Katie Evans

In the business, "Prime" is what you will hear many mortgage brokers refer to it. This is good news if you have a note that is tied to the prime rate.

For instance, most construction loans are prime + 1. Today that would mean the effective rate would be 5.5%. This is a huge drop. In December 2006, when we secured a construction loan for a $800,000 house prime was 8! What a major difference?!?

Does this drop in prime mean that mortgage rates will fall?

Generally speaking when prime drops, the stock market gains. Obviously we need a rally to boost consumer confidence.

When this happens investors will move their money from mortgage backed bonds to stocks to take advantage of the gain. The mortgage back bonds will drop.

These mortgage backed bonds are what lenders and investors look at to determine mortgage rates. Sometimes this does not effect rates. There are many other components to the system.

I hope this helps everyone understand the relationship to PRIME RATE and MORTGAGE RATES.

Just a short thought this morning in the aftermath of the bailout.......

Most of my short sale clients are on Disability or Social Services. The people who should not have owned a house to start with! However, with some certainty, a short sale usually prevents any judgments to the clients. What I am finding is the banks (the ones that are willing to work with me) want it off their books ASAP! Of course, we get that in writing.

If the govenment buys the bad debt.....

Are the debtors more likely to see a 1099 than before? In my opinion, that would be an easy way to run this buyout in the black. Make them pay taxes on it! Including interest and penalties.

What does everyone else think? Will see more 1099's? After all the only given in life is death and taxes!

This is an open post to all you consumers. That is right! The general public.

These are the Golden Rules of Being a buyer.

• When you decided who to use as your agent, email them. Be honest. Tell them that you want to do a little web searching on your own. Ask them for a sight recommendation. Most of the agents will have what we call and IDX data push.

What is an IDX Data Push?

Essentially, MLS is updated daily on their website. As a consumer, this will provide you with the most current data, pictures, and information on properties in our MLS.

• DO NOT GO TO OPEN HOUSES. Call your agent. They will be glad to show them to you. The other agent that is in that house is working for the seller. DO NOT TELL THEM HOW MUCH YOU LOVE THE HOUSE.
• Work with us NOT AGAINST US. When you decide that you do not want to buy, tell us IMMEDIATELY. IT only prolongs the pain. Which leads me to the next rule:
• GO HOME AND SLEEP ON IT. Do not base your decision on emoition. You have the upper hand these days!
• Listen to your agent. We have seen most of the houses that are out there. 567 days on the market is there for a reason!
• See a FSBO you like? CALL YOUR AGENT! That is worse than going to an open house. If you go FSBO, do not call your agent and ask them to help you. You are on your OWN!
• When we do not answer our phones, do not stalk us! I will call you back. UNLESS YOU BOUGHT THE FSBO and need my help!
• Get preapproved. Get reapproved. The rules change daily! Make sure you stay in contact with your lender.
• Verify that the agent gets a copy of your good faith estimate. How else will they EXACTLY what your closing costs would be.
• Do NOT CALL at 9:00 at night and ask for me to call you back ASAP. We are not robots. We have family, friends, and lifes. UNLESS we are negotiating, my phone is OFF at 7:30. I believe that 12 hours is enough time to get me.

Now I feel better! I am sure that there are so many that I forgot! Be a good buyer and your agent can focus on what matters the most: getting the best deal, with the least headache, in the least amount of time!