Sean Murphy's Blog

FHA Streamline Refinance MS

Sean Murphy (Centennial Mortgage Corp.) — Tue, 04 Aug 2009 14:38:32 -0700

Is your rate 6% or above? Do you have an FHA loan with an adjustable rate? Did you know that on a $200,000.00 loan a 1% lower rate would save you over $125.00 a month. 2% lower more than doubles that. Let me get you a 30 year fixed rate as low as 4.875%. Even if your credit is not as good as when you orginally got your FHA loan, or you have more debt you may still qualify for this program. It is designed by HUD to simply make your monthy payment more affordable. I can qualify you in just a few easy steps! It is simple and takes as few as two weeks to complete!

FHA Streamline offers a great opportunity to anyone currently in an FHA loan. All FHA loans qualify for the program, including 30- and 15-year fixed rate FHA loans and all ARM FHA loans. FHA Streamline allows you to take advantage of lower mortgage rates by refinancing your current FHA loan into a lower fixed rate on a new FHA loan.

Lower Your Mortgage Rate on Your FHA Loan with FHA Streamline

Community First Bank makes it simple. If today’s mortgage rates are lower than your current rate, or you have an FHA ARM that may adjust upward, you can refinance your FHA loan up to the original amount of your current loan at today’s lower rates. And with FHA Streamline, you could qualify for an FHA refinance with no appraisal and no income verification. It’s easy, fast and designed to get you a lower payment on your FHA loan.

What the FHA is Saying about FHA Streamline

Here is some information from HUD’s website about FHA Streamline:

“The ‘streamline’ refers only to the amount of documentation and underwriting that needs to be performed by the lender, and does not mean that there are no costs involved in the transaction. The basic requirements of a streamline refinance are:

The mortgage to be refinanced must already be FHA insured.
The mortgage to be refinanced should be current (not delinquent).
The refinance is to result in a lowering of the borrower’s monthly principal and interest payments.
No cash may be taken out on mortgages refinanced using the streamline refinance process.”

Get an FHA Streamline and Get a Lower Mortgage Rate Today

Let’s clarify the benefits of FHA Streamline. Consider a 30-year fixed rate mortgage of $250,000. The monthly payment on this mortgage at 7% is approximately $1,663. If you could lower that interest rate to 5%, your payment would be approximately $1,342. That’s a monthly difference of $321. Over a year that would be $3,852. Over 10 years the difference is $38,520. And over the full life of your 30-year mortgage, that’s a difference of $115,560.

In Real Estate You Can't Benefit From A Buyer's Market Unless You Decide To Buy

Sean Murphy (Centennial Mortgage Corp.) — Wed, 29 Jul 2009 16:38:28 -0700

The housing industry's had a rough few years. Foreclosures are way up, home values are way down, and -- pardon my french -- but mortgage underwriters are so tight that if you stuck a lump of coal up their fist, in two weeks you'd have a diamond.

The upside of it all is that today's home buyers have an unprecedented amount of negotiation leverage with the sellers. Want a lower sales price? Just ask for it. Need your closing costs paid for? Put it in your offer letter. Want to close in 30 days? The world is your oyster.

A look at the recent statistics, though, suggests the market is morphing.

Sales of new homes are rising at the fastest clip in a decade
The supply of existing homes is falling month-by-month
Home buyer activity continues to surge

Furthermore, home prices are no longer falling in many U.S. markets.

So, all this to say, if it hasn't happened already, home buyers are about to lose their upper hand with their sellers. And when they do, buying a home won't be nearly the "deal" it may feel like today. Especially once mortgage rates head back up and the $8,000 First-Time Home Buyer Tax Credit meets its December 1 expiration date.

After all that, home sellers will be back in the proverbial driver seat, moving homes for more money and with fewer concessions. Indeed, housing data suggests that this is happening in some markets already.

They say today's housing market is a Buyer's Market. Well, it's only a buyer's market if you actually buy.

If you're thinking about buying but are on the fence about what to do next, call or email me anytime. I'm happy to work with you.

How To Accept a Home Downpayment Gift That Won't Get Rejected In Underwriting

Sean Murphy (Centennial Mortgage Corp.) — Wed, 29 Jul 2009 16:37:52 -0700

Over the past 2 two years, mortgage guidelines have tightened and one of the lasting impacts on home buyers is that it now takes a larger downpayment to buy a home.

It's as true for conventional home loans as it is for FHA ones -- banks want to see more of home buyer's own skin in the game.

Unfortunately, not every buyer has the cash.

This is one reason why -- anecdotally -- the number of home buyers asking for "downpayment gifts" from family members is rising. With home prices down, mortgage rates low, and a generous first-time home buyer tax credit in place, there's a lot of would-be homeowners that don't want to miss out on the action.

However, if taking a gift of downpayment is part of your upcoming home financing strategy, you need to know that there's a right way and a wrong way to do it. You can't just deposit your parents' money into a bank account.

Accepting cash for a downpayment is a 3-step process. Follow the steps to a tee, or expect an underwriter to disallow the gift as a source of downpayment.

First, complete and sign an acceptable gift letter. There are lots of variations on the "Downpayment Gift Letter" but each follows the same basic format.

Includes the amount of the gift
Includes the subject property address
Includes the relationship of the gifter to the giftee
States that the gift is actually a gift and not a loan
Signed and dated by all parties

If you don't have a template gift letter on-hand, send me an email and I'll forward you the one I use for my clients.

Next, with the gift letter in place, the gifter should to make an extra strong paper trail for the money being gifted. This is one reason why certified checks are preferable to wire transfers. Both are acceptable methods of gifting, but certified checks are easier to document and simpler to prove -- all it takes is a teller receipt.

Make sure the amount of the gift matches the amount specified on the gift letter.

And, lastly, when receiving the gift, the giftee should be careful to accept the gift as-is. Deposit it with a live teller in a branch bank and make sure the deposit is not commingled. If the gift is for $10,000, for example, make a $10,000 deposit -- nothing more, nothing less. Don't add a random $100 check to the deposit, in other words.

Follow these 3 steps, though, and everything should be fine.

Meanwhile, there might be legal and tax liabilities when gifting funds between family members. If you're unsure about how donating or receiving a gift might impact you, be sure to talk with your attorney and/or accountant.

In A Market Like This, How Do You Get A Home Loan Approved, Anyway?

Sean Murphy (Centennial Mortgage Corp.) — Wed, 29 Jul 2009 16:37:09 -0700

As strict as mortgage underwriting has been lately, it may seem that there's a magic formula to getting approved. Truth is, there's not.

Getting approved for a mortgage is the same as it ever was, just with higher hurdles. Satisfy the Mortgage Income-Equity-Credit Triangle and everything else is cream cheese.

The Income-Equity-Credit Triangle is the basis for most mortgage approvals -- conforming, FHA, Jumbo and otherwise. The more strength that an applicant shows across each of the three elements, the more likely that person is to get approved in underwriting.

The 3 corners of the mortgage approval triangle are:

Income : The relative strength of monthly taxable income versus monthly household debt. This is more commonly called debt-to-income, or DTI.
Equity : The percentage of equity in a home. This is more commonly called loan-to-value, or LTV.
Credit : The middle of the three credit scores, as reported by Experian, Equifax, and TransUnion.

Now, for every mortgage product on the market, applicants must meet or exceed a series of minimum requirements in order to gain an approval. These requirements are more commonly called "guidelines" and they've been been dramatically toughened over the past 18 months.

This is one reason why getting approved for a mortgage has been challenging lately. Meeting the minimum requirements is like hitting a target with a bow-and-arrow and the smaller the bulls-eye, the harder it is to score.

Furthermore, the bulls-eye's size varies from loan program to loan program.

Whenever the 3 elements exceed minimum requirements -- as shown in the illustration at top -- the "Morgage Approved" bulls-eye is fully visible. This tells us that the applicant's home loan is likely to be approved in underwriting.

Not every mortgage applicant will show three-category strength, though, and that's okay, too.

Weakness in one of the 3 areas can be compensated for if the applicant can show exceptional strength in the two other categories. In essence, the applicant's strengths counter-balance his weakness, and a mortgage approval can be just as likely.

In the industry, it's called "compensating factors" and is illustrated by the graphic at right.

Although income levels are less than ideal, credit scores and home equity percentages are stronger-than-necessary, leaving the "Mortgage Approved" bulls-eye in full view. This applicant's home loan is likely to be approved in underwriting.

Now for that same applicant, if credit scores and home equity percentages are not strong, the bulls-eye falls out of range. With no compensating factors, on paper, the loan looks primed to default and it's going to be denied in underwriting.

This is illustrated at right.

And, unfortunately for homeowners, mortgage lenders are putting less faith in compensating factors these days than they used to. It's another reason why mortgage approvals are tougher to come by.

In response to spiraling mortgage defaults, Fannie Mae, Freddie Mac and the FHA all drew lines in the sand with respect to certain minimum applicant requirements.

For example, debt-to-income levels have a "hard-stop" in the 40-percent range. Anything above that triggers a turn-down. This holds for everyone -- even the multi-millionaire with 20% loan-to-value.

Hard stops are a cause for consternation among both homeowners because, in some respects, it's like common sense is getting thrown out the window. "Of course I can repay this mortgage," an applicant will say. "Look at my bank accounts. Look at my payment history. Look at my equity. I'm the perfect borrower!"

Sadly, underwriters don't care much for that. A hard stop is a hard stop and the mortgage application will be turned down because the paper file fails to meet minimum mortgage guidelines.

So, in reviewing the mortgage approval process, nothing's really changed over the past few years. Appraisals are under more scrutiny, income must absolutely be verified, and there's more steps from start-to-finish but the process itself is exactly the same.

The only thing that's different is the size of the bulls-eye. It's been shrunk. And trying to jam yourself into the smaller bulls-eye isn't always your best answer. Oftentimes, there's a better-fitting product with rates just as low.

So, if you're having trouble getting a home loan through underwriting or want to talk about your qualifications, send me an email anytime and we can talk about what's possible for you.

The $8,000.00 First-Time Homebuyer Tax Credit Expires December 1, 2009

Sean Murphy (Centennial Mortgage Corp.) — Wed, 29 Jul 2009 16:36:27 -0700

The $8,000 First-Time Home Buyer Tax Credit expires December 1, 2009.

If you're planning to claim use the credit and haven't started looking for a home, your clock is officially ticking. You must be closed on your new home on or before December 1.

Because purchase closings come 60-days standard, therefore, your $8,000 is in jeopardy unless you go under contract prior to October 2, 2009. That's less than 70 days from now.

Use it or lose it, as they say.

The First-Time Home Buyer Tax Credit is part of the American Recovery and Reinvestment Act of 2009. In it, Congress authorized a first-time homebuyer tax credit of up to $8,000 for home buyers meeting certain qualifying criteria. The program's goal was to stimulate entry-level home purchases and, by most measures, the plan has been successful.

First-time home buyers accounted for about one-third of all home resales in May.

Now, the IRS definition of "first-time home buyer" may be different from what you expect. According to the IRS, a first-time home buyer is anyone who has not owned a "main home" in the last 3 years with "main home" defined as a home in which a person has lived "for most of the time". Main homes can include traditional homes, houseboats, trailers and other residence types.

For couples -- married or otherwise -- both home buyers must be first-timers to be tax credit-eligible.

Moreover, not every first-time home buyer is eligible for the $8,000 First Time Home Buyer Tax Credit. Some notable exclusionary cases include first-time home buyers who:

File taxes separately and whose adjusted gross income exceeds $95,000
File taxes jointly and whose adjusted gross income exeeeds $170,000
Acquire property from a mother, father, sibling or child
Acquire property from an entity in which they're a majority owner
Acquire the home by gift or inheritance

And then, the First-Time Home Buyer Tax Credit may not deliver the full $8,000.

The tax credit is limited to 10 percent of the home's purchase price the it also diminishes as home buyer income rises. Tax credit phase-outs start at $75,000 for homebuyers filing separately and $150,000 on joint returns.

Assuming you qualify, though, the good news is that it's easy to claim your tax credit.

Buy and close on a new, "main" home before December 1, 2009.
Submit IRS Form 5405 with your 2009 tax returns in April 2010.

That's it.

Meanwhile, the program does come with some gotchas. For example, If you sell your home, or cease to use it as your "main home" within 36 months of purchase, the IRS will require a full payback. There are only a few allowable exceptions to this policy and you shouldn't count on being granted one.

Not moving in the next 3 years? Don't worry about it.

If you're a first-time home buyer and have questions, you're welcome to reach out to me directly anytime. I'll answer your questions and if I don't lend in your state, I can refer you to loan officers that I trust who do.

And lastly, please don't just take my word for it on tax issues. I am a loan officer and not an accountant. I can offer basic guidance, but paying a professional for expert advice is often the right way to go. If you don't have an accountant you trust or you're not using the free filing and tax audit services of TurboTax or something, call or email me for a recommendation.

Fannie Mae Toughens Guidelines On 2 Unit Homes, Trailing Spouses, and Retirement Portfolios

Sean Murphy (Centennial Mortgage Corp.) — Wed, 29 Jul 2009 16:35:50 -0700

Mortgage approvals are getting more difficult. Again.

After reviewing recent unemployment data and market fluctuations, plus patterns of mortgage fraud, Fannie Mae is making major mortgage guideline changes for the first time in more than 6 months.

The changes are broad, impacting 15 separate areas of the mortgage approval process as detailed in Fannie Mae's official announcement.

Across-the-Board Guideline Changes:

Credit, income and asset documentation can't be more than 90 days old. The former guidelines allowed for 120 days.
Lenders must compare actual federal tax returns from the IRS to a borrower's supplied income documentation. Previously, this review step was at the lender's discretion.
"Tip" income must be verified.
Trailing secondary wage earning is now prohibited. This means that P&G employees relocating to Cincinnati can't use a spouse's "expected" Cincinnati income until that spouse actually has a job.
Stocks, bonds and mutual funds get assigned 70% of current market value. Formerly, this was 100%.
Retirement assets get assigned 60% of current market value. Formerly, this was 70%.

By themselves, these bullet points would kick more than a handful of home loans out of the underwriting queue but of all the changes Fannie Mae is making, the most impactful one may new its new restrictions on mortgages for 2-unit properties.

Until now, Fannie Mae had treated duplex homes as somewhat "safe", granting them the same liberal underwriting policies as for a single-family home. Because of defaults and fraud prevention efforts, though, Fannie Mae decided to make getting approved for a 2-unit property decidedly more difficult.

Minimum credit scores are higher and maximum loan-to-values are lower.

When your 2-unit is your Primary Residence:

Purchase: Maximum LTV lowered to 80%; 640 minimum FICO.
Rate-and-Term Refinance: Maximum LTV lowered to 80%; 640 minimum FICO.
Cash Out Refinance: Maximum LTV lowered to 75%; 680 minimum FICO.

When your 2-Unit is an Investment Property

Purchase: Maximum LTV lowered to 75%; 660 minimum FICO.
Rate-and-Term Refinance: Maximum LTV lowered to 75%; 660 minimum FICO.
Cash Out Refinance: Maximum LTV lowered to 70%; 680 minimum FICO.

Overall, Fannie Mae's new 2-unit guidelines restrict loan-to-value limits by as much as 15 percent and raise minimum FICOs by up to 40 points -- 2 major shifts in policy. Because of it, going forward, fewer 2-unit mortgage applicants will qualify for mortgages and that should slow both purchase and refinance activity in the 2-unit market until the market returns to balance.

It's especially tough for owners of more than 4 financed properties.

Fannie Mae has said September 1, 2009, is the "effective date" for its underwriting changes so not every lender is underwriting to the new rules just yet. It's expected that by August 1, all of them well.

Therefore, if you know that you have a 2-unit home to refinance, or that you need your stock and/or retirement portfolio to qualify for your mortgage, consider moving up your timeframe to the next two weeks. Lenders often implement new guidelines without advance warning and that could leave you in the cold.

Better to get a good rate today than to be ineligible for a great rate tomorrow. If I can help you plan for an upcoming mortgage, call or email anytime.

How To Pick A Closing Date That Will Get You Lower Mortgage Rates

Sean Murphy (Centennial Mortgage Corp.) — Wed, 29 Jul 2009 16:35:05 -0700

Whether you're buying a home in Louisiana or refinancing one, there's lots of ways to make a play for lower mortgage rates or fewer loan fees. For Example:

Have a higher credit score
Make a larger downpayment

But, sometimes, the easiest way to save money on your mortgage is by picking a better closing date.

It's all about Rate Lock Commitments.

A Rate Lock Commitment is a bank's promise to honor a specific mortgage rate for a specific period of time. It's a contract, of sorts, in which the lender says: "Provided you close on your loan in the next however-many days, we'll make sure you get your locked rate."

In many respects, a mortgage lender's profitability is linked to its ability to accurately predict what mortgage markets will look like at the end of a Rate Lock Commitment.

It's a dangerous game to predict the future and banks know that the farther into the future they try to predict, the more likely their predictions will be wrong. It's why longer rate lock commitments tend to carry higher interest rates, higher fees, or both -- banks are purposefully hedging against "time risk".

Rate locks typically come in 15-day increments with the 30-day rate lock serving as the basis for all other pricing:

15-day rate lock : Often 1/8 percent lower than the 30-day rate lock
30-day rate lock : The basis for all other pricing
45-day rate lock : Often 1/8 percent higher than the 30-day rate lock
60-day rate lock : Often 1/4 percent higher than the 30-day rate lock

Based on the chart, you can see why choosing a closing date matters. A simple 1-day difference can lower your mortgage rate by 0.125% -- an annual $380 savings against a $400,000 home loan.

And the math doesn't just apply to purchase mortgages. It applies to refinances, too.

A refinance that can close in 30 days is going to be better priced, in general, than one that takes 45 days to close. It's one reason why being responsive to documentation requests is so important -- quicker to process means quicker to close.

Managing a mortgage rate lock commitment is an often-neglected method for keeping mortgage rates and loan fees down -- mostly because homeowners and real estate agents rarely know how to do it, and loan officer rarely talk about it.

So, before choosing a closing date for your pending home purchase, or starting to work on a new refinance, consider the impact of time on your bottom line. The shorter your rate lock commitment, the more money you're likely to save.

Are Mortgage Rates Really Lower? It Depends on What Day You Lock

Sean Murphy (Centennial Mortgage Corp.) — Wed, 29 Jul 2009 16:34:14 -0700

It's been a wild few months in the mortgage markets and a trying time for mortgage rate shoppers.

Making sure you get the absolute "lowest rate" has never been tougher. Rates are up. Then, rates are down. Rates are up. Then, rates are down. Over the past 5 weeks, mortgage rates have carved out a 1.500 percent range.

It's been a stomach-dropping ride for people trying to time a market bottom before locking in a rate and it's all happening because traders can't seem to answer to the most important question on Wall Street right now:

Is the recession ending, or getting worse?

It would seem like a simple yes or no -- there's plenty of available data , after all -- but the data is conflicting. As soon as we get cause for optimism from one sector of the economy, weak data presents itself somewhere else.

Furthermore, when it comes to predicting the future of the U.S. economy, not all data is created equal. Unemployment statistics tend to lag, for example, whereas Retail Sales may be more immediate.

So, what's a home buyer or would-be refinancer to make of it all?

Well, first of all, it's important to recognize that markets are moving on momentum and fundamentals right now. That's a dangerous combination because even the smallest market event could lead to a mortgage rate surge The other side, of course, is that rates could fall on new news, but mortgage rates usually rise much faster than they fall.

There's an old adage: Mortgage rates take the elevator on the way up, but take the stairs on the way down.

Lately, we've even seen this IRL. There have been days where rate are up by as much as half-percent as investor flee from the bond market, but when rates recover lower, they seem to be dropping just an eighth of a percent at a time.

Floating your mortgage rate is fine, but given the current market conditions, you may be playing with house money right now and this is as good a time as any to cash in your chips. All it will take a series of strong earnings from the banks this week and some hotter-than-expected inflation data to push rates back near 6 percent again.

The world moves quickly and mortgage rates do, too. If you're not already working with a loan officer and are looking for a specific mortgage rate before locking, you may want to participate in my Rate Watch program. You pick your target interest rate and when it's available on the open market, I'll lock it for you.

Call or email me directly. I'll take a full loan application from you to keep on file, ready for when rates fall

Mortgage Rates, Will They Rise or Fall?

Sean Murphy (Centennial Mortgage Corp.) — Wed, 29 Jul 2009 16:33:24 -0700

Are mortgage rates going up? Are mortgage rates going down?

Bankrate.com has a mortgage rate survey that is for conforming mortgages only. It does not apply to FHA mortgages, VA mortgages, jumbo mortgages, or foreign national mortgages. For rate quotes, contact me directly.

The group's 30-day prediction from July 16, 2009 says this about mortgage rates:

50% predict mortgage rates will increase
25% predict mortgage rates will decrease
25% predict mortgage rates will remain unchanged

A couple of things are happening in our market right now and none of them are good for mortgage rates. If we use our 20/20 Hindsight Glasses, we probably could have seen it coming.

Home prices are no longer on a steep decline
Consumer Confidence is rising
The financial system is returning to profitability

Furthermore, Americans no longer have Recession on the Brain like they did last September and October. Back then, the financial crisis was the leading story of every news-related show on TV and in print.

The notable absence of these The End Of The World As We Know It-like messages may be one reason why consumer purse strings are starting to loosen. For the fourth straight month in May, Retail Sales figures were hotter-than-expected.

Consumer spending accounts for the majority of the economy's activity and, now that spending is up, Wall Street is betting that businesses will prosper. The Dow Jones is up 5 percent since Monday.

It shouldn't surprise you, but mortgage rates have tanked over the same period of time.

In 2008, mortgage rates benefited from the stock markets' losses. Investors fled risk and parked their dollars in the relative safe haven of the mortgage-backed bond market. Now, in 2009, as the stock market improves, some of those safe haven trades are getting unwound.

Over the next few weeks, at least, gains in the stock market should come at the expense of mortgage rates.

Remember, though, mortgage rates move quickly. If you're not already working with a loan officer and know you'll want a new mortgage soon, you should consider being a part of my Rate Watch program.

Call or email me anytime and I'll take a full loan application from you to keep on file and queued up. I'll ask you to pick a "target rate" and then, when I see it available on the rate sheets, I'll submit and commit it for you. We then start working toward your closing.

Want to Buy a Foreclosed Home?

Sean Murphy (Centennial Mortgage Corp.) — Wed, 29 Jul 2009 16:32:42 -0700

It's transcended trending -- it's now a given. Foreclosures regionalize.

In June, for the brazillionth time in as many months, just 3 states accounted for half of the country's foreclosure-related activity. The top 10 states accounted for 75%.

Clearly, the foreclosures crisis doesn't impact every state in the same way.

Setting aside the personal pain foreclosures can cause, the massive mortgage default numbers have a silver lining. Both first-time home buyers and opportunistic real estate investors can now buy foreclosed homes at relatively low prices and finance them at attractive mortgage rates.

Not every foreclosure is going to a "diamond in the rough" but there are some great deals to be had out there. It may help explain why distressed properties accounted for nearly half of all home resales in April and for one-third of May's.

Meanwhile, to meet the burgeoning demand for foreclosed homes, several real estate companies built high-powered Foreclosure Search Engines geared at general home-buying public. Whether you're a home buyer, real estate investor, or just curious about your neighborhood, there's lot of ways to find a foreclosed home.

Foreclosure search engines are rarely free but often come with "trial periods". Trial memberships are usually full-featured and you can use your 7 free days to make an unlimited number of queries to help ascertain whether or not the foreclosure market is a good fit for your personal real estate goals.

According to RealtyTrac, the number of Q2 foreclosures was the second highest on record so there's deals to be had if you know where to look. And when you find that deal and want to finance it, be sure to reach out to me directly by phone or email.

I'd be happy to work with you.

For the 4th consecutive month, the Case-Shiller Index showed a softening in year-over-year home price declines

Sean Murphy (Centennial Mortgage Corp.) — Wed, 29 Jul 2009 16:31:50 -0700

For the 4th consecutive month, the Case-Shiller Index showed a softening in year-over-year home price declines. As a standalone story, this is news.

Even more relevant to homeowners than the annual Case-Shiller numbers, though, are the monthly ones. According to the data, 18 of the 20 tracked markets improved between April and May 2009. It's the Case-Shiller Index's strongest showing in nearly 3 years and yet another sign that housing is on the mend.

That said, the Case-Shiller Index is far from perfect:

Case-Shiller measures home values in just 20 U.S. cities. Those 20 cities represent but 9% of the U.S. population.
Case-Shiller on a 2-month delay. It is not reflective of the current state of housing, but of the way is was.
Case-Shiller ignores the "all real estate is local" adage. It lumps disparate city and suburban neighborhoods together.

Despite these flaws, though, the Case-Shiller Index remains relevant to housing.

Remember -- stock markets tanked as housing went bad in 2007 and 2008. Americans lost their savings and their homes. Huge, historied banks went bankrupt and Fannie Mae and Freddie Mac got nationalized. Today, a lot of people believe that rising home values could undo some of that damage. Maybe even most of it.

And this is why the Case-Shiller Index -- however imperfect -- is still so important. Its recent strength is surprising and may be foreshadowing the end of the U.S. economic recession. As home prices go, so goes the economy and, recently, home prices have been rising.

All in all, it's just another brick in the housing recovery wall.

Port of Gulfport Keeps Rolling

Sean Murphy (Centennial Mortgage Corp.) — Mon, 24 Nov 2008 12:03:04 -0800

GULFPORT -- The Port of Gulfport has big plans for expansion, but even at its current size and with a slumping economy, the port already has put itself in a position to be the benefactor of a future business boom.

A shift in trade patterns began several years ago when many Gulf Coast ports tweaked operations and drifted away from a specific type of cargo, choosing instead to handle mostly containerized and break-bulk cargo - goods that can be boxed or fastened to a pallet and usually need to be lifted from a vessel by crane.

Meantime, industry executives say another method of shipping is slowly being squeezed out and a few smaller ports along the Gulf are seizing the opportunity.

Some ports, such as Houston and Tampa, still handle a variety of cargo types, but many major ports are decreasing their capacity for "ro-ro" cargo (goods that can be rolled on and rolled off a vessel). This has allowed smaller ports, such as Gulfport and Galveston, to put a heavy emphasis on that trade.

"One of the things that maritime shipping companies look for when they look at ports is what type of cargo a port can handle," said Don Allee, executive director of the Port of Gulfport. "We are at a great advantage because we can do both."

Before Hurricane Katrina the Port of New Orleans handled several ro-ro vessels, including several calls a month from Wallenius Wilhelmsen Logistics and National Shipping Company of Saudi Arabia.

WWL has since consolidated its services at Galveston and NSCSA has moved its ro-ro services to Atlantic ports. Matt Gresham, a spokesman for the Port of New Orleans, said his port hopes to eventually bring ro-ro vessels back.

On the other side of Gulfport, the Port of Mobile still handles ro-ro cargo on occasion; port spokeswoman Judy Adams said Alabama still markets its port as being capable of handling all types of cargo.

"(Mobile) can handle ro-ro cargo without adversely impacting capacity or capability of handling break-bulk or containers," she said. "If a ro-ro opportunity presents itself, we accommodate."

Millions of containers enter the United States every year through terminals in California, but port congestion and labor shortages in recent years have forced cargo ships to wait in long lines at major West Coast ports. Many vessels small enough to fit through the Panama Canal have been diverted to ports in the Gulf of Mexico.

Experts believe the planned expansion of the Panama Canal, which would allow next-generation megaships to cross into the Gulf, will drastically increase business at Gulf Coast ports.

HUD Gives O.K to the Gulfport $570MM Port Expansion

Sean Murphy (Centennial Mortgage Corp.) — Mon, 24 Nov 2008 11:59:44 -0800

The U.S. Department of Housing and Urban Development (HUD) has accepted the State of Mississippi's revised plan to restore the Port of Gulfport, which was heavily damaged by Hurricane Katrina.

As part of the work, the port wiill be elevated to 25 feet above sea level to better protect it from storm surge, according to a press release from the Mississippi Development Authority.

MDA has allocated $570 million to the project.

"Rebuilding the Port of Gulfport stronger than before is essential to not only the economy of the Gulf Coast but the entire state," Gov. Haley Barbour said. "Like the coastal community, HUD recognizes how much this restoration plan will boost each component of our storm recovery plan, including our efforts to ensure people have good jobs to complement the $4 billion we've allocated to housing recovery." Read more about this story in Saturday's Sun Herald.

Center for Marine Education and Research will open on Seaway just off Cowan

Sean Murphy (Centennial Mortgage Corp.) — Mon, 24 Nov 2008 11:57:26 -0800

GULFPORT -- Dolphin lovers at the Institute for Marine Mammal Studies are flipping over their new state-of-the-art museum and research facility expected to open in the next few weeks.

IMMS President Dr. Moby Solangi, a marine biologist who spent more than two decades working with dolphins at Marine Life Oceanarium, said the new 12-acre Center for Marine Education and Research will open as soon as Harrison County officials can pave the entrance along the Industrial Seaway, just off Cowan-Lorraine Road.

"This is all cutting-edge stuff that we're doing here," Solangi said. "And obviously we're very excited about opening our new facility."

With more than 750,000 gallons of tank space, and a veterinary hospital and surgery center, Solangi said the facility will be unmatched by any other marine mammal research center along the Gulf of Mexico.

IMMS, a nonprofit group established in 1984, will use the facility to study and treat injured animals. Those that cannot be released back into the wild could eventually be housed at the nearby oceanariums or a future aquarium on the Coast.

It will be the first facility completely devoted to dolphin rescue and rehabilitation in Mississippi, Louisiana and Alabama, and the only facility capable of caring for sick and injured marine mammals. In addition, IMMS will be able to rehabilitate sick and injured sea turtles.

The $7 million facility also includes a necropsy lab, a pump house for operating life-support systems, fish houses to store food and three pools capable of housing animals at any stage of rehabilitation.

In addition, the facility includes classrooms and laboratories, a museum and a 200-seat auditorium. IMMS officials hope to book numerous educational tours and school field trips.

Since 2006, IMMS has spread its message of conservation during more than 70 classroom visits to Coast schools and the institute also has rescued hundreds of stranded marine mammals and sea turtles in its 24-year history.

The institute's 2005 rescue of a pod of dolphins stranded in Mallini Bayou in Pass Christian made headlines.

However, that news was overshadowed a few months later when Katrina flattened the Marine Life Oceanarium, home to 17 bottlenose dolphins.

Eight trained dolphins were swept out to sea and after several days of unsuccessful searching, Solangi figured they were gone for good.

"Some of them had been born in captivity, so they had no idea how to find food," Solangi said. "It would be like someone dropping you in the jungle and telling you to survive on your own."

But on the morning of Sept. 10, 2005, the nation awoke to scenes playing out on most major television networks of the Coast dolphins splashing and playing in the Mississippi Sound. Biologists located the dolphins by performing aerial surveys from a NOAA Fisheries Service airplane.

The institute hopes to continue its rescue missions and research and educational work, but Solangi and the 17 staff members at the facility make no secret of what it will take to keep them going: Cash.

IMMS functions mostly off government grants, but a lot of its funding comes from individual donations.

The group is selling engraved bricks that will make up the front entrance to the new facility. Sponsorships of museum exhibits are for sale, along with T-shirts and other items sold at an online gift shop at IMMS.org.

In May state lawmakers approved a measure for IMMS license plates that features two dolphins flipping through the air, with a lighthouse in the background. At least $24 of the proceeds from each license plate will go directly to IMMS.

The facility will be a welcome addition to a city still knee-deep in Katrina recovery and to a Coast that has missed its sea lions and dolphins for more than three years.

Biloxi is atop the list of the 10 Hottest Housing Markets in the United States

Sean Murphy (Centennial Mortgage Corp.) — Tue, 18 Nov 2008 14:45:17 -0800

BILOXI -- Atop the list of the 10 Hottest Housing Markets in the United States sits Biloxi.

Based in Destin, Fla., Housing Predictor provides independent real estate market forecasts for more than 250 cities across the country. Federal money to rebuild more than 1,000 houses at Keesler Air Force Base and the city's steady progress to rebuild from Hurricane Katrina are what landed Biloxi at the top of the list.

"Here in this sour real estate market we're the market that is seeing the best appreciation," said Eric Smith, a Realtor with Coldwell Banker United Realtor in Ocean Springs.

Link: Housing Predictor web site

Although sales are significantly below last year, Smith said, "Our market is strong." He said credit is available for those with credit scores of 620 or better.

Biloxi Community Development Director Jerry Creel said the city was also just named one of the best places to raise a family, "which is going to make it favorable for housing development." The city is averaging $4 million each week in residential and commercial construction permits, and last week issued $15 million in permits, including permits for apartment complexes on Motsie Road and on Woolmarket Road.

"We have construction going on in just about every area of Biloxi," Creel said.

"An increase in construction will alleviate the supply problems that have kept prices rising in Biloxi since Katrina devastated the area," said Ken Fears, manager of regional economics for The National Association of Realtors. But building 1,000 homes doesn't ensure home prices will appreciate, and he said once the construction boom is over, many of those jobs will be lost.

"The main component for a healthy and steady housing market is demand," and he said people who have good jobs want to own a home. "So, once the construction boom is over - and it will end eventually - some industry will need to replace it."

Bernanke Says Credit Markets May Be Improving

Sean Murphy (Centennial Mortgage Corp.) — Tue, 18 Nov 2008 14:38:53 -0800

The markets continued to advance during the midday with the Dow soaring 170 points to 8444 after Federal Reserve Chairman Ben Bernanke testified before Congress that the credit markets may be improving. Nasdaq climbed 8 points to 1490.

On the upside

BB&T Capital Markets upgraded Chiquita Brands International (CQB).

Shares of Research in Motion (RIMM) climbed ahead of the release of its first touch screen BlackBerry Storm on Friday.

Third quarter earnings for Home Depot (HD) tumbled due to the weakening economy but the results topped analyst estimates.

On the downside

Microchip Technology (MCHP) and ON Semiconductor (ONNN) withdrew their unsolicited bid to acquire Atmel (ATML).

Saks Fifth Avenue (SKS) blamed the sluggish economy for posting a wider than expected loss for the third quarter.

Corning (GLW) lowered its outlook for the fourth quarter and withdrew its full year 2009 guidance as demand for glass used to make flat screen televisions and computers tumbled amidst the weakening economy.

In the broad market, advancing issues outpaced decliners by a slim margin on the NYSE and by more than 10 to 9 on Nasdaq. The Russell 2000 which tracks small cap stocks rose 6 points to 457.

Link to VA and FHA Approved Condos

Sean Murphy (Centennial Mortgage Corp.) — Thu, 30 Oct 2008 17:02:59 -0700

Click this link for VA approved condos

http://condopudbuilder.vba.va.gov/2.2/frames.html

Click this link for FHA approved condos

https://entp.hud.gov/idapp/html/condlook.cfm

How the economy effects rates

Sean Murphy (Centennial Mortgage Corp.) — Thu, 30 Oct 2008 15:46:54 -0700

Interest-rate movements are based on the simple concept of supply and demand. If the demand for credit (loans) increases, so do interest rates. This is because there are more buyers, so sellers can command a better price, i.e. higher rates. If the demand for credit reduces, then so do interest rates. This is because there are more sellers than buyers, so buyers can command a lower better price, i.e. lower rates. When the economy is expanding there is a higher demand for credit, so rates move higher, whereas when the economy is slowing the demand for credit decreases and so do interest rates.

This leads to a fundamental concept:

Bad news (a slowing economy) is good news for interest rates (lower rates).
Good news (a growing economy) is bad news for interest rates (higher rates).

A major factor driving interest rates is inflation. Higher inflation is associated with a growing economy. When the economy grows too strongly, the Federal Reserve increases interest rates to slow the economy down and reduce inflation. Inflation results from prices of goods and services increasing. When the economy is strong, there is more demand for goods and services, so the producers of those goods and services can increase prices. A strong economy therefore results in higher real-estate prices, higher rents on apartments and higher mortgage rates.

Mortgage rates tend to move in the same direction as interest rates. However, actual mortgage rates are also based on supply and demand for mortgages. The supply/demand equation for mortgage rates may be different from the supply/demand equation for interest rates. This might sometimes result in mortgage rates moving differently from other rates. For example, one lender may be forced to close additional mortgages to meet a commitment they have made. This results in them offering lower rates even though interest rates may have moved up!

There is an inverse relationship between bond prices and bond rates. This can be confusing. When bond prices move up, interest rates move down and vice versa. This is because bonds tend to have a fixed price at maturity.

Wednesday October 29, 2008 Market Update

Sean Murphy (Centennial Mortgage Corp.) — Thu, 30 Oct 2008 15:30:24 -0700

WEDNESDAY AFTERNOON UPDATE:

This week's FOMC meeting has adjourned with an announcement of a half-point rate cut by the Fed in an effort to stimulate economic activity. The move was widely expected by market participants, but has still boosted stocks and hurt bonds. The Dow is currently up 218 points while the Nasdaq has gained 44 points. The bond market is currently down 17/32, which will likely push this afternoon's mortgage rates higher by approximately .250 of a discount point.

The post-meeting statement indicated that the Fed was still concerned about the economy and was expecting further weakness. This led to speculation that the Fed may lower short-term rates again in the future despite the fact that the Federal Funds rate is now at a record low of 1.00%. It has not been this low since June 2003 to June 2004. The fact that it appears the Fed has conceded more measures may be needed and is ready to act has helped drive stock prices higher during afternoon trading. This has made bonds less attractive to investors and is the reason we likely will see upward revisions to mortgage rates this afternoon.

The Commerce Department reported this morning that Durable Goods Orders for September rose 0.8% when they were expected to fall 1.0%. This means that manufacturing activity was stronger than expected, which is bad news for bonds and mortgage rates.

Tomorrow morning brings us the release of the preliminary reading of the 3rd Quarter Gross Domestic Product (GDP). The GDP is considered to be the benchmark measurement of economic growth because it is the sum of all goods and services produced in the U.S. and therefore is likely to have a major impact on the financial markets and mortgage pricing. There are three versions of this report, each a month apart. Tomorrow's release is the first and usually has the biggest impact on the markets. Current forecasts call for a decline of approximately 0.5% in the GDP. If this report shows a larger decline, I am expecting to see the bond market rally and mortgage rates to fall tomorrow.

What kind of information will I need to gather to get started with the FHA

Sean Murphy (Centennial Mortgage Corp.) — Tue, 14 Oct 2008 13:37:20 -0700

What kinds of information will I need to gather to get started with the FHA?

The FHA will ask for a lot of information, which will go on your loan application. Be sure to ask your loan officer for a complete list of required data and give yourself plenty of time to gather the information. You will need to provide the FHA with a wide range of details; this includes all the addresses where you have lived in the previous two years, your employers name and addresses for the last two years, plus the amount of your Gross Monthly Salary. If you have had multiple jobs over the last twenty-four months, you will need your W2s for all of them. You will also need your income tax forms submitted for the last two years. If you don't have copies of your W2s, you should contact your employers for assistance. If you need replacement copies of your income tax returns, go to IRSs site and follow the instructions on how to order replacements. A tax transcript is free of charge, and copies of actual tax returns cost thirty-nine dollars.

What is the FHA

Sean Murphy (Centennial Mortgage Corp.) — Tue, 14 Oct 2008 13:27:31 -0700

What is the FHA?

The Federal Housing Administration is an agency of the federal government. The FHA insures private loans issued for new and existing housing, and for approved programs for home repairs. The FHA was created by Congress in 1934, and in 1965 became part of the Department of Housing and Urban Development's Office of Housing. The FHA's mission in the present day includes offering help borrowers get the amounts they qualify for, and to assist lenders by reducing the risk of issuing loans. To get situation-specific information and advice on how you might be able to take advantage of an FHA-insured loan, you'll need to contact an FHA lender to get started. You can search for an FHA lender near you at HUD

NASA Shared Service Center Opens In Hancock County

Sean Murphy (Centennial Mortgage Corp.) — Tue, 14 Oct 2008 10:52:10 -0700

State, federal and local leaders held a ceremonial ribbon cutting Thursday for NASA's newest addition to Stennis Space Center. It's the $33 million NASA Shared Services Center, which puts all of NASA's Human Resources services, procurement activity and financial management under one roof at the Hancock County facility.

Before the building went up at Stennis, those services were scattered among NASA's ten0 installations across the nation. NASA leaders say consolidating the services into one central location will save taxpayer dollars.

"This is a jewel that's been added at Stennis, about 500 jobs high tech high end. So it's a big job creator, but it adds even more luster to the high quality jobs that we have at Stennis," Gov. Haley Barbour said.

The building was funded by the state through a special appropriations bill signed by Governor Barbour. Stennis was selected as the location out of a field of six NASA facilities that were vying for the shared services center.

New Development Taking Shape Along Hwy 90

Sean Murphy (Centennial Mortgage Corp.) — Tue, 14 Oct 2008 10:42:05 -0700

It has been slow going since Katrina, but a new commercial corridor is beginning to take shape along Highway 90 in Biloxi.

Right now there are several projects under construction, with more in the planning stage. The latest commercial development along the busy highway targets the tourism industry.

Hooters will soon return to the Biloxi beach front.

"We're back. And we're opening on November third. We've actually put the site on the northside of Highway 90 this time. But we're opening November third and we can't wait. We're very excited to be coming back," said Hooters spokesman, Pete Meleones.

He says the new business will feature a more modern layout and an outdoor deck with 25 tables to take advantage of the waterfront view.

"We're very confident this is going to prosper. We think this is going to do a lot more business than we did because there's not much around here right now. And we should be able to take advantage of that for a long time to come," he said.

Edgewater Inn recently celebrated its 20 year anniversary on Highway 90. The hotel welcomes the restaurant as the latest sign of commercial recovery.

"Absolutely. It's going to be different though. It's never going to be the same you know. But I guess that's what life is about, change," said hotel clerk Karen Potter.

New hotel projects are part of the new commercial landscape along Highway 90 in Biloxi. At the I-110 loop, a former high rise apartment building will soon be a Sheraton Four Points.

Farther down the road, another hotel project is under construction. A new Motel Six is located between the coast coliseum and Edgewater Mall.

Development may be somewhat slower than expected since Katrina, but it is taking shape along the beach front highway.

"We think Highway 90 is going to be tremendous in the future. And we're glad that we're one of the first ones," said Meleones.

Along with the hotels and restaurant, another gas station will soon be built along Highway 90 in downtown Biloxi. This week the city council gave the go ahead for Exxon's plans to build across from the Hard Rock.

Gulfport Ready To Redevelop Gulfport VA Property

Sean Murphy (Centennial Mortgage Corp.) — Tue, 14 Oct 2008 10:32:46 -0700

GULFPORT, MS (WLOX) - Gulfport's plans to create a multi faceted neighborhood along the shoreline came into sharper focus on Monday. Five of Gulfport's seven council members joined Mayor Brent Warr and the Gulfport Development Commission on a tour of the old Veterans Administration property. What they saw, and what they discussed were ways to revitalize the city's waterfront.

By the end of the year, Gulfport should take over ownership of the VA property. That's why concepts are being formulated to determine the kinds of developments Gulfport leaders would like to see around what's being called a 92 acre treasure.

The oak trees scattered around the Gulfport VA property are scarred. But, as Gulfport councilwoman Libby Milner Roland noted, they still show signs of life.

"There's strength in those trees," she boasted.

Roland was at the VA to tour the grounds.

"We're going to start in the chapel," Gulfport Development Commission member George Schloegel told the group.

The chapel is one of the ten remaining VA buildings that somehow survived Mother Nature's fury. Soon, those weakened structures will rise from the ashes, and form the foundation of Gulfport's new waterfront.

"I get so excited about this," said Schloegel.

The VA property could become the responsibility of Schloegel and his fellow commissioners. If the city council gives its blessing, negotiating development deals with investors could fall under the umbrella of that commission.

"I see the most valuable piece of property in the state of Mississippi, and it's sitting right here on the gulf coast undeveloped," Schloegel said while walking through the VA's original administration building. "It's a treasure."

Sixteen Gulfport leaders toured the VA property to get a better idea what could be developed here once the city takes over the land. Mayor Brent Warr said that getting the conveyance from the VA was "a huge deal, and it's just been so complicated trying to sort through all the details and eligibility because it's never been done before."

The VA is in Councilwoman Roland's ward. She see's incredible opportunities all around the property.

"The sky's the limit. Absolutely. The sky's the limit," she said. "There's something here for everybody."

The VA is supposed to convey the waterfront portion of its property to the city in December. Gulfport will actually take over ownership of the northern side of the VA later this month.

The one building on the northern side of the VA is the old laundry facility. City leaders think that vacant structure could become a convention center, and a place for Gulfport's performing arts.

During Monday's tour, the group sat inside the laundry building and discussed ways Gulfport could get it up and running as quickly as possible. The biggest stumbling block they encountered was figuring out how to pay for building renovations. But commissioner Carole Lynn Meadows is confident that issue will be resolved, and Gulfport will reap the benefits from its VA investment.

"It could be an identity for Gulfport, a hub of Gulfport, adding to its recreational dimension, adding to its cultural center dimension," Meadows said. "I just think it's an opportunity for us to show that Gulfport is moving into the next century."

As soon as Tuesday, the name and the bylaws of the new development commission may change. Attorneys say renaming the group the redevelopment commission will give it the latitude it needs to work on projects like the VA renovations.

Good News For Pascagoula Business

Sean Murphy (Centennial Mortgage Corp.) — Tue, 14 Oct 2008 10:31:24 -0700

PASCAGOULA, Miss. (AP) - Gulf LNG Energy has announced the groundbreaking for its liquefied natural gas import facility at the Port of Pascagoula. Governor Haley Barbour and members of the Mississippi congressional delegation are to attend tomorrow's ceremony. The Houston, Texas-based Gulf LNG is developing 40 acres at the port for the facility.