your home. Many of these homes are managed by an asset management company in another state, and may not even have a local person besides the agent who can handle large repairs. Generally speaking, bank-owned homes are sold on a very strict "as-is, where-is" basis, which just means that you should expect to take possession of it, if you buy it, in exactly the position and location it is, no matter how defective. Do not walk into a viewing of a foreclosed home, notice how the plumbing is all ripped out of the wall, and make an offer for it, assuming you'll be able to get the bank to "fix" the issue later. Usually, if the bank is willing to do any repairs to a foreclosed home, they do so, on the advice of the listing agent, prior to the home being listed.

Out of hundreds of foreclosure transactions I have personally been involved in, I have seen exactly four where the bank did agree to do some level of repairs at a buyer's request. Every one of those times, the repair was to fix a health-and-safety endangering property defect, like a gas-leak or an electrical fritz. And every one of those times, the property defect was highly non-obvious - not something even a diligent buyer could have detected visually prior to making an offer. Maybe another few times I've seen a bank agree to a small price reduction due to surprising condition problems. And dozens of times, I've seen transactions fall apart or buyers take on the property’s repair costs, when they request repair credits, price reductions or actual repairs from the ban seller.

If a foreclosure you're considering has obvious property damage, have your contractor stop by with you or gather whatever information you need to get as comfortable as possible with your offer price, assuming that the bank will not be chipping anything in for repairs, before you make the offer.

2. The bank speaks no evil. When it comes to real estate disclosures, the fact is, the bank speaks not much of anything! Many states exempt banks and other types of corporate homeowners from making substantive disclosures about the condition of the property. Even in jurisdictions where the bank is not legally exempt, most banks will simply write across the required disclosures something to the effect that the bank has no knowledge of the property's condition. (Before you protest with a "that's not fair!!" keep in mind that the bank never lived in the property, so most often truly does have no idea of any important facts or details about its condition or location, the things an average home seller would be required to disclose.)

Even in a normal transaction, it behooves a buyer to be thorough in having the property inspected and meticulous about reviewing the resulting inspection reports. But buying a foreclosure ups even that ante, as you have no seller disclosures to highlight particular problems you should have looked at, and none of the usual legal recourse you would have if a “regular” seller made incomplete disclosures. Get a property inspection. A pest inspection. A roof inspection. A sewer line inspection. A pool inspection, if you have a pool and care about its condition.

Yes - all these inspections cost money, but the drama and thousands each of them can save you is well worth it. And read your state’s buyer inspection advisory or similar document (ask your agent), just to make sure you’re aware of all the inspections that are available to you, and work with your agent to determine which ones make sense, and which are not appropriate.

Some insider tips:

Vacant foreclosures often have their utilities disconnected. Work with your agent to make sure the utilities get turned on - even for a single day - so that your property inspector can run the water taps, test the stove and dishwasher, see if the water heater and electrical outlets work, and so forth.
If appliances are there, the bank will probably leave them there, even though they may not have technical “legal” ownership of them, so they may not be included in the contract, like in a "normal" home sale.
However, the bank will not give you any sort of warranty on appliances, so try to obtain any warranty coverage you want or need elsewhere - from a home warranty company or, potentially, the original manufacturer/retailer.

3. The contract terms, they are a changin'. One thing squarely in the wheelhouses of local real estate pros are local market standard practices. From negotiating practices to which party pays which closing costs, every market is different, and experienced local agents are experts on this information. If you’re buying a foreclosure, though, the bank will often require you to use it’s own purchase contract, rather than the more commonly used state forms. Many times, this is done to advise the buyer of the bank’s refusal to make substantive disclosures (see above) and to change some of the normal practices for your area to the bank’s standard practices.

For instance, if you are buying a home in a contingency state, where you would usually have to sign a document proactively releasing contingencies, the bank’s contract will probably change that, so that your transaction operates on an objection period. In "objection" based transactions, you have a certain period of time in which you must either speak up about your concerns with the property and/or cancel the deal, or you will automatically be presumed to be moving forward with the deal and your deposit money will be forfeited if you change your mind after that date.

If you’ve been making offers on non-foreclosures on the standard contract form, or you’ve bought homes before and think you know the drill, please - I implore you - READ every word of the contract you sign when you buy a home from the bank, and ask your broker, agent or attorney to explain anything that doesn’t make sense.

4. Expect the unexpected. When you buy a foreclosure, you might end up working with the bank’s escrow company, instead of a company you or your agent selects. And the bank's escrow provider might be slow or disorganized. C’est la vie. The bank might rush you for your deposit money, but take their own sweet time coming up with the necessary signatures on their end to close the deal. Par for the course. You might expect that the bank would be desperate for buyers, and instead find out that there are 20 offers on the same REO. Or, you might be the only offer and still get your aggressively low (but still reasonable) offer rejected, only to have the bank reduce the list price of the home to the same price of your offer! (They often want to see if exposing it to other buyers at the new, lower list price might generate more interest and higher offers.)

When you’re buying a foreclosure, expect glitches, expect your calendar to be derailed, expect the bank to be inflexible and possibly even unreasonable. It’s not overkill to ask your broker or agent to brief you on the common complications they see in REO transactions. Having realistic expectations may keep you from pulling your hair out. And if the transaction turns out to run smooth as silk? You’ll be pleasantly surprised.

Posted via email from WESTCHESTER COUNTY DISTRESSED PROPERTY INFORMATION

Westchester Economic Summary

2011-01-13T10:12:00.001-05:00

So what did we learn from this Jobs Report?

While positive news, this jobs number was still soft enough to support the Fed continuing their plans for a full dosage of QE2 for the economy and this won’t be good for bonds and home loan rates, as it carries some inflation threat down the road.
The recent tax package and lower tax rate extensions have not yet had enough time to be seen or felt in the economy, so those factors should help provide further improvement in the labor market in future months but also will create inflation – bad news for bonds and home loan rates.

Posted via email from WESTCHESTER COUNTY DISTRESSED PROPERTY INFORMATION

RealtyTrac: More Than One Million Homes Seized by Lenders in 2010

2011-01-13T10:01:00.001-05:00

Lenders repossessed 1,050,500 homes last year, according to the 2010 end-of-year foreclosure report from RealtyTrac.

The annual figure marks a record-high number of new bank-owned properties tracked by the company. The 2010 tally is up 14 percent from the previous year, when banks seized 918,376 homes, according to RealtyTrac’s historical data.

Just to put things into perspective, in 2008 RealtyTrac reports there were 861,664 new REOs. That year the figure more than doubled from 2007, when there were 404,849 newly repossessed homes. In 2006, RealtyTrac tracked 268,532 new REOs.

While the number of homes taken back by lenders jumped by more than 130,000 from 2009 to 2010, RealtyTrac’s data show the number of default filings declined by 20 percent over the same period. The industry is still wading through a severe backlog of unpaid mortgages, but with new defaults apparently tapering off, it’s plausible that the size of that backlog may begin contracting.

According to RealtyTrac’s 2010 report, a total of 3,825,637 foreclosure filings – including default notices, scheduled auctions and bank repossessions – were reported on a record 2,871,891 U.S. properties during the year. The company says 2.23 percent of all U.S. housing units, or one in 45, received at least one foreclosure filing last year.

Total filings are up nearly 2 percent from 2009 and 23 percent from 2008, despite a sharp drop-off in activity during the latter part of 2010.

Foreclosure filings were reported on 257,747 properties during the month of December, a decrease of nearly 2 percent from the previous month and down 26 percent from December 2009.

It’s the biggest annual drop in foreclosure activity for any one month since RealtyTrac began publishing its foreclosure report in January 2005. December’s total

filings are the lowest monthly total recorded by the company since June 2008.

Fourth-quarter activity overall dropped considerably, with filings during the October to December timeframe down 14 percent from the previous quarter and 8 percent lower than the same period last year. The fourth quarter total was the lowest quarterly total since Q4 2008.

“Total properties receiving foreclosure filings would have easily exceeded 3 million in 2010 had it not been for the fourth quarter drop in foreclosure activity, triggered primarily by the continuing controversy surrounding foreclosure documentation,” said James Saccacio, RealtyTrac’s CEO.

“Even so, 2010 foreclosure activity still hit a record high for our report, and many of the foreclosure proceedings that were stopped in late 2010 — which we estimate may be as high as a quarter million — will likely be re-started and add to the numbers in early 2011,” Saccacio added.

All the usual suspects held their spots at the top of RealtyTrac’s list of states with the highest foreclosure rates for the 2010 calendar year. The company pointed out, however, that foreclosure activity dropped 22 percent in December in the judicial state of Florida, although bank repossessions spiked more than 45 percent that month in Nevada, Arizona, and California.

More than 9 percent of Nevada housing units (one in 11) received at least one foreclosure filing in 2010, giving it the nation’s highest state foreclosure rate for the fourth consecutive year, despite a 5 percent decrease in foreclosure activity from 2009.

Arizona registered the nation’s second highest state foreclosure rate for the second year in a row, with 5.73 percent of its homes (one in 17) receiving at least one foreclosure filing in 2010.

Florida claimed the nation’s third highest foreclosure rate, with 5.51 percent of its housing units (one in 18) receiving at least one foreclosure filing during the year.

Other states with 2010 foreclosure rates ranking among the nation’s 10 highest were: California (4.08 percent), Utah (3.44 percent), Georgia (3.25 percent), Michigan (3.00 percent), Idaho (2.98 percent), Illinois (2.87 percent), and Colorado (2.51 percent).

RealtyTrac says five states accounted for 51 percent of the nation’s total foreclosure activity in 2010: California, Florida, Arizona, Illinois, and Michigan. Together these five states documented nearly 1.5 million properties receiving a foreclosure filing during the year despite annual decreases in the three states with the most foreclosure activity.

Posted via email from WESTCHESTER COUNTY DISTRESSED PROPERTY INFORMATION

Should You Have the Air Ducts in Your Home Cleaned?

2011-01-10T11:41:00.001-05:00

Most people are now aware that indoor air pollution is an issue of growing concern and increased visibility. Many companies are marketing products and services intended to improve the quality of your indoor air. You have probably seen an advertisement, received a coupon in the mail, or been approached directly by a company offering to clean your air ducts as a means of improving your home's indoor air quality. These services typically -- but not always -- range in cost from $450 to $1,000 per heating and cooling system, depending on the services offered, the size of the system to be cleaned, system accessibility, climatic region, and level of contamination.

Duct cleaning generally refers to the cleaning of various heating and cooling system components of forced air systems, including the supply and return air ducts and registers, grilles and diffusers, heat exchangers heating and cooling coils, condensate drain pans (drip pans), fan motor and fan housing, and the air handling unit housing.

If not properly installed, maintained, and operated, these components may become contaminated with particles of dust, pollen or other debris. If moisture is present, the potential for microbiological growth (e.g., mold) is increased and spores from such growth may be released into the home's living space. Some of these contaminants may cause allergic reactions or other symptoms in people if they are exposed to them. If you decide to have your heating and cooling system cleaned, it is important to make sure the service provider agrees to clean all components of the system and is qualified to do so. Failure to clean a component of a contaminated system can result in re-contamination of the entire system, thus negating any potential benefits. Methods of duct cleaning vary, although standards have been established by industry associations concerned with air duct cleaning. Typically, a service provider will use specialized tools to dislodge dirt and other debris in ducts, then vacuum them out with a high powered vacuum cleaner.

In addition, the service provider may propose applying chemical biocides, designed to kill microbiological contaminants, to the inside of the duct work and to other system components. Some service providers may also suggest applying chemical treatments (sealants or other encapsulants) to seal or cover the inside surfaces of the air ducts and equipment housings because they believe the sealant will control mold growth or prevent the release of dirt particles or fibers from ducts. These practices have yet to be fully researched and you should be fully informed before deciding to permit the use of biocides or sealants in your air ducts. They should only be applied, if at all, after the system has been properly cleaned of all visible dust or debris.

Deciding Whether or Not to Have Your Air Ducts Cleaned

Knowledge about the potential benefits and possible problems of air duct cleaning is limited. Since conditions in every home are different, it is impossible to generalize about whether or not air duct cleaning in your home would be beneficial.

You may consider having your air ducts cleaned simply because it seems logical that air ducts will get dirty over time and should occasionally be cleaned. While the debate about the value of periodic duct cleaning continues, no evidence suggests that such cleaning would be detrimental, provided that it is done properly.

On the other hand, if a service provider fails to follow proper duct cleaning procedures, duct cleaning can cause indoor air problems. For example, an inadequate vacuum collection system can release more dust, dirt, and other contaminants than if you had left the ducts alone. A careless or inadequately trained service provider can damage your ducts or heating and cooling system, possibly increasing your heating and air conditioning costs or forcing you to undertake difficult and costly repairs or replacements.

You should consider having the air ducts in your home cleaned if:

There is substantial visible mold growth inside hard surface (e.g., sheet metal) ducts or on other components of your heating and cooling system. There are several important points to understand concerning mold detection in heating and cooling systems:

Many sections of your heating and cooling system may not be accessible for a visible inspection, so ask the service provider to show you any mold they say exists.
You should be aware that although a substance may look like mold, a positive determination of whether it is mold or not can be made only by an expert and may require laboratory analysis for final confirmation. For about $50, some microbiology laboratories can tell you whether a sample sent to them on a clear strip of sticky household tape is mold or simply a substance that resembles it.
If you have insulated air ducts and the insulation gets wet or moldy, it cannot be effectively cleaned and should be removed and replaced.
If the conditions causing the mold growth in the first place are not corrected, mold growth will recur.

Ducts are infested with vermin, e.g. (rodents or insects); or

Ducts are clogged with excessive amounts of dust and debris and/or particles are actually released into the home from your supply registers.

Other Important Considerations...

Duct cleaning has never been shown to actually prevent health problems. Neither do studies conclusively demonstrate that particle (e.g., dust) levels in homes increase because of dirty air ducts or go down after cleaning. This is because much of the dirt that may accumulate inside air ducts adheres to duct surfaces and does not necessarily enter the living space. It is important to keep in mind that dirty air ducts are only one of many possible sources of particles that are present in homes. Pollutants that enter the home both from outdoors and indoor activities such as cooking, cleaning, smoking, or just moving around can cause greater exposure to contaminants than dirty air ducts. Moreover, there is no evidence that a light amount of household dust or other particulate matter in air ducts poses any risk to health.

If you think duct cleaning might be a good idea for your home, but you are not sure, talk to a professional. The company that services your heating and cooling system may be a good source of advice. You may also want to contact professional duct cleaning service providers and ask them about the services they provide. Remember, they are trying to sell you a service, so ask questions and insist on complete and knowledgeable answers.

Suggestions for Choosing a Duct Cleaning Service Provider

To find companies that provide duct cleaning services, check your Yellow Pages under "duct cleaning". Talk to at least three different service providers and get written estimates before deciding whether to have your ducts cleaned. When the service providers come to your home, ask them to show you the contamination that would justify having your ducts cleaned.
Do not hire duct cleaners who make sweeping claims about the health benefits of duct cleaning -- such claims are unsubstantiated.
Do not hire duct cleaners who recommend duct cleaning as a routine part of your heating and cooling system maintenance.
Do not allow the use of chemical biocides or sealants unless you fully understand the pros and the cons.
Check references to be sure other customers were satisfied and did not experience any problems with their heating and cooling system after cleaning.
Contact your local consumer affairs or local Better Business Bureau to determine if complaints have been lodged against any of the companies you are considering.
Interview potential service providers to ensure:

they are experienced in duct cleaning and have worked on systems like yours;
they will use procedures to protect you, your pets, and your home from contamination; and
they comply with air duct cleaning standards and, if your ducts are constructed of fiber glass duct board or insulated internally with fiber glass duct liner, with the North American Insulation Manufacturers Association's (NAIMA) recommendations.

If the service provider charges by the hour, request an estimate of the number of hours or days the job will take, and find out whether there will be interruptions in the work. Make sure the duct cleaner you choose will provide a written agreement outlining the total cost and scope of the job before work begins.

What to Expect From an Air Duct Cleaning Service Provider

If you choose to have your ducts cleaned, the service provider should:

Open access ports or doors to allow the entire system to be cleaned and inspected.
Inspect the system before cleaning to be sure that there are no asbestos-containing materials (e.g., insulation, register boots, etc.) in the heating and cooling system. Asbestos containing materials require specialized procedures and should not be disturbed or removed except by specially trained and equipped contractors.
Use vacuum equipment that exhausts particles outside of the home or use only high efficiency particle air (HEPA) vacuuming equipment if the vacuum exhausts inside the home.
Protect carpet and household furnishings during cleaning.
Use well controlled brushing of duct surfaces in conjunction with contact vacuum cleaning to dislodge dust and other particles.
Use only soft bristled brushes for fiberglass duct board and sheet metal ducts internally lined with fiberglass. (Although flex duct can also be cleaned using soft bristled brushes, it can be more economical to simply replace accessible flex duct.)
Take care to protect the duct work, including sealing and re-insulating any access holes the service provider may have made or used so they are airtight.
Follow standards for air duct cleaning and NAIMA's recommended practice for ducts containing fiber glass lining or constructed of fiber glass duct board.

How to Determine if the Duct Cleaner Did A Thorough Job

A thorough visual inspection is the best way to verify the cleanliness of your heating and cooling system. Some service providers use remote photography to document conditions inside ducts. All portions of the system should be visibly clean; you should not be able to detect any debris with the naked eye. After completing the job, ask the service provider to show you each component of your system to verify that the job was performed satisfactorily.

How to Prevent Duct Contamination

Whether or not you decide to have the air ducts in your home cleaned, committing to a good preventive maintenance program is essential to minimize duct contamination.

To prevent dirt from entering the system:

Use the highest efficiency air filter recommended by the manufacturer of your heating and cooling system.
Change filters regularly.
If your filters become clogged, change them more frequently.
Be sure you do not have any missing filters and that air cannot bypass filters through gaps around the filter holder.
When having your heating and cooling system maintained or checked for other reasons, be sure to ask the service provider to clean cooling coils and drain pans.
During construction or renovation work that produces dust in your home, seal off supply and return registers and do not operate the heating and cooling system until after cleaning up the dust.
Remove dust and vacuum your home regularly. (Use a high efficiency vacuum (HEPA) cleaner or the highest efficiency filter bags your vacuum cleaner can take. Vacuuming can increase the amount of dust in the air during and after vacuuming as well as in your ducts).
If your heating system includes in-duct humidification equipment, be sure to operate and maintain the humidifier strictly as recommended by the manufacturer.

To prevent ducts from becoming wet:

Moisture should not be present in ducts. Controlling moisture is the most effective way to prevent biological growth in air ducts.

Moisture can enter the duct system through leaks or if the system has been improperly installed or serviced. Research suggests that condensation (which occurs when a surface temperature is lower than the dew point temperature of the surrounding air) on or near cooling coils of air conditioning units is a major factor in moisture contamination of the system. The presence of condensation or high relative humidity is an important indicator of the potential for mold growth on any type of duct. Controlling moisture can often be difficult, but here are some steps you can take:

Promptly and properly repair any leaks or water damage.
Pay particular attention to cooling coils, which are designed to remove water from the air and can be a major source of moisture contamination of the system that can lead to mold growth. Make sure the condensate pan drains properly. The presence of substantial standing water and/or debris indicates a problem requiring immediate attention. Check any insulation near cooling coils for wet spots.
Make sure ducts are properly sealed and insulated in all non-airconditioned spaces (e.g., attics and crawl spaces). This will help to prevent moisture due to condensation from entering the system and is important to make the system work as intended. To prevent water condensation, the heating and cooling system must be properly insulated.

Should chemical biocides be applied to the inside of air ducts?

Air duct cleaning service providers may tell you that they need to apply a chemical biocide to the inside of your ducts to kill bacteria (germs), and fungi (mold) and prevent future biological growth. Some duct cleaning service providers may propose to introduce ozone to kill biological contaminants. Ozone is a highly reactive gas that is regulated in the outside air as a lung irritant. However, there remains considerable controversy over the necessity and wisdom of introducing chemical biocides or ozone into the duct work.

Little research has been conducted to demonstrate the effectiveness of most biocides and ozone when used inside ducts. Simply spraying or otherwise introducing these materials into the operating duct system may cause much of the material to be transported through the system and released into other areas of your home.

In the meantime...

Before allowing a service provider to use a chemical biocide in your duct work, the service provider should:

1. Demonstrate visible evidence of microbial growth in your duct work. Some service providers may attempt to convince you that your air ducts are contaminated by demonstrating that the microorganisms found in your home grow on a settling plate (i.e., petri dish). This is inappropriate. Some microorganisms are always present in the air, and some growth on a settling plate is normal. As noted earlier, only an expert can positively identify a substance as biological growth and lab analysis may be required for final confirmation. Other testing methods are not reliable.

2. Explain why biological growth cannot be removed by physical means, such as brushing, and further growth prevented by controlling moisture.

If you decide to permit the use of a biocide, the service provider should:

1. Show you the biocide label, which will describe its range of approved uses.

2. Apply the biocide only to uninsulated areas of the duct system after proper cleaning, if necessary to reduce the chances for regrowth of mold.

3. Always use the product strictly according to its label instructions.

While some low toxicity products may be legally applied while occupants of the home are present, you may wish to consider leaving the premises while the biocide is being applied as an added precaution.

Do sealants prevent the release of dust and dirt particles into the air?

Manufacturers of products marketed to coat and seal duct surfaces claim that these sealants prevent dust and dirt particles inside air ducts from being released into the air. As with biocides, a sealant is often applied by spraying it into the operating duct system. Laboratory tests indicate that materials introduced in this manner tend not to completely coat the duct surface. Application of sealants may also affect the acoustical (noise) and fire retarding characteristics of fiber glass lined or constructed ducts and may invalidate the manufacturer's warranty.

Questions about the safety, effectiveness and overall desirability of sealants remain. For example, little is known about the potential toxicity of these products under typical use conditions or in the event they catch fire.

In addition, sealants have yet to be evaluated for their resistance to deterioration over time which could add particles to the duct air.

Most organizations concerned with duct cleaning, do not currently recommend the routine use of sealants in any type of duct. Instances when the use of sealants may be appropriate include the repair of damaged fiber glass insulation or when combating fire damage within ducts. Sealants should never be used on wet duct liner, to cover actively growing mold, or to cover debris in the ducts, and should only be applied after cleaning according to appropriate guidelines or standards.

Posted via email from WESTCHESTER COUNTY DISTRESSED PROPERTY INFORMATION

2011: The Year of Big Decisions

2010-12-29T12:47:00.001-05:00

If we think 2010 was a tough year, then hang on because 2011 is going to be fast and furious. With all of the legislative and regulatory changes coming within the next 18-24 months, we will not be able to sit back and hope it all works out for the best.
Yes, there is some good news … all loan officers, no matter who you work for, are now going to be paid on an equal compensation program. Unlike in the past, either one side or the other had an advantage, but now compensation becomes one set of guidelines starting April 1, 2011.

Loan officers, effective April 1, 2011, will be paid off the loan amount only, plus any bonuses developed by companies, with nothing involving fees, programs or interest rates.

The broker/owner is going to have to plan for all of the following:

1. How is my company going to be paid?
2. How much is my company going to make on the loan?
3. How much does it cost for me to originate the loan?
4. What is my compensation program going to look like?
5. Am I going to have a bonus program and how is going to be structured?
6. Is my company going to be a broker, banker or a hybrid?
7. How do I attract good producing loan officers?
8. Can I stay competitive?
9. Am I going to be able to meet all of my deadlines on my own, or do I need outside help?
10. How do I make sure I keep my loan officers within Nationwide Mortgage Licensing System (NMLS) timelines and requirements?
11. Have I met all of the minimum wage and labor requirements?
12. What is your mortgage origination projections for 2011?

Now that you have answered these questions, you are ready to sit down and develop your own business plan for 2011. In the past, we have never had to experience the number of challenges in developing a plan for 2011. It may be overwhelming, but as the old anecdote says, “How do you eat an elephant … one bite at a time.” The year 2011 may one of the most challenging years to date, but it is going to be one of the most exciting and fun years as you develop your company into the fighting machine it has to be to survive. Don’t give up.

As you look at the overall market, in 2006 there were 1,800 mortgage companies in the state of Illinois alone and a total of 18,000 loan officers. In 2011, we will see less than 700 companies and approximately 5,000 loan officers in Illinois. How does that make you feel? It should make you feel fantastic as you are a survivor who has less competition to deal with and you will have a greater opportunity with the right plan to gain increased market share.

Everyone predicts that the banks are going to take over the market, I can assure that has been said at least five times since 1986. Mortgage brokers and mortgage bankers continue to survive and develop their own market and niche. Why, because they are innovative and are filled with an entrepreneurial spirit. So, let’s be aware of what others are doing, but let’s develop our own plan for survival and increase our presence. Remember, no matter what the market was doing, good or bad, the mortgage customers came to you, the mortgage broker and mortgage banker, because you were more knowledgeable, persistent in getting a loan and more economical.

As a mortgage broker and a mortgage banker, we also one other thing that no financial institution can sat and that is we are licensed professionals … be proud of that.

Once you have figured out how to navigate your business through what lies ahead in 2011, I hope you’ll ponder what you can do in terms of helping the industry at large. The greatest opportunity to make a far-reaching impact comes when many small companies band together as one. Whether that’s through getting involved in a trade association, making an appointment with your legislator, taking continuing education classes or attending industry events, we all have many opportunities, and the responsibility, to not only see to it that our companies endure, but that our industry thrives as well.

So as we enter the year 2011, we have a lot to look forward to as long as we are willing to make the difficult decision and put together a plan that is real and obtainable. We will continue to be under attack, but we have survived 15 years of new regulations and we continue to be here, so they cannot do much more to hurt us.

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5 Strategies to Rebuild Your Credit after Foreclosure

2010-12-24T08:41:00.001-05:00

If you’ve been through a foreclosure, you may wonder if there is hope for you to become a homeowner again. The answer is yes, but it will take a while. “It doesn’t mean you’ll never be a homeowner again,” said Linda Davis-Demas, director of housing at Consumer Credit Counseling Service of Greater Dallas.

But you’ll need to examine what caused you to fall behind on your mortgage and take steps to fix the problem. “You have to look at what were the reasons you didn’t make the payment,” said Davis-Demas. “Was it budgeting? You can modify that type of behavior.”

A foreclosure is a major hit to your credit history and stays on your credit report for seven years.

“Foreclosure is one of the FICO seven deadlies,” said credit expert John Ulzheimer, referring to the dominant FICO credit score. “It’s considered a major derogatory item, regardless of the back story”— whether it’s a job loss, rate reset, underemployment or other reasons.

Your credit score will also suffer “the minute the foreclosure process begins,” said Ulzheimer, founder of 2StepCredit.com, a credit education website. “It doesn’t have to be completed for it to be very damaging,” he said. “The damage will vary based on your scores, but it can damage the score as much as 200 points, especially if your scores are very strong to begin with.”

So, after a foreclosure, your priority has to be rebuilding your credit. You’ll have some time to do so, because mortgage giants Fannie Mae and Freddie Mac impose strict rules on how long it will take before you’re eligible for another mortgage.

For example, borrowers with a prior foreclosure and extenuating circumstances—such as a job loss, divorce or medical issues—must wait three years before they can qualify for a Fannie Mae-backed loan, said spokeswoman Amy Bonitatibus. For all other borrowers, the waiting period is seven years.

At Freddie Mac, those who can prove extenuating circumstances must wait three years before applying for a new mortgage; everyone else must wait five years. But that will change in February, when the waiting period for those whose foreclosure was caused by their own financial mismanagement will increase to seven years.

Fannie Mae and Freddie Mac also have strict rules on the credit score and the size of the down payment required of borrowers with a prior foreclosure.

Here’s what you need to do to rebuild your credit to qualify again for a mortgage:

Pay your bills on time: The FICO score, the dominant credit score used by lenders, gives the greatest weight to payment history, so make sure you consistently pay your bills on time. “Stability is the key,” said Craig Jarrell, president of the Dallas region of IberiaBank Mortgage Co. “Have you demonstrated that you are now capable of owning a home and paying the bills, and have recovered from whatever circumstance caused the original foreclosure?”

Review your credit report: You’re entitled to a free credit report once every 12 months from each of the three national credit bureaus—Experian, TransUnion and Equifax. You should get a copy and check it for any inaccuracies.

To get your free credit report, go to http://www.annualcreditreport.com. “Make sure it is about you and only you,” said Gail Cunningham, spokeswoman for the National Foundation for Credit Counseling. “If you find errors, dispute them. If you discover old debts, it will weigh in your favor to satisfy them. Paid late looks better than not paid at all. Make sure that debts older than seven years have rotated off your report, as these could be dragging your score down unnecessarily.”

Check your mortgage: You want to be sure that you don’t still owe anything on your old mortgage. Sometimes proceeds from a foreclosure sale aren’t enough to cover what’s owed on the mortgage, which would leave you owing the difference.

“Make sure there is a zero balance reflected, and if you are responsible for a shortfall, make arrangements to repay the remaining balance,” Cunningham said.

Many lenders are willing to settle that “deficiency judgment” for less than what’s owed because “it’s better than getting no money at all,” Jarrell said.

Apply for credit: In particular, apply for different varieties of credit. “Credit scoring models value having different types of credit,” Cunningham said. “Having some revolving accounts, typically credit cards, and some installment fixed-payment loans, such as a car payment, can improve your score.” But don’t apply for too much credit at once. “This can appear as though you’re desperate for credit and perhaps make lenders less inclined to extend credit to you,” Cunningham said. “Further, too many credit inquiries can have a negative impact on your credit score.”

Don’t fall prey: Watch out for credit repair companies that promise to clean up your credit report so you can get a car loan, a home mortgage, insurance, or even a job—after paying a fee for the service. “The truth is, that no one can remove accurate, negative information from your credit report,” according to the Federal Trade Commission. “It’s illegal.” Only the passage of time can assure that negative, but accurate, information on your credit report will be removed.

When it comes to repairing your credit, there are no quick fixes, the experts say. What lenders want to see is responsible financial behavior over time.

“Know that time is your friend, as the farther you move away from the financial distress, the less negative impact it has,” Cunningham said. “Follow with responsible behavior with your new credit, and you’ll soon have a solid credit file.”

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An Update on Home Foreclosures

2010-12-20T13:25:00.001-05:00

Lately, very few things have been in the news more than the topic of home foreclosures. Depending on the source, it is estimated there have been over 4 million homes entering foreclosure over the past four years and about 300,000 are entering the first stage monthly.

Recently the attention has turned from the sheer volume of foreclosures to the procedural flaws in foreclosing that are threatening lenders' rights to foreclose because legal "ownership" of the mortgage may not be readily determined or because paperwork related to foreclosing was improperly executed.

The net result is that several major lenders have announced a moratorium on their foreclosure process to allow them time to review their documentation and to determine that they can legitimately move forward.

This means that the natural flow of homes through the pipeline is interrupted. Instead of having a predictable timeline, buyers must sit in limbo with respect to the actual availability of a particular home for purchase.

Except for the national attention and anxiety caused by the media saturation of this issue, the real economic effect will likely be very localized and concentrated. In communities with a large number of foreclosures where the mortgages on those homes are owned by lenders who are temporarily halting the process, it means those homes can't go on the market. So in turn, the decline in the amount of inventory being offered for sale could result in an increase on home prices in that area, until the foreclosure freeze is thawed out.

However as a national economic issue, the overall impact will probably not have a measureable or lasting effect on the housing market. That assumes, of course, that lenders move expeditiously to determine their ownership and identify steps necessary to deal with the process and documentation problem – such as, resuming the foreclosure process or indentifying loan modifications and workouts.

I will continue to monitor this situation very closely, and would encourage you to call or email me so we can discuss what this might mean to you.

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Eat well while conserving your energy

2010-12-15T12:45:00.001-05:00

For people living with COPD, or chronic obstructive pulmonary disease, getting proper nutrition is crucial.

But, it isn't always easy to do. COPD can make daily activities tiring — that includes planning and preparing meals. Even eating can make people more short of breath.

Why is it so important?
COPD makes the lungs and heart work harder. A nourishing diet can help these vital organs keep up with their workload. It can improve a person's breathing and stamina. It's also vital to weight control — and can help prevent infection and illness, too.

On the other hand, being undernourished can make the condition worse. The muscles used for breathing can get weaker.

3 easy-does-it tips
There's no special COPD diet. What's important is eating a variety of healthful foods. To do this — without using up too much of your energy — you may find it helps to:

1. Consider prep time. Make a list of a variety of nutritious foods and dishes that are easy to prepare. Build your daily meals around these items.

2. Take it slow. Rest before and after eating. And, take your time. Don't rush a meal.

3. Break it up. Try to eat six small meals every day. Large meals can fill up your stomach, pressing against your diaphragm and making it harder to breathe.

Help to eat well and stay well
Whether or not you're having difficulty preparing or eating nutritious meals, talk with your doctor. He or she may be able to refer you to a registered dietitian who works with people who have COPD.*

Depending on your condition, you may need more intensive nutritional help.

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11 Year End Tax Savings Tips

2010-12-13T11:57:00.001-05:00

This time of year, now through the first quarter of next year, you will see articles offering year-end tax planning tips. Tax planning tips can increase income in future years, so be careful. Many tax tips often involve accelerating deductions, deferring income, or last-minute charitable deductions (the first three following tips).

For example you may be compelled to make a large charitable contribution this year by December 31st. However if you could be in a higher tax bracket next year because your income is going up because of a substantial raise or bonus, you would have been better off to make the contribution next year. Some may say this is heartless, but I say just the reverse. If you pay less in taxes because of good planning, your will be better off financially and able to give more in the future.

If you have volatile income, before you use the tax savings tips here and in other articles, you may want to run projections for this year and next. A good accountant will run these calculations for you, but understand that tax law changes from year to year and from one administration to the next can often make predicting tricky.

1. Defer income

If you are able to defer income, such as commissions and bonuses until next year, you might be able to pay lower income taxes this year. However, you must consider what your income and taxes will be next year to be sure that you are not actually increasing your taxes.

2. Accelerating deductions

Accelerating major deductions such as state income taxes, property taxes, and mortgage interest may help anyone, especially during a high-income year. If you don't think your personal income tax bracket will be higher next year, and you're not affected by the alternative minimum tax, you can make state and/or local tax payments before the end of this year so you can take a deduction this year.

3. Charitable Contributions

Consider making charitable deductions before the end of the year to receive a deduction. You must make the contribution by 12/31/2009.

Donate appreciated property such as real estate or stock instead of the proceeds of the sale. You may be able to receive a deduction for the value of the contribution without paying tax on the growth portion resulting from a sale, then a gift. If you intend to transfer appreciated property, begin early since it will take several weeks to make the change.

4. Alternative minimum tax traps

Many people face large AMT bills compared to previous years. Be warned if you have larger than usual medical expenses, non-federal income and real estate taxes, or miscellaneous itemized deductions; or if you have exercised large stock options, to name a few.

Year-end tax planning strategies can backfire under AMT. Be very careful accelerating some deductions and exercising stock options at year end. See a tax professional for information on your specific tax situation.

5. Be careful when investing new money in mutual funds at the end of the year

Call the mutual fund and find out when the distribution date is. You may want to purchase after the distribution date to avoid owing taxes on fund shares that you owned only for a short period of time and had little to no gain.

6. Contribute the maximum to retirement accounts

Contribute the maximum allowable to employer-sponsored defined contribution retirement plans, such as profit sharing, 401(k), 403(b) and 457(b) plans. This not only provides an excellent tax deduction, but it also helps you to plan for your future retirement.

You may want to contribute to an IRA; up to $2,000 is fully deductible if you did not participate in a company-sponsored retirement plan or if your income falls below certain levels.

If you are self-employed, you can contribute more to a pension plan than into an IRA. You have until December 31 to set up the plan.

7. Investment Losses

If your investment portfolio has stock that has depreciated in value and is worth less than when you originally purchased it, you may want to consider selling it. You may be able to use that loss to offset capital gains and ordinary income.

Be careful though; investment decisions should not just be for tax purposes. Make sure that you do your research before selling any investment. Some people react too quickly when investments lose value; others sometimes hold on too long. If you decide to sell and invest in something new, make sure that you examine your portfolio to ensure that you have the right mix of investments to match your investment profile, risk propensity and asset allocation model.

8. Save for College

Consider contributing to your child's college savings into a 529 plan. The contributions are not deductible on your Federal return, but parents may be able to write off contributions up to a certain dollar amount on their state income tax return. Log on to SavingforCollege.com to find out information about your state.

9. Home Improvements

Here is a great deal. How about saving energy and the environment, lower utility bills, increase the value of your home and save on taxes - all at once. Projects for the home's shell (insulation, windows, sealing) and heating and cooling may qualify for a one time tax credit of $500. However you are running out of time, since they must be in place by the end of 2007. So while crawling around your attic looking for ornaments, think of adding insulation. If you made home improvements over the last couple of years, be sure to dig up your records; you may already be eligible.

Before moving forward on one of these projects, make sure that you get full information about these and other energy efficient tax incentives from The Tax Incentives Assistance Project at http://www.energytaxincentives.org. There you will find more information about Home Shell and Heating & Cooling as well as Hybrid Passenger Vehicles and Solar Energy Systems.

10. If self-employed, buy equipment and supplies

Have you been putting off buying needed business equipment and supplies, or do you know that you will soon need them? Now may be the time to invest in your business and save taxes as well. Business tax can be complex; therefore it may be wise to first call your accountant prior to large purchases.

11. Give gifts to children

When you give to friends and family, it is usually not taxable to the recipient or the giver. Many people do not realize though if that gift exceeds $12,000 per person it is taxable to the giver, and at a high rate. Therefore, if you intend to give anyone more than that amount, you could give some this year and some next. The second tip is that you and your spouse can both give $12,000 per person, doubling the amount not subject to tax. Be sure to consult your legal and tax advisor prior to making all gifts.

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58 Percent of Americans Expect Housing Market to Recover after 2012, According to Trulia and RealtyTrac

2010-12-09T11:14:00.001-05:00

Trulia.com, a top site for home buyers, sellers and renters, and RealtyTrac, a leading online marketplace for foreclosure properties released the latest results of an ongoing survey tracking home buyers’ attitudes toward foreclosed homes. Results of the survey conducted online from November 2-4, 2010 by Harris Interactive on behalf on Trulia and RealtyTrac showed that Americans continue to grapple with uncertainty about the housing market, with 58% of U.S. adults expecting recovery to take at least another two years.

As a result of the recent robo-signing debacle, half of U.S. adults expressed that they now have less faith in mortgage lenders, banks and the government. Another 35% believe the robo-signing issue will delay the housing market’s recovery, while only 6% of U.S. adults think the robo-signing issue will have no effect on the recovery of the housing market.

“More and more, American homeowners, -sellers and -buyers are tamping down their expectations for a swift recovery in the housing market and bracing themselves for a long, slow climb back to a healthy real estate market. Fifty-eight percent believe recovery will happen after 2012 and more than one in five U.S. adults believe recovery won’t happen until 2015 or later,” said Pete Flint, co-founder and CEO, Trulia. “Government incentives have come and gone and historic lows in interest rates have done little to spur recovery. Then, as if prospective buyers and sellers needed more to be concerned about, the robo-signing issue caused a ‘what’s next?’ fear to surface in the minds of consumers who, frankly, have lost faith in banks and their government to make good decisions.”

Under water and out of options
Nearly half (48%) of homeowners with a mortgage admitted that they would consider walking away if their mortgage was under water, an increase compared with May 2010, when only 41% said they would consider walking away if their mortgage was under water. Interestingly, men (57%) are more likely than women (40%) to consider strategic default as an option for dealing with negative equity.

If they became unable to pay the mortgage payments on their current primary residence, two-thirds of U.S. adults with mortgages said they would consider calling the lender and trying to modify the terms of the loan as their first option. The next most popular solution is to have a tenant move in to contribute to the mortgage, but only 10% of U.S. adults would do this.

Interest in buying a foreclosure
Nearly half (49%) of U.S. adults are at least somewhat likely to consider purchasing a foreclosed property, up from 45% in May 2010. Despite the rising interest in buying a foreclosed home, an increasing number of U.S. adults also recognize negative aspects to buying a foreclosure. Over the past six months, the number of U.S. adults who believe there are downsides to buying foreclosed properties has increased to 81%, from 78% in May 2010.

Expected discount on foreclosure purchase
Two-thirds (67%) of U.S. adults would expect to pay at least 30% less for a foreclosed home than a similar home that was not in foreclosure, and one-third of U.S. adults (35%) would expect to pay at least 50% less for a foreclosed home. Overall, 97% of U.S. adults would expect at least some discount on a foreclosed home.

“It seems like consumer expectations and market realities are beginning to align when it comes to foreclosure discounts,” said Rick Sharga, senior vice president, RealtyTrac. “During the third quarter, foreclosure homes sold for an average of 32% less than homes not in foreclosure. It’s also not surprising that we’ve seen an increase in negative sentiment toward foreclosure purchases, where the recent robo-signing controversy has added more confusion to an already complicated process.”

For more information, visit www.trulia.com and www.realtytrac.com.

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A 5 Point Plan: How to Get The Cash You Need Fast!

2010-12-08T07:39:00.001-05:00

......by using your mortgage to your advantage in a cash flow or shortage situation......"

Mortgage regulations have changed significantly over the last few years, making your options wider than ever. Subtle changes in the way you approach mortgage shopping, and even small differences in the way you structure your mortgage, can cost or save you literally thousands of dollars and years of expense.

Get the Right Information - Whether you are about to buy your first home, or are planning to make a move to your next home, it is critical that you be informed about the factors involved.

Everyday people are in need of cash, and fast. May be it is or isn't time to consider your mortgage loan as an option. By taking these few minutes to acquaint yourself with the "A 5 Point Plan: How to Get The Cash You Need Fast!", you will know what options to discuss with your mortgage lender and you will be better prepared to make the right decisions for your unique situation..

A Traditional Refinance

The initial option for most people to consider is a traditional refinance. This option takes advantage of available interest rates that might be lower than your current mortgage. The benefit of this option is that you can reduce your monthly payment while getting the best possible interest rate.

A Cash Out Refinance

A cash out refinance works like a traditional refinance, except that you’re able to remove some of your equity in the property. One of the significant benefits of this option is your ability to pay off higher interest loans, make home improvements, or a major purchase, while at the same time qualifying your interest payments as a deduction on your federal tax return. Always consult with your accountant or tax attorney to determine eligibility in your unique situation.

A Second Mortgage

This works very similarly to a Cash Out, except you get a second financing vehicle instead of refinancing an existing one. A few reasons for a second mortgage are debt consolidation, home improvements, or a major purchase. If you take cash out to buy a car you may be able to deduct the interest from your taxes, similarly to the last example. Remember to always consult with your accountant or tax attorney to determine eligibility in your unique situation.

Beware of the Quality of Service Provided

You want your refinance to be the least amount of hassle in the shortest period of time. Ask your mortgage broker details of their service plan and performance guarantee.

Not All Mortgage Brokers are Created Equally

Be sure to ask your mortgage broker about available loan products, terms and rates. A subtle difference can save or cost you thousands.

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New foreclosure trouble brewing as late payments rise?

2010-11-22T14:05:00.001-05:00

Several states across the Northeast are seeing a sharp jump in homeowners falling behind on their mortgages.

That's the word out from TransUnion, which released its third quarter mortgage delinquency numbers over the weekend. The biggest increases in late payments were seen in New Jersey, New York and Connecticut at the region's core, as well as in outliers like Maine and Delaware.

Pennsylvania and Maryland, as well as another swath of New England states - Vermont, New Hampshire and Rhode Island - saw less dramatic increases.

The regional rise bucks a national trend that is seeing a slow but steady decline in mortgage delinquencies from a record-shattering peak in 2009. (That is with the exception of the Great Depression, which saw half of all homeowners either fall behind on their payments or face foreclosure.)
While the national rate is up, year over year, at 6.44 percent, it has been falling steadily on a quarter-by-quarter basis, TransUnion reports.

A sluggish economy that still feels like a recession to many of us is clearly continuing to take a toll. Check out this Boston Sunday Globe story. Three quarters of all Massachusetts residents say the recession has not ended for them, with more than half seeing no break in the tough conditions for at least two more years, according to a Globe/Suffolk University poll.

Try as I might, I couldn't find third quarter data for Massachusetts. I will be calling the TransUnion public relations flak this morning to fill in that gap and will post the data when I get it.

The Bay State's delinquency rate stood at just over 5 percent of all borrowers in the second quarter, far above historical norms of 1.5 percent to 2 percent.

What's your take? Are you falling behind on your payments - or hesitating to buy because of a still uncertain economy?

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An Update on Home Foreclosures

2010-11-16T13:20:00.001-05:00

I will continue to monitor this situation very closely, and would encourage you to call or email me so we can discuss what this might mean to you.

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Realtors Strive to Streamline Short Sales through HAFA

2010-11-11T08:35:00.001-05:00

RISMEDIA, November 11, 2010—Realtors gleaned inside knowledge on the efforts being made to improve the short sale process through the Home Affordable Foreclosure Alternatives Program at the 2010 REALTORS® Conference & Expo. HAFA was intended to help homeowners who are unable to keep their home under the Making Home Affordable Modification Program avoid foreclosure by streamlining the short sales process and providing incentives to lenders that complete short sales. According to the National Association of Realtors’ most recent Realtors Confidence Index, 12% of all recent home buyers purchased their home through a short sale.

“Realtors from across the country are telling us that the current short sales process is time-consuming and cumbersome, discouraging buyers who would otherwise want to purchase a home in a short sale,” said NAR President Vicki Cox Golder, owner of a real estate company in Tucson, Ariz. “As the leading advocate for home ownership and housing issues, NAR has been urging lenders and servicers to approve reasonable short sale offers that allow homeowners to avoid foreclosure when a family is absolutely unable keep their home.”

HAFA includes uniform procedures, standards forms, and deadlines, but its success depends on effective servicer implementation and the cooperation of investors and subordinate lien holders.

Lenders have been criticized for cumbersome and confusing short sale processes, and JK Huey, senior vice president, Wells Fargo Home Mortgage REO and Short Sale, addressed some primary concerns and myths surrounding these transactions.

“There are a number of decision makers involved in a short sale, and the more parties involved, the more complex the process becomes,” said Huey. “It’s important to keep in mind that this is not a typical buy-sell transaction. Our Realtor partners’ expertise helps us deliver timely solutions to assist customers, minimize losses to investors, and help to rebuild and stabilize our communities.”

To address concerns related to the short sales process, Wells Fargo has increased staff resources by 57% over the past 12 months, implemented proactive marketing efforts to provide information and education on short sale workout alternatives to its customers, and worked with legislators and government agencies to help streamline processes.

Panelist Laurie Maggiano, director of policy for the U.S. Department of the Treasury’s Office of Homeownership Preservation explained how homeowners in need benefit from HAFA. HAFA provides $3,000 relocation assistance to homeowners after a successful closing and requires that the homeowner be fully released from future liability for the primary mortgage and also any subordinate liens.

“HAFA offers additional foreclosure avoidance options when other home retention options have been exhausted,” said Maggiano. “Being proactive can only positively impact the homeowner’s ability to buy a home in the future. For example, Fannie Mae will allow a homeowner to be considered for a home loan within two years of a short sale, whereas a homeowner who goes through a foreclosure will need to wait seven.”

Earlier this year, NAR produced a “Home Affordable Foreclosure Alternatives” brochure to explain the HAFA program to Realtors so they could help their home buyer and seller clients through the process. NAR also offers the SFR certification (Short Sales and Foreclosure Resource) to help Realtors obtain advanced training in managing the complexities of transactions that involve foreclosed homes and short sales.

The Realtors Confidence Index is a key indicator of housing market strength based on a monthly survey of over 50,000 real estate practitioners.

For more information, visit www.realtor.org.#END

THE CRECCO COMPANIES

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Anthony J Crecco

Short Sale and Loan Modification Expert

Thornwood NY 10594

914.269.8184

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Deliberately seek the company of people who influence you to think and act on building the life you desire."

2010-11-10T10:15:00.001-05:00

"Deliberately seek the company of people who influence you to think and act on building the life you desire."

Napoleon Hill
1883-1970, Author

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NAR Buyer and Seller Survey Shows Value of Long-Term Home Ownership

2010-11-09T12:09:00.001-05:00

RISMEDIA, November 9, 2010—Home buyers today have affirmed a long-term view of home ownership, the typical seller is experiencing positive returns and the vast majority of home owners see their property as a good investment, according to the latest consumer survey of home buyers and sellers. The study was released at the 2010 Realtors Conference & Expo.

The 2010 National Association of Realtors Profile of Home Buyers and Sellers is the latest in a series of large national NAR surveys evaluating demographics, preferences, marketing and experiences of recent home buyers and sellers.

Although typical sellers had been in their previous home for eight years, up from seven years in the 2009 study, first-time buyers plan to stay for 10 years and repeat buyers plan to hold their property for 15 years.

NAR 2010 President Vicki Cox Golder, owner of Vicki L. Cox & Associates in Tucson, Ariz., said the pattern of home buyers taking a long-term view has solidified over the past few years. “This underscores two simple facts—home ownership encourages stability, and the longer you own, the better your investment.”

Even with several years of price declines, the typical seller who purchased a home eight years ago experienced a median equity gain of $33,000, a 24% increase, while sellers who were in their homes for 11-15 years saw a median gain of 40%.

“Sellers who purchased at the top of the market and had to sell in a short time frame were hurt by the price correction, but the vast majority who are able to stay for a normal period of home ownership generally built enough equity to make a trade-up purchase,” Golder said. “Despite swings in the housing market in recent years, the fact is most long-term owners see healthy gains in the value of their property.”

House flipping is virtually nonexistent in today’s market. “The primary exception is for experienced investors, many of whom pay cash and are making renovations or improvements after a careful study of properties, neighborhoods and market demand,” Golder explained. “The house flipping and quick gains which occurred during the boom period were abnormal, driven by risky, easy-money financing that should never have been allowed in the market.”

In the 2006 study, covering sellers during the close of the housing boom, 6% of sellers had owned their property for less than a year and a total of 30% had owned for three years or less. In the 2010 study, only 3% had owned their home for less than a year and a total of 11% had owned for three years or less.

Paul Bishop, NAR vice president of research, said the lion’s share of buyers view their home as a good investment. “Eighty-five percent of recent home buyers see their home as a good investment, and nearly half think that investment is better than stocks,” he said. “Even with the turmoil created by the housing boom and bust, this indicates the long-term view of home ownership as a fundamental goal and value remains sound. In fact, the single biggest reason most people buy a home is the simple desire to own a home of their own, cited by 31% of respondents, including 53% of first-time buyers.”

The next biggest reasons for buying, identified by all home buyers, were desire for a larger home, 9%; a change in family situation and the home buyer tax credit, cited by 8% each; a job-related move, 7%; and the affordability of homes, 6%. Twelve other categories were 5% or less.

The number of first-time home buyers rose to a record high 50% of all home sales from 47% in the 2009 study, building on success of the home buyer tax credit which began in 2009. The previous cyclical high for first-time buyers was 44% in 1991; records date back to 1981.

The profile shows the median age of first-time buyers was 30 and the median income was $59,900. The typical first-time buyer purchased a 1,540 square foot home costing $152,000, with 93% using the first-time buyer tax credit.

First-time buyers who made a downpayment used a variety of sources: 74% used savings, 27% received a gift from a friend or relative, typically from their parents, and 9% received a loan from a relative or friend. Eight percent tapped into a 401k fund, and 6% sold stocks or bonds. Ninety-five percent chose a fixed-rate mortgage.

The shares of entry-level buyers receiving a gift or loan were modestly higher than 2009 when 22% received a gift and 6% a loan from a relative or friend. “It appears more parents were motivated to help their children to take advantage of the home buyer tax credit and very favorable affordability conditions,” Bishop said.

Fifty-six percent of entry level buyers financed their purchase with an FHA loan, while another 7% used the VA loan program. Forty-two percent said financing their first home was more difficult than expected and 9% had been rejected by a lender.

Fifty-eight percent of all buyers are married couples, 20% are single women, 12% single men, 8% unmarried couples and 1% other.

Bishop noted that women buyers have accounted for roughly one out of five transactions since the late 1990s, and single men have been at the one in 10 level since 1981. “A modest increase in the share of single men buyers may result from the home buyer tax credit, but this is the highest share for single men in the history of the study,” he said.

Buyers searched a median of 12 weeks and viewed 12 homes. Fourteen percent of buyers own two or more homes.

The typical repeat buyer was 49 years old, earned $87,000, and purchased a 2,000 square foot home costing $215,000.

The median downpayment of all home buyers was 8%, ranging from 4% for first-time buyers to 14% for repeat buyers.

The median age of home sellers was 49 and their income was $90,000. Sellers moved a median distance of 18 miles and their home was on the market for 8 weeks, down from 10 weeks in the 2009 survey. Half traded up in size, 28% bought a comparably sized home and 21% traded down.

Sixty-four percent of sellers chose their agent based on a referral or had used the same agent in the past. Reputation was the most important factor in choosing an agent, cited by 35% of respondents, followed by trustworthiness at 23%. Eighty-four percent of sellers are likely to use the same agent again or recommend to others.

Forty-four percent of sellers offered incentives to attract buyers, such as home warranties or assistance with closing costs. The typical home sold for 96% of the listing price, compared with 95% in the 2009 profile.

Home buyers thought the most important services agents offer are helping find the right house, and negotiating sales terms and price. Buyers also most commonly choose an agent based on a referral from a friend, neighbor or relative, with trustworthiness and reputation being the most important factors.

Buyers use a wide variety of resources in searching for a home: 89% surf the Internet, 88% use real estate agents, 57% yard signs, 45% attend open houses and 36% look at print or newspaper ads. Although buyers also use other resources, they generally start the search process online and then contact an agent.

When asked where they first learned about the home purchased, 38% of buyers said the Internet; 37% of buyers from a real estate agent; 11% a yard sign or open house; 6% from a friend, neighbor or relative; 4% home builders; 2% a print or newspaper ad; 2% directly from the seller; and less than 1% from a home book or magazine.

Eighty-five percent of home buyers who used the Internet to search for a home purchased through a real estate agent, while 70% of non-Internet users were more likely to purchase directly from a builder or from an owner they already knew in a private transaction.

Local metropolitan multiple listing service websites were the most popular Internet resource, used by 59% of buyers; followed by Realtor.com, 45%; real estate company sites, 43%; real estate agent websites, 42%; other websites with real estate listings, 41%; and for-sale-by-owner sites, 15%; other categories were smaller.

Seventy-seven percent of all buyers purchased a detached single-family home, 9% condo, 8% a townhouse or rowhouse, and 6% some other kind of housing.

Commuting costs continue to factor strongly in buyer decisions, with three-quarters of buyers saying transportation costs were important.

Environmentally friendly features remain a significant factor: 88% of buyers said that heating and cooling costs were important, 71% desired energy efficient appliances, and 69% wanted energy efficient lighting.

Fifty-two percent of all homes purchased were in a suburb or subdivision, 18% were in an urban area, 17% in a small town, 11% in a rural area and 1% in a resort or recreation area. The median distance from the previous residence was 12 miles.

Not surprisingly, for-sale-by-owner transactions reached a record low, accounting for 9% of sales in the 2010 study, down from 11% in 2009. The share of homes sold without professional representation has trended down since reaching a cyclical peak of 18% in 1997. “In a market as challenging as today, it’s clear most home sellers need professional assistance,” Bishop said.

As seen in previous studies, many FSBO properties were not placed on the open market. Factoring out private sales between parties who knew each other in advance such as family or acquaintances, the actual number of homes sold on the open market without professional assistance was a record low 5%—the rest were unrepresented sellers in private transactions. The market share of open-market FSBOs is half of what it was six years ago—10% were sold on the open market in 2004.

The median home price for sellers who used an agent was $199,300 vs. $140,000 for a home sold directly by an owner, but there were important differences. The median income of unassisted sellers was $64,000, in contrast with $93,200 for agent-assisted sellers. Unassisted sellers were much more likely to be selling a somewhat smaller home, and they were more likely to be in a rural area. Combined, these factors suggest a lower value for FSBO properties.

The most difficult tasks reported by unrepresented sellers are getting the right price, preparing and fixing the home for sale, understanding and performing paperwork, and selling within the planned length of time.

NAR mailed an eight-page questionnaire in July 2010 to a national sample of 111,004 home buyers and sellers who purchased their homes between July 2009 and June 2010, according to county records. It generated 8,449 usable responses; the adjusted response rate was 7.9%. All information is characteristic of the 12-month period ending in June 2010 with the exception of income data, which are for 2009. Because of rounding and omissions for space, percentage distributions for some findings may not add up to 100%.

For more information, visit www.realtor.org.

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Designing a Successful Day

2010-11-02T10:55:00.001-04:00

All success requires you to make a decision to succeed. Here are five thoughts to consider:

Success is more difficult to live with than failure. You must know why you want to succeed so that it has purpose. Otherwise it is a non-fulfilling experience.
Success in any endeavor requires you to pay the price. Short-cuts never win you the world-championship.
Success is not a one-time thing, it's an all-the-time thing. You never play to lose but every loss teaches you how to play to win.
Success is a habit–so is failure.
Success is on the inside first before it ever translates to the outside. Feel good about you or you'll never be able to compete.

The quality of your life is in direct proportion to your commitment to excellence.

Based on the above, what's your dream day? If your "success canvas" was without the blight of your current challenges, how would you paint it? How would you answer the following questions:

What kind of work would you do?
How would you feel?
How many hours would you work?
What time would you start?
What time would you end?
How much money would you earn?
How much money would you save?
What memories would you create?
What one-on-one experiences would you have with your spouse?
How about with your kids?
How would your attitude be?
What would be the things you would not do?
How much more time would that give you?
How peacefully would you sleep?
How much inner peace would you have?

These are important questions, the kind of questions that determine your destiny. Highly successful people design their perfect days and they strive to adhere to that agenda. Use the above questions to help you determine if your choices are adding to or taking away from your success.

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GSEs Instruct Servicers to Help Unemployed Through State Programs

2010-11-01T10:50:00.001-04:00

Fannie Mae and Freddie Mac have both issued notices to servicers that they must work closely with state housing finance agencies to provide mortgage assistance to homeowners who’ve lost their jobs.

The Treasury Department has awarded $7.6 billion for housing agencies in certain states to develop programs that provide temporary relief to unemployed homeowners.

Effective immediately, GSE servicers are instructed to accept all monthly mortgage payments from housing finance agencies (HFAs) on behalf of borrowers enrolled in state-specific programs for unemployment mortgage assistance or mortgage reinstatement plans.

The directive applies to mortgage loans held in the GSEs’ own portfolio, in a mortgage-backed securities (MBS) pool with the special servicing option, or a shared-risk MBS pool for which the GSEs market the acquired property.

Specific program details vary by HFA, but the assistance provided generally falls under one of two types. An unemployment mortgage assistance program pays portion of or the full monthly mortgage payment amount for qualifying borrowers so that they may seek employment or obtain job training without fear of losing their homes. A mortgage reinstatement program provides a one-time lump sum payment to assist in restoring a delinquent mortgage to current status.

A borrower participating in an HFA program may not simultaneously receive assistance through another loss mitigation program, including the federal government’s Home Affordable Modification Program (HAMP).

Servicers have been instructed that they may not determine borrower eligibility or communicate qualification for a state HFA program to a borrower. Servicers can, however, refer potentially eligible borrowers to the HFA in accordance with relevant state requirements.

The GSEs’ stressed, though, that servicers must not deny or delay consideration of a borrower for a relief or workout option pending approval for HFA mortgage assistance and must not require a borrower to first request financial assistance from an HFA as a condition of consideration for a relief or workout option.

Regarding protocol for foreclosures related to loans that qualify for an HFA program, Servicers are not required to accept mortgage assistance payments if a notice of trustee/sheriff sale has been recorded and is scheduled less than seven days from the date the servicer is notified of borrower approval by the HFA.

If the notice of borrower approval from the HFA is received seven or more days in advance of a scheduled foreclosure sale, Fannie says a servicer still should not suspend the foreclosure proceedings unless it has actually received funds from the HFA to cover the borrower’s mortgage payment.

Freddie stressed that if servicers suspend foreclosure proceedings, they must ensure that appropriate action is taken to re-commence foreclosure proceedings should the borrower’s mortgage payment not be received from the HFA in the month in which it is due.

Fannie Mae noted that it has elected not to participate in any principal reduction options that may be offered by some HFAs. Freddie Mac did not specify in its notice whether principal reduction was an approved means of assistance.

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New York State Banking Department issues report on pre-foreclosure notices

2010-10-31T13:14:00.001-04:00

The New York State Banking Department has announced that more than 76,744 pre-foreclosure notices were sent to New York homeowners who have fallen behind on their mortgage payments since May 31, 2010. A total of 134,000 pre-foreclosure notices have been sent since data collection began on February 13, 2010. If a borrower does not become current on their mortgage within 90 days of receiving the notice, the lender then has the right to begin the formal foreclosure process.

The four counties with the highest total number of pre-foreclosure filings on owner-occupied, 1-to-4 family properties were Suffolk County, Queens, Nassau and Brooklyn. These are the same four counties that topped the last report issued on June 10, 2010.

Starting next month, the Banking Department’s online filing system will begin accepting lis pendens information on mortgages that have a pre-foreclosure notice file in the system. A lis pendens is a written notice that a lawsuit has been filed against a property and is the legal beginning of the foreclosure process. The lis pendens data will be included in the Department’s next pre-foreclosure notice report, which will be issued in January 2011.

To read the entire Banking Department press release, click here.

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With Millions of Foreclosures on Horizon, Should States Mandate Mods?

2010-10-29T12:11:00.001-04:00

The foreclosure crisis is far from over. According to figures released by the Center for Responsible Lending (CRL), since the crisis took hold, 2.5 million homeowners
have already lost their homes and another 5.7 million are at imminent risk of foreclosure. Looking ahead, the nonprofit research group says it’s projected that between 10 and 13 million foreclosures will have occurred by the time this crisis abates.

The federal government has implemented a mixed bag of foreclosure-prevention programs over the past two years in the hopes of stemming the tide, even incentivizing all parties involved, from lenders and servicers, to investors and the homeowners themselves. But housing analysts, watchdog groups, and industry insiders agree, they’ve yet to hit on a silver bullet solution.

CRL argues that the power to stop unnecessary foreclosures and stabilize local housing markets lies with state legislatures. With exclusive control over their state-specific foreclosure laws, the Center says lawmakers should impose mandatory loss mitigation standards for all servicers prior to foreclosure.

A recent study by the State Foreclosure Prevention Working Group found that “nearly three years into the foreclosure crisis…more than 60 percent of homeowners with seriously delinquent loans are still not involved in any loss mitigation activity.”

In a report written by Sara Weed, a policy attorney at CRL, and Sonia Garrison, a senior researcher for the organization, the Center outlines its proposal for state policymakers to apply “common sense standards to any actor pursuing foreclosure.”

The authors argue state legislatures should mandate that mortgage servicers assess whether foreclosure is in the financial interest of the investor before proceeding to foreclosure.

To be effective, CRL says this mandatory loss mitigation standard should be combined with a requirement that the foreclosing party provide homeowners with a loss mitigation application in tandem with any pre-foreclosure notice or pre-foreclosure communication.

If after the loss mitigation assessment the servicer opts to move forward with foreclosure, the authors recommend states institute a requirement that the foreclosing party

submit an affidavit disclosing their specific reasoning for the denial of a loan modification, including the inputs and outputs of any loss mitigation calculations.

In addition, homeowners should be granted a defense to foreclosure (or equivalent right in non-judicial foreclosure states) based on failure of the foreclosing party to engage in a “good faith review” of foreclosure alternatives, according to CRL.

“The reality is that many of these foreclosures can and should be avoided. All too often, troubled mortgages are sent to foreclosure, driven by a system biased in favor of foreclosure sales over sustainable loan modifications, even when foreclosure is more costly,” the authors wrote.

The report notes that borrowers seeking a loan modification are often told that they have been denied due to “investor restrictions.” However, a recent CRL research report points out that modification is more often than not a win-win for the investor and the borrower.

The Center says in fact, investors themselves often claim that they are not standing in the way of modifications and have voiced concerns that servicers are not acting in their best interest either.

According to the authors of the report, “spillover” costs extend throughout the neighborhood and the larger community. CRL estimates that by 2012, the foreclosure crisis will strip neighboring homeowners of $1.9 trillion as foreclosures drain value from nearby homes, pushing even more borrowers underwater on their mortgage.

Meanwhile, state and local governments continue to be hit hard by declining tax revenues coupled with increased demand for social services, according to CRL. The Urban Institute estimates that a single foreclosure costs $79,443 after aggregating the costs borne by financial institutions, investors, the homeowner, their neighbors, and local governments. But the Center says even this number understates the true cost, since it does not reflect the impact of the foreclosure epidemic on the nation’s economy.

“We cannot afford to wait any longer for the housing market to stabilize itself. If implemented quickly, states can prevent unnecessary foreclosures before it is too late,” authors Weed and Garrison said in the CRL report.

The recent news of some servicers circumventing state laws to push foreclosures through quickly has brought every attorney general in the country together and pitted them directly against the servicing community as one powerful and determined force.

Some attorneys general have come out and said mandated loan modifications may be considered as part of a settlement with servicers who’ve filed improper foreclosure affidavits. But such a stipulation would only apply to those foreclosure cases where documentation was found to be defective, and it’s expected servicers will put up a strong fight against such terms.

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Untitled

2010-10-28T13:19:00.001-04:00

Reconsidering Foreclosures, Short Sales and Listings in an Upside Down Market

When sales activity has diminished, as is the case in today’s market, appraisers have a much smaller pool of comparable transactions available to them. Such times require that appraisers give greater scrutiny to transactions that have traditionally been discarded.

Here’s why and how appraisers are reconsidering foreclosures, short sales and listings in an upside down market.

Foreclosures
A sales transaction that complies with the definition of market value is often referred to as an “arm’s length” transaction. In this regard, an “arm’s length” transaction refers to a conveyance in which the parties are typically motivated, well informed, acting in their own best interest, have time to market the property and are not deploying unusual financing incentives.

Perhaps the most frequently cited example for a “non-arm’s-length transaction” is the sale of a foreclosed property. This is because, in a normal market, the mortgage balance is most often below market value. When the mortgage balance is below market value, the foreclosing lender has the option to cut the price of the real estate in order to achieve a quick sale. This allows the foreclosing lender to terminate his investment in the loan quickly and favorably, without the risk of an extended marketing period. Similarly, an owner who is selling in a normal market, under the duress of foreclosure, can cut his price for the purpose of quickly getting out from under a mortgage to salvage his credit.

However, the relationship between the mortgage balance and market value is overturned under the recessionary market conditions we are presently experiencing. We all watched while the real estate bubble inflated larger and larger, rising to its fattest somewhere around the end of 2005 or early in 2006. During this inflating period, credit was easily available and lenders were competing to make loans to buyers who were competing with other buyers in bidding up prices, often even higher than the original asking prices. When the bubble eventually burst and values began to decline, many owners were left with huge mortgage balances. As the market declined precipitously, market values dipped below the principal balance on many mortgages, leaving owners “upside down.” This situation was exacerbated as the supply of listings and foreclosures accelerated, while prices continued to plummet.

These new market conditions created a new and abnormal relationship between the mortgage principal and market value. We now see that mortgage balances are often much more than market value. Foreclosing lenders are finding themselves with collateral that is worth considerably less than the mortgage amount. In many ways, this “upside down” posture makes a sale by a lender of foreclosed property much more similar to any other market transaction where a seller is simply trying to get as much as he can out of his real estate. No longer does the foreclosing lender have the ability of creating a “non-arm’s-length” transaction by simply choosing to liquidate the investment at below market value. Instead, the foreclosing lender is now on equal footing with any other seller in the marketplace (typically motivated), simply trying to get the most money possible out of the real estate. Doesn’t this new set of circumstances equate the lender to any other seller? Doesn’t this new set of circumstances qualify a sale of foreclosed property as an “arm’s length” transaction?

Short Sales
One particular form of evidence that these transactions represent “arm’s length” arrangements is the emergence of the “short sale.” A “short sale” is the modern label for a transaction in which the lender has simply agreed to accept a loan payoff that is less than the mortgage balance. In the circumstance of a “short sale,” there is no actual foreclosure because the owner and the lender (as well informed and well advised sellers) know that the value of their real estate and collateral has diminished and wish to take advantage of a present opportunity to get cash out of the property, just as would any other active seller. There is no special or creative financing, only a mutual agreement by owner and lender to sell, just as any other seller might agree to sell. This often qualifies these transactions as “arm’s length” under current market conditions.

Nonetheless, many appraisers remain intent on avoiding the use of foreclosed and “short sale” transactions, claiming these transactions are representative of duress because of the depressed state of the recessionary market. But the fact that these transactions are representative of the current state of the market is the very reason they are more worthy of our consideration. When the market is oversupplied and prices are low, we have an obligation to seek a value in our appraisals that realistically represents what a seller can obtain in the open market. The fact that a seller in the open market must compete with a plethora of other sellers, many of whom are lenders, cannot be ignored in any legitimate quest for market value.

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Foreclosure, what does it really mean to people?

2010-10-25T15:18:00.001-04:00

Miami, FL- (October 25, 2010) For the vast majority of homeowners, new questions about the state of foreclosures appear to be irrelevant. Few people seem to have been wrongly thrown out of their homes, and those who have been are generally months or years behind on their mortgage payments.

But the fallout from the crisis is beginning to be felt in real-estate markets across the country, particularly in places dominated by vacation homes and investment properties. Some of the worst-hit areas could be Western ski towns, because fall is the busiest time of the year for sales.

Real-estate salespeople in some of those places are worried. "September and October are usually the height of the selling-season for us," says Rich Armstrong, who owns the brokerage Rare Properties in Jackson Hole, Wyo. "Now we are seeing a number of what we call 'fence sitters,' people who would have leapt in even a month ago, but now are waiting on the sidelines."

The "foreclosure crisis" is a result of the frenzied real-estate boom and bust of the past decade. Banks made foolish loans, and borrowers signed up for them—only to default later, as the economy slumped. Banks rushed to reclaim properties, launching a record number of foreclosure proceedings.

In the past several weeks flaws have emerged in that complex process. Because of the high volume of foreclosures, the documentation supporting legal actions was prepared hastily, and some homes were seized improperly

Yet the far bigger worry is what happens next. A frenzy of lawsuits and banks' examinations of their own practices could throw more of the millions of foreclosures of the past few years into legal jeopardy. Attorneys general in all 50 states are investigating, and plaintiffs' lawyers are working hard to perfect their legal strategies for suits on behalf of people who have been foreclosed on.

The suits might well fail. But just the threat that past foreclosure rulings might be overturned could result in collateral damage. In some places, banks are rushing foreclosed properties to market. In others, buyers are stepping back, refusing to buy foreclosed properties or "short sales"—homes sold by owners for less than the mortgage balance. In markets already beset with large inventories of foreclosed properties, the result could be a slower recovery.

Coastal markets and ski areas are feeling the most anxiety. Some already are littered with foreclosures—in part because they're dominated by second-home and investment properties. Those owners are more willing to walk away from a house that isn't their primary residence.

Foreclosure tracker RealtyTrac estimates that, nationwide, 30% to 35% of properties in foreclosure are owned by investors or were second homes. In Aspen, Colo., the figure is about 60%, says Kim McKinley, owner of McKinley Sales Real Estate in Basalt and Aspen, Colo. If foreclosure proceedings slow from here, inventory could jump, leading to price weakness late

"We're concerned that the phantom inventory buildup will cause a more rapid and drastic drop in prices in Aspen, which is just getting started in terms of foreclosures coming to the market," says Ms. McKinley.

The timing of the foreclosure mess is especially inconvenient for ski towns, given the fall selling season.

Property owners are growing nervous. In Park City, Utah, lenders are quickly unloading foreclosed homes ahead of what could be a long, stalled foreclosure process, says Joe Trabaccone, a real-estate agent there.

On Oct. 11, for example, J.P. Morgan Chase put up for sale an 8,000-square-foot home adjacent to a private gated golf course. Mr. Trabaccone initially recommended the property be listed for $1.6 million, but Chase opted for $1.26 million. "They are offering these homes far too low just to hurry up and sell them," Mr. Trabaccone says.

Even so, it hasn't worked. A buyer made an offer and signed a contract, but then backed out.

In South Lake Tahoe, Calif., on Thursday, Freddie Mac, the big government-sponsored guarantor of mortgages, put a foreclosed home that had just been listed for sale on hold, freezing the property until paperwork could be straightened out. The foreclosure mess "seems to be filtering down and it could be an impact," says Doug Rosner, the broker who had listed the home. Three other properties in town were also frozen, another real-estate agent says.

The "sand states" of Arizona, California, Florida and Nevada are being hit as well. These areas, too, have a lot of vacation and investment properties—and a lot of foreclosures.

Robin Speronis, a real-estate broker in Cape Coral, Fla., says business had been picking up recently, with several inquiries a day—until the latest foreclosure scandal broke. Since then, she says, inquiries have shriveled to just one in the past week.

Susan Weeks, 55 years old, and her husband, Eddie, aren't optimistic. The couple had expected to retire and downsize when they bought a condo in Clermont, Fla., near Orlando, in 2007 for $192,000. Their plan was to sell their primary residence 10 minutes away and live in the condo. The trouble: They can't sell their first home.

The Weeks paid $269,000 for their three-bedroom home in 2004. The house next door, a bit larger, is listed at $185,000, Ms. Weeks says.

The couple has decided to move back to their primary home and take a renter for the condo. But while that brings in $850 a month, the Weeks take a $450-a-month hit on the condo —on top of the $2,400 a month they pay every month on their primary home.

"We're just going to wait it out," she says.

The possible foreclosure wars to come loom so largely over Florida markets that Ms. Speronis is urging condo sellers to consider any offer they get, even if it is far below asking price or what is owed on the mortgage.

Dianne Cloutier, a records supervisor in Chelmsford, Mass., had been looking for a retirement property in Cape Coral, but decided to wait because of the foreclosure mess. "It's left us on hold until we are sure the banks have legitimately foreclosed on people and that nobody can come back on us to get their property back," she says.

Foreclosures aren't the only problem. Short sales are getting more difficult to pull off, too.

In Bend, Ore., agents say buyers are avoiding short sales or even backing out of contracts because they don't want to deal with paperwork hassles or the chance of a court challenge later.

"I have some people saying 'I don't want to mess with bank-owned properties or short sales,'" says Dianne Willis, principal broker with RE/MAX Sunset Realty in Sunriver, Ore. "They're reluctant because it can be a frustrating process, especially for those who are looking to make a big move."

The short sales "can be very frustrating," adds Becky Ozrelic, of with Steve Scott Realtors in Bend. "You just have buyers waiting and waiting."

For sellers, lining up a short sale was tough even before the latest foreclosure crisis. Banks and mortgage "servicers," the outfits that process payments, already had been scrambling to handle surging workloads.

Mike and Kim Schwarz of San Jose, Calif., are coming up on the one-year mark on their short-sale saga.

The couple had acquired several investment properties over the past few years, including one in Thousand Oaks, Calif., for $751,000. After the tenants stopped paying rent, the Schwarzes couldn't cover the payments and decided to sell, Mr. Schwarz says.

They lined up a buyer in November 2009, and started working with their loan servicer on the short sale. For lenders, short sales are ugly because they guarantee a loss, but they often are preferable to a foreclosure, in which the lender is saddled with a tough-to-sell house.

The servicer, Residential Credit Solutions, took six months to process the paperwork, the Schwarzes say. Faxes and emails were sent, but nothing happened, Mr. Schwarz says.

"We typically don't hear from borrowers about long delays," says Dennis Stowe, president of Residential Credit.

The buyer walked away from the deal in June. The couple found another buyer in August, and resubmitted the short-sale paperwork. Mr. Schwarz says he has sent paperwork to Residential Credit four times since.

On Friday, Mr. Schwarz says, Residential called to tell him the short-sale paperwork looked good and the sale should close in mid-November.

See and download the full gallery on posterous

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The Art of Happiness

2010-10-12T11:07:00.001-04:00

Making Each Day Your Best

In The Art of Happiness, the Dalai Lama shares this powerful insight into life:

"I believe that the very purpose of our life is to seek happiness. That is clear. [Regardless of religion], we are all seeking something better in life. So I think the very motion of our life is toward happiness."

But how are we to achieve this happiness that we all seek? What common factor can we rely upon, regardless of our health, wealth, appearance, family, etc? The Dalai Lama goes on to discuss how the mind can be trained for happiness, despite a lack of material wealth and success. It's that whole idea of "wanting what you have versus having what you want."

Stephen Covey refers to this as "responsibility," or the ability to choose your response. Tony Robbins calls it "reframing your perspective". James Allen simply calls it "self-control." Whatever name it goes by, the principle is the same: We all have the power to think positive thoughts, and to react positively to every "negative" thing that happens in our lives.

Why, then, is it so hard to do?

Because like anything of any worth, it takes effort. It takes practice. It takes time. And like most skills, the sooner you begin, the sooner it gets easy. But no matter how old we are, we can all start practicing positive thinking today, and begin being happier immediately.

It's very easy to get out of practice, however, so it's best to surround yourself with triggers for happiness. Music is one of the best triggers. Just think how happy we get when we hear Little Orphan Annie singing, "The Sun Will Come Out Tomorrow," or Bobby McFerrin crooning, "Don't Worry, Be Happy." We can also remind ourselves with little incantations such as "look on the bright side" when things aren't going as planned.

I hope this tip brightens up your day!

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Selecting a New Water Heater

2010-10-12T08:05:00.001-04:00

Many homeowners wait until their water heater fails before shopping for a replacement. Because they are in a hurry to regain their hot water supply, they are often unable to take the time to shop for the most energy efficient unit for their specific needs. This is unfortunate, because the cost of purchasing and operating a water heater can vary greatly, depending on the type, brand, and model selected and on the quality of the installation.

To avoid this scenario, you might want to do some research now--before you are faced with an emergency purchase. Familiarize yourself today with the options that will allow you to make an informed decision when the need to buy a new water heater arises.

Types of Water Heaters Available

Within the last few years, a variety of water heaters have become available to consumers. The following types of water heaters are now on the market: conventional storage, demand, heat pump, tankless coil, indirect, and solar. It is also possible to purchase water heaters that can be connected to your home's space heating system.

Storage Water Heaters

A variety of fuel options are available for conventional storage water heaters--electricity, natural gas, oil, and propane. They range in size from 20 to 80 gallons (75.7 to 302.8 litres). A storage heater operates by releasing hot water from the top of the tank when the hot water tap is turned on. To replace that hot water, cold water enters the bottom of the tank, ensuring that the tank is always full. Because the water is constantly heated in the tank, energy can be wasted even when no faucet is on. This is called standby heat loss. Newer, more energy efficient storage models can significantly reduce the amount of standby heat loss, making them much less expensive to operate.

Demand Water Heaters

It is possible to completely eliminate standby heat losses from the tank and reduce energy consumption 20% to 30% with demand (or instantaneous) water heaters, which do not have storage tanks. Cold water travels through a pipe into the unit, and either a gas burner or an electric element heats the water only when needed. With these systems, you never run out of hot water. But there is one potential drawback with demand water heaters--limited flow rate. Typically, demand heaters provide hot water at a rate of 2 to 4 gallons (7.6 to 15.2 litres) per minute. This flow rate might suffice if your household does not use hot water at more than one location at the same time (e.g., showering and doing laundry simultaneously). To meet hot water demand when multiple faucets are being used, demand heaters can be installed in parallel sequence. Although gas fired demand heaters tend to have higher flow rates than electric ones, they can waste energy even when no water is being heated if their pilot lights stay on. However, the amount of energy consumed by a pilot light is quite small.

Heat Pump Water Heaters

Heat pump water heaters use electricity to move heat from one place to another instead of generating heat directly. To heat water for homes, heat pump water heaters work like refrigerators in reverse. Heat pump water heaters can be purchased as integral units with builtin water storage tanks or as add ons that can be retrofitted to an existing water heater tank. These systems have a high initial cost. They also require installation in locations that remain in the 40° to 90°F (4.4° to 32.2°C) range year round and contain at least 1000 cubic feet (28.3 cubic meters) of air space around the water heaters. To operate most efficiently, they should be placed in areas having excess heat, such as furnace rooms. They will not work well in a cold space.

Tankless Coil and Indirect Water Heaters

A home's space heating system can also be used to heat water. Two types of water heaters that use this system are tankless coil and indirect. No separate storage tank is needed in the tankless coil water heater because water is heated directly inside the boiler in a hydronic (i.e., hot water) heating system. The water flows through a heat exchanger in the boiler whenever a hot water faucet is turned on. During colder months, the tankless coil works well because the heating system is used regularly. However, the system is less efficient during warmer months and in warmer climates when the boiler is used less frequently. A separate storage tank is required with an indirect water heater. Like the tankless coil, the indirect water heater circulates water through a heat exchanger in the boiler. But this heated water then flows to an insulated storage tank. Because the boiler does not need to operate frequently, this system is more efficient than the tankless coil. In fact, when an indirect water heater is used with a highly efficient boiler, the combination may provide one of the least expensive methods of water heating.

Solar Water Heaters

Through specially designed systems, energy from the sun can be used to heat water for your home. Depending on climate and water use, a properly designed, installed, and maintained solar water heater can meet from half to nearly all of a home's hot water demand. Two features, a collector and a storage tank, characterize most solar water heaters. Beyond these common features, solar water heating systems can vary significantly in design. The various system designs can be classified as passive or active and as direct (also called open loop) or indirect (also called closed loop). Passive systems operate without pumps and controls and can be more reliable, more durable, easier to maintain, longer lasting, and less expensive to operate than active systems. Active solar water heaters incorporate pumps and controls to move heat transfer fluids from the collectors to the storage tanks. Both active and passive solar water heating systems often require "conventional" water heaters as backups, or the solar systems function as pre-heaters for the conventional units. A direct solar water heating system circulates household water through collectors and is not appropriate in climates in which freezing temperatures occur. An indirect system should not experience problems with freezing because the fluid in the collectors is usually a form of antifreeze. If you are considering purchasing a solar water-heating system, you may want to compare products from different manufacturers. Just choosing a solar water heater with good ratings is not enough, though. Proper design, sizing, installation, and maintenance are also critical to ensure efficient system performance. Although the purchase and installation prices of solar water heaters are usually higher than those of conventional types, operating costs are much lower.

Criteria for Selection

As with any purchase, balance the pros and cons of the different water heaters in light of your particular needs. There are numerous factors to consider when choosing a new water heater. Some other considerations are capacity, efficiency, and cost.

Determining Capacity

Although some consumers base their purchase on the size of the storage tank, the peak hour demand capacity, referred to as the first-hour rating (FHR), is actually the more important figure. The FHR is a measure of how much hot water the heater will deliver during a busy hour. Therefore, before you shop, estimate your household’s peak hour demand and look for a unit with an FHR in that range. Gas water heaters have higher FHRs than electric water heaters of the same storage capacity. Therefore, it may be possible to meet your water-heating needs with a gas unit that has a smaller storage tank than an electric unit with the same FHR. More efficient gas water heaters use various non-conventional arrangements for combustion air intake and exhaust. These features, however, can increase installation costs.

Rating Efficiency

Once you have decided what type of water heater best suits your needs, determine which water heater in that category is the most fuel efficient. The best indicator of a heater's efficiency is its Energy Factor (EF), which is based on recovery efficiency (i.e., how efficiently the heat from the energy source is transferred to the water), standby losses (i.e., the percentage of heat lost per hour from the stored water compared to the heat content of the water), and cycling losses. The higher the EF, the more efficient the water heater. Electric resistance water heaters have an EF between 0.7 and 0.95; gas heaters have an EF between 0.5 and 0.6, with some high-efficiency models around 0.8; oil heaters range from 0.7 to 0.85; and heat pump water heaters range from 1.5 to 2.0. Product literature from manufacturers usually gives the appliance’s EF rating. If it does not, you can obtain it by contacting an appliance manufacturer association. Some other energy efficiency features to look for are tanks with at least 1.5 inches (3.8 centimeters) of foam insulation and energy efficiency ratings.

Comparing Costs

Another factor uppermost in many consumers' minds is cost, which encompasses purchase price and lifetime maintenance and operation expenses. When choosing among different models, it is wise to analyze the lifecycle cost--the total of all costs and benefits associated with a purchase during its estimated lifetime. Units with longer warranties usually have higher price tags, though. Often, the least expensive water heater to purchase is the most expensive to operate.

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Courts Are Delaying Foreclosures

2010-10-11T15:03:00.001-04:00

Courts Are Delaying Foreclosures

Miami, FL - . The recent suspensions of foreclosures by four major companies that service mortgages
compound a problem that had existed for years in states where foreclosures are handled
by the courts.

In the 23 states in which foreclosures must be approved by a judge, the process takes
longer than in states where courts are not involved, and some economists say it's among
the factors delaying a housing rebound.

One comparison widely cited: In California, where judges don't handle foreclosures,
the housing market appears to have hit bottom a year ago and has been bouncing back.
In Florida, where foreclosures go through the court system, prices keep falling, and
foreclosure inventory continues to rise.

On Friday, Bank of America Corp. announced it would suspend foreclosure sales in all
50 states. That follows the bank's earlier suspension of tens of thousands of foreclosures
in the states that handle foreclosures through the court system, a move also taken by
GMAC Home Mortgage, Inc., a unit of Ally Financial Inc.,
and J.P. Mortgage Chase & Co.'s home-loan unit.

Meanwhile, several state attorneys general, as well as members of Congress,
are calling for an across-the-board foreclosure moratorium on foreclosures to sort out
alleged irregularities in foreclosure documents submitted by the banks.

Obama administration officials said such a move risked worsening the housing crisis
because foreclosures account for such a large share of all home sales. "Stopping that
process could have significant impacts on prolonging the housing recovery,"
said David Stevens, the commissioner of the Federal Housing Administration. Mr. Stevens.

White House adviser David Axelrod on Sunday questioned the need for a moratorium, saying that valid foreclosures with accurate documents should go ahead. "Our hope is this moves rapidly and that this gets unwound very, very quickly,'' he said on CBS's "Face the Nation"

Richard Cordray, Ohio's attorney general, said Sunday that as many as 40 state
attorneys general across the country intend to open an investigation of lenders and
servicers to figure out the scope of the problems with foreclosure documents.

While it remains unclear how long the foreclosure process will be stalled,
economists say any delay is bad for the housing market long-term. "Foreclosures are being delayed with good intentions, to protect consumers, but it's really just delaying the inevitable," says John Burns, a real estate consultant in Irvine,Calif. "They're delaying the eventual housing recovery."

A report released last month by RealtyTrac, which tracks foreclosures,
found that foreclosures sales amounted to an average of 24% of all home sales
during the second quarter of this year, which totaled about 248,000 homes.
In Nevada, one of several western states that was hard hit by the housing downturn,
foreclosure sales comprised 56% of all sales activity.

"Before all the bank suspensions and the robo-signers, we were headed for some big price declines in the fourth quarter. But now, in a place like Florida, in the short term, this will stabilize prices, because there won't be this bubble of supply hitting the market all at once," says Ivy Zelman, a housing analyst at Zelman & Associates in Cleveland.

While slowing foreclosures could have some positive benefits—stabilizing prices in the short term—economists argue that the vast majority of borrowers in trouble ultimately lose their homes, and the delays and interventions do more harm than good.

Florida and California have led the nation in foreclosures since the housing crisis began and both saw average home prices drop more than 50% between 2007 and 2009.

But while the percentage of mortgages in foreclosures continues to rise in Florida, it is falling in California.

Mark Zandi, chief economist of Moody's Analytics, said that price recoveries in states is closely tied to the length of the foreclosure process and has pressed for a standardization of foreclosure laws at the federal level to expedite the process.

The judicial process isn't the only determining factor. California's economy is more diverse than Florida's and real estate, long term, has always been a stronger bet in California, which explains why buyers would pounce once prices declined.

Data prepared for The Wall Street Journal by LPS Analytics shows that the time it takes for a borrower to go through the foreclosure process nationally has steadily climbed in all states in the past five years, and now takes an average of 478 days, up from 302 days in early 2005.

In Florida, the average foreclosure now takes 573 days. In California, the average is 457 days, though many take less than 120 days.

"We're seeing a mess and we're seeing a process that takes anywhere from nine months on the short end to two or three years," said Peter Murphy, president of Tampa, Fla.-based Home Encounter LLC a realty firm.

He says that in the last week, as the documents issue unfolded, he saw 15% of all foreclosure-sales listings of bank-owned homes yanked from the market. "I would expect that if we didn't have the judicial process, we'd be either right at the bottom, or we'd be bumping along the bottom getting ready to recover."

　Consumer advocates say the judicial process gives consumers a better chance to work out their problems. But Florida's court system is so overwhelmed with foreclosures that last year it began calling judges out of retirement to handle hundreds of foreclosure cases a day in a forum that became known as the "rocket docket."

Economists argue the efforts are wasteful because in the large majority of cases, borrowers have already turned over the keys to the home and walked away from their loans. Others stopped paying because, they said, defaulting was the only way to get their lender to consider a loan modification.

Matt Johnson, a 37-year old preacher and schoolteacher who now lives in Tampa, Fla., bought a $250,000 home in Gainesville at the height of the market in 2006. He defaulted three years later, hired a lawyer, failed to sell the house and hasn't made a mortgage payment in thirteen months. The home is vacant, awaiting repossession.

In California, when a homeowner defaults, the lender sends a notice, then must wait 90 days before scheduling a trustee sale of the house. The trustee sale must occur at least 21 days after it is scheduled, meaning that the quickest California foreclosures can take 111 days after default.

Samuel Kuoha, a 63-year old retired police officer and karate instructor, lost his home in El Cajon, Calif., in less than four months after defaulting on the $450,000 mortgage, which he refinanced in 2004 into a subprime loan, with payments that reset from $2,800 to nearly $5,000 per month. He says instead of serving him with papers, about 100 days after he defaulted, a bank representative gave him 30 days notice to move out.

"Next thing we know, some guy walked up to the door, and told my wife that they now owned the home, that they had bought it on the courthouse stairs," he said. Mr. Kuoha has since moved to Arizona, where he rents a house from a friend.

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Bank of America Halts Foreclosures

2010-10-11T08:04:00.001-04:00

Miami, FL - .Bank of America Corp. imposed a nationwide moratorium on foreclosures and the sale of foreclosed homes after it came under intense pressure from a government-run housing-finance giant worried about documentation problems, people familiar with the situation said.

The bank called the halt as concern mounted from legislators and state prosecutors about procedures used by lenders to foreclose on homes. Many banks use so-called robo signers, employees who sign hundreds of documents a day, without carefully reviewing their contents, when foreclosing on homes. Critics say that could result in improper foreclosures.

Freddie Mac, the government-run mortgage-finance company that along with Fannie Mae owns many of the mortgages serviced by banks, pressed Bank of America to expand its search for problems with the foreclosure documentation process, said the people familiar with the situation.

On a call Thursday with several banks that included Bank of America, a Freddie official said the mortgage company wanted the institutions to look at foreclosure documentation across all 50 states, and asked them to consider putting a stop to the entire foreclosure process, say people familiar with the call.

Many in the banking industry fear that the widening paperwork problem could cause further delay on foreclosures and threaten an already weak housing market, which in turn is stalling the broader U.S. economic recovery. On the other hand, it could provide a brief financial respite to people who have defaulted on their mortgages and are still occupying their homes.

As of August, there were more than 4.4 million home loans that were either in the foreclosure process or 90 days past due, according to mortgage research firm LPS Analytics. Since 2006, about 6.4 million homes have been lost through the foreclosure process.

Edward DeMarco, who heads the Federal Housing Finance Agency, which regulates Fannie Mae and Freddie Mac, said in an interview that officials were working to find a "tailored" response to the foreclosure problem that won't cause broader problems for the fragile housing market. "We are trying to be quick but measured in the approach and the response taken," he said. "We're concerned about the whole housing market, and we're concerned about what this means for taxpayers and other market participants."

Last week Bank of America, J.P. Morgan Chase & Co. and Ally Financial Inc. agreed to more closely examine documents used in 23 states where a court's approval is required to foreclose on a home. J.P. Morgan said its review suspended nearly 56,000 foreclosures.

In conversations with Bank of America, Freddie said financial penalties or litigation could result if the bank did not take additional steps, said a person familiar with the conversations. Bank of America told Freddie that an audit of procedures in the 23 states uncovered no errors, this person said.

But Freddie said the work didn't go far enough and asked for a review in all 50 states, as well a stop to any foreclosure sales, said people familiar with the situation. Freddie Mac declined to comment.

Bank of America Chief Executive Brian Moynihan said Friday that the bank hasn't found problems in its foreclosure process, but opted to temporarily halt all foreclosures to "clear the air." He said the bank wants to "go back and check our work one more time."

Its decision is expected to stop "a couple of thousand" foreclosure sales scheduled for the next week, according to one person familiar with the matter said. The bank declined to specify how many homes it has in the foreclosure pipeline.

So far, Bank of America is the only lender to expand its foreclosure freeze, but others may be forced to begin or broaden a review, banking executives say. Wells Fargo & Co., one of the nation's largest mortgage lenders, says it hasn't stopped foreclosing on any properties.

At this point, J.P. Morgan isn't expanding its foreclosure moratorium, but is widening its document review beyond the 23 states where it has frozen foreclosures, according to a person close to the bank.

Bank of America services 14 million mortgages, or one out of every five in the U.S., and its loan-servicing portfolio exceeds $2.1 trillion in size. Of its mortgages, 10 million came from its 2008 acquisition of troubled California lender Countrywide Financial Corp. More than 80% of its delinquent loans were acquired through Countrywide.

A push over the last week from politicians and law-enforcement officials troubled by reports of foreclosure problems only intensified the pressure on Bank of America, which has been working to improve its relations in Washington. It concluded that reviews in just 23 states wouldn't cut it with elected officials in the other states, a person close to the bank said.

"In this intense political season we are in, it didn't play well to say do it in some states but not your state," this person said.

Senate Majority Leader Harry Reid (D., Nev.), whose state has been hit hard by foreclosures, and House Oversight and Government Reform Committee Chairman Edolphus Towns (D., N.Y.), both said Friday they welcomed Bank of America's move and called on other banks to follow.

Cassandra Toroian, chief investment officer at Bell Rock Capital LLC, a money-management firm, says the additional reviews are unlikely to significantly impact the outcome for homeowners who are facing foreclosure. "It's just delaying the inevitable," she says.

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10 Trouble Spots to Consider When Purchasing a Foreclosed Home

2010-10-08T13:03:00.001-04:00

It’s easy pickings out there for many potential home buyers. Housing prices are at their lowest in more than a decade, inventories are high, analysts are predicting a new wave of foreclosures and the government is offering two substantial tax credits for which many home buyers qualify.

But bargain buyers beware, warns Vince Mastronardi, whose property preservation business has been busy preparing foreclosed homes for sale.

“Buyers need to educate themselves about the potential pitfalls of purchasing a distressed property,” says Mastronardi, president of On-Site Specialty Cleaning & Restoration. “It’s not so much what damage occurred, but the source of that damage and how long before the problem was addressed.”

These 10 signs may indicate that trouble is around the corner.

1. Unheated house in winter months. If the home has been properly winterized, there’s no need for heat. But if the home has not been properly winterized, pipes will burst and cause water damage.

2. Missing sinks, toilets and other fixtures. Make sure they’ve been properly removed and not ripped from walls and floors.

3. Peeling, bubbling, and discolored paint; swelling in walls or ceilings (especially around kitchens and bathrooms) or a musty odor all indicate water damage and, potentially, the presence of moisture and mold.

4. Fungus growth inside cabinets, behind drawers and built-ins. Fungus could mean that there has been water damage. Since water falls down, look for the source above the mold.

5. Blocked drains or pipes will cause future problems and may have already created sewage backups.

6. Black cobwebs, greasy gray residue on walls and/or a strong oily odor. This could point to potential soot damage or a malfunctioning furnace.

7. An older home with extensive renovations. Check with the city for pulled permits in order to get remolding details. If asbestos is present and has been disturbed, be sure it’s been remediated by a certified specialist.

8. Excessive painting of every nook, cranny, door and floor may mean that the seller is covering up mold.

9. Discolored subflooring. From the basement, check the subflooring above for stains and small holes, both caused by mold.

10. Air Quality. The air quality within a home tells a lot about the home’s condition. Be sure to include air and surface testing in your home inspection. It’s a few hundred dollars well spent.

“Time and technique are the most important factors of effective clean-up and preventing future problems like mold or contamination,” Mastronardi explains. “Ideally, professional cleanup begins within a few days of the damage; technicians are trained, certified or licensed; and equipment is specialized and up to date.”

Ask the seller to explain how the damage was fixed. Plus, check out the company that performed the repairs to ensure it has industry-recommended certification. If needed, follow-up with the seller or repairing company for specific repair details.

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Paperwork Missteps to Prolong Foreclosure Crisis in Certain States

2010-10-05T08:23:00.001-04:00

Three major mortgage lenders have halted foreclosures in states where the process is handled through the court system after suspicions surfaced that employees did not follow legal procedures in preparing the required documentation. GMAC Mortgage was the first to do so, followed by JPMorgan Chase and then Bank of America.

Analysts warn that the practice of rubber-stamping foreclosures without following legal statutes may go far beyond these three, with more foreclosure suspensions expected in the coming weeks. These paperwork problems are widely expected to draw out the already devastating foreclosure crisis in the affected states.

At the request of a number of DSNews.com readers, we have dug a little deeper to provide a list of the states where judicial foreclosures are the standard and that are most likely impacted by the foreclosure suspensions announced.

According to data provided by RealtyTrac, the 23 states listed below primarily use the judicial foreclosure process, with two additional states (Hawaii and Nebraska) employing judicial procedures “fairly often.”

Connecticut
Delaware
Florida
Illinois
Indiana
Iowa
Kansas
Kentucky
Louisiana
Maine
Maryland
Massachusetts
New Jersey
New Mexico
New York
North Dakota
Ohio
Oklahoma
Pennsylvania
South Carolina
South Dakota
Vermont
Wisconsin

A spokesperson for RealtyTrac explained that all states allow for foreclosures to be handled through their judicial system, but the 23 listed here are the ones where it is most commonly used.

According to a Mortgage News Daily blog, the memo GMAC sent to its “preferred agents” alerting them of its foreclosure suspension includes all of the states listed above with the exclusion of Delaware, Maryland, and Massachusetts. In their place, Hawaii, North Carolina, and Nebraska were added to GMAC’s list.

Bank of America has provided DSNews.com with its list of affected states. It contains all the states cited by RealtyTrac above, with the omission of Maryland and Massachusetts and the addition of Hawaii and Nebraska.

A spokesperson for JPMorgan responded to our inquiry with “We aren’t sharing at this point.”

The analysts at the credit rating agency DBRS wrote in commentary released Monday, “Apparently, in an effort to keep up with the ever increasing volume of foreclosures, many servicers are now realizing they violated the foreclosure commencement requirements of judicial jurisdictions which necessitate that: 1.) anyone who signs an affidavit must have verified all of the information contained within the document to ensure its accuracy and; 2.) all affidavits must be executed in the presence of a notary.

The analysts added, “DBRS believes that servicers will be able to quickly correct and refile any deficient affidavits in addition to implementing the appropriate controls to ensure there is not another breakdown in process. However, RMBS [residential mortgage-backed securities] that contain these loans will likely experience higher loss severities due to longer liquidation timelines.”

The Association of Mortgage Investors issued a called to all RMBS trustees on Friday urging them to “perform their fiduciary responsibilities and protect millions of American pensioners and retirees, in the wake of reports about serious irregularities in the processing of legal affidavits by the nation’s largest mortgage servicers.”

The group says the news that has come to light “undermines the integrity and the operational framework of the housing finance and mortgage system as it exists today.”

In all cases where underlying loan files do not have the legal documents required under RMBS pooling and servicing agreements (PSAs), the Association of Mortgage Investors is demanding servicers immediately pursue the repurchase of these loans.

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Existing Home Sales Improve a Bit

2010-10-01T16:06:00.001-04:00

The National Association of Realtors® (NAR) reported that existing home sales advanced modestly in August, rising 7.6% to a seasonally adjusted annual rate of 4.13 million units. This follows the dramatic 27% decline in July — an adjustment to the effects of the home buyer tax credit and its deadlines, which drew home sales that normally would have occurred in July and August forward into March and April.

While the modest rise in home sales in August was a welcome development, it was still the second lowest level since the NAR began reporting total existing home sales, which includes condominiums and coops, in 1999.

The turn-around in August was consistent across housing sectors and regions. Single-family home sales rose 7.4% from 3.37 million in July to 3.62 million, the second lowest sales rate since July 1995. Meanwhile, condominium and coop sales rose 8.5% to 510,000. Regionally, total home sales increased 7.9% in the Northeast, 5.0% in the Midwest, 5.2% in the South and 13.8% in the West.

Home affordability conditions are the best in more than a generation, with the average commitment rate for a 30-year fixed rate mortgage at a record low of 4.43% in August and the NAR median house price back down to its 2003, pre-boom level.

Although this has not been reflected in recent home sales, economic conditions and job growth are expected to improve in this year’s fourth quarter, setting the stage for a sales rebound

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Where Are The Home Buyers Looking Now?

2010-09-17T15:59:00.001-04:00

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10 Tips for Hiring a Home Remodeling Contractor

2010-09-16T15:08:00.001-04:00

Given the economic difficulties that still exist, it's not surprising that many homeowners are looking to home improvement and renovation, rather than buying a new home.

When deciding to undertake a remodeling project, however, there are several invaluable tips to keep in mind as you discuss your home makeover with potential contractors.

Thanks to our network of leading real estate professionals, the Top 5 in Real Estate Network®, I, along with my team, can offer tips to make your home renovation a more streamlined, more palatable experience, courtesy of Stageoflife.com:

Tip #1: Does Your Contractor Have Proof of Insurance?
Ask the contractor to have his insurance company mail or fax a copy of his current contractor insurance card to you. If the contractor can't do this, stay away. Why? If there is an accident at your home, you are then liable. This also applies to any sub-contractor or employee that the contractor may use; those individuals should have active insurance cards faxed or mailed to you as well.

Tip #2: Did You Check References and See Photos?
Ask for at least three references — with two of them being for the same type of project you are planning — and then call the references. Additionally, ask the contractor to provide photos of previous work, especially for the same type of project. If he produces lawn and garden photos and you're planning a bathroom remodel, you may want to check out another contractor.

Tip #3: Does Your Contractor Take Debit or Credit Cards?
Besides your ability to earn a few points, bonus miles or cash back on your project, a good sign that a contractor is financially savvy and has a bank behind his business is his ability to take debit and credit cards. This doesn't just apply to big contracting companies. Many small, one-man shops will take cards if they have a good relationship with their business bank or credit union.

Tip #4: Manners and Appearance?
If the contractor drove his vehicle to your home to give you an estimate, take a look at the way he keeps the equipment and vehicle. Are things clean? Neatly arranged? If not, that's a big warning. The way a contractor treats his tools is a direct connection to how he'll treat your home. During the initial meeting, does the contractor present himself in a professional way? Do you feel comfortable around him or his employees? They will be working in your home after all.

Tip #5: Clean-Up Policy?
Ask about the clean-up policy. For example, if your home improvement is a multi-day project, will the contractor be cleaning up at the end of every day or will he leave the dust, wood chips, and other mess laying there for day two? The more mess in your home ... the more it gets tracked around. Many homeowners find themselves with mouths gaping wide after the contractor has left for the day and their floors and home are dirty and messy around the project area.

Tip #6: Will the Contractor Put It In Writing?
Is your contractor willing to put both his bid and the scope of work in writing? If not, walk away immediately. You'll be surprised how many homeowners have been duped by contractors who verbally tell you what's included in their scope of work, but will then, in the middle of everything, require extra money to finish the remodel, thus holding you hostage with an uncompleted home project.

Tip #7: Availability?
Can the contractor get the job done in your timeline rather than his? There's nothing more frustrating than if a contractor tells you that a job will be done by a certain date and then it isn't. On the flip side, if you can't find a good contractor that's willing to commit to your timeline, your expectations may be too high and you may need to adjust your timeline.

Tip #8: Does Your Contractor Use "Subs?"
Does your contractor plan on doing everything himself? Or will he "sub out" work to the "trades?" For example, if you are remodeling a bathroom, you may need a plumber, electrician and carpenter. It's okay if the contractor subs work out to these specific trades — it shows he wants the work done right.

Tip #9: Quoting & Billing Procedure?
Ask the contractor about his quoting procedure. Will it contain general information, or will it be specific? For example, most contractors will charge you for a fuel surcharge, material up-charges, waste removal, labor, etc. Some will show you these exact costs in a line item invoice, but others roll it up into one big bill. How much detail do you want? You should clarify that with your contractor upfront.

Also, what is the payment or billing policy? Is money required upfront? If so, go back to #1 and #2 above to make sure you have the contractor's references checked and have a copy of his contractor's insurance.

Tip #10: Did Your Contractor Get the Permits?
Ask your contractor to take care of the permits. Although permits cost you money, the inspection process is meant to protect you from poor workmanship and to make sure that everything is being built to code.

For more information on home improvement and renovation, please e-mail our team and please feel free to forward these tips to any family and friends.

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Credit Scoring

2010-09-12T14:37:00.001-04:00

Dealing with Challenges

Typically, a person with a low credit score is in this position because they lack structure in his or her life. There are, of course, cases where unplanned health or employment complications are to blame, but for the most part, these are individuals who lack the discipline to pay their bills on time or curb their spending. This is your opportunity to be the "knight in shining armor" that provides them with a simple roadmap to get back on track.

Let's say we have a borrower with a credit score of 664. She has a concentration of credit card debt on one card; let's say $17,000 on a card with a $20,000 limit. At the same time, she has four or five additional credit cards, all with a zero balance. I would advise the borrower to distribute the debt over a number of her cards. Remember, a borrower's credit to debt ratio represents 30% of his or her overall score. By simply changing the ratio of available credit to debt, the borrower in this example could possibly increase her credit score to something closer to 700, saving thousands of dollars on her mortgage.

Another thing to take into consideration in a case like this is what percentage each of the five factors measure in the resulting credit score. Let's say we have a borrower with a "credit high" (the maximum debt allowance on all cards, combined) of $20,000. He has one card that is used for business purposes that is pushing the limit. I would advise the client to get two new cards and, once again, spread the debt out over all of his cards, leaving 50-70% available credit on each card. This will positively affect his overall score, based on the five elements of the FICO scoring model.

Conversely, the borrower should be advised not to close any existing credit card accounts, even if they are at a zero balance. Some people think they are doing themselves a favor by having fewer cards, but they lose out on the credit history factor. Even if the borrower does not have a good rate on an old credit card, they are rewarded for having the long-term credit history, and from time to time they should make a small purchase to keep the account in an active status.

These are just a few examples of what borrowers can do to improve their credit scores when they consider buying a home. If they are disappointed by the fact that they cannot get the most desirable loan up front, I would continue to monitor rates and their specific loan scenarios on an ongoing basis and advise them when they will have a chance to turn this situation around. The new mortgage debt will temporarily drop the score, but once the first payment registers as "paid," the score will begin to go up again and eventually present the opportunity to refinance at a lower rate.

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Untitled

2010-09-07T08:20:00.001-04:00

The three versions of the homebuyer tax credit are expected to result in revenue losses to the federal government of about $22 billion, according to estimates from the Government Accountability Office (GAO).

Homebuyer tax credit off the radar

2010-09-03T16:23:00.001-04:00

No Talk about reinstating the HomeBuyer tax Credit??

http://www.inman.com/news/2010/09/3/homebuyer-tax-credit-radar">Read more here…

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Mortgage Help

2010-09-03T12:59:00.001-04:00

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HAMP Program Not Doing Its Job!!!

2010-09-03T12:28:00.001-04:00

HAMP remains incapable of filling the imminent default gap

The Loan Modifications are not Working as Planned.

The Five Factors of Credit Scoring

2010-09-03T12:17:00.001-04:00

There are five factors that comprise the credit score. They are listed below in order of importance, just as an underwriter would look at the score:

Payment History: 35% impact. Paying debt on time and in full has a positive impact. Late payments, judgments and charge-offs have a negative impact. Missing a high payment has a more severe impact than missing a low payment. Delinquencies that have occurred in the last two years carry more weight than older items.
Outstanding Credit Balances: 30% impact. This factor marks the ratio between the outstanding balance and available credit. Ideally, the consumer should make an effort to keep balances as close to zero as possible, and definitely below 30% of the available credit limit when trying to purchase a home.
Credit History: 15% impact. This marks the length of time since a particular credit line was established. A seasoned borrower is stronger in this area.
Type of Credit: 10% impact. A mix of auto loans, credit cards, and mortgages is more positive than a concentration of debt from credit cards only.
Inquiries: 10% impact. This quantifies the number of inquiries that have been made on a consumer's credit history within a six-month period. Each hard inquiry can cost from 2 to 50 points on a credit score, but the maximum number of inquiries that will reduce the score is 10. In other words, 11 or more inquiries in a six-month period will have no further impact on the borrower's credit score.

Remember, a computer that's not taking any personal factors into consideration calculates these scores. When a credit report is generated, it is simply today's snapshot of the borrower's credit profile. This can fluctuate dramatically within the course of a week, depending on the individual's own activities. Borrowers should be made aware of this when they enter into the loan process, and know that it's not in their best interest to go out on a shopping spree. They need to make sure they are not creating a negative impact on the score while the lender is reviewing their file.

Secondly, it is often beneficial to compile a tri-merge credit report. This provides scores from the three credit bureaus, Experian®, TransUnion®, and Equifax. We will use this rounded profile because these three scoring systems can vary in their results. We are going to look at the middle score and throw out the other two. In many cases, this works to the borrower's advantage.

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Fannie Mae Says Foreclosure Delays Represent a Breach by the Servicer

2010-09-03T12:16:00.001-04:00

The nation’s largest mortgage company is about to start cracking down on servicers for letting delinquent loans languish too long without action.

Fannie Mae issued a notice this week alerting servicers that it is monitoring all delinquent loans in its portfolio and mortgage-backed securities (MBS) pools to ensure foreclosures are handled within an acceptable time frame.

By the tone of Fannie’s announcement, it wants these nonperformers off its books as quickly as possible. The GSE says it may assess penalties for poor servicer performance when it comes to completing foreclosures in a timely manner.

Fannie says it will be keeping tabs on all whole mortgages, participation pool mortgages, and MBS pool mortgages with a special servicing option referred to an attorney or trustee to initiate foreclosure proceedings on or after July 1, 2010. Company officials will be scrutinizing servicer data to identify delays in the default management process.

According to the GSE, it may elect to perform a more extensive servicing review – possibly on-site – to further evaluate the actions the servicer took on certain mortgage loans. Servicers must send the requested documentation or make it available…within the time frame specified in the notification. If the servicer fails to do so, Fannie Mae may assess compensatory fees without first reviewing the loan or exercise other available remedies, the GSE warned.

Fannie Mae will communicate any performance deficiencies to the servicer, who will then be given an opportunity to explain any mitigating circumstances or factors that justify the servicing actions it took or did not take within a reasonable time frame.

“A compensatory fee not only compensates Fannie Mae for damages but also emphasizes the importance placed on a particular aspect of the servicer’s performance,” the GSE stated in its servicing guide.

Fannie also updated the allowable foreclosure time frames for four states: Florida – 185 days; Maryland – 90 days; Nevada – 150 days; New York (upstate) – 300 days; and New York (downstate) – 420 days.

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Buying a Foreclosed Home? Top Problem Areas to Look Out For

2010-09-02T15:18:00.001-04:00

Today's real estate landscape offers some great buys for savvy real estate consumers, especially when it comes to foreclosure properties. Unfortunately, even though there are already a large number of foreclosures on the market, analysts are predicting that yet another wave of distressed properties will crop up in the coming months.

As a Member of the Top 5 in Real Estate Network®, I, along with my team, have consulted with many clients seeking to capitalize on a foreclosure purchase. We always advise them, however, to weigh the pros and cons. While a foreclosure could represent your best chance to get a great deal, make sure you educate yourself about the potential pitfalls of purchasing a distressed property in advance - and what correcting those pitfalls might cost. In most cases, it's not so much about what damage occurred but rather the source of the damage and how long before the problem was addressed.

Here are the top 10 signs that may indicate trouble in a foreclosed home:

Unheated house in winter months. If the home has been properly winterized, there's no need for heat. But if the home has not been properly winterized, pipes will burst and cause water damage.
Missing sinks, toilets and other fixtures. Make sure they've been properly removed and not ripped from walls and floors.
Peeling, bubbling and discolored paint; swelling in walls or ceilings (especially around kitchens and bathrooms), or a musty odor all indicate water damage and, potentially, the presence of moisture and mold.
Fungus growth inside cabinets, behind drawers and built-ins. Fungus could mean that there has been water damage. Since water falls down, look for the source above the mold.
Blocked drains or pipes will cause future problems and may have already created sewage backups.
Black cobwebs, greasy gray residue on walls and/or a strong oily odor. This could point to potential soot damage or a malfunctioning furnace.
An older home with extensive renovations. Check with the city for pulled permits in order to get remolding details. If asbestos is present and has been disturbed, be sure it's been remediated by a certified specialist.
Excessive painting of every nook, cranny, door and floor may mean that the seller is covering up mold.
Discolored subflooring. From the basement, check the subflooring above for stains and small holes, both caused by mold.
Air quality. The air quality within a home tells a lot about the home's condition. Be sure to include air and surface testing in your home inspection. It's a few hundred dollars well spent.

There are indeed many great opportunities in today's market, but proper education and preparation are essential to making the right investment. Please e-mail our team for further information and be sure to forward this article to others who might be considering a foreclosure purchase.

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When Should You Buy Real Estate??

2010-09-02T08:13:00.003-04:00

Listen to what the experts from CNBC and Zillow.com have to say about when you should buy Real Estate

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When Is A Good Time To Buy Real Estate???

2010-09-02T08:13:00.001-04:00

Listen to what the experts from CNBC and Zillow.com have to say about when you should buy Real Estate

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Analysts predict more declines in housing demand

2010-09-02T08:11:00.001-04:00

Analysts predict more declines in housing demand

Miami, FL-“The recent bond rally is good news for the secondary market, but it may be an unsustainable trend, as analysts predict more declines in the housing industry, potentially sapping mortgage-backed bonds.“ Explains Jacob Gafney from housingwire.com.

The feeling among realtors, economists, and the public in general is that the housing market will keep looking down. Considering that attempts made through modification of loans, and tax credits, and other incentive provided by the government have not done a lot for the struggling homeowner, people have little hope in any future attempts to fix this mortgage crisis. The National Association of Realtors reported that home sales for July dropped 27% (3.83 million annually) to its lowest rate since NAR began tracking, after the homebuyer tax credit was introduced.>>READ MORE

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Where are the Buyers Going to Look for A Home

2010-09-02T08:07:00.001-04:00

CNBC and Trulia Tell you the Answer. Listen in to find out where the activity is taking place

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Home Buyer Tax Credit Extended??

2010-08-30T08:00:00.001-04:00

Well its here. Just as I thought, the Obama administration is thinking that the home buyer tax credit should be extended. It does not talk about prices. It’s a HOME BUYER TAX CREDIT and possibly to Investors.

The Obama administration plans to set up an emergency loan program for the unemployed and a government mortgage refinancing effort in the next few weeks to help homeowners after home sales dropped in July, Housing and Urban Development Secretary Shaun Donovan said.

“The July numbers were worse than we expected, worse than the general market expected, and we are concerned,” Donovan said on CNN’s “State of the Union” program yesterday. “That’s why we are taking additional steps to move forward.”

The administration will begin a Federal Housing Authority refinancing effort to help borrowers who are struggling to pay their mortgages, and will start an emergency homeowners’ loan program for unemployed borrowers so they can stay in their homes, Donovan said.

“We’re going to continue to make sure folks have access to home ownership,” he said.

Sales of U.S. new homes unexpectedly dropped in July to the lowest level on record, signaling that even with cheaper prices and reduced borrowing costs the housing market is retreating. Purchases fell 12 percent from June to an annual pace of 276,000, the weakest since the data began in 1963.

Sales of existing houses plunged by a record 27 percent in July as the effects of a government tax credit waned, showing a lack of jobs threatens to undermine the U.S. economic recovery.

House Sales Plummet

Purchases plummeted to a 3.83 million annual pace, the lowest in a decade of record keeping and worse than the most pessimistic forecast of economists surveyed by Bloomberg News, figures from the National Association of Realtors showed last week. Demand for single-family houses dropped to a 15-year low and the number of homes on the market swelled.

U.S. home prices fell 1.6 percent in the second quarter from a year earlier as record foreclosures added to the inventory of properties for sale. The annual drop followed a 3.2 percent decline in the first quarter, the Federal Housing Finance Agency said last week in a report.

Donovan said on CNN yesterday that it is too soon to say whether the administration’s $8,000 first-time homebuyer credit tax credit, which expired April 30, will be revived.

“All I can tell you is that we are watching very carefully,” Donovan said. “We’re going to be focused like a laser on where the housing market is moving going forward, and we are going to go everywhere we can to make sure this market stabilizes and recovers.”

Reviving the tax credit would “help enormously” in the effort to fight foreclosures and revive the economy, Florida Governor Charlie Crist said on the same CNN program. Florida has the third-highest home foreclosure rate in the country, with one in every 171 housing units receiving a foreclosure filing this year.

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Top 5 Mortgage Options for Home Buyers

2010-08-26T16:31:00.001-04:00

While many great deals exist in today's real estate market, securing the optimal mortgage is a critical part of your home purchase decision.

As a Member of the Top 5 in Real Estate Network®, I, along with my team, have worked with many home buyers over the years and am well versed on the factors in every mortgage loan package that will determine whether or not you can afford the house you want to buy. The most important things to take into consideration are: interest rate, points, mortgage type, closing costs and fees, and down payment and mortgage insurance. Here’s a closer look at each:

Interest Rate: The interest rate determines the amount of your monthly payment. Keep in mind that different lenders offer different interest rates, so it is important to shop around. Generally, a short-term or adjustable-rate loan will offer a lower interest rate because you agree to repay the lender more quickly or to pay fluctuating rates.
Points: Points are fees charged by the lender to originate your loan. A point equals one percent of the total mortgage amount. Lenders will charge different numbers of points for different loans, so it is important to understand how many points a lender will be charging. For example, in some cases, lenders may advertise very low interest rates, but build a high point charge into the cost of issuing the loan, making the deal less valuable than a loan at a higher interest rate.
Types of Mortgage Options:

Fixed Rate. On a fixed-rate mortgage, the interest rate does not change for the entire life of the loan.
Adjustable Rate. Adjustable rates, on the other hand, are interest rates that fluctuate based on market conditions. Since no one knows how the market will behave, they are riskier than fixed-rate loans. Over the life of the mortgage, you could end up paying more or less than you would have with a fixed-rate loan.
Balloon. The next common type of mortgage is a balloon payment loan. A balloon payment loan allows you to make relatively small monthly payments for an initial period, but requires a lump-sum payment toward the end of the term. These are risky to consider unless you are confident that you can either refinance the loan or sell the home at the end of the initial loan period.

Closing Costs: Closing costs and fees are additional amounts that the buyer and seller must cover during the course of the mortgage loan transaction. They include items like credit report fees, appraisal fees, title search fees and title insurance.

Down Payment and Mortgage Insurance: When searching for the right type of mortgage for you, the amount of your down payment, the need for private mortgage insurance (PMI) and other factors, such as whether you are a first-time home buyer, a teacher or a peace officer, will also affect your monthly mortgage payment.

A professional real estate agent, such as a member of the Top 5 in Real Estate Network®, or a trusted mortgage broker can help you decide what makes the best financial sense for you. Please e-mail our team for more information and be sure to pass this email on to others who might be in the market for a mortgage.

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Clean Up Your Credit !!!!!!

2010-08-25T17:42:00.001-04:00

7 Tips for Improving Your Credit

Here's how to clean up your credit so you get the least-expensive home loan possible.

Getting the loan that suits your situation at the best possible price and terms makes homebuying easier and more affordable. Here are seven ways to boost your credit score so you can do just that.

1. Know your credit score

Credit scores range from 300 to 850, and the higher, the better. They're based on whether you've paid personal loans, car loans, credit cards, and other debt in full and on time in the past. You'll need a score of at least 620 to qualify for a home loan and 740 to get the best interest rates and terms.

You're entitled to a free copy of your credit report annually from each of the major credit-reporting bureaus, Equifax (http://www.equifax.com), Experian (http://www.experian.com), and TransUnion (http://www.transunion.com). Access all three versions of your credit report at www.annualcreditreport.com (http://www.annualcreditreport.com). Review them to ensure the information is accurate.

2. Correct errors on your credit report

If you find mistakes on your credit report, write a letter to the credit-reporting agency explaining why you believe there's an error. Send documents that support your case, and ask that the error be corrected or removed. Also write to the company, or debt collector, that reported the incorrect information to dispute the information, and ask to be copied on any materials sent to credit-reporting agencies.

3. Pay every bill on time

You may be surprised at the damage even a few late payments will have on your credit score. The easiest way to make a big difference in your credit score without altering your spending habits is to diligently pay all your bills on time. You'll also save money because you'll keep the money you've been spending on late fees. Credit card or mortgage companies probably won't report minor late payments, those less than 30 days overdue, but you'll still have to pay late fees.

4. Use credit carefully

Another good way to boost your credit score is to pay your credit card bills in full every month. If you can't do that, pay as much over your required minimum payment as possible to begin whittling away the debt. Stop using your credit cards to keep your balances from increasing, and transfer balances from high-interest credit cards to lower-interest cards.

5. Take care with the length of your credit

Credit rating agencies also consider the length of your credit history. If you've had a credit card for a long time and managed it responsibly, that works in your favor. However, opening several new credit cards at once can lower the average age of your accounts, which pushes down your score. Likewise, closing credit card accounts lowers your available credit, so keep credit cards open even if you're not using them.

6. Don't use all the credit you're offered

Credit scores are also based on how much credit you use compared with how much you're offered. Using $1,000 of available credit will give you a lower score than having $1,000 of available credit and using $100 of it. Occasionally opening new lines of credit can boost your available credit, which also affects your score positively.

7. Be patient

It can take time for your credit score to climb once you've begun working to improve it. Keep at it because the more distance you put between your spotty payment history and your current good payment record, the less damage you'll do to your credit score.

Other web resources

How FICO scores are calculated (http://www.myfico.com/CreditEducation/WhatsInYourScore.aspx)

Answers to frequently asked credit report questions (https://www.annualcreditreport.com/cra/helpfaq)

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New Regulations at Fannie Mae

2010-08-25T17:13:00.001-04:00

We Need New Systems and Checks in Place to Prevent What has Happened to Housing!!

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