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More people buying homes

Minneapolis, MN:  An index that measures the number of people signing home purchase agreements jumped in October to its highest level in nearly six years.

Slightly lower unemployment rates, combined with historically low mortgage interest rates, bottom of the market home prices, and higher consumer confidence levels have made home buying more attractive.

It will be interesting to see how this plays out with reports after the election and the dramatic tax changes coming soon.

The National Association of Realtors said that seasonally adjusted pending sales rose 5.2%. Except for a few months when there was a $8,000 home buyer tax credit, this means the index is the highest since March 2007.

There is generally about a 60-day gap between a signed purchase agreement and a closed transaction.

 

Mortgages rates basically unchanged for week ending 11/23/2012

Mortgage Rates Basically Unchanged

Freddie Mac today released the results of its Primary Mortgage Market Survey® (PMMS®), showing fixed mortgage rates virtually unchanged and remaining near their record lows amid growing concerns around the fiscal cliff. The 30-year fixed-rate mortgage has averaged below 4.00 percent all but one week in 2012, while the 15-year fixed-rate mortgage has averaged below 3.00 percent since the last week in May.

News Facts

  • 30-year fixed-rate mortgages (FRM) averaged 3.32 percent with an average 0.8 point for the week ending November 29, 2012, up from last week when it averaged 3.31 percent. Last year at this time, the 30-year FRM averaged 4.00 percent.
  • 15-year fixed rate mortgages this week averaged 2.64 percent with an average 0.6 point, up from last week when it averaged 2.63 percent. A year ago at this time, the 15-year FRM averaged 3.30 percent.
  • 5-year adjustable rate mortgages (ARM) averaged 2.72 percent this week with an average 0.6 point, down from last week when it averaged 2.74 percent. A year ago, the 5-year ARM averaged 2.90 percent.

Quotes Attributed to Frank Nothaft, vice president and chief economist, Freddie Mac.

“Mortgage rates were virtually unchanged this week amid growing concerns around the fiscal cliff. Although low mortgage rates failed to boost new home sales in October, year-to-date sales are up 20 percent compared with 2011 volumes, and there are growing signs of a turnaround in house prices. The S&P/Case-Shiller® national home price index (seasonally adjusted) rose 5.2 percent over the first three quarters of this year. In addition, all 20 of the city indices (seasonally adjusted) had positive growth over the first 9 months, led by a 17.9 percent increase in Phoenix. More recently, the Federal Reserve’s November 28th regional economic review, known as the Beige Book, noted that 10 of the 12 districts reported the market for single-family homes continued to improve leading into mid-November.”

Freddie Mac’s survey is the average of loans bought from lenders * last week, including discount points. Applicants must pay all closing costs at these rates. No cost loan rates higher.

Follow this link to view today’s best MN and WI mortgage interest rates.

 

FHA Mortgage Insurance soon to be for life of loan

FHA Mortgage Insurance soon may be for life of loan

Minneapolis, MN:  The Federal Housing Administration (FHA) has announced that sometime in 2013, all new FHA insured mortgage loans will now require the monthly mortgage insurance be on the loan for the entire LIFE OF LOAN.

The proposed rule is NOT official — Yet.

Currently, FHA mortgage insurance premiums drop from FHA insured loans once the loan balance reaches 78% of the original balance and the home owner has had the loan at least 5-years.

FHA has not giving an official starting date yet, but it will be on all NEW loans going forward, and WILL NOT effect existing FHA insured home loans. Any existing FHA insured loan will still be able to drop mortgage insurance (PMI).

Most NEW FHA insured loans are just 3.5% down payment – therefore the mortgage insurance is currently 1.25% of the loan amount monthly. FHA has also announced that in 2013, the cost of the insurance will increase to 1.35% monthly.

As an example, on a $100,000 FHA insured loan, the homeowner will pay $112.50 in mortgage insurance every month for the entire 30-year loan.

For those capable, meeting both the higher credit score and underwriting guidelines, moving to a conventional loan with 5% down is going to result in very significant savings over an FHA mortgage loan going forward.

FHA has indicated they are making this move to increase their capital reserves after suffering major losses due to foreclosures and the mortgage market meltdown. The vast majority of the losses are attributed to loans written from 2007 – 2009 as lenders moved marginal home buyers into FHA loans after sub-prime loans disappeared from the market in 2007.

 FHA home mortgage loans will still remain a great option for many buyers, but clearly FHA has indicated they do not want to be the loan for everyone.

 

 

AmeriSave Mortgage Class Action Lawsuit

Minneapolis, MN: If you are on the internet, you are bound to see multiple ads from Amerisave Mortgage. They are everywhere!  Thier advertisements always proclaim to have what would be the best interest rates in the market.

To any industry insider, there were, and continue to be, serious reservations about those claims, and the practices of the company. Assuming they really could offer those amazing interest rates, every other company offering mortgage loans – banks, brokers, and lenders, would all be out of business!

Finally, someone has taken them to task.  Mehri & Skalet, in conjunction with co-counsel, filed a class action lawsuit against Amerisave Mortgage Corporation for violating the Truth in Lending Act and state consumer protection statutes. Plaintiffs allege that Amerisave engaged in unfair and deceptive practices in the selling of residential mortgages.

The lawsuit alleges that Amerisave promises customers they can quickly obtain a “lock-in” of a low interest rate, and requires the customer to pay upfront fees in order to obtain it. The Amerisave class action complaint contends that the company does not actually provide the rate lock and/or does not approve the loan, for reasons unrelated to the credit-worthiness of the customer.

READ THE WHOLE STORY and visit www.amerisavemortgagesettlement.com if you feel you are a victim of Amerisave

Word of advice? Never use some out-state internet based lender. There is NOTHING they can offer that you can’t get from the local mortgage company down the street. Go visit the local lender for a face-to-face visist when getting the largest financial transaction of your life!

 

FHA Announces Loan Fee Increases

Minneapolis, MN: Thinking of getting an FHA home loan?  The Federal Housing Administration, commonly known as FHA just announced increases to mortgage insurance fees it charges homes owners by 10 basis points, or 0.10%.  This is on top of the massive fee increase from last year, which effectively doubled the cost of FHA mortgage insurance.

Swamped with a record $70 billion of claims from lenders on loans originated from 2007- 2009, the Federal Housing Administration Friday said it had no choice but to hike monthly mortgage insurance.

With the fee increase, the typical FHA borrower will now pay 1.35% of their loan amount per year in mortgage insurance. For example, a home with a $100,000 mortgage will now pay $112.50 a month in PMI. FHA said the fee increase will average $13.00 a month. Two years ago, the same $100,000 home would have only paid $45.83  a month.

The increase is designed to fix a reported a 16.3 billion deficiency in the FHA insurance fund as a result of defaulted loans insured during the housing crisis. While the mutual mortgage insurance fund shortage was projected at $13.48, this estimate is still well below the 2011 estimate of $14.67 billion.

FHA does actually do home loans, they insure the loans, which means lenders are more likely to do the loans knowing they have insurance on the loans against any losses. The increase insurance will greatly lessen the chances that the FHA will require a Government bailout to cover losses.

The Federal Housing Administration, currently insures about 16% of all home mortgages.

Banks cut mortgage balances for lucky few

Five banks cut mortgage balances by $6.3 billion

Five of the biggest U.S. banks have cut struggling homeowners’ mortgage balances by $6.3 billion, part of a total $26.1 billion in home loan relief provided under a landmark federal settlement.

More than 309,000 borrowers got mortgage relief between March 1 and Sept. 30, according to a report issued Monday, Nov. 19 by those who monitors the settlement.  $13.1 billion of the $26.1 billion in relief was in the form of short sales, in which lenders agree to accept less than what the seller owes Another $1.4 billion in relief was provided by refinancing 37,396 home loans with an average principal balance of $210,398.

Banks also had $4.2 billion worth of loans under trial modifications. That could lead to permanent reduction in loan balances of $135,223 per borrower. All told, banks erased about $2.6 billion in first-lien loans and $2.8 billion in second-lien loans.

The federal government and state attorneys general for 49 states forged the $25 billion settlement in February with five banks: Ally Financial Inc., Bank of America Corp., JPMorgan Chase & Co., Citigroup Inc., and Wells Fargo & Co.

Mortgage rates set new record lows for week ending Nov 9, 2012

Mortgage Rates Dip To New Record Lows *

Minneapolis, MN.  Freddie Mac today released the results of its Primary Mortgage Market Survey® (PMMS®), showing fixed mortgage rates dipping to new all-time record lows amid indicators of higher consumer confidence and lower wholesale prices. The previous record low for the 30-year fixed was set the week of October 4, when it averaged 3.36 percent, and the 15-year fixed was set the week of October 18, when it averaged 2.66 percent.

News Facts

  • 30-year fixed-rate mortgages (FRM) averaged 3.34 percent with an average 0.7 point for the week ending November 15, 2012, down from last week when it averaged 3.40 percent. Last year at this time, the 30-year FRM averaged 4.00 percent.
  • 15-year mortgages this week averaged 2.65 percent with an average 0.7 point, down from last week when it averaged 2.69 percent. A year ago at this time, the 15-year FRM averaged 3.31 percent.
  • 5-year adjustable (ARM) Mortgages (ARM) averaged 2.74 percent this week with an average 0.6 point, up from last week when it averaged 2.73 percent. A year ago, the 5-year ARM averaged 2.97 percent.

Quotes

Attributed to Frank Nothaft, vice president and chief economist, Freddie Mac.

“Fixed mortgage rates eased this week to record lows on indicators of higher consumer confidence and lower wholesale prices. Consumer sentiment rose in November to the highest reading since July 2007 according to the University of Michigan. Meanwhile, the core producer price index fell 0.2 percent in October.”

Freddie Mac’s survey is the average of loans bought from lenders * last week, including discount points. Applicants must pay all closing costs at these rates. No cost loan rates higher.

Follow this link to view today’s best MN and WI mortgage interest rates.

Interview Questions for your Real Estate Agent

Buying or Selling A Home? Questions to ask your REALTOR®

1.  How does this Agent work?  Certain hours a day?  Certain days of the week?  Will you be able to find a mutually agreeable time frame? Full time, or part-time agent?

2.  What experience does this Agent have?  Do they have a specialty?  It’s difficult for a commercial Agent to sell a residential home.  The forms are different, terms, negotiations, etc.  Make sure they are capable of helping you in the type of real estate you are looking to purchase.

3.  How many successful transactions has this Agent had under their belt?  It’s not necessary for an Agent to be the highest top producer, but you need to know how versed they are in the entire process.  Asking a trusted friend for a referral might help you in this area.

4.  What happens if the Agent is out of town, calls in sick or just can’t make your scheduled times?  Does this Agent work with a Team, or have a designated assistant that can fill in, or will you have to wait for the Agent to return back to work to help you?

5.  And lastly an understanding of the expectations of all parties involved.

 

Low appraisals hurting housing recovery

Story from KARE TV in Minneapolis / St Paul, MN. Story touches on it lightly, but misses the major issue that new mortgage lender / appraiser rules put into place in 2009, known as HVCC (Home Value Code of Conduct), now simply known as the Appraiser Independence rules, are the real problem. Appraisers are the holders of the countries equity, and the new rules have caused trillions of dollars in lost equity.

What do you think?

 

I messed up on my credit card and need your help

I messed up on my credit card and need your help

I’m not a bad guy.. but I screwed up and need your help.  You see, I make a pretty good income, and I’ve tried to stay within my budget but things have gotten away on me.

First I paid my bills on time, but like so many others, I wanted things I can’t really afford. My solution was to apply for credit. With my good previous history, a was able to get a cool card with a gigantic limit.  At first I only put a little on the card, and making the payments was easy and pain free. I continued this for a long time, only to open the monthly statement to realize my balance was now 4 times my yearly income. I had way over extended myself.

I knew I had to stop spending more than I make, but I just couldn’t. It started to get even worse when my kids kept asking for things, and I just kept buying them. After awhile, it got so bad, I was now taking cash advances on my credit card just to make payments on my credit card.

The first thing I figured was I needed to cut off the kids.  I asked them if I could stop helping them, but they begged and cried because they had become dependent on me paying bills they should be responsible enough to pay themselves.  I kept pushing them, but they literally protested in the streets until I caved in. To keep their love, I kept paying their way for them.

To make it worse, many of their friends figured out I am a pushover, so they knocked on my door and asked me to fix their cars, help them catch up on their mortgages, and even to pay the banks back for some checks they bounced.  Like an idiot, I did. This added a huge amount to my credit card balance – but at least I made these other people happy.

I’ve gotten a few raises along the way, and while this helped a little bit, there was no way I was ever going to make enough money for this house of cards to work.  Fiscal disaster was on the horizon, as my credit cards were just about maxed out, and I just couldn’t pay down the balance fast enough. I kept saying – if I just had more money.

In desperation, last spring, I asked the credit card companies to raise my limits…  AND THEY DID!  How crazy was that? This gave me a little breathing room, but I just kept spending and spending, and now it looks like the end is finally near.

I need your help. Seeing as I can not control my spending, and I can not get the kids to stop demanding money, with my card maxed out, it will force me into a personal disaster of  defaulting on my credit cards, house payment, and car loan.

Will you please donate money to me so I can keep up my spending habits?   Please???

So who am I?  The United States Government.

The Democrats solution is to tax more. Unfortunately, you can claim that taxing the rich will solve the problem, but you’ll never be able to tax enough to make it work.

The Republican solution is to reduce spending.  I really do make enough money, I just spend way too much.

Nov 6th 2012 – The kids voted. They voted to keep their spending habits and the fiscal cliff is coming. Selfish bastards.

(C) 2012 – Joe Metzler.  Please forward but do not  remove my name – Originally Posted on www.MNRealEstateDaily.com 

 

Mortgages rates hover near record lows for week ending Nov 2, 2012

Mortgage Rates Settle in Near Record Lows

Minneapolis, MN: Freddie Mac today released the results of its Primary Mortgage Market Survey® (PMMS®), showing fixed mortgage rates mixed following the monthly employment report but continuing to hover near their record lows over the past six weeks. Last year at this time, the 30-year fixed-rate mortgage averaged 3.99 percent, dropping below 4.00 percent for the first time since Freddie Mac started reporting its weekly mortgage rates survey in 1971.

News Facts

  • 30-year fixed-rate mortgages (FRM) averaged 3.40 percent with an average 0.7 point for the week ending November 8, 2012, up from last week when it averaged 3.39 percent. Last year at this time, the 30-year FRM averaged 3.99 percent.
  • 15-year fixed rate mortgages this week averaged 2.69 percent with an average 0.7 point, down from last week when it averaged 2.70 percent. A year ago at this time, the 15-year FRM averaged 3.30 percent.
  • 5-year adjustable mortgages (ARM) averaged 2.73 percent this week with an average 0.6 point, down from last week when it averaged 2.74 percent. A year ago, the 5-year ARM averaged 2.98 percent.

Quotes

Attributed to Frank Nothaft, vice president and chief economist, Freddie Mac.

“Mortgage rates remained near record lows following the employment report for October. The economy added 171,000 jobs, above the market consensus forecast, and the two prior months were revised up a combined 84,000. The Labor Department also reported that the unemployment rate ticked up to 7.9 percent and that average hourly wages were unchanged.”

Freddie Mac’s survey is the average of loans bought from lenders last week, including discount points. Applicants must pay all closing costs at these rates. No cost loan rates higher.

Follow this link to view today’s MN and WI mortgage interest rates.

 

The FHA 203k Rehab Loan in MN / Fix a Fixer-Upper

Found your dream home – But it needs a little repair? The FHA 203k rehab loan to the rescue!

Minneapolis, MN: The FHA  203(k) loan program offers borrowers the resources to buy that great fixed-upper home opportunity. One single loan is used to pay for the purchase (or refinance) and the cost of renovating the home.

There is no doubt that the current real estate market offers a lot of great bargains on bank owned, Foreclosed, REO, Repo’d, etc homes. However,  many of these homes are in poor condition. Missing appliances, ruined carpet & flooring, holes in the wall, etc.  Most lenders don’t offer loan programs that will be able to help folks buy homes in this condition.

This is where a little known program called the FHA 203K Rehab loan comes in. The FHA 203K Rehab loan is becoming very necessary for the purchase of many Bank Owned, REO, or Repo properties.

FHA 203K streamlines loans make the process of buying a home that needs a little TLC (or quite a bit in some cases!) easier, more affordable, and quicker. Many of us have seen firsthand, or have heard stories about foreclosed home that have been torn up, stripped, vandalized, etc. With conventional financing, these homes are very difficult to sell or buy, as they are not in move in condition, and most lenders will not lend on a damaged home.

 

Is a 203(k) Loan Right for You?

  • Buy a “Fixer-upper” or REO property needing renovation
  • Get funds to both purchase and upgrade your dream home
  • Refinance and renovate your existing home

Advantages of 203(k)

  • Loan amount based on the home value including renovations
  • Only one loan needed to both purchase and improve
  • Refinance and rehab your own home

Can be used to buy property otherwise not eligible for financing

Who Qualifies?

  • A minimum down payment of 3.5%
  • A credit score of 640 or higher
  • You currently have no other FHA loans
  • You DO NOT have to be a first-time buyer
  • Home will appraiser for the purchase price PLUS repair costs
  • Loan amount meets FHA Loan limits, which vary by county (Check FHA  limits in your area)

 Download a Streamline 203K Presentation

 Download a Free Home Buyer Handbook

Mortgages Rates for week ending Oct 26th, 2012

Mortgage Rates Continue To Hover Near Record Lows

St Paul, MN: Freddie Mac today released the results of its Primary Mortgage Market Survey® (PMMS®), showing fixed mortgage rates moving slightly lower while continuing to remain near their all-time lows this week amid signs of a growing economy and low inflation.

News Facts

  • 30-year fixed-rate mortgage rates (FRM) averaged 3.39 percent with an average 0.7 point for the week ending November 1, 2012, down from last week when it averaged 3.41 percent. Last year at this time, the 30-year FRM averaged 4.00 percent.
  • 15-year fixed rates mortgage rates this week averaged 2.70 percent with an average 0.7 point, down from last week when it averaged 2.72 percent. A year ago at this time, the 15-year FRM averaged 3.31 percent.
  • 5-year adjustable mortgage rates (ARM) averaged 2.74 percent this week with an average 0.6 point, down from last week when it averaged 2.75 percent. A year ago, the 5-year ARM averaged 2.96 percent.

Quotes

Attributed to Frank Nothaft, vice president and chief economist, Freddie Mac.

“Mortgage rates remained relatively unchanged this week on signs of a growing economy and low inflation. The economy grew 2.0 percent in the third quarter with residential fixed investment contributing 0.3 percentage points to growth. The core price index of personal consumer expenditures grew 1.7 percent between September 2011 and 2012 and was within the Federal Reserve’s preferred target range.”

Freddie Mac’s survey is the average of loans bought from lenders last week, including discount points. Applicants must pay all closing costs at these rates. No cost loan rates higher.

Follow this link to view today’s MN and WI mortgage interest rates.