Your Southern Oregon Housing Resource For Home Loans

AFFORDABLE IN ASHLAND! Bank owned ad priced to sell quick. Nice home near Helman School.

American Pacific Mortgage- Karen Cooper, Oregon & California — Thu, 19 Nov 2009 15:26:23 -0600

What an amazing deal for a first time home buyer in Ashland Oregon who thinks they can never afford to do anything but rent in Ashland! The monthly payment probably works out to be less than most Ashland rents, and this area is eligible for no money down USDA home loans!

Via Chris and Kim Knox (Landline Real Estate, LLC of Southern Oregon):

Chris and Kim Knox | Landline Real Estate, LLC | 541-899-8222

127 Cypress Circle, Ashland, OR

AFFORDABLE in ASHLAND!

3BR/2BA Single Family House

offered at $209,900

Year Built 1978

Sq Footage 1,389

Bedrooms 3

Bathrooms 2 full, 0 partial

Floors 1

Parking 2 Car garage

Lot Size 0.18 acres

HOA/Maint $0 per month

DESCRIPTION

Affordable in Ashland! Bring your best offer, quick! Move-in ready, near Helman Elementary School. Nice, single level, 3 bed/2 bath home located in a cul-de-sac. Shows well with lots of natural light, a fireplace, a large covered patio, and a lovely fenced yard with a garden area. Great curb appeal, attractive floor plan, and well maintained yard. Centrally located (less than 2 miles to downtown Ashland or to the Ashland Hospital). Seller has no knowledge of property, sold as-is. Easy to view. Check out the attached virtual tour. Solid value.

see additional photos below

PROPERTY FEATURES

- Central A/C - Central heat - Fireplace

- Living room - Dining room - Dishwasher

- Stove/Oven - Laundry area - garage - Balcony, Deck, or Patio

- Yard

ADDITIONAL PHOTOS

Photo 1

Photo 2

Photo 3

Photo 4

Photo 5

Photo 6

Contact info:

Chris and Kim Knox

Landline Real Estate, LLC

541-899-8222

For sale by agent/broker

Equal Opportunity Housing

Posted: Nov 18, 2009, 3:53pm PST

Karen Cooper - OR|CA Mortgage Consultant - www.Quality4Loans.com
Providing high Quality, Professional, Ethical service to Oregon and California home buyers and owners since 1983. Whether you are taking out your first home loan or your fiftieth, for your home, your second home or for investment, put my knowledge and expertise to work for you.

Send A Gift- Thank You Card To Our Soldiers- Xerox Let's Say Thanks Program

American Pacific Mortgage- Karen Cooper, Oregon & California — Thu, 19 Nov 2009 15:15:20 -0600

This is a worthy program we've participated in before. It's that time again! Thanks for the prompt and the great info, Katerina & Nestor!

Via Nestor & Katerina Gasset Realtors® Wellington Florida Luxury Homes (International Properties and Investments, Inc.):

Thanks to Xerox sending out a Thank You card to our soldiers is simple, fast and free.

At this time of the year we can take some time out to teach our children about giving thanks and living in gratitude.
The best way of course to teach gratitude is by being a good example of being in a thankful state of mind.

You can gather your children around your computer right now and go to this site:

Let's Say Thanks- In Support of our Troops.

All you do is click on the card you want to send and then click on what you want the words on the text side of the card to say.
You don't even have to think to do this because it is all done for you. You just have to choose the card and the text out of the ones on the site.
Then you just click send.

Xerox prints out the postcards and then these cards go into the care packages that Givetothetroops® sends to our soldiers.
What a gift Xerox is giving to the troops. I really appreciate a company setting a great example like this.
The cards have all been designed by children and are patriotic. There are many patriotic symbols and messages to choose from.

There is a link on the site where you can read the responses from soldiers around the globe.
For some of these soldiers, your card will be the only mail they get from home.

Here are some of the comments sent back by different servicemen and women:

To all who have supported us,

I would like to take this opportunity to say thank you from myself and my fellow Marines. Your packages and well wishes have lifted our spirits at a time when we are so far away from our friends and family. I wish you could have seen the bright eyed looks and utter excitement from the Marines when opening the boxes. It was a true blessing that you made happen. It makes us proud to know that our fellow Americans care as much as we do. It makes the sacrifices we and our families make worth every minute we spend here. We Americans can stand shoulder to shoulder in unison on one thing - we're all proud of our country and we're all proud of each other. The effort you make on behalf of the troops is just as important as the work we are doing here and around the world.

- A Gunnery Sergeant

As I was leaving an un-eventful Valentine's Day today, one of the mail clerks yelled "Adams!! You have a package!!" A package, I thought to myself. I'm not expecting anything. What could this be? I took the box into my office and closed the door. As I opened the box, a flood of joy came over me as I looked over the cards from you and the young ones, one of my co-workers walked in to see tears rolling down my eyes. I had never received a gift with this much love, packed into one little place from someone that I've never known.

As I thought about what the cards talked about with soldiers giving their lives and privileges up to ensure the freedom of Americans, it was nice to know that someone out there does not take it for granted. I don't know who you are, but you are truly a gift from God. The gift that gives me the drive to serve my country proudly. As you pray that the Lord keeps the soldiers here safe and brings us home, I pray to the Lord that people like you do not die off from this world. Your contributions are nowhere near inadequate. Please never forget what this means to a soldier. Thank you for your love and thoughts.

Please be kind- take a moment out of your day to send a card for free to a soldier today. Please Reblog!

Medford Oregon Neighborhood Stabilization Buyer in the News

American Pacific Mortgage- Karen Cooper, Oregon & California — Wed, 18 Nov 2009 11:25:59 -0600

Working with a lot of first time home buyers over the years prepares one to expect challenges in the mortgage process. One recent transaction that should THANKFULLY close before Thanksgiving was probably at the top of the challenging range. I found out some things on the journey with these buyers. Some of these things make sense to me, others were like being blindfolded and poked with a sharp stick repeatedly:

Patience is not only a virtue, it is the key to these buyers successfully closing on their first home purchase
Neighborhood Stabilization Program guidelines and provisions were not carefully thought out
Real estate brokers handling the listing for bank owned foreclosure homes are not supportive of the Neighborhood Stabilization Program, and if they have an offer from a buyer not using NSP, they will choose it first
The lender support the State of Oregon thought they had does not exist
Diligent efforts of SOME of the parties to a transaction cannot trump other parties dropping the ball – the whole team has to work together, or we lose the game
Expect the unexpected – over and over and over again! Trained NSP coordinator transferred to another position; new NSP coordinator doesn’t have lending background, so has a sharper learning curve to get up and running; three consecutive local NSP contacts – one fired but is appealing that decision, one goes out on vacation, the third gets to start from scratch trying to carry the ball forward until the 2^nd one returns; NSP application accepted, but documentation not reviewed for 6+ weeks with no mention of this during repeated fund requests; three inspectors do not require repairs, FHA underwriter does; FHA lender closes office due to the commercial building they are located in being foreclosed upon; chaos reigns with the merger of lender’s operations centers; notified lender’s corporate center has reviewed and approved NSP program as an acceptable down payment assistance program, but approval is retracted; lender’s rep goes out on maternity leave early; FHA lender’s underwriting approval is three pages long, but only two pages are provided; the missing 3^rd page contains additional FHA underwriter required repairs

This family WILL be recipients of Neighborhood Stabilization Program funding, as will roughly 7 others in the City of Medford. I cannot afford the time investment this program requires, and will only help this one family, having referred the other I had to another lender. God Bless this first family and the families that follow them…

Thank you, Damien Mann of the Medford Oregon Mail Tribune, for responding when this family reached out to you to share their story. It needed to be told.

See you at the closing table!

Will Mortgage Insurance Still Be Tax Deductible After December 31 2010?

American Pacific Mortgage- Karen Cooper, Oregon & California — Wed, 18 Nov 2009 10:15:16 -0600

With all the rapid changes we’re seeing in the mortgage industry, those that have been instituted and many coming down the pipe, I haven’t heard anything about the tax deduction for Mortgage Insurance Premium that expires 12/31/2010. Right now, eligible taxpayers may deduct their eligible mortgage insurance premiums, including FHA upfront mortgage insurance and monthly mortgage insurance premium, USDA guarantee fee, and VA funding fee as well as the private mortgage insurance premiums required on conventional Fannie Mae|Freddie Mac vs. government loans.

Although these mortgage insurance premiums are not nearly as much as the mortgage interest taxpayers deduct, they can add up! Up until the demise of the “piggyback mortgage” – concurrent first and second mortgages broken up to 80% of the purchase price or less, with the remaining amount financed put in a second mortgage – homeowners took the cost, and tax deductibility (or lack thereof), of mortgage insurance premiums in to consideration on how to structure their financing.

For example, a buyer choosing to use an FHA loan as the finance tool to purchase their home because they are putting 3.5% down on a home that costs $175,000 will pay (and/or finance) an upfront mortgage insurance premium of almost $3,000 plus another $900+ per year with the monthly mortgage insurance premium for at least 5 years, or until their original loan balance is paid down to 78% of the original purchase price. A USDA Guaranteed Rural Housing or VA loan would have roughly the same in upfront guarantee/funding fees.

Most home buyers chose a “piggy back” to avoid the mortgage insurance costs they could not deduct on their income tax return, finding this structure was more affordable.Then, these costs were temporarily made tax deductible for buyers meeting the income criteria and the acquisition criteria. Now that home buyers don’t have that choice, we once again see them paying the cost of mortgage insurance premiums whenever they will have less than 20% equity/down payment.

Barney Frank and the “boys” must be busy with all the other stuff they’re putting forward. Maybe they should look at the expiring tax deductions, too – or maybe they shouldn’t…

What do YOU think?

See you out there!

Will realtors ever stop saying "Now is the time to buy and sell real estate". Just give us the facts, ma'am.

American Pacific Mortgage- Karen Cooper, Oregon & California — Tue, 17 Nov 2009 10:43:31 -0600

Like "location, location, location", "timing can be everything" is part of the equation when a buyer is determining the "right time to buy". Is it the right time to buy - FOR YOU?

Thanks for posting some great points in the decision making process, Pacita!

Via Pacita Dimacali - e-PRO, SRES, CDPE, MBA East Bay, North CA real estate (Gallagher & Lindsey):

Is it a good time to buy and sell real estate?

The perception is that REALTORs are always trying to convince their clients to buy or sell real estate each and any time. But the reality is that when the buyers or sellers are on the verge of making a decision, they are the people who make that decision based on the information they have, and how they process that information.

As such, it is always a good idea to stay abreast of the real estate market movement and factors that are affecting --- or effecting --- that movement.

Affect versus Effect

There is a difference when used as a verb:

Affect means: to have an influence on; to act on the emotions of; to attack or infect

Effect means: to bring about to produce an outcome to achieve a result

How to we apply this to real estate and to answer the question of whether or not it's a good time to buy or sell? The answer lies in how people process, interpret and take action on the information they know about the current situation.

Tax credits

The National Association of REALTORS helped to effect(cause to happen) the extension and expansion of the tax credits by encouraging its membership to contact their legislators to pass the bill and encourage President Obama to sign it.

Who are affected by the bill when it was signed? The first time home buyers and repeat buyers who have until April 30 2010 to get into contract, and have 60 days to close escrow to qualify for the tax credit.

Short sales and Foreclosures

The four largest lenders are staffing up their short sale department to effect a simplification of the short sale process

Homeowners who are suffering reduced incomes and drop in home market values are facing foreclosure, and are directly affected by the economic downturn. Market observers like Steve Harney say that "if anything, future foreclosure inventor is underestimated, not overestimated."

More short sales and foreclosures may adversely affect the market values of neighboring homes. So if property owners are contemplating selling their home, they should factor the projected increase in distressed properties. How can they compete? Price their homes aggressively so that they move fast and ahead of the market. Assume

Assume $500,000 home in November 2009, and owner has an outstanding loan of $400,000 at 6% interest.

Selling now for $500,000 with projected close of escrow by April 30, 2010: $64,600 net at closing

Waiting until June 2010 when more foreclosures and short sales are expected to come on the market, the value of his home may be affected by as much as 10% or down to $475,000. Projected close of escrow 90 days: $61,873 net at closing

Interest rates and FHA down payment

Historically speaking, the current rates are still some of the lowest they've ever been in 40 years. See FreddieMac for a peek at 30-year rates since 1971.

Interest rates may rise by 1 - 2% by next year. A concern for increasing rates may effect renewed interest in buying property, coupled by a desire to meet the tax credit deadlines.

When interest rates rise, this may affect the buyers' ability to qualify for a loan if the monthly mortgage payments based on the higher interest rates are higher than what their current income level can support. It is important to relate the cost of buying a home --- if prices decrease by 10%, but the interest rate increases by 1% --- how will that affect your monthly payment? Assume 30-year mortgage with 20% down payment , in Oakland CA

$500,000 purchase price at 5% interest rate: $2,814/month

Reduced purchase price by 10% or $475K, with increased interest rate to 6%: $2,912/month, or $98 higher

Now, about that FHA down payment....

Keep your eye on this bill H.R. 3706 that proposes increasing down payment for FHA insured mortgages from 3.5% to 5%. Reactions are mixed regarding the pros and cons of this bill and what its effect will be (more bailout?) and how it will affect buyers (more difficult to qualify to buy).

According to Wall Street Journal, the agency opposes this bill. David Stevens, the commissioner of the FHA, warned that "the biggest mistake" the agency could make is to "overcorrect."

Can one say information overload? Political intervention and interference? Who do we believe? What can we expect?

Clash of the Titans | Bank Owned Foreclosure Homes vs. FHA |VA| USDA Home Loans PART 2 OF 2

American Pacific Mortgage- Karen Cooper, Oregon & California — Mon, 16 Nov 2009 10:37:10 -0600

Really what this boils down to is one question. Banks selling Foreclosure Home Inventory… why do you accept the offer of a buyer using FHA or USDA home loan financing programs if you are unwilling to negotiate their lender’s required repairs?

Yes, we all read in the MLS sheet the “As Is” provisions. Saw all the “As Is” provisions and warnings in your addendum to the purchase contract. We read about all the other provisions that were negotiated before the buyers went under contract with you, too. Why, may I ask, are we experiencing this clash between your “As Is” sale expectations and the known requirements of the buyer’s financing terms AFTER the buyer has paid their whole house inspection and appraisal fees? And maybe after they’ve paid to de-winterize/re-winterize your REO home, too? This is $1,000 or more the buyer paid! When you accepted an FHA| USDA| VA buyer, did you not just make those provisions null and void? Shame on you Bank REO Seller – YOU should KNOW better!

Did you read the part in that same purchase contract about the buyers using FHA home loan financing? Using USDA home loan financing? Do YOU know, as a bank| lending institution that there are HUD required Minimum Property Standards for an FHA or USDA or VA home loan? Just in case, here is a link to those HUD minimum Property Standards in case the time has come for you to refresh your memory. Don’t have time to read all that? Here’s a General Summary that can be found as of today on HUD’s website:

CHAPTER 2

GENERAL ACCEPTABILITY CRITERIA

200 GENERAL

These general acceptability criteria apply to existing as well as new construction.

201 REAL ESTATE ENTITY

The project site shall comprise a single plot, except that two or more parcels separated by other parcels or a street or streets may be acceptable provided the resulting parcels comprise a readily marketable real estate entity. In either case, the property shall be sufficiently grouped to assure that convenient and efficient management during operation can be expected.

202 SERVICES AND FACILITIES

202-1 TRESPASS

The property shall be so designed that it can be used and maintained without trespass upon adjoining properties.

202-2 UTILITIES
Utilities and other facilities shall be independent for the property, without dependence upon other properties.

203 SITE CONDITIONS

HAZARDS

The property shall be free of those hazards which may adversely affect the health and safety of the occupants or the structural soundness of the improvements or which may impair the customary use and enjoyment of the property. These hazards include toxic chemicals, radioactive materials, other pollution, hazardous activities, subsidence, flood, erosion, expansive or compressible soils, inadequate drainage outfall,

landslides or mudflows, and deposition of suspended solids or others located on or off site. Projects with potentially significant hazards may be acceptable if any such hazards are effectively mitigated.

203-2 UNFORESEEN CONDITIONS

When special conditions exist or arise during construction which were unforeseen and which necessitate precautionary measures, the HUD Field Office may require such corrective work as may be necessary to meet the

special conditions. Special conditions include rock formations, unstable soil, high groundwater level and springs.

204 ACCESS

204-1 STREETS

Each property shall be provided with vehicular access by an abutting public or private street. Private streets shall be protected by a permanent easement.

204-2 ACCESS TO THE BUILDING AND THE NONDWELLING FACILITIES

204-2.1 Each building shall have safe and convenient pedestrian access from project parking areas.

204-2.2 Each building shall have convenient access for service and, when necessary, for delivery of fuel.

Still too much, Bank REO Seller? Did you know you could hire a forward thinking appraiser, such as one we have here in Southern Oregon, who will do a preview of a property for $75 to let you know what repairs likely would be called out on an appraisal for a buyer using financing subject to HUD’s minimum property standards? Yes, I know how fee conscious you are Bank REO Seller, but I’d say that would be $75 well spent – before I log that FHA home loan appraisal and the information on your foreclosure home becomes of record.

Wouldn’t it be nice if a buyer using FHA| VA| USDA home loan financing could know before they spent $1,000 in initial fees that the repairs on your Bank Owned Foreclosure Home would exceed their budget? Think the buyers that did that only to find out they can’t afford your home are ever going to want to bank with you? Is it not part of your business practices to build goodwill with the community members your banks| branches are located in?

Since your bank owned foreclosure homes represent such a large percentage of the inventory of available homes for sale in our area, I think the time is overdue for you to ease some of our pain in this community. Be PROACTIVE about fulfilling market needs! If you KNOW a large percentage of your buyers will be using home loan programs that will require your property meet HUD’s minimum property standards, why not spend the $75 and get repair estimates in advance so these issues may be hit head on?

Just a thought…

See you at the closing table!

Clash of the Titans | Bank Owned Foreclosure Homes vs. FHA VA USDA Home Loans Part 1 of 2

Clash of the Titans | Bank Owned Foreclosure Homes vs. FHA|VA|USDA Home Loans PART 1 OF 2

American Pacific Mortgage- Karen Cooper, Oregon & California — Mon, 16 Nov 2009 08:46:18 -0600

In this battleground home buyers and sellers find themselves on in today’s real estate market, it is often necessary to work our way through conflicting goals to reach the ultimate goal, a successful closing on the sale of a bank owned foreclosure home to a ready, willing and able buyer. That bank’s goal is to get the home sold as quickly as possible at the lowest possible cost to them, which doesn’t necessarily mean the highest possible price they can obtain, as is the case in a traditional private party transaction where individuals are selling the home vs. institutions. Banks are factoring in the more traditional costs of a sale, such as selling commissions and closing costs, negotiating the lowest price they can get these fees to while passing as many as possible on to the buyer. But, unlike a traditional private party seller, the institution seller (bank) is factoring in their employee costs, legal costs, asset management costs and maintenance costs of an abandoned home. Let’s not even get in to the bank’s focus on their balance sheet and reserve requirements! Bottom line is, the bank| institutional seller is focused on money, not service or win| win negotiations and no emotions come in to play here.

Every real estate market can be a little different... sometimes, a LOT different. Let’s look at Southern Oregon’s market. Here in Southern Oregon, a large percentage of the home loans buyers are choosing as the tool to purchase their home are FHA, VA and USDA loan programs. Based on the reports I’m reading, these three loan types, FHA, VA and USDA, have vastly increased their market share in the past 24 months. Why? Because they have low| no minimum down payment requirements, and with the deterioration of the private mortgage insurance industry and their corresponding tightening of underwriting criteria, conventional loans which require private mortgage insurance if a buyer is putting less than 20% down cannot meet the needs of the market. Entry level buyers and investors are driving the market here, and the entry level buyers are almost all using FHA, VA and USDA loans as the financing tool of choice to buy their homes with. If my pipeline is any indication of what other markets are experiencing, 99% of the home loans I am working on for California and Oregon home buyers are FHA, VA and USDA loans, and 99% of my pipeline is purchase transactions, because most of the existing clients in my database who would benefit from refinancing have already done so – or can’t, due to current market values being driven downward by the vast percentage of distress sales such as these bank owned foreclosure sales.

The buyers I am working with are in the market right now because they can buy a home for about what they have been paying for rent with little to no cash outlay. They see some amazing deals, and are attracted to the bank owned foreclosure inventory which is being put on the market at below market prices…below market for now, since as soon as those bank owned foreclosure home sales close, they become the market price for everyone since appraisers will use them as sales comparables until private party sales percentages pick back up again when the bank inventory of foreclosure homes sells through and distress sales no longer determine market values. These buyers are qualifying for such low interest rates, AND are getting tax credits for purchasing a home, so they have been coming out in droves these past 9 months. The naysayers say this is just the set up for the next real estate market crash, buyers going in to these homes without enough “skin in the game”. I say I’m sure there will be some of that out there, but since the home buyers I work with choosing FHA | USDA| VA home loans have analyzed their budgets, investigated the various loan programs available to them, and are planning to purchase these homes to live in for 5+ years, I suspect the default rate for these buyers will be as low as it has been for ALL the first time home buyers I have worked with since 1983 who have taken the time and made the effort to prepare for sustainable homeownership, none of whom have “strategically defaulted” on their home loans that I am aware of, although many have experienced financial hardship driving them to try to find solutions to help keep them in their homes.

Horns are locked and the battle is on! So what is the battle over? The battle is over the bank’s “As Is” provisions vs. the Minimum Property Standards required by HUD for FHA | VA loans which most banks and lenders adopt for USDA home loans, too. After 9 months of frenzied buyers snatching up REO inventory, we’re finding a lot of the homes on the market aren’t in the same condition some of the first waves of REO’s were in. Part 2 of Clash of the Titans | Bank Owned Foreclosure Homes vs. FHA|USDA|VA Home Loans will highlight the respective positions of the bank vs. the FHA| USDA| VA buyer in these foreclosure home sale transactions.

See you at the closing table!

Almost Speechless Sunday - Transitions...

American Pacific Mortgage- Karen Cooper, Oregon & California — Mon, 16 Nov 2009 08:37:27 -0600

From the roses in full bloom to the winter berries... from the still turning autumn leaves to the bare branches of winter. There is no doubt that fall has arrived here in Southern Oregon. And Winter isn't far behind...

See you out there...even if I am all bundled up!

A Hard Look At Reality: When Has The Federal Deficit Been This High?

American Pacific Mortgage- Karen Cooper, Oregon & California — Sat, 14 Nov 2009 12:08:03 -0600

Ouch, Mike! Sometimes the truth hurts, but I'm glad you are letting it be seen.

Via Mike Jones (SUNSTREET MORTGAGE, LLC):

A picture graph is worth 1,000 pages of congressional lawmaking.

The chart on the left was compiled by Bloomberg, and shows the budget surplus / deficit as a percentage of Gross Domestic Product.

I came across this chart this morning, and mentally did an overlay of historical events. That led me to wonder what a longer historical perspective would show.

Deficits since the Civil War

I found the most interesting and interactive website to help me with this. The chart below shows the Federal Deficit as a percentage of Gross Domestic Product since 1860. You'll want to note some significant events that have taken place in our nation since that time, and overlay the events on the chart.

The American Civil War

1861 to 1865

US Involvement in World War I

1917 to 1919

US Involvement in World War II

1941 to 1945

The First Gulf War

1990 to 1991

The Iraq War

2003 - 2009

And that leads me to wonder this: To what event will history attribute that blue spike on the right, a deficit never equaled except in a time of world war?

Back to that first chart...

From the TARP bill to the current legislation passed over the weekend under the heading "health care reform," it's apparent that none of the elected representatives we voted into office take the time to READ, EVALUATE, and UNDERSTAND the legislation they enact into law.

"There wasn't time," I've heard lawmakers say on CNN, "the crisis was so great that we had to act..."

I beg to differ.

You can't run your real estate business like that.

You can't operate your household like that.

We ought not to let our representatives run our country like that.

The Voter Revolution

2009 to ...

___________________

I'm Mike in Tucson, and I blog here on the Active Rain Real Estate Network just about every day.

I'm an internet-based mortgage lender who happens to reside in Tucson, Arizona. Read my blog, and get to know me. The internet allows me to perform at the highest level of trust and productivity.

Sunstreet Mortgage is a correspondent bank.

Click the Active Rain link below to see my guarantee of service.

SUNSTREET MORTGAGE, LLC
a correspondent banker
Call me if I can help you or someone you know
with a purchase or refi mortgage.
(520) 349-9090

"I'm mad as hell and I'm not going to take this anymore!"

American Pacific Mortgage- Karen Cooper, Oregon & California — Sat, 14 Nov 2009 11:31:23 -0600

Greg Cook has shared the information received from a directive Chase Finance is giving to strong arm buyers in to using their services, whether it is in their best interest or not. Thanks for getting the word out, Greg! I believe it is important that buyers understand the many hidden undercurrents leading to unexpected and/or unnecessary costs when a buyer is considering the purchase of a bank owned foreclosure home.

Via Greg Cook (First Time Home Buyer Network):

In the movie classic Network, Howard Beal, played by Peter Finch in one of the iconic moments in movie history gives us the classic line: "I'm mad as hell and I'm not going to take this anymore!"

I'm wondering when we as Realtors and our clients as consumers are "not going to take this anymore!"

Those of you who believe that the banks/lenders who control the REO properties are going to negotiate fairly and protect your client's interest, can probably stop reading here.

If you think, your job is to protect your client's best interest and negotiate the best possible terms for them, might want to read on.

If you haven't heard about it yet, you will. Chase Bank in a memo to its Asset Managers, announced the Chase Finance Initiative. In an attempt to capture more of the loans that are being done on their REO properties, Chase is encouraging their asset managers to promote Chase financing.

Problem is, they are in violation of RESPA and FTC guidelines and more importantly putting your clients at a serious disadvantage in the negotiation process.

I'm going to quote directly from RESPA Section 9 and FTC Guidelines for Antitrust Laws, so bear with me if it's a little dry. I'm also going to quote directly from the Chase memo that outlines their Chase Finance Initiative.

RESPA Section 9 - "Section 9 prohibits home sellers from requiring home buyers to purchase their settlement services from a particular company either directly or indirectly, as a condition of sale. Buyers may sue a seller who violates this provision for an amount equal to three times for all charges made for the title insurance." "Settlement service means any serive provided in connection with a prospective or actual settlement including but not limited to any one of the following: Origination of a federally related mortgage loan...Rendering of services by a mortgage broker..."

FTC Guide to the Antitrust Laws - "For competitive purposes, a monopolist may use forced buying, or "tie-in" sales to gain sales in other markets where it is not dominant and to make it more difficult for rivals in those markets to obtain sales. This may limit consumer choices for buyers wanting to purchase one ("tying") product by forcing them to also buy a second ("tied") product as well. Typically, the "tied product may be a less desirable one that the buyer might not purchase unless required to do so, or may prefer to get them from a different seller. If the seller offering the tied products has sufficient market power in the "tying" product, these arrangements can violate the antitrust laws."

Refusal to Deal - Sometimes the refusal to deal is with customers or supplier, with the effect of preventing them from dealing with a rival: "I refuse to deal with you if you deal with my competitor".

Chase's plan? "3. Sell the fact that buyers are more likely to receive seller assistance with closing costs by using Chase financing" "8. In multiple offer situations, advise the agent that the seller will generally put more weight" on an offer with Chase financing than any other offer."

As a Realtor, you're really going to like this section from the Chase Finance initiative: "With Chase as our primary client, (asset manager name withheld) must work with Realtors who understand the importance of Chase financing on Chase owned properties and we will begin to limit our relationships to those who can adhere to these guidelines."

I'm sure there are more examples but here are three brief ones, that amplify the disadvantage your clients would have when negotiating with Chase:

1) The lender selected by your client has a more favorable interest rate than Chase, but in order to get their offer accepted, they will have to take the higher rate by using Chase.

2) Your client asks for closing costs to be paid by Chase, but in reviewing your client's financials determines your client has the ability to pay them, and Chase counters accordingly.

3) Your client makes an offer on a Chase home that is priced below the maximum amount for which they qualify. Even though your buyers are making a prudent financial decision, Chase can counter to a higher amount solely because they know your buyer can qualify for the higher price. Think your buyers might accept the higher price if they've already written 20 offers?

This probably isn't something that can be won in a court of law, but perhaps it can be won in "the court of public opinion".

Pass the word, reblog, protest, make t-shirts, just do something. As other banks follow this lead it will be more difficult for us to best represent your client's interest.

As Howard Beal said: "I want you to get up right now! and go to the window, open it, stick your head out and yell I'M MAD AS HELL AND I'M NOT GOING TO TAKE THIS ANYMORE!
Greg Cook

First Time Home Buyer Specialist

First Time Home Buyer Network

951-265-4532

greg@homebuyerhelpnetwork.com

http://firsttimehome.us

The Road To Homeownership – 5k, 10k, Marathon, Triathlon…

American Pacific Mortgage- Karen Cooper, Oregon & California — Fri, 13 Nov 2009 15:19:36 -0600

The road to homeownership is different for each buyer. For some, it may be a walk in the park filled with wonder and beautiful sights along the way – a quick, uneventful, on-time closing. An experience, learning about the various species found, or re-visiting a favored path– learning about loan programs, different types of inspections involved, insurance policies, etc. for the first time home buyer; re-familiarizing themselves with the process and up-to-date changes for the move-up buyer and investors.

Some home buyers, they may find their road to homeownership is like a 5k run. A bit of effort involved to cross the finish line – changing underwriting criteria requiring more documentation, inspection issues, nothing insurmountable - but a sense of reward upon completion. At the end of the race, they have fond memories of a race well-run.

Some home buyers find the road to homeownership most like a 10k run. They need to do some training before they enter the race – work on items on their credit to increase their credit scores, reduce balances owed, wait until they can meet the job/self-employment requirements, save more for a down payment – they need to build up strength in order to successfully complete the race.

Some home buyers are engaged in a full-on marathon race. Their mind is focused on the ultimate goal to reach that finish line – close on their dream home. They’ve been diligent about their training and preparation – obtaining all required documentation even when additional items are requested or guideline changes crop up along the way, quickly getting out to see homes in their price range as they come on the market knowing they’ll be competing with other buyers to get it - and are prepared for many unforeseeable circumstances with the drive to work through them – low appraised value, increased down payment requirements, loan program change mid-stream, repairs required, late closing; prepared to get back out there and find another home if a cash buyer comes in on the one they want. By golly, they’ve trained to complete this race, and they WILL cross that finish line!

Some home buyers find the road to homeownership is a Triathlon. They are fully prepared for a tough race, have realistic expectations, have mapped out their plan of action and are ready to take on the many challenges. They understand what limitations they may have, working hard to overcome them before entering the race. Hurdles arise throughout the race – underwriting guidelines change making their loan of choice unavailable to them, players in the transaction drop the ball with their responsibilities, players are unknowledgeable /inexperienced/ inept, delay after delay to their closing occurs – and they keep moving forward, taking each hurdle on as it comes, their sideline coaches cheering them on and giving them the tools they need, methodically pushing themselves beyond what they ever thought they could do to reach that finish line.

Come with me for a marvelous walk in the park. Or, if this is what’s needed for you to reach your goal, I’ll be your partner for your 5k, 10k, or Marathon Race. Taking on a Triathlon? I’ll climb that mountain with you - after I recover from this last one I just participated in. A few walks in the park would be very enjoyable during my recuperation…

See you at the closing table!

Beware of Hidden Costs in Your Home Purchase Transaction

American Pacific Mortgage- Karen Cooper, Oregon & California — Tue, 10 Nov 2009 10:22:02 -0600

After a series of winter-like storms rolling through our corner of the world, the latest in a stream of “hidden costs” associated with the purchase of bank owned foreclosure sale transactions came to my attention. Working with a lot of first time buyers who often work very hard to come up with their required cash contributions to purchase their first home, I’ve learned to be diligent in watching their costs so they know going in to their first home purchase exactly what to expect. In the past couple of years, as bank owned foreclosure sales became more prevalent in our area, there are several issues that have come up (I won’t talk about the obvious “as is” provisions the banks have on their REO transactions since they have not occupied the properties) here are some that have come to light:

On Fannie Mae owned homes, a provision of the Fannie Mae Purchase Addendum to their accepted contracts is that the buyer pay certain escrow/title charges that are "usual and customary SELLER charges". These charges equate to about $700, which can be quite a burden for the unprepared buyer who finds this on their Estimated Closing Statement vs. their initial Good Faith Estimate of closing costs.

REO agents for bank owned foreclosure homes will “winterize” a property per the bank’s request. Often times, a buyer’s inspector shows up to do the whole house inspection, only to find they cannot do their job and need to come back. Because this has become more prevalent, these inspectors are charging for their time as well as their expertise. This just happened on one transaction where the whole house inspector had to come back after the Fannie Mae REO had been “de-winterized”, and the buyer was told they will be charged the $150 to “de-winterize” and “winterize” again. This process took place before the appraiser was scheduled in to do their inspection, and guess what? Another $150 AND the $50 re-inspect fee the appraiser will charge, even after the appraiser asked the real estate broker if all utilities were on at the subject property so they could do their job. $350 of unnecessary, undisclosed charges to the buyer.

A first time buyer was interested in purchasing a home that backed to a creek, one that was dry and overgrown at the time the buyer decided to make an offer on this bank-owned foreclosure home. Although the need for flood insurance was not listed on the MLS listing for this property, the buyer’s very diligent real estate broker knew that the property was located in a flood hazard area. As it turned out, a very expensive flood hazard area, as the flood insurance premium for this property would add $1,200 per year to the buyer’s costs.

Caveat emptor is Latin for "Let the buyer beware."

Buyers - choose your professional representation CAREFULLY!!!!!

See you at the closing table!

Even the Rich Are Treating Their Houses Like Piggy Banks | Valerie Fitzgerald | Beverly Hills & West L.A. Real Estate

American Pacific Mortgage- Karen Cooper, Oregon & California — Sat, 07 Nov 2009 17:07:08 -0600

Here in Southern Oregon, super jumbo mortgages are not commonly seen. I found this an interesting read, getting a glimpse in to the motivation these homeowners had in taking out their multi-million dollar mortgages. Used to see this a lot more in my Southern California days...

Via Valerie Fitzgerald | Beverly Hills & West L.A. Real Estate (Coldwell Banker Residential Brokerage):

In recent years, millions of Americans looked at their houses and saw big, fat piggy banks. And it occurred to them to take out big, fat new mortgages.

Few did it on the scale of Ronald Burkle.

Mr. Burkle, the grocery-store billionaire, has $56 million in loans against two houses, including $9 million added last year. One is his iconic Beverly Hills mansion, "Green Acres," a 44-room Italian Renaissance palazzo built in the 1920s by silent-film star Harold Lloyd that more recently was a favorite overnight rest stop for Mr. Burkle's buddy, Bill Clinton.

Mr. Burkle declined to say how he is using the money. There is no indication he needs it to pay the water bill.

Traditionally, the super-rich didn't really bother with mortgages. Home loans were for people who carry lunch buckets, not captains of industry.

That changed in the boom years -- and it is still going on. Recent big-time home borrowers include fashion entrepreneurs, hedge-fund titans and baseball-team magnates.

Home loans "are a really good source of cheap capital," says Robert Maguire, a real-estate tycoon who built some of the tallest officer towers in L.A. He has borrowed some $50 million against several properties, including his beach house, which features huge picture windows framing the Pacific near Santa Barbara, Calif.

He has been raising money with an eye toward regaining control of his property firm, Maguire Properties Inc., which he lost during the real-estate bust. Even as he borrows against his beach retreat, Mr. Maguire is trying to sell it for $29 million.

By hocking the house, so to speak, he and others say they are simply borrowing low in hopes of investing in something they believe will yield a high return.

And mortgage rates are near historic lows. In April, Mr. Burkle renegotiated his $56 million in adjustable-rate mortgages down to 3.25%, which was in line with adjustable home loans of a more mortal size. Recently, his rate adjusted down to about 2.25%, based on publicly available documents.

It puts Mr. Burkle's mortgage interest charge at $105,000 a month, give or take.

Like ordinary home loans, megamortgages flourished during the boom earlier in the decade. The number of home mortgages in the $3 million-and-up category soared to about 3,000 in 2007, from only 1,100 or so in 2004, according to LPS Applied Analytics, a unit of Lender Processing Services Inc.

Not surprisingly, mammoth home loans got scarce during last year's near-unraveling of the world economy. But now they are showing signs of coming back.

U.S. Trust, which is the private wealth-management arm of Bank of America Corp., has seen a 33% rise this year in home loans, compared to last year, with the average size over $3 million. Jan Reuter of U.S. Trust says clients are using the cash to buy stocks and other assets. Other major lenders tell a similar story.

The federal tax code doesn't smile upon giant mortgages. It allows mortgage interest to be deducted only on home borrowings of about $1 million or less.

But there are ways around that, says David Adamo of Luxury Mortgage Corp., a mortgage-banking firm in Stamford, Conn. If the cash is used for investment purposes, the loan interest could be used to reduce taxes on income from the investments, he says.

Of course, plenty of rich people still avoid home loans. Partly, it is an image thing. Maria Elena Lagomasino of GenSpring Family Offices LLC, a Palm Beach Gardens, Fla. wealth-management firm, says a mammoth mortgage implies to her that someone is "borrowing because they have to."

One rub for zillionaires who value their privacy: Mortgages are a matter of public record.

One of New York City's classiest new addresses is 15 Central Park West -- which along with the requisite pool, health club and movie-screening lounge, offers "30 climate-controlled wine rooms" with "solid oak cabinetry." Since the start of last year, five buyers there have taken out mortgages ranging from $10 million and $35 million, according to public information collected by First American Corps.' RealQuest data service.

Not all megamortgages have happy endings. Since mid-May, about a dozen home loans of $3 million to $9 million have been involved in default or foreclosure actions in Malibu, Beverly Hills and other fancy areas around Los Angeles, according to public data gathered by First American. None of the giant mortgages over $10 million examined in detail are in default.

Max Azria, chief executive of privately held BCBG Max Azria Group Inc. clothing company, took out a $25 million mortgage in April 2008 on a 12-bedroom, 13-bath West Los Angeles mansion, once home to the late TV producer and novelist Sidney Sheldon, according to public records. He bought the house in 2005 for about $16 million.

Last year, Moody's Investors Service, the credit-rating company, said BCBG could face a cash crunch without financial help from Mr. Azria. A BCBG spokesman said Mr. Azria used the mortgage money for renovations and "additional personal liquidity," and that the company restructured and improved its finances this year without funds from him.

Israel Englander, who runs the Millennium Management LLC hedge-fund operation in New York, last year pledged a home in a wooded, estate-filled section of Greenwich, Conn., as part of the collateral for a revolving credit line of up to $100 million.

Mr. Englander declined to comment. There is no indication he needed the money for anything other than investment purposes.

Besides signing multimillion-dollar baseball players, Frank and Jamie McCourt have accumulated homes with multimillion -- dollar mortgages since moving to Los Angeles in 2004 to run the Los Angeles Dodgers. They bought homes and adjacent properties in both West Los Angeles and Malibu.

Their 15,000-square-foot, 10-bath L.A. manse, located in the prestigious Holmby Hills neighborhood across the street from the Playboy Mansion, was purchased in 2004 for about $20 million. For good measure, the McCourts spent $14 million to upgrade the place, including tearing out the tennis courts to install an indoor, Olympic-size swimming pool.

All told, the homes carry some $28 million in mortgages. The houses, which are in Mrs. McCourt's name, are now part of a nasty divorce battle between the couple, who are fighting for control of the Dodgers.

The McCourts declined to comment.

Amid the acrimony, the estranged couple did agree on one housekeeping matter at a court hearing Thursday: Mrs. McCourt could have exclusive access to the indoor Olympic pool. Swim hours for her are between 6 a.m. and 2 p.m.

—Jonathan Karp contributed to this article.

Write to John R. Emshwiller at john.emshwiller@wsj.com

Cold vs. H1N1 - Know the Difference!

American Pacific Mortgage- Karen Cooper, Oregon & California — Sat, 07 Nov 2009 17:02:14 -0600

This is some great information put together by Debi Boucher, Woodland Park photographer about the differences between a cold and H1N1. Great info!

Via Debi Boucher - "Realtor Showcase" Real Estate Slideshows/ Photographer (Memories DVDs - Realtor Showcase Slideshows):

Cold vs. H1N1 - Know the Difference!

I heard on the news the other day that the seasonal flu hasn't really even hit yet - That means, according to the report, that nearly all cases of the flu so far are H1N1. The government has declared the H1N1 pandemic a national emergency. According to the Washington Times, as of October 25th, there have been more than 1000 deaths, 100 of them pediatric. (The synopsis below reports 22 pediatric deaths as of Oct. 24). And we are woefully short on vaccines. We all know the steps we should take to help prevent getting the flu, but do we all know the symptoms? When is going to the doctor warranted? Or the emergency room? I have to wonder how many deaths can be prevented by not waiting too long to get medical care.

A co-worker had the flu last week. I asked her if it was H1N1, and she said she didn't know for sure. It is too expensive to have the tests done, so she didn't have it confirmed. Are the statistics we see on how many cases there have been based on 'tested' cases? If that's so, then the numbers must be much higher than reported.

This information is from the CDC:

Synopsis:

During week 42 (October 18-24, 2009), influenza activity increased in the U.S.

8,268 (42.1%) specimens tested by U.S. World Health Organization (WHO) and National Respiratory and Enteric Virus Surveillance System (NREVSS) collaborating laboratories and reported to CDC/Influenza Division were positive for influenza.

All subtyped influenza A viruses being reported to CDC were 2009 influenza A (H1N1) viruses.

The proportion of deaths attributed to pneumonia and influenza (P&I) was above the epidemic threshold.

Twenty-two influenza-associated pediatric deaths were reported. Nineteen of these deaths were associated with 2009 influenza A (H1N1) virus infection and three were associated with an influenza A virus for which the subtype was undetermined.

The proportion of outpatient visits for influenza-like illness (ILI) was above the national baseline. All 10 regions reported ILI above region-specific baseline levels.

Forty-eight states reported geographically widespread influenza activity, Guam and two states reported regional influenza activity, the District of Columbia and Puerto Rico reported local influenza activity, and the U.S. Virgin Islands did not report

Know the Difference between Cold and H1N1 Flu Symptoms

Symptom

Cold

H1N1 Flu

Fever

Fever is rare with a cold .

Fever is usually present with the flu in up to 80% of all flu cases. A temperature of 100°F or higher for 3 to 4 days is associated with the flu .

Coughing

A hacking, productive (mucus- producing) cough is often present with a cold.

A non-productive (non-mucus producing) cough is usually present with the flu (sometimes referred to as dry cough) .

Aches

Slight body aches and pains can be part of a cold .

Severe aches and pains are common with the flu .

Stuffy Nose

Stuffy nose is commonly present with a cold and typically resolves spontaneously within a week .

Stuffy nose is not commonly present with the flu .

Chills

Chills are uncommon with a cold .

60% of people who have the flu experience chills .

Tiredness

Tiredness is fairly mild with a cold .

Tiredness is moderate to severe with the flu .

Sneezing

Sneezing is commonly present with a cold .

Sneezing is not common with the flu .

Sudden Symptoms

Cold symptoms tend to develop over a few days .

The flu has a rapid onset within 3-6 hours. The flu hits hard and includes sudden symptoms like high fever, aches and pains .

Headache

A headache is fairly uncommon with a cold .

A headache is very common with the flu, present in 80% of flu cases .

Sore Throat

Sore throat is commonly present with a cold .

Sore throat is not commonly present with the flu .

Chest Discomfort

Chest discomfort is mild to moderate with a cold .

Chest discomfort is often severe with the flu .

If you know someone who lives alone, keep an eye on them! They may not be able to get the care they need if they are too sick to seek it out....

DBoucher Photography

Nature and Wildlife Photography Notecards

Real Estate Showcase Slideshows

Position yourself above your competition - Utilize a "Real Estate Showcase" Slideshow as a listing tool. Post it on your own website - Realtor Showcase Members can upload it to Realtor.com - Post it on your blog to showcase your listings.

"Real Estate Showcase" Slideshow and Web Presentations, more captivating than a virtual tour!

Photos taken by Debi Boucher, DBoucher Photography, all rights reserved, may not be reproduced without express written permission.

"How To Get Rich In This Market"

American Pacific Mortgage- Karen Cooper, Oregon & California — Fri, 06 Nov 2009 18:05:46 -0600

I’m thanking God it is Friday. This week has so drained my energy. I’m looking forward to it being revitalized by family, friends and church this weekend. I will not be taking any business related calls this weekend, because I desperately need to recharge. Have you ever felt like that?

A “funny” thing happened this week, though. In the heat of trying to prod government and major bank employees along to get a first time home buyer’s transaction closed before their extended closing date passed us by, I inadvertently addressed a fiery e-mail to the previous CEO of Carteret Mortgage, one of our nation's largest mortgage brokerage until they closed down with the rapid disintegration of the mortgage industry. I can’t tell you how this “divine intervention” “coincidence” - whatever you wish to label this experience – did to help take my focus off an imploding file, taking me out of battle mode for a few moments so I could contemplate how the myriad of changes we’ve been facing in the mortgage industry have effected this gentleman, Mr. Eric Weinstein (not Everlyn Williams, whom the e-mail was intended for! :->).

The dialog between Eric Weinstein and I went back and forth a bit, but here is an article by Eric Weinstein, formerly CEO of Carteret Mortgage, that I found soothing in this crazy week:

“How to get rich in this market” by Eric Weinstein

“I must say, as the former owner of one of the largest mortgage brokers in the country, I have a new found respect for all the crap my loan officers must have gone through when I was at the top making policy at Carteret Mortgage. Literally, four of my last 5 borrowers in the last two weeks did not qualify where less than a year ago, they were golden. I never had these problems when I was taking loan apps fifteen years ago, typing the 1003 on my trusty Smith-Corona and using some sort of “special machine” to run my credit reports. You old timers, like me, will remember the days before LP, before anyone had an LOS that merged the liabilities into the second page and when basically anyone breathing qualified for a loan.

So here I am, a time traveler thrown back fifteen years, to when I was a loan officer just starting out in the business. Back then, all we had was agency and government loans, just like to day. At least we had MI back then. Yes, technology has made inputting the loan faster, but now we have to worry about appraisal reviews and ever changing guidelines.

What I am saying is…”It’s always something.” The market is tough now, but hey, old timers like us have been through stuff like this before. The market is bad, then it’s good, then it’s bad again Underwriting is hard, then it’s easy, then it’s hard again. Life sucks, then you are on top of the world and then it sucks again. So what is the secret to being rich in this crazy market?

I love the bumper sticker “He, who dies with the most toys … is STILL DEAD.” The best way to get rich in this market is to count your blessings, Realize you still have your health, your family and you are still breathing on this earth. Life is the greatest gift and if you are reading this, there is a good chance you are not dead yet. Rejoice at just being alive and the rest is just the price you pay for the privilege. Right now, you are the richest person at the cemetery. So, just say a little” thank you”, and get back to work.”

Eric – thank you! I’m counting my blessings…and getting rich!

See you out there!

Wordless Wednesday - When You've Gotta Go, You've Gotta Go

American Pacific Mortgage- Karen Cooper, Oregon & California — Tue, 03 Nov 2009 23:08:32 -0600

High Offers Offset By Low Appraisals - Fair And Balanced? Or Unfair?

American Pacific Mortgage- Karen Cooper, Oregon & California — Tue, 03 Nov 2009 19:41:12 -0600

We're seeing a lot of accepted offers way over the listed price on bank owned foreclosure homes in our local markets, too. I haven't seen any low appraisals, although we've been seeing lots of repairs called out. Lisa brings to light an issue I hadn't considered. Thanks for the food for thought, Lisa!

Via Lisa Udy Realtor Utah Real Estate Specialist (Logan Utah Real Estate Immaculate Homes):

With the amount of offers coming in on REO properties(Bank Owned Properties), there has been a new trend among buyers. The trend is to just offer as high as possible to get the property under contract. After the contract is accepted by the bank, they have to get an appraisal for the loan.

The appraisal comes in quite a bit lower then their original offer price, which means the buyers won't be able to get the financing. These buyers then have the right to withdraw from the contract based on the appraisal contingency. The deal is dead right?

Not so fast. The buyers agent has been planning this all along. The agent and the buyers will submit an addendum to the price to meet the appraisal, and will re-submit to the bank.

Now, the bank wants to get this deal done, and knows the same thing will happen with any other buyer. The appraisal has already been done. So, the bank just accepts the lower price, and the buyers get away with it. They knew the appraisal would not meet the original offering price, and they get a great deal.

With the new appraisal guidelines, this is happening more and more. Appraisals are coming in low, buyers are aware this is what's happening, they are offering high to get the property over the competition, and just wait out the appraisal to get a great deal.

How fair is it to the buyers that put in an offer closer to asking price? Is this fair and balanced? Is it unfair to the other buyers that put in a reasonable offer? Or is it a smart way to get your buyers the house they wanted?

Know Your Forms - New RESPA Closing Documents On The Way!!!

American Pacific Mortgage- Karen Cooper, Oregon & California — Tue, 03 Nov 2009 19:26:23 -0600

Gary Woltal has highlighted the new Good Faith Estimate and its 2010 proposed changes very well. Hopefully, this will be the final form that is eventually released in January, as many revisions have taken place. Thanks, Gary!

Via Gary Woltal - Associate Broker REALTOR® Dallas Ft. Worth (Keller Williams Realty):

Come January 1st, 2010, as a REALTOR or a consumer at the closing table things are about to change as far as the Good Faith Estimate (GFE) and Settlement Statement (HUD-1). Links below will allow you to print these out to familiarize yourself with them. Both now are three pages in length. The highlights:

Revised Good Faith Estimate (GFE)

GFE tolerances on settlement costs (1/8 point allowed to be in error)

Revised Settlement Statement (HUD-1)

Revised definitions for application, Good Faith Estimate, and Mortgage Broker

Additional definitions for changed circumstances, origination services, loan originator, prepayment penalty, third party, title service and tolerance

Elimination of 1% origination fee cap on FHA loans

RESPA (Real Estate Settlement Procedures Act) forms apply to federally insured or backed loans such as FHA/VA/Conventional and NOT cash deals. There is also a 30 day cure period to give lenders after closing the ability to meet the tolerance. The closing script is eliminated as it is contained in the revised HUD-1. Average charges can be used by service providers and is not limited to loan originators.

Bottom line is it looks like the new GFE and HUD-1 want the borrower to be as crystal clear on everything related to the loan. It looks like the fastest you could go from app to close is about three weeks. On page three of the new HUD-1 boxes compare GFE and HUD-1 costs. On page 3 of the GFE they clearly in the instructions state what charges CANNOT increase past the GFE, can increase up to 10%, and what charges can change. It is VERY clear. The only thing weird I saw on both the new HUD-1 and GFE is it never clearly says the PITI monthly payment but just principal, interest, and mortgage insurance in the loan terms.

It looks a lot different for most of us, but print yourself out a copy and take a look. January is NOT that far off.

Revised Good Faith Estimate (GFE)

Revised Settlement Statement (HUD-1)

With closings averaging 130 pieces of paperwork both the REALTOR and the consumer need to know about these documents ahead of time. One last tip for both groups in this area, be sure to show up at the table with a U.S. government issued ID with a picture and your signature. This is mandatory for identification purposes. Good luck and happy closings!!!

Out With The New/Old, In With The Old/New…Oh Whatever!

American Pacific Mortgage- Karen Cooper, Oregon & California — Tue, 03 Nov 2009 18:31:54 -0600

2008 and 2009 have been phenomenal funding times for FHA loan financing for buyers purchasing real estate. This is because FHA guidelines are broader, making this financing tool more suited to today’s homebuyers’ needs. FHA guidelines allow the buyer to receive gift funds for their down payment/closing costs, which is what many first time home buyers are doing these days.

Prior to FHA financing’s comeback, conventional loans were the tool of choice for first time home buyers because they could choose “piggyback financing” – two loans, holding the amount borrowed on the 1^st mortgage to 80% or less, financing the rest in the 2^nd mortgage, thereby eliminating the need to obtain private mortgage insurance which until the past few years was not tax deductible. Automated underwriting made for easy processing of these loans, limiting documentation requirements and making for faster closings.

Now, proposals are moving forward to increase the down payment requirements on FHA financing to at least 5% down. I’ve received word that Fannie Mae and Freddie Mac are reviving 3% down on certain programs for home buyers with credit scores of 680+, because they have a private mortgage insurance carrier that will agree to insure these loans. These programs are priced higher than FHA financing, making it an unlikely substitute if the down payment requirements are raised on FHA loans.

In 2010, the tax deduction for private mortgage insurance is set to sunset. I haven’t heard about any proposal to extend that tax deduction. Guess it’s time to start another letter writing campaign to my elected officials on THAT issue.

Welcome to my world where the new is old and the old is new…it’s like watching professional ping-pong.

See you out there!

Thanks, Neighbor For Your Diligence In Hanging In There To Sell Your Home – The Rest of Us Living Here Appreciate It!

American Pacific Mortgage- Karen Cooper, Oregon & California — Tue, 03 Nov 2009 17:51:10 -0600

There’s another home on our street that turned over recently. This homeowner relocated to another state to take a job. Having purchased at a high point in the market, they rented the home out, after attempting to sell it to no avail. Three sets of tenants later in a relatively short period of time of about 2 years, they put the home on the market. I’m guessing it was a short sale, with the owner having purchased at a peak AND sunk quite a bit of money in to the home to renovate it and fix some quirky floor plan issues making this home more easily marketable for the future... a future that came along much sooner than the homeowner anticipated.

Short sales are not looked upon favorably in our market, by the prospective buyers or by the Realtors. Showings are lower than they are on bank owned foreclosure homes or privately held “market rate” homes. With good reason, based on the lack of response and ineptitude encountered with many mortgage holders. Admittedly, some of them are getting better. Some are still floundering with the excessive, escalating volume of transactions these mortgage companies need to review, transactions being set up and processed by inexperienced under-trained staff that have been thrown in to sink or swim at these mortgage companies. There are some bargain hunters willing to give purchasing a short sale home a try, or purchasing a bank owned foreclosure home able to see its potential through the damage the property may have and the repairs/renovation it may need. Who can blame them for wanting to take advantage of extraordinarily low priced homes while they can take advantage of the $8,000 first time home buyer tax credit AND low mortgage interest rates? Or, if they are investors, pick up several homes for their portfolio that will cashflow and meet their return on investment goals?

Over time, multiple buyers came along, some tried to negotiate an accepted contract to be approved by the mortgage companies, and then there would be a price reduction and further wait for another buyer willing to attempt the cycle again. Finally, a diligent (lucky?) buyer came along, worked out a deal, got the mortgage company to approve it, and closed escrow on this home. Hallelujah, after a year the vacant home is filled! And the home DID NOT go through foreclosure.

Thank you persistent seller for pursuing this long road to avoid letting the home go back to the bank. Thank you dedicated real estate brokers who hung in there to successfully get this home sold. Thank you diligent buyer who lives in this home - we're thrilled to have good neighbors again.

People are successfully refinancing there homes under the Home Affordable Refinance program. People are successfully modifying their loans under the Home Affordable Modification Program. Even more people are now successfully refinancing or modifying their existing home loans under the Home Affordable Programs since the limit was increased to 125% of their home’s current market value. People are successfully selling their homes for less than what is owed on them when they can no longer ride this market out. Kudos to every one of these people for traveling these challenging paths to avoid foreclosure.

Thanks, Neighbor, for your diligence in getting your home sold…for playing your part in stemming the tide of foreclosures we’re seeing in our local real estate market. The rest of us here really appreciate it!!!!

See you out there!

Thanks, Neighbor and Thanks, Bank of America/Countrywide/Fannie Mae/Freddie Mac – NOT!

American Pacific Mortgage- Karen Cooper, Oregon & California — Tue, 03 Nov 2009 15:47:25 -0600

There are some great Realtors here in Southern Oregon, dedicated to their profession and their clients. One of them, our 2010 Rogue Valley Association of Realtors President, Krista Bolf, knows where I live and lets me know what sales are happening in the neighborhoods where we own property. Yesterday, Krista Bolf of Coldwell Banker ProWest Ashland spotted a new listing on our street. This isn’t the first “don’t shoot the messenger” message we’ve received from Krista Bolf, and with the way the local real estate market has been very likely won’t be the last.

There are a lot of ways to deal with financial distress. I’ve listed several of those that pertain to the housing/real estate/ mortgage distress below. Then, there are those that just irk me, like the strategic foreclosure or the high cost loan modification companies.

As of October, there was another Trustee Sale creating a bank owned foreclosure home on our street. There are about to be two bank owned foreclosure homes on the street where we have a rental, too. A sign of the times, hopefully a tide that will be stemmed soon with all of the housing stimulus being poured out. If I’m going to have to foot the bill for these programs for the rest of my life and probably those of my children, I’d like to see this blood-letting of our assets end soon.

The most recent bank owned foreclosure home on our street is a home the owners had for almost 20 years. At some point, maybe from the beginning, this was an investment property for the owners. They wouldn’t have been eligible for the Home Affordable Modification Program through Bank of America/Countrywide/Fannie Mae/Freddie Mac because they won’t modify notes on this program for Investment Property. They paid $85,000 for the home that went back to the bank. But, it didn’t go back to the bank to be foreclosed on for that amount or less. It went back for almost $230,000 owed to Bank of America/Countrywide. So, that tells me the owner used this home as an A.T.M., borrowing against it and borrowing against it until the rents couldn’t sustain the Bank of America/Countrywide mortgage payments, at which time they defaulted on their Bank of America/Countrywide mortgage creating a new foreclosure in our neighborhood. I don’t know about you, but I certainly don’t appreciate the ramifications of what may have been this homeowner’s decisions! No, I don’t know first hand what circumstances led to the eventual loss of our neighbor’s house through foreclosure or their reasons for refinancing; maybe there were health issues that led to outrageous medical bills, or a job/income loss that put them in survival mode - I’d rather think this than that they sucked all the equity dry and walked leaving the rest of us to pay the price. Yes, I am making some assumptions based on case histories I’ve come across repeatedly since the real estate/mortgage industry began the tumble from unsustainable peaks.

So now, Bank of America/Countrywide/Fannie Mae/Freddie Mac has listed the home for sale at a “bargain rate”, something that is done prevalently by banks when selling their foreclosure inventory. Throw the home on the market at a low price, sell quickly, drag the values in the neighborhood down for the rest of us – over and over again if there are multiple bank owned foreclosure homes in the neighborhood, which we are finding happens frequently. This home in our neighborhood is listed for sale for a little over $150,000. We paid $205,000 for our house in 2004. Yes, this REO home is less desirable in condition, lot size and location, but we are similar in square footage and age. We don’t have a lot of turnover of homes in our neighborhood, so this puppy will be setting the stage on values for a while.

So, thanks Neighbor for the choices you made leading to your home going back to the bank (or, forgive me for making false assumptions), and thanks Bank of America/Countrywide/Fannie Mae/Freddie Mac for putting this foreclosure home on the market at this below market rate – NOT! These banks are reminding me of the Robin Hood principle - stealing from the “rich” to give to the “poor”, and I’m getting a little tired of being stolen from! It’s no wonder we’re seeing the level of strategic defaults we’re seeing now. Is this the objective/goal you had in mind Bank of America/Countrywide/Fannie Mae/Freddie Mac? You contributed to it!!!!

There ARE other ways to handle distressful financial circumstances in many cases. Exploring all alternatives, like Home Affordable Refinance or Home Affordable Modification Programs which will now let you refinance up to 125% of your primary home’s value to help you lower your payments and keep you in your home using any lender that offers the programs, not just the one you are already with who you may or may not want to stick with. If you’ve tried one or both of those two Home Affordable options, but you don’t qualify, you may want to get legal/tax guidance for the other alternatives. If you haven’t tried the Home Affordable programs because of the barrage of negative media attention on unsuccessful applicants, TURN YOUR TV/RADIO/ MONITOR off and give it a try! If you’ve tried the Home Affordable route, but haven’t been able to get a credible response/action from your lender, get to a HUD approved housing counselor in your area to help you work through the process – THEY will get the attention of your mortgage holder. Exhaust this alternative, because the next options – short sale/ deed in lieu of foreclosure/ foreclosure / bankruptcy – will have longer term, costlier affects on your credit and your pocketbook. If a Home Ownership Preservation Event (H.O.P.E.) is being held in your area, and you need help on your primary residence, GO TO IT! Make sure you get the proper professional guidance from a knowledgeable reputable source, as bad advice and scams are rampant out there. Chances are anyone who wants to charge you a significant upfront fee for loan modification is operating illegally – they are in California and Oregon, anyway.

See you out there!

That Was Then…This Is Now 2007-2009

American Pacific Mortgage- Karen Cooper, Oregon & California — Mon, 02 Nov 2009 11:48:26 -0600

Having been in the mortgage industry for so long, having seen a great many changes since 1983, recent changes seem different from earlier changes in one big way. The period between 2007 and 2009 doesn’t really seem like a long period of time in the big picture, but these changes are making for some long days in my mortgage industry world. Where many of the changes in the past were market driven, today’s changes are “putting fires out” driven. And it seems to me, those changes are being made without the necessary foresight and investigation required to have these changes be viable solutions to the problems they are meant to address. Take these two, for example:

Home Valuation Code of Conduct (HVCC):

Before this change went in to effect, a loan originator could choose an experienced, qualified, local appraiser to be hired to do the appraisal inspection/report for their refinance or purchase transaction. Limited analysis of rapidly defaulting home loans brought to light that there were cases of undue pressure on appraisers that were playing a big part in the appraisers providing over-inflated values. The solution was to not allow loan originators to speak to appraisers and limit what other parties to a transaction may say to an appraiser that must be hired anonymously through an appraisal management company. Of course, the appraisal management company wants to be paid, so they first increased appraisal fees, then secondly took a piece of the appraiser’s compensation to accomplish this. The appraisers the appraisal management companies hire have to be willing to accept the lower compensation for the same work, limiting the available pool the appraisal management companies draw from, and often the appraisal management companies hire appraisers for jobs that are not from the area the subject property is located in and/or appraisers that have less experience than that of the appraiser an originator may have chosen to hire for the job before. The latest report referenced by TBWS on a comparison between 2^nd quarter 2009 when HVCC went in to effect, comparing the 3^rd quarter 2009 results to 3^rd quarter 2008 results before HVCC was in effect, and guess what? Cases of appraisal fraud, including over-inflated values, are UP 46% since HVCC was instituted.

Real Estate Settlement Procedures Act (RESPA):

There have been several proposed changes to RESPA to help make the Good Faith Estimate and Truth-in-Lending disclosures with their respective information complete, clear and concise. Limited analysis of the homeowners defaulting on their home loans brought to light that many of those homeowners didn’t fully understand the loan program they used to buy/refinance their home. It also brought to light that a limited number of loan originators were “churning” loans and being compensated through yield spread premiums on those loans that bank employees were not required to disclose to their borrowers. The objective is to help the home loan applicant better understand the loan product they have chosen and the loan products available to them to use as the tool for their refinance or home purchase. Further proposed changes currently in the comment stages are proposing that yield spread premiums disclosed by mortgage brokers but not by the rest of the mortgage originators be eliminated, not just disclosed because the average homeowner isn’t savvy enough to figure out what they are. The results? The disclosure forms are longer, more confusing for first time homebuyers, and if the latest change proposed by R1366 is approved, will eliminate yield spread premium and fix the compensation of loan originators, so that those seeking home loans will HAVE to pay points to get their loans (although 44% of borrowers chose NOT to) unable to scale their interest rates up and down to offset charges for risk factors associated with their individual circumstances and/or get the lowest annual percentage rate for their individual plans/goals/objectives.

The difference from earlier changes and the common denominator I see in today’s changes? They HURT the consumer!!!! They are NOT helping anyone other than the factors pressing for changes that will make them money and/or eliminate their competition. They will chase what is left of the quality appraisers, loan originators, and real estate brokers out of the business. The rules don’t need to be dramatically changed like this…the original ones just needed to be enforced! Greed, fraud, poor judgment are still a part of our world – how about we focus on enforcing existing regulations/ laws to address these issues since this human element can’t be removed?

You CAN do something to change the changes. Let your elected officials know your experience with HVCC if your transaction(s) fell apart because of it. It isn’t too late, because a bill is moving forward requesting a moratorium on HVCC. Let your elected officials know if you don’t want to HAVE to pay thousand of dollars more for an interest rate that is SET, and you believe you are intelligent enough to understand – or have confidence in the support you can get to help interpret –your disclosure forms, the forms the newest MDIA regulations give you 6 business days to receive and review before an appraisal may be ordered. If you attend HUD approved homebuyer education programs, you are taught how to figure these out.

We’ve come a long ways these past 2 ½ years…but I think we’ve taken some wrong turns at some Y’s along the way. I think it’s time We The People take some initiative and steer our own vehicle. Let your voice be heard – it’s your constitutional right!

I have a suggestion. How about we get back to basics – buyer beware, read before you sign, get reputable professional guidance if you don’t understand it, “buy local” through recommended companies/ representatives.

See you out there!

A Sunday Drive in Southern Oregon (3 of 3)

American Pacific Mortgage- Karen Cooper, Oregon & California — Sun, 01 Nov 2009 23:09:24 -0600

After we have finished exploring Sunny Valley and the ghost town of Golden Oregon with the hydraulic mining sights across the road, we head to Historic Wolf Creek Inn to have dinner. In spite of the Rogue Valley population being well over 200,000 people now, we manage to bump in to two people we know having dinner with their families at the Wolf Creek Inn. After a delicious dinner of "Steak for 2" and Crab and Avocado Louie, we meet up with one group of friends and tag along for a tour of the Wolf Creek Inn, learning about the days the Inn was established as the overnight stop for the Portland to San Francisco Stage Coach run, housing notables such as Clark Gable and Robert Redford, while hearing tales of paramormal activities - appropriate for All Saints Day, don't you think?

Thanks for sharing our Sunday Drive to three very scenic locations here in Southern Oregon.

Part 1 - Sunny Valley, Oregon

Part 2 - Golden, Oregon

See you out there!

A Sunday Drive in Southern Oregon (2 of 3)

American Pacific Mortgage- Karen Cooper, Oregon & California — Sun, 01 Nov 2009 22:40:19 -0600

On this first day of November 2009, we continue our Sunday drive on this glorious day, leaving Sunny Valley, and heading north to go to Golden, Oregon. This historic town was settled by early Gold Miners, most of whom moved on to other areas for their treasure hunt. The State of Oregon is in the process of restoring/renovation this historic area, and we'll look forward to seeing it again one day. In the meantime, here you go!

There is such beautiful scenery in this area, and so many great places to sightsee and hike, or as we chose to do, take a leisurely Sunday drive!

Part 1 - Sunny Valley

Part 3 - Mill Creek Inn

A Sunday Drive in Southern Oregon (1 of 3)

American Pacific Mortgage- Karen Cooper, Oregon & California — Sun, 01 Nov 2009 22:27:00 -0600

There are so many wonderful places to visit here in Southern Oregon. Today, my family and I piled in to the car and headed North from Medford Oregon to spend some time discovering places and some ground we've passed through many times along the I-5 corridor.

First stop, was the Grave Creek Covered Bridge in Sunny Valley, Oregon. This is along the Applegate Trail, and there is a small interpretive center located here that tells the tail of Sunny Valley and these scenic landmarks that can be spotted when one is driving north or south on the Interstate 5 Freeway.

A nice pit stop on a Sunday drive, with a great location for a picnic.

Off to Golden we go to see this historic ghost town that came to be in the Gold Rush days... (see part 2 of 3)

Part 2 - Golden Oregon

Part 3 - Wolf Creek Inn

Symptom	Cold	H1N1 Flu
Fever	Fever is rare with a cold .	Fever is usually present with the flu in up to 80% of all flu cases. A temperature of 100°F or higher for 3 to 4 days is associated with the flu .
Coughing	A hacking, productive (mucus- producing) cough is often present with a cold.	A non-productive (non-mucus producing) cough is usually present with the flu (sometimes referred to as dry cough) .
Aches	Slight body aches and pains can be part of a cold .	Severe aches and pains are common with the flu .
Stuffy Nose	Stuffy nose is commonly present with a cold and typically resolves spontaneously within a week .	Stuffy nose is not commonly present with the flu .
Chills	Chills are uncommon with a cold .	60% of people who have the flu experience chills .
Tiredness	Tiredness is fairly mild with a cold .	Tiredness is moderate to severe with the flu .
Sneezing	Sneezing is commonly present with a cold .	Sneezing is not common with the flu .
Sudden Symptoms	Cold symptoms tend to develop over a few days .	The flu has a rapid onset within 3-6 hours. The flu hits hard and includes sudden symptoms like high fever, aches and pains .
Headache	A headache is fairly uncommon with a cold .	A headache is very common with the flu, present in 80% of flu cases .
Sore Throat	Sore throat is commonly present with a cold .	Sore throat is not commonly present with the flu .
Chest Discomfort	Chest discomfort is mild to moderate with a cold .	Chest discomfort is often severe with the flu .