In November of 2009, I wrote a blog post entitled Was the Tax Credit Extension a Good Idea?Here is an excerpt:In my opinion, tax credits have become subsidies distorting the real estate market. I believe that any further extension or expansion of this program, with the exception of those benefits due our military, will be counterproductive. I say it’s time to help homeowners. Figure out how to give them $8,000 so that they don’t have to sell as a short sale. There are a lot of well loved homes in excellent condition that would make ideal homes for new buyers, creating move up buyers for other homes, that can’t be sold now because the sellers are upside down in their mortgages. A short sale may benefit a new buyer, but it eliminates another (for two years at least). Why not consider helping sellers with a monetized tax credit so that they can sell their home at market value, stop or minimize short sales and foreclosures eroding property values, get buyers into “non-distressed” homes and turn that seller into another buyer, thus propelling the market forward.Here is what I am experiencing today:I have received numerous requests through the holidays for market evaluations from homeowners who either bought, or refinanced, during the past 3 years. What I’m finding is that the value of these homes is almost as upside down as those of homeowners who bought in 2006-2007. Artificially inflated home sales prices, driven by subsidized demand, and used by appraisers to substantiate further inflated home sales prices, is setting the stage for Round 2 of the Great Housing Crisis. Not only will the various homebuyer tax credits burden the Federal budget deficit for years, we have now created a situation where the same homeowners who benefited from $7,500 – $8,000 in “cash back after closing”, are going to be in the distressed property boat along with everyone in the coming tide of foreclosures. Good luck getting THAT money back.The solution is simple stated. It’s about jobs. Always has been and always will be. How to create those jobs should be the domestic policy focus of 2011. Ideas?
Please let me know, by January 5th, if you would like to join me! I have four extra tickets available for non-Realtor ® guests. If you’re thinking about buying or selling a home, this event would provide much more relevant, decision making information than the news you get from any of the national media outlets. All real estate is local, and this is OUR local housing report.(Salt Lake Realtors) BOARD OF DIRECTORS MESSAGE… 2011 Salt Lake Housing Forecast Breakfast on Tuesday, Jan. 11 at 8 a.m. at the Little America Hotel in downtown Salt Lake City.This year Lawrence Yun, chief economist for the National Association of REALTORS, will speak on recent developments in the housing market and the direction home prices are headed in the next 12 to 24 months.In addition, a housing forecast by James Wood, director of the University of Utah’s Bureau of Economic and Business Research, will be distributed. This report will offer a glimpse of what is in store for Salt Lake County in 2011.Seating is limited. The deadline to register is Wednesday, Jan. 5. Members are free. $25 for guests.
Although it will be quiet through the week leading in to the new year, January 3rd, the first business Monday in 2011, will bring renewed activity to our real estate market. All indicators point to a January 2011 that will bring with it stabilization of home values and the quantitative beginnings of recovery in our local housing market. With both home prices and interest rates at historic lows, it is a perfect time to buy. With prices and rates bringing more buyers in to the market, it is a perfect time to sell. Good News Report – Utah’s Unemployment Rate Remains Significantly Below National Average Utah’s Employment Summary: November 2010
The news contained in this report is simply that 2011 will continue to be a strong buyer’s market. Sellers who have been holding off listing their homes for sale, anticipating real estate values to recover, are going to have to wait at least 12 – 18 more months to see any improvement. It is NOT going to happen this spring.This is not necessarily bad news. If a seller is also looking to buy a home, then they should be able to take advantage of home prices comparable to those in 1997. Interest rates are still at or below 5%. Two historic conditions that may not present themselves again.This is the time for savvy home owners, current or new, to take advantage of unprecedented opportunity in the housing market.Click here to watch the How’s Housing? Video Posted to: Mortgage and Real Estate Video News Wednesday, December 22, 2010 10:08 AM Discussing the state of the housing market and the impact rising interest rates are having on the housing inventory, with CNBC’s Diana Olick.
Update on KeyBank’s 100% Financing Program:In my last post about this topic, I referred to this as a “new” program. After meeting with Kristin Shields and Will Mullin, KeyBank Mortgage Advisor and Relationship Manager respectively, I know now that Key has had this program in place for +/- four years.Disclaimer: The information that I am sharing here is NOT to promote KeyBank. As a professional REALTOR ®, representing both buyers and sellers, it is my responsiblity to have a broad knowledge of available financing to achieve my client’s home ownership (or home sale) goals. Lender guidelines vary, the most significant of which is FICO score minimums. I have experienced some lender FICO requirements as high as 720. KeyBank’s 620 benchmark is extremely borrower friendly.The 100% program is actually called the “Key Community Mortgage“. I entered the meeting a skeptic. I left a believer. And I can’t wait to share this incredible financing opportunity with my clients. No other lender that I am aware of is offering a truly obtainable community mortgage such as this. I was even able to get a glowing recommendation about the program from a title officer who I know and trust, who has successfully closed a Key Community Mortgage.Meeting SummaryQuestion: Why is KeyBank offering this program? It seems too good to be true, or too good to last.Answer: This is Key’s way of meeting federal requirements for community investment.Question: What does this mean, realistically, in terms of purchase price and interest rate, for the borrower?Answer: A $500 minimum investment, approximately .25% add on to the interest rate (example: yesterday’s rate was 5.25% = .25% over yesterday’s VA rate), and, based on income guidelines, works ideally on a purchase price up to $180,000.Question: Are the funds available for this program limited, capped or budgeted?Answer: NOCool Program Details
For More Information Contact: Kristin Shields, Mortgage Advisor Phone: 801-792-2625 Fax: 216-370-9481 Email: Kristin_Shields@KeyBank.comTell Her You Read About the Program Here!
I have always been under the impression that the utilities must be on and the furnace, water heater, etc must be in operating condition when a VA appraiser appraises a home. Apparently, that isn’t the case. It is true for FHA appraisals, but not VA.This morning, I received a telephone call from a VA appraiser to schedule an appointment to get in to one of my (approved) short sale listings. I told him that the home was vacant, but that the seller had made arrangements with the utility companies to have utilities all on the previous week, for the buyer’s home inspection and appraisal – with the lender’s coordination. As of now, except for the electricity, the utilities have been shut off again.The appraiser informed me (much to my relief) that VA did not require that the utilities be on – only FHA appraisals have that condition. For VA, the appraisers operate under the “reasonable person” theory. The theory that a reasonable person, and prudent home buyer, would have a professional inspection to determine if the furnace, water heater, plumbing, etc were in proper working order.I have tried, unsuccessfully, to find the VA documentation to confirm this. What is interesting is that I cannot locate anything that says that the utilities MUST be on, either. In search of a definitive answer, I’ve posted the question on the Appraisal Institute’s Facebook Page and also joined the Appraisers Forum.Follow up to be posted. If you know the answer to this question, please post!Research Documents:VA Appraiser’s HandbookVA Pamphlet 26-7 Revised: Lender’s HandbookVA Pamphlet 26-7 Revised Chapter 12: Minimum Property Requirements (MPR)
I’m looking forward to a luncheon at Key Bank on Thursday, December 16th, as they introduce their new 100% financing loan product. .25% rate add, no mortgage insurance, 620 FICO score with no lates in past 12 months, income cap at $51,000. No first time homebuyer restrictions.Hope this provides some of my clients with an option for financing that they wouldn’t otherwise have.This is a conventional program that seems to offer a borrower more flexible guidelines to meet than Utah Housing, or even the standard FHA loan. Debt ratio not to exceed 42%. There is a minimum borrower’s investment of $500, which could be in the form of the buyer’s earnest money deposit.Follow up to be posted.
Finally, I’ve found the actual FHA regulation, a clear and concise breakdown of the waiver of FHA’s Anti-Flipping Rule. Surprisingly, the FHA ruling is quite simple reading, with easy, common sense conditions to meet. If any of you are dealing with individual lenders and their investors with flip situations right now, you know that these institutions all have their own “layer” of requirements that make it almost impossible to meet their guidelines.
Solution? Make sure that your lender doesn’t have their own policy restricting underwriting and financing of “flips” and has access to an investor who will honor the FHA guidelines, as written, without a third layer of restrictions and conditions.Layers are good if you’re Shrek, not so much if you’re a buyer’s agent trying to make your client’s first time home buying dream come true when they find that cute little remodel with the fenced backyard for her kids.
Absolutely the cutest house in town! Beautiful hardwood flooring, carpet in near perfect condition. Updated Americana themed kitchen, big dining area remodeled bathroom with cultured marble tub surround. Gas log “wood”stoves in living room & approximately 12′ x 25′ master bedroom. Pitched asphalt shingled roof. Double wide driveway & RV parking with gate to the backyard. Furnace has green sticker.Driving Directions: 4 blocks East of the railroad tracks. From Main St. in Sunset (aka 1900 W in Roy), turn W on 1300 N. Turn right (N) on 300 W to home (on W – left side of street). Kids walk 8 blocks to Sunset Elementary, 4 blocks to Sunset Jr High, bus to Northridge HS.
As a CDPE ® serving the communities surrounding Hill AFB UT, I compiled this handbook to aid my active duty, prior service and retired military clients understand their options to overcome obstacles created by the current mortgage and housing crisis. Click Here for a copy of my handbook.Although the primary subject matter relates to Foreclosure Prevention, there is also guidance on how to take advantage of the military benefits of the 2009 ARRA American Recovery & Reinvestment Act (original and enhanced). In particular is the Extended Dept. of Defense HAP Homeowners Assistance Program which provides relief in the event deployment or relocation creates a financial hardship due to the decline in local real estate market values.
If you need assistance, please contact me. I’m a voice for foreclosure prevention … You have options, I can help.
Kim Novak, CDPE: Certified Distressed Property Expert
(801) 726-1443 (800) 977-7835 firstname.lastname@example.org