Point Your Future Toward Blue Skies

These days, after much upheaval and 7.9 million homes lost to foreclosure since 2007, the landscape has changed – banks would rather agree to a sales price below the amount owed, than get stuck with another foreclosure. The U.S. Treasury’s Home Affordable Foreclosure Alternatives (HAFA) Program are offering cash relocation assistance to qualified homeowners and the push to correct the housing market has caused positive changes in the short sale process.

It is time to point your future toward blue skies – if you are no longer able to make your monthly mortgage payment and you owe more than your home is worth, it is time to ask for help. For homeowners who qualify, the HAFA Program can offer:

•  $3000 in CASH relocation assistance
• Reassurance the foreclosure process will be stopped during the short sale process
• A waiver on deficiency judgments following the sale completion, which means the lender, will not attempt to collect the difference owed between sales price and mortgage balance

What is your New Year’s Resolution?

Happy New Year! I can hardly believe there are only a few more days left of this year – and what a year it has been. What will be your New Year’s Resolution? Perhaps buying a home is at the top of the list. As the final reports for 2011 are starting to roll out, I want to share some interesting statistics about our Phoenix Real Estate Market to help you decide if the New Year will be a good time to buy.

According to ABC news online, “October's decline in home prices was driven by slides in major cities, including New York, which has, over the past several years, exhibited more stable prices than many other regions, said Guy LeBas, chief fixed income strategist with Janney Capital Markets. Nineteen of the 20 cities analyzed had decreases in home prices over the month. Phoenix was the only one of the 20 areas that had a positive monthly change at 0.3 percent.”

The National Association of Realtors also posted some positive insights regarding the housing market. “Other recent good news for the housing market: November sales of existing homes increased 12 percent year-over-year, new-home building starts were up nearly 21 percent year-over-year, and mortgage rates reached new record lows last week, pushing housing affordability even higher.”

Our Phoenix market is seeing signs of improvement, from low inventory, less foreclosures and more short sale approvals. When inventory is low, the law of supply-and-demand will naturally cause the values to rise. If you are waiting to see if the market has bottomed out, you might not want to wait much longer – if you want to take advantage of the pricing opportunities available now, buying a home should be on your New Year’s Resolutions!

And just in case you didn’t know, mortgage rates have no fallen to a new “record-low.” Freddie Mac, or the Federal Home Loan Mortgage Corporation announced last week that the 30-year fixed mortgage rate is 3.91 percent. This “new all-time low” has dropped below the previous 3.94 percent, which was the record low.

Santa has a Message for you!

In between the hustle and bustle of shopping, cooking, parties and all night wrapping, remember to take time to celebrate the magic of the season with those you cherish. I thought you might enjoy this great website I found which will help you capture the spirit of the St. Nick.

The Portable North Pole creates a personal message direct from Santa Claus – it only takes a few moments to create a memory that will last throughout the New Year. I hope you enjoy!

7 Tips to Saving Money for a Down Payment

If buying a home is on your New Year’s resolutions for 2012, here are a 7 tips you can implement to help you save the money you need for a down payment. Buying a home today has never been easier or more affordable!

1.)    Have a budget

I know none of us what to think about the dreaded word “budget” however it is an essential piece to buying a home – not only will the discipline of a budget help you save the money you need for a down payment, in the long run, it will help you be a more financially responsible homeowner.

2.)    Avoid the QT

Let’s face it, they are not called QT without good reason! And although they are “quick trips” and oh so very convenient, they wreak havoc on our budgets. Avoid paying the price for convenience and you will see a huge improvement in your checking account.

3.)    Track your spending

Not everyone enjoys maintaining a running spreadsheet of their daily expenditures however, tracking your spending is an important part to saving the money you need for a down payment. If you don’t know what you are spending money on and how much, then you will never be able to maintain a good, solid budget. Even if you can spend 10 minutes at the end of each week to tally up your receipts, you would have a better handle on your spending.

4.)    Have a list

Before you leave the house on Saturday morning to run your errands, make a list. Know what you need before you get to the store – it will help avoid over spending on things you don’t necessarily need right then.

5.)    Paint a picture of your new home

If buying a home is on your New Year’s resolutions, then I encourage you to do a little painting – with your mind! Sit down for 30 minutes and create a picture of what your home will look like. If you aren’t the creativity type, then use the Internet to help you out. Print a picture of the house you would like to own and put a copy on the refrigerator or on your bathroom mirror. Having a visual reminder will help you stay on track with your savings plan.

6.)    Pay cash when you can

Now days you hardly see anyone paying cash for purchases – instead we reach for our super convenient, handy-dandy debt cards. But the problem with using “debt cards” is our awareness to how much we are spending. When I was growing up, we wrote checks and had to balance our check books – just because we had checks didn’t mean we had an unlimited supply of money! Paying cash has a different emotional feeling than swiping a debt card. The money is taken from your hand and it is literally gone – you realize how far a $1.00 goes when you pay cash.

7.)    Avoid the impulse purchase

Did you know that most major shopping stores spend millions of dollars each year to find way to improve the “impulse purchase?” Did you ever notice all the really great merchandise strategically placed at the front of the store so it is “convenient” for you to throw in the cart? In order to be successfully at saving the money you need for a down payment, you will need to practice impulse control. Try implementing a rule that only allows you to spend a certain dollar amount on thing that are not on your list or perhaps you wait a few days to think about the purchase before you react to the urge to buy it now. You might realize tomorrow that you don’t really don’t need it after all!

If you or someone you know is thinking about purchasing a home in 2012, please give me a call – I can help you stay on track so you can save the money you need for a down payment!

623-362-3035
BarbHenderson@remax.net
Join me on Facebook!

Reverse Mortgages: good or bad?

With the change in the economy and the housing market, some homeowners may be looking for alternatives for cash reserves. I am sure you have heard the increased exposure and advertising about the Reserve Mortgage. Of course, as with any big financial decision it is wise to consult with a loan officer who is skilled and knowledgeable about the loan program before you make a decision.

Reserve Mortgages: the bad

1.)    Reserve Mortgages cost more than a typical loan
With a Reverse Mortgages the borrower has to pay a loan origination fee plus the HUD Up-Front Mortgage Insurance. Depending how the homeowner chooses to take their loan funds, it may end up costing more in the long run. A Reserve Mortgage loan balance grows over time and the fees are based on the principal loan limit or the appraised value, whichever is less.
2.)    Eligibility changes
For seniors who do not plan to pay off their current mortgage but wish to take all their Reserve Mortgage funds up front, could face possible challenges with need-based programs. By having a large sum of cash available, they may limit or restrict eligibility for programs, like Medicaid.
3.)    Higher risk for scams
Elderly people are the target of unscrupulous individuals who are looking for ways to scam or steal from them. This is especially true for seniors with large sums of cash. Be wary of people looking to “sell” or help you “invest” your money.
4.)    Who is responsible?
When there is an age difference between two homeowners, where one is younger than the other, it is tempting to remove the young borrower from the title and only use the older borrower for the Reserve Mortgage. If this is done, there should always be adequate insurance coverage or another plan in place in case the older borrower should pass on. This would leave the younger spouse responsible for the balance, which they may or may not be able to qualify for, leaving the property at risk for foreclosure.
5.)    Additional costs
Homeowners should keep in mind they are always responsible for the upkeep of the property as well as for the property taxes and insurance costs.

Reserve Mortgages: the good

1.)   Benefit
The biggest benefit a Reserve Mortgage offers is the opportunity to live in their home with no monthly mortgage payment (loan is repaid after they leave the home).
2.)   Other liens
A Reserve Mortgage can be taken out on a property, even if there is existing financing on the home or it is free and clear.
3.)   No income or credit requirements
A borrower does not need monthly income to qualify for a Reserve Mortgage, nor are there any credit requirement to meet in order to qualify. And the loans are government insured.
4.)   No monthly payment
With traditional financing, conventional or FHA loans, the borrower has to make a monthly mortgage payment. With a Reverse Mortgage, the borrower does not have to make any payments, so long as they are living in the property.
5.)   Ownership does not change
The borrower always maintains ownership of their property and then passes onto their heirs. Reserve Mortgage proceeds are tax free and the homeowner can use the funds however they wish.

Reverse Mortgages can offer a good solution for certain individuals – they are not suitable for everyone and must be reviewed thoroughly to make sure it is the right decision for your financial situation. If you are interested in learning more, please call me. I can recommend an expert loan officer to help you determine whether or not a Reserve Mortgage is good or bad.

623-362-3035
BarbHenderson@remax.net
Follow Me on Facebook!

Presently, there are only 16,376 homes on the market for Maricopa County. In 2009 there were roughly 60,000 homes for sale! The more startling number is the sale pendings – 16,089 homes in Maricopa County are presently under contract – that is nearly equal to all available inventory! When the “housing bubble” burst in 2008-2009 there were speculations that we had a years and years of inventory for sale and it would take a decade to dig out from under it. I think, all things considered, the fact there are less than 20,000 homes for sale in the 6^th largest city in the U.S. is a great sign of positive changes in our real estate market.

What do the changes to Obama’s new refi program mean to you?

By now you have heard the buzz about the new changes to the HARP program as announced this week by President Obama. The changes are a revamp to the existing HARP program which was put into place in 2009 to assist homeowners avoid foreclosure. So what does this mean for you?

There are several key changes that have been made to the program, which will open up the edibility of nearly 1 million underwater homeowners. Here is a brief overview of the changes:

·         Must be current on mortgage payment

·         The revised program will eliminate the 125% loan-to-value

·         There will no longer be a requirement to have 20% equity in the home

·         Mortgages backed by Fannie and/or Freddie Mac and originally sold to the GSE’s on or before May 31^st 2009 are eligible for the new refinance program

·         Fannie Mae and Freddie Mac have done away with the requirement for a new appraisal

·         HARP program has been extended from June 30, 2012 through December 31, 2013

We hope to see the changes in place as early as December 1^st 2011. With the options available now, homeowners will be able to take advantage of the low interest rates and free up monthly income they would have otherwise been paying to their mortgage bill. Officials for HAFA and HARP believe the improvements to the program will help prevent future strategic foreclosure.

If you are not sure if you qualify or if you have a Fannie Mae or Freddie Mac loan, please give me a call – I can help you. 623-362-3035.

Top 10 Halloween Safety Tips
Halloween is a festive time of year for every member of the family, especially the young ones who like to get dressed up. In order to help everyone have a safe and happy Halloween this year, I have put together a top 10 list of Halloween Safety Tips for you.

1.)    Children under the age of 12 should never go trick or treating without supervision. Even if your child doesn’t like it, you or someone old enough should chaperon. When they get to the door, make sure the person who answers can see there is an adult with them. For children over 12 years, you should always establish a curfew time for their return home.

2.)    If you don’t live in an area that is safe for trick or treating, you can always attend a community event. Many cities, libraries, churches, recreation centers, etc offer a planned Halloween event with games and custom contests and best of all, the treats!

3.)    Plan a route for trick or treating before you leave the house. Planning ahead will avoid potential danger.

4.)    Make sure your child’s costume is safe. If they are wearing a dark colored material, it is a good idea to attach something that glows or is reflective so they can be seen by others, especially those driving in vehicles. Make sure your child can breathe properly and can see clearly if they are wearing anything that covers their head as a part of their costume.

5.)    Teach your children about stranger danger. Create a plan in case something happens. You can provide your child with a wristband or a slip of paper in their pocket with their address, phone number in case of an emergency.

6.)    Never let your children eat their treats until you have had a chance to inspect them. Candy that has been tampered with can cause serious health risks.

7.)    Teach your children how to cross the street safely. Make sure they stop and look both ways before entering the street.

8.)    If your child should get lost, teach them how to ask for help and who to look for.

9.)    When approaching a house, make sure you only choose houses that are well lite and in safe areas.

10.) Practice safety first so you can enjoy Halloween!