Maria Marriott , Mortgage Advisor

Last week one of my clients got an accepted offer after making quite a few unsuccessful ones. If you're actively house hunting and making offers with no success, here's a story for you. Being a deligent agent, Debbie Baldes aways makes sure to check several times a day if new homes that fit her clients' specific needs came out in the market. And this time was no different. She noticed a new property in the market and scheduled an appointment that same day for our clients to see the inside. The house was a charm so she advised them to make an offer RIGHT AWAY. The reason behind the "right away" was because Debbie knew that the property wouldn't be around for long. Even days. They immediately got a verbal acceptance and the rest is history.

So what's the big deal? Well, the next day that same property had other offers up to $20,000 higher than our client's offer and if it wasn't for the sense of urgency and the trust between all parties, our buyers wouldn't be in escrow now and would risk loosing the chance of taking advantage of the $8,000 tax credit.

The lesson..."ACT NOW...THINK LATER", Debbie says. Don't be afraid of making an offer on a house that you like because you'll always have time to do all your inspections and due diligence. But you need to get the offer in. Listen to your agent.

hoIn this real estate environment it is crucial that you trust your Realtor. A few hours could make a difference. You sooze...you loose. With home prices as low as they are and rates at historic lows, investors are coming in with cash offers and the houses are going very fast. So make sure you work with an agent that understands the market and is pro-active. Follow their lead and you'll get the keys to your home.

To Your Success

Last week Mortgage Bonds finished at levels not seen since May 21 and home loan rates hit near historic lows. It’s hard to believe that some borrowers locked their interest rates under 5% on 30 year fixed rate mortgages. Stocks closed lower and the Dow market had its worse week since mid-June. As a result, money flowed to Bonds which helped home loan rates to stay low.

With weaker than expected Job Report for September and the unemployment rate of 9.8%, the Labor Department wasn’t showing much love for US workers. We also saw a decline in the Average Workweek and Average Hourly Earning. Both reports show the weakness in the labor market.

Personal Spending indicated that spending rose in August – the fastest monthly pace in almost 8 years. It sound like great news but we need to take into consideration the results of the “Cash for Clunkers” vehicle purchasing incentive, which is no longer in effect. Pending Home Sales were up above expectations which could be due to the $8,000 First Time Home Buyer Tax Credit set to expire on November 30. So if you're still thinking of taking advantage of this great incentive, it's certainly time to act and get off that fence.

I wonder if Timothy Geithner's home has sold yet... Check out what our Secretary Of The Treasury is trying to do with his house. It's hillarious!

Looking Forward

The markets may see some volatility due to the Treasury Department auctions coming up this week and the auctions will certainly compete with Mortgage Backed Securities. As you may or may not know, the Fed has decided to scale back their purchase of Mortgage Backed Securities so Mortgage Bonds may not get as much support now. We could see more of a wild ride on this week’s auctions than before.

Always Remember

When economic news are weak, money flows out of Stocks and into Bonds which helps the bond market and home loan rates to improve. Strong economic news usually has the opposite result.

To Your Success ~ Maria

In big news this week, the Fed said that there won't be any additional Mortgage Backed Securities purchase on top of what they've committed to buy. Instead, they'll slow down on the purchase and extend it through the first quarter of 2010 in order to provide a smooth transaction back to normal market conditions. It's important to remember that once the Fed stops purchasing Mortgage Backed Securities interest rates will start climbing. It also means that they'll be purchasing lower quantities since the remaining will be spread over a long period of time. Needless to say...we could see some home loan rates increase in the near term.

Existing Home Sales and New Home Sales reports came lower than expected but continue to show that the housing market seems to be getting a little better. Inventory of unsold existing and new homes went down. In the case of new homes it is partially because we haven't seen as many constructions as before.

Stocks struggled this past week and one of the reasons being concerns of Iran's nuclear sites construction. Stocks and Bonds could suffer some more if the situation escalates. There's a meeting scheduled for Thursday where members of six nations will discuss the situation further.

Durable Goods Orders fell in August and adding stocks struggles to that, the Bond market did well and we saw some improvements on interest rates.

Looking Forward...

The biggest report coming out this week is the Jobs Report for September. It's a very important one because it can show signs of an improved economy. August report wasn't good so hopefully we'll see something a little better.

Other reports coming out this week...Consumer Confidence (Tuesday), Core Personal Consumption Expenditure (PCE) Index (Thursday) - Fed's favorite measure of inflation, and the Jobless Claims report just before the Job Report on Friday.

Remember...Weak economic news causes moneys to flow from Stocks to Bonds, helping home loan interest rates. Strong news has the opposite effect.

To Your Success ~

Maria

It is no news that the current real estate market has attracted a large number of real estate investors. With all the great deals available and home loan interest rates extremely attractive it has become evident that some investors are taking advantage of the market by doing what is called “flipping”. Flipping is when an investor purchases a real estate property, makes some improvements and sells it for a profit.

If you’ve been involved with flipping, you’re aware of the “90 Day Flipping Rule” but if you haven’t here’s the scoop on this very important rule that could change the course of your real estate transaction. Based on the “90 Day Flipping Rule” a lender won’t approve financing on a property that is being flipped within the first 90 days. So it’s extremely important that all parties involved in the transaction know the last time that specific property was sold. If it’s been less than 90 days a buyer may have to review their financing options. If purchasing with cash…no problem. But if financing is necessary, the buyer needs to make sure they're getting the correct mortgage.

FHA loans are now very popular but will be a problem for flipping properties. You see, HUD won’t allow flipping within the first 90 days so it’s in your best interest not to even get in contract until the 91st day. VA loans are OK.

Technically the rule does not apply to conventional loans (Fannie and Freddie) but it’s smart to make sure your mortgage professional is aware of each lender’s specific guidelines. Even though the rule doesn’t technically apply to conventional financing, different lenders will have their own “overlays” that could get in the way. Banks will look at the new appraised value, amount of profit, etc, and if not within the investor’s parameters it could be a problem. So the rule will vary from lender to lender and it’s crucial that your mortgage professional knows which lender to use in order to avoid surprises, especially after you’ve invested your time and money.

To Your Success ~

Maria

Nope. It's not about beef!
It's about a great zero down payment home loan.

USDA Rural Development's Guaranteed Rural Housing Program is designed to assist home buyers who have dependable income and satisfactory credit history, but not the down payment funds. It's a great option for home buyers who need 100% financing.

Here are the highlights:

- 100% financing. No down payment required
- No loan limits or sales price limits.
- Income limits will apply
- No monthly mortgage insurance - This is a big one!
- You DO NOT HAVE to be a first time buyer
- Sellers can credit up to 6% of purchase price towards buyers' closing costs
- No cash reserve requirements
- Property must be USDA eligible
- Property must be owner occupied

This is a great program that has been helping hundreds of home buyers.

CLICK HERE for income limits

If you'd like more information about USDA home loan program, please feel free to call me.

To Your Success ~
Maria

Maria@MariaMarriott.com

www.MortgageMinutesAndMore.com