Insigniaresidential - FSBO

Once you have decided that you want to be an investor in real estate and you are in it for the long haul, you need to assemble your team of experts.

Depending on how conscientious you were in the past about guarding your credit, this process can take up to one year. You will need to interview the members of your team because you will be working with them continuously.

Here are the steps that you have to do.

1. Visit your local banker and speak with the person who deals with all loans. If the bank is small enough, this person will handle all loan inquiries in that particular branch.

2. Assemble your papers. This means bank statements, pay stubs, cds, titles to properties you already own.

3. Find the addresses of  the three major credit bureaus. Ask for your most recent credit report (you may or may not have to pay for this service).

4. Begin interviewing mortgage brokers. You do not need to send in paperwork to all the mortgage brokers that you know, as every time they access your credit report there is a corresponding decrease in your credit score.

5. Work with a real estate agent who has done the same thing you are going to do. Someone who sold you your million dollar home may or may not have had experience in investing, very simply because they have different focus and have defined niches.

6. Your real estate agent should have a list of everyone that can help you manage and or keep up your investment.  This list will include appraisers, inspectors, plumbers, electricians, cleaning ladies, carpenters, painters, landscape or yard maintenance person. If you decide to have someone manage the property for you, interview not 3 but 5. This is  a crucial choice. It can save you a lot of frustration, not to mention lost income.

7. You will need an attorney that will do the legal work for you and it has to be a real estate attorney.

8. Once you  have assembled your team, set up a meeting with your finance team (banker/mortgage broker/accountant) and tell them what you intend to do.

9. Set up a meeting with your real estate agent, the one who is going to find you the properties. Be specific in your criteria when defining what you want to invest with (is it location? type of construction? undeveloped land? a new construction? is it a single family home? is it a multifamily home?). Those are the questions that only you can answer.

10. Know the area you want to invest in like the palm of your hand. Where are the grocery stores? Where is the nearest bus stop? Is there a laundromat close by? How are the buildings in that area? Do the owners maintain them? The most important criteria: Will you live there?

You have assembled a team of experts and your task is almost done. That is just the preparation for your buying process. You have to be doing all of this in addition to your family/social obligations and your career. Give yourself some time.

This information is posted by www.FloridaLoanSpecialist.com for your convenience. Need Financing? Call Christina Felgenhauer @ 239-699-1462 or email Christina@FLS-Service.com
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WASHINGTON – July 14, 2008 – Faced with record-high foreclosure rates, the Bush administration has been scrambling to keep people from losing their homes, but many are beyond help, Treasury Secretary Henry Paulson said Tuesday.

Lax lending standards that accompanied the once high-flying housing market allowed people to buy homes they could not afford, Paulson said.

“Many of today’s unusually high number of foreclosures are not preventable,” he said in prepared remarks to a mortgage-lending forum meeting in Arlington, Va. “There is little public policymakers can, or should, do to compensate for untenable financial decisions.”

Paulson said that there were 1.5 million home foreclosures started in 2007. He said some economists estimate there will be about 2.5 million foreclosures started this year.

Since last summer, the Bush administration has been focused on cutting down on the number of what Paulson called preventable foreclosures, where struggling homeowners want to keep their homes and have the financial wherewithal to do so.

The administration has been working with the Hope Now alliance, an industry group trying to coordinate a response to the mortgage crisis, to encourage lenders to work out loan modifications or refinancings for people who can afford the new terms and can keep making payments.

“While there have been bumps in the road and there is still work to do, the industry, through Hope Now, has made an enormous effort and great progress toward meeting these challenges,” Paulson said.

Since last July, the industry has helped 1.7 million homeowners with loan workouts that allowed them to stay in their homes, Paulson said.

Slumping home values are blamed for the bulk of the increasing foreclosures. Troubled borrowers left owing more to the bank than their homes are worth are walking away. Dumping more empty houses on the market adds to the pile of unsold homes, and that drives home prices down further.

Other homeowners were clobbered when initially low mortgage rates reset to much higher levels, ballooning their monthly payments.

Congress is working on legislation that would permit the Federal Housing Administration to provide new, cheaper mortgages to distressed homeowners who otherwise would have difficulty refinancing into more secure government-insured loans. Lenders would have to be willing to take a substantial loss by reducing the amount owed on the loan.

Differences have to be worked out between the Senate package and a similar House-passed proposal, and with the White House, too. The White House has threatened a veto but is working behind the scenes with congressional leaders to find common ground.

Paulson said he was pleased that Fannie Mae and Freddie Mac, major providers of mortgage financing, are raising more capital to bolster their balance sheets.

Shares of Fannie and Freddie tumbled on Monday after a Lehman Brothers report said that an accounting change could force the companies to raise billions of capital.

As part of a broad housing rescue package that includes leeway for the FHA, lawmakers also would revamp oversight of Fannie and Freddie, something the Bush administration has been championing.

Paulson also said Treasury is working with the Federal Reserve and other financial agencies to explore the potential of “covered bonds” as a way of increasing the availability and lowering the costs of mortgage financing.

These bonds provide funding to an issuer, such as a bank, and are backed by mortgages or cash flows from other debt. If the bond issuer goes into bankruptcy, investors who bought the bonds can lay claim to the underlying assets. Such bonds have been widely used in Europe to finance residential and commercial real estate, student loans and credit card debt, he said.

source: ap.org

This information is posted by www.FloridaLoanSpecialist.com for your convenience. Need Financing? Call Christina Felgenhauer @ 239-699-1462 or email Christina@FLS-Service.com
Professional, Fast, Reliable!!

This information is posted by www.FloridaLoanSpecialist.com for your convenience. Need Financing? Call Christina Felgenhauer @ 239-699-1462 or email Christina@FLS-Service.com
Professional, Fast, Reliable!!

Jul 10, 3:24 PM EDT

By JEANNINE AVERSA
AP Economics Writer

WASHINGTON (AP) -- Rates on 30-year mortgages edged up this week, while rates on other home loans were a mixed bag.

Freddie Mac, the mortgage company, reported Thursday that 30-year fixed-rate mortgages averaged 6.37 percent this week. That was up from 6.35 percent last week.

Rates on 15-year fixed-rate mortgages, a popular choice for refinancing, dipped to 5.91 percent this week, compared with 5.92 percent last week.

Meanwhile, five-year adjustable-rate mortgages rose to 5.82 percent this week, up from 5.78 percent last week. Rates on one-year adjustable-rate mortgages held steady at 5.17 percent, unchanged from the previous week.

Earlier this week, there were fresh signs that the painful housing slump was likely to drag on. The National Association of Realtors' pending home sales index slipped 4.7 percent in May to the third-lowest reading on record.

"Pending home sales fell more than expected," said Freddie Mac's chief economist Frank Nothaft.

Home foreclosures have hit record highs as sagging home values have left some borrowers owning more on their mortgages than their homes are worth. With more empty homes being dumped on an already glutted market, prices are being pulled lower. Buyers, however, have become harder to find as credit has gotten harder to secure.

Congress is moving ahead on a package to help distressed homeowners. It would allow the Federal Housing Administration to provide them with more affordable, fixed-rate mortgages.

The mortgage rates do not include add-on fees known as points. The nationwide fee for 30-year, 15-year and five-year mortgages all averaged 0.6 point this week. The fee on one-year mortgages averaged 0.5 point.

A year ago, rates on 30-year mortgages stood at 6.73 percent, 15-year mortgage rates averaged 6.39 percent, five-year adjustable-rate mortgages were at 6.35 percent and one-year adjustable-rate mortgages averaged 5.71 percent.
On the Net: Freddie Mac: http://www.freddiemac.com

Olga Savelov will be speaking at our inaugural event July 15. She will tell you how you can start repairing your credit in 45 days. Olga is a Senior Mortgage Consultant at Universal Mortgage. She started on the ground floor of a financial institution in 1981 and was promoted to Executive Vice President / Treasurer and CFO. As a CFO, Olga successfully negotiated business financing contracts. Since she enjoyed that aspect of her job so much, Olga then decided to make the transition to originating home loans full time, and has consistently been one of the highest producing mortgage consultants in her region. Her business is 100% referral based, which is a testament to the strong relationships she has built with her business partners and clients.

Olga is also a mom to two daughters. She has smartly advised to be property owners as well.

Fixed rate mortgages offer borrowers the ability to help budget for household expenses more accurately because they have an interest rate that remains constant for an agreed portion of the overall term of the mortgage - typically between one and five years.

Unlike variable rate mortgages, the interest rate charged on fixed rate mortgages will not be influenced by changes in either the Bank of Canada Base Rate or the lender’s Standard Variable Rate (SVR). Instead, the interest rate will remain constant during the fixed rate period regardless of movements in interest rates on other financial products.

The fixed interest period gives borrowers the stability they need to manage their household budget more effectively, which is why fixed rate mortgages are popular with first-time-buyers and young households.

Fixed rate mortgages are also popular during times of historically low interest rates. Many homeowners fix their interest rates while they believe the cost of borrowing is cheap, therefore locking in the low rates well into the future. However, while fixed rate mortgages provide borrowers with some advantages, there are also several disadvantages.

Fixed interest rates are usually slightly higher than current variable rates. Borrowers should therefore refrain from fixing their rate if they believe that interest rates will either remain stagnant or fall in the near future.

If a fixed interest rate is locked in for a period of time and the variable rate for the same mortgage product remains lower throughout that same period of time, the borrower will pay more interest on their mortgage than required.

Additionally, once the fixed rate period expires, the interest rate will convert to the lender’s Standard Variable Rate. It is therefore advisable for borrowers to assess their remortgage situation before the termination of the fixed rate period.

It is also important to note that most lenders charge an arrangement fee for their fixed rate mortgage products. Therefore, borrowers should assess whether the estimated future savings in interest that can be made by fixing the interest rate is not outweighed by any upfront arrangement or brokerage fees that must be paid.

Borrowers should therefore assess the overall expected cost savings in combination with the ability to manage their household budget more effectively, against any upfront fees that may be charged, before applying for fixed rate mortgages. If borrowers require help in deciding whether to fix their interest rate they should contact an independent mortgage advisor.

An independent mortgage broker can offer unbiased and impartial advice on the entire UK mortgage market. Because they are not tied to specific lenders and products they can find the most appropriate home loan products for their clients based solely on their clients’ needs. Experienced brokers should be able to advise their clients whether they believe interest rates are historically low and the environment is therefore right for locking in a fixed interest rate.

Independent mortgage brokers and financial advisors should also be able to assess their clients’ individual financial circumstances and recommend whether fixed rate mortgage are appropriate based on this.

I am reading the writing on the walls and coming to the conclusion that the days of the Mortgage Broker are probably numbered.  Bank of America cut off their wholesale division awhile back, and since they now own Countrywide, I believe the Countrywide wholesale operation will soon follow suit.  Once that happens I believe lender wholesale divisions will fall like dominoes. 

Maybe it is a good thing in the long run.  As long as Congress and the public at large are of the mind that unscrupulous brokers caused the mortgage crisis, eliminating brokers may be the only way to restore some confidence in the mortgage market.  Restoring confidence in the mortgage market is crucial for everyone's sake

If you have read my previous blog entries you will know that I don't really believe that Mortgage Brokers are as much to blame as the Wall Street Investment Houses who invented loan programs that required virtually no strength whatsoever on the part of borrowers.

As long as public perception is what it is,  upper management at Mortgage Banks will be able to cut off mortgage brokers and then turn to their shareholders, and the public at large, and announce they have fixed the problem.  Soon after closing down wholesale divisions, upper management will realize the same kind of "problematic" lending practices exist in their own retail lending divisions as well.  Retail loan officers will be the next to go. 

Washington Mutual has already closed standalone retail lending offices, along with their wholesale division. Washington Mutual has apparently chosen instead to handle mortgage applications via general purpose branch personnel.  I believe upper management at most mortgage lenders tend to view mortgages as a product rather than a process so I foresee that they will ultimately attempt to "sell" mortgages on line and eliminate local loan origination personnel altogether.

I feel bad for all the honorable Mortgage Brokers out there, and there are many.  I feel bad for the borrower because they will lose access to the valuable knowlege and service that a good broker provides.  I see borrowers in the future going from lender to lender trying to find one who will qualify them for the loan they need.  They will probably have to start from scratch with each new lender.

I feel bad for Realtors too because a trusted mortgage professional provides invaluable service before, during, and after the real estate transaction.  I interviewed with a high profile Internet lender awhile back.  The first thing that struck me was the job description stated "no mortgage experience required!"  During the interview, I asked how they handle the pre-approvals of clients for Realtors.  The interviewing manager responded that they "discourage their employees from wasting time with those."

As for me,  I am  an ex-mortgage broker now. I don't want to end up like the guy who used to deliver ice for your ice box after the refrigerator was invented, so I am working on something new.  I am  back in school to retrain myself in all of the technology involved behind the scenes in Internet marketing. 

One of the first things I learned was how important digital images will be in marketing real estate, or anything else for that matter, over the Internet.  With gas approaching $5 a gallon, more and more buyers will narrow thier search by reviewing listings on line before they jump in the car to go visit homes.  Listing photos will be relied on more heavily than ever to make the all important first impression.

I have developed processes specifically geared toward improving the digital photographs Realtors obtain of their listings.  We have developed processes to lighten, brighten, straighten, and sharpen the digital images of your homes when they are listed for sale.   

This week we launched, Mio -Marketing Image Optimization.  We can fix your listing pics!  We would love for you visit our web site and let us know what you think.

http://www.lightbrightlistings.com

Wachovia Corp. announced yesterday that they would stop offering negative amortization mortgages.Their negative amortization mortgage was called Pick-A-Payment because it gave borrowers 4 different payment options each month.  A negative amortization mortgage is a mortgage that you are allowed to make payments for less than the amount of interest that is due. The interest that is not paid in full each month is added to the mortgage's principal balance.

Wachovia's Pick-A-Payment mortgage gave borrowers the following options each month:

1. Paying the fully amortized 30 yr Fixed principal and interest payment. Making this monthly payment will pay off your mortgage in 30 yrs.
2. Paying the fully amortized 15 yr Fixed principal and interest payment. Making this monthly payment will pay your mortgage off in 15 yrs.
3. Interest only payment. Paying only the interest that is due on the mortgage. Nothing is paid toward the principal so your principal balance remains the same.
4. Making the mininum payment due which does not cover any principal and doesn't cover the full interest payment due on the mortgage. The interest that is not paid is added to the principal balance on the mortgage.

Wachovia's Pick-A-Payment became very popular during the recent real estate boom when alot of people were investing in real estate and didn't care about paying down the mortgage because property values were increasing so fast that it didn't matter if they paid anything toward the principal.

I think that this is a very wise move on Wachovia's part and I'm surprised that they didn't do it sooner but they have really just taken over World Savings, which is the company that was marketing the Pick-A-Payment mortgage.

Have a Great Day,

Sandra Sheely

We have foreign national mortgageswith no prepayment penalties. Not having a prepayment penalty can save you thousands of dollars when you sell your home. A prepayment penalty is when a lender charges you a "penalty" or fee if you sell your home within the first few years after you took out the mortgage. Most prepayment penalties are usually 6 months worth of interest so not having a prepayment penalty will save you alot of money.  Six months of interest on a $200K foreign national loan at 7.5% interest is $7,500 so the savings are exceptional.

Prepayment penalties on foreign national loans are very common so this is a great opportunity to get a foreign national loan without the prepayment penalty.  

Have a Great Day,

Sandra Sheely

Florida Attorney General Bill McCullum filed suit against Countrywide Financial Corp. on Monday for misleading and unfair trade practices.  Countrywide Chief Executive Angelo Mozila  was also named a defendant. The complaint, filed in Broward County, claims that Countrywide hid the potential negative effects of these so called "teaser loans", including increased interest rates and prepayment penalties. Essentially Countrywide is accused of giving mortgage loans to people that couldn't repay them, charged subprime interest rates to borrowers that qualified for prime rate loans.  The complaint said that Countrywide's own underwriters were threatened with termination for attempting to verify a borrower's ability to pay or otherwise impeding loan approval. The complaint also stated that managers were encouraged to approve subprime loan applications initially denied by their underwriters that suspected loan fraud.

Florida joins the states of California and Illinois which also filed suit against Countrywide Financial Corp last week.  I'm sure that Florida is not going to be the last state that files suit against Countrywide. Will Nevada be the next to file a suit? I'm glad that Angelo Mozila is a defendant. He should be held accountable if all of this was going on under his reign.

I know someone that works in Countrywides sales call center and things are very slow over there right now. They are so happy that Bank of America bought Countrywide because they hope that it will bring some stability and much needed cash.

Have a Great Day,

Sandra Sheely

WASHINGTON (AP) -- Rates on 30-year mortgages rose again this week, climbing to the highest level in more than nine months, reflecting more concerns about how the Federal Reserve will respond to higher inflation pressures.

Freddie Mac, the mortgage company, reported Thursday that 30-year fixed-rate mortgages averaged 6.45 percent this week. That was up from 6.42 percent last week.

It was the highest level for 30-year mortgages since they averaged 6.46 percent for the week of Sept. 9. It marked the fifth consecutive weekly increase and the fifth week that they have been above 6 percent.

Frank Nothaft, chief economist at Freddie Mac, said financial markets are uncertain about what the Fed will do in response to rising inflation pressures. On Wednesday, the central bank brought its aggressive campaign of interest rate cuts to a halt, leaving the federal funds rate unchanged at 2 percent.

Fed officials expressed heightened concern about inflation and signaled that their next move would likely be a rate increase.

Financial markets are debating about when Fed rate increases might begin, with some worried about a possible hike this fall but others believing that any rate increases will not occur until after the November election.

In a speech earlier this month, Federal Reserve Chairman Ben Bernanke said that the Fed would "strongly resist" any tendency for Americans' expectations about price increases to become unsettled.

Other types of mortgages showed increases this week, according to the Freddie Mac survey.

Rates on 15-year fixed-rate mortgages rose to 6.04 percent, up from 6.02 percent last week.

The five-year adjustable-rate mortgage rose to 5.99 percent, up from 5.89 percent last week. The rate on a one-year adjustable-rate mortgage rose to 5.27 percent, compared to 5.19 percent last week.

The housing market is facing numerous headwinds, from slumping prices, which are keeping potential buyers on the fence, to rising mortgage defaults, which are dumping more homes on an already glutted market.

The mortgage rates do not include add-on fees known as points. The nationwide fee for 30-year, 15-year and one-year mortgages averaged 0.6 point. The fee on five-year mortgages averaged 0.7 point.

A year ago, rates on 30-year mortgages stood at 6.67 percent, 15-year mortgage rates averaged 6.34 percent, five-year adjustable-rate mortgages were at 6.30 percent and one-year adjustable-rate mortgages averaged 5.65 percent

 source: ap.org