The Real Estate Market Synopsis

NOTE: For the full market update, including facts, figures, and other market indicators, go to Gitta's Blog right now!

Orlando Real Estate Market Update 08/24/07

Gitta Urbainczyk, P.A.

At first, this may sound too good to be true.  If you think you have heard this idea before, you really need to listen to this one now and find out more about it! Most people labor 30 years to pay off their home.  In the process, they end up paying hundreds of thousands of dollars in interest expenses.  In the end, they will never pay off their home. Now, there is a fairly new program which is called Home Ownership Accelerator which is offered through many mortgage brokers.

In today's battered mortgage market, it is refreshing to see a program which offers a new approach to cutting away at lifetime indebtedness.  In paying the traditional way, you get a 30-year mortgage that you pay monthly principal and interest payments to the mortgage company.  This also includes your taxes and insurance. The mortgage company will place the escrow money into an escrow account and pay the insurance and the taxes once per year. Just imagine how many billions of dollars are sitting in escrow accounts and collecting interest!  Where does that money go?  You guessed it, the mortgage companies.

I am sure you have also heard of a program where you pay the mortgage on a bi-monthly basis or just make additional mortgage payments to reduce the time it takes to pay off a mortgage from 30 years to say 20 years or so. Still, these programs require you to put an additional payment towards the principal or pay the mortgage payments bi-monthly.  The Home Ownership Accelerator program is different because it replaces your traditional 30-year mortgage with a HELOC (Home Equity Line Of Credit).  With a HELOC, the first mortgage goes away altogether.  Basically, your home is secured by a HELOC instead of by the first mortgage.  The HELOC is treated like a checking account with benefits such as a debit card and checks.  

This program only works for people who have at least 10% of equity in their home, a credit score of at least 680 (could change) and a positive monthly cash flow. Because you will deposit your weekly paychecks into this HELOC account and treat the account like a checking account, your outflow cannot exceed your income. Under the HOA program, you do not pay escrows to the mortgage company.  Instead, you will pay the escrow only once per year and therefore the tax and escrow money will stay in the HELOC account.  This will accumulate interest for you instead of your traditional mortgage company and also reduce your indebtedness, thus making your monthly HELOC payment lower. 

I have to say, this is a pretty revolutionary program and certainly something that can help many homeowners get out of debt early instead of paying hundreds of thousands in interest payments to your mortgage company.  Plus, you keep the money in your own pocket and in your own savings account.  Here are some of the salient points of the program.

How does the Home Ownership Accelerator revolutionize home loans?

The Home Ownership Accelerator makes one simple change in your financial life. It combines your checking account with your home loan. So you flow all of your personal cash against your loan balance. Why is this aspect a big deal? The money currently in your checking account earns close to nothing. In the Accelerator account, your money will "earn" your home loan rate (a much better return) because:

•  Your income lowers your monthly balance.
•  The lower balance saves you interest.
•  The saved interest becomes extra principal payment.
•  This further lowers your balance, saving more interest.
•  This frees up even more money to reduce principal.
•  This cycle repeats itself each month, compounding your interest savings and accelerating the reduction of your debt.

If you want to find out more about the program, please feel free to call mortgage brokers Marc Urbainczyk at 321- 228-3104 or Matt Morro at 321-438-1862.  Both are with Premier First Home Mortgage and they can guide you through the program to get you into financial freedom faster! You can also look at the website called http://www.homeownershipaccellerator.net/.

With today's market, you need a mortgage solution which gets you to your financial goals.  This HOA program might just be the right vehicle for you.   Good savings!

Home Sellers!

We are at a very difficult time in the real estate market and things are not about to get any better.  There are just too many unknown issues hanging over the mortgage market. The world financial markets are in turmoil and there is no quick fix.  The difficulties of the housing market really have yet to surface. If you want the latest updates, please go this website http://ml-implode.com/ and follow how lender after lender is closing down with no end in sight. The good side of the equation:  you can still sell your home if you price your home reasonably and understand that the buyer is setting the prices right now. This is because any home bought today cannot be re-sold for the same price next month, 12 months and 24 months from now.   We are on a downward slide in home prices. Understand that selling your home at all is a privilege now because many others will not be able to sell.  They will eventually take their home off the market, rent it out or join the many people in giving the home back to the bank.

It is important for you to understand what is going on in the market today.  If you get an offer, make it work!  It might be the last offer you will see for a long time, if not for the next 2 years! We want to give you the best possible advice given the current climate and your desire to sell. Today, buyers are buying price, and they want to make sure they are getting the best deal possible.  They simply do not want to be upside down the minute they move into their new home.

Have Great weekend.

Gitta

NOTE: For the full market update, including facts, figures, and other market indicators, go to Gitta's Blog right now!