Jeff Baxter

If you own rental property in Bethany Beach, get ready for a new town mandated safety checklist to protect your tenant's (even weekly summer visitor's) safety.

Bethany Beach Town Council members voted 5-1 at their Jan. 16 meeting to adopt the new safety checklist, which will be sent out to property owners each year as part of their rental license package from the town. Owners will be required to certify that every itme on the checklist is complete and in working order beginning with the 2010 summer rental season.

The required items include:

1. battery-operated smoke detectors for each bedroom in the rental home;
2. deadbolt locks that do not require interior keys;
3. ground-fault circuit interrupter (GFCI) protection on all outdoor electrical receptacles, bathroom receptacles, garage wall outlets, kitchen receptacles and all receptacles in crawl spaces;
4. a minimum of 4-inch-high exterior house numbers; and
5. secure window locks for all windows within 12 feet of grade and second-story windows accessible by fire escapes or stairs.

Rental property owners will be required in 2010 to submit a completed checklist with their license application. The checklist must be signed by the owner, to attest to the accuracy of the form, and notarized.

The town is offering the service of town staff to perform that notarization, free of charge at town hall. The notarization requirement was offered so the town could allow a "self-inspection" with the checklist instead of requiring a town employee to inspect for compliance in person.

You may have heard something about Reverse Mortgages lately - something changed - something big maybe? You heard right because something is changing with Reverse Mortgages. Beginning February 2nd, Seniors can now use a Reverse Mortgage to help purchase a home and never have to make a mortgage payment again.

This new program - an FHA insursed Reverse Mortgage for Purchase - can help Realtors list and sell more homes in Sussex County. We are a retirement destination for many seniors and before Reverse for Purchase was available, a senior had to have enough equity in their present home to sell and purchase a retirement home for cash if they didn't want a mortgage payment going into retirement.

Let's look at an example of how this might work. A senior (age 62+) with $125,000 in equity in their primary home and wishes to sell and move to a new home for retirement that costs $350,00. The Realtor lists and sells the departure home and writes a contract on the new purchase combining a $125,000 downpayment and $225,000 in Reverse Mortgage Purchase Money. The result: The Senior homeowner has no monthly mortgage payment.

The numbers vary with the age of the homeowner and current rates and you can use this calculator to get a good estimate of the numbers invovled in a specific scenario.

Reverse Mortgage for Purchase Calculator

This FHA program has strong consumer safeguards as well:

• Lower Fees
• Never Give Up Title to Home
• Never Owe More than Home's Value
• Never Have to Move
• Never Make a Payment on Principal or Interest (until last borrower dies, moves, or sells)

Plus, there are no income and credit qualification requirements for a Reverse Mortgage.

Always deal with a trusted advisor, escpecially so with a Reverse Mortgage. Always keep the Senior's family involved in all the decisions. I'll be happy to meet with you and discuss the basics of the program and then bring in a specialist to move things forward if the circumstances are right. Contact me directly for more information.

We get the question every day. How much will this home go up in value? Well, maybe not so much these days, but here's something to think about. What if your house never went up in value - should you still buy? Click below and get my answer. Hint: Emotion can be a big driver in the home purchase, especially for a first time buyer, but the down and dirty financial benefits are still big, even if prices don't appreciate.

Click Here For What if my house never goes up in value, should I still buy?

Let me know what you think.

Jeff

call at 302-602-1067

I said in my blog - A View from the Beach - over the weekend that the Fed might cut 3/4% and they did. I also said that mortgage rates probably would not go down if the Fed did cut by that much. Guess what - I was way wrong! CPI was down 1.7% this morning. November Housing Starts fell -19% to a record low of 625K annual units, far below the consensus of 730K. Building Permits, a leading indicator, showed a similar decline. Housing Starts were running at a 2.2 million unit annual pace in early 2006. The slowdown in the building of new homes will help reduce the inventory of unsold homes on the market. That's what we need now, a reduction in the glut of homes on the market.

For now, inflation is not a concern for investors. Add to that, the Fed statement that accompanied the rate cut this afternoon:

"In particular, the committee anticipates that weak economic conditions are likely to warrant exceptionally low levels of the federal funds rate for some time."

And further:

". . .over the next few quarters the Federal Reserve will purchase large quantities of agency debt and mortgage-backed securities to provide support to the mortgage and housing markets, and it stands ready to expand its purchases of agency debt and mortgage-backed securities as conditions warrant. The committee is also evaluating the potential benefits of purchasing longer-term Treasury securities."

Wow! Low rates for the foreseeable future and massive purchases of mortgage-back securities, expanded as conditions warrant. Based on this awesomely great news, the mortgage-backed markets spiked upwards (higher in price, LOWER in rate) almost immediately after the Fed announcement and stayed there. Here's a chart of the 5% Fannie Mae bond price action today. Spike at 2:15 pm when the annoucement came and higher prices held the rest of the session.

Naturally, I don't know where rates are going from here (5.125% with 0 points currently), but I'm expecting an unscheduled favorable re-pricing late this afternoon that could put us at 5% with 0 points or 4.75% with 1 point.

Can a Christmas present get any better than this for someone with good credit, documentable income, and at least 20% equity in their home? I'm seeing refi's saving people up to $500 per month in payment. ($400,000 mortgage at 6.50% to 5.125%) Look at your situation, look at your client's situation, and call me to discuss it.

Wow, what a day!

The Bethany Beach Holiday Happening is this Saturday, December 6 from 3 - 6 PM. Entertainment for the whole family! Musical entertainment begins at 3:00 PM with The Lord Baltimore Holiday Ensemble singing holiday favorites. Peaches, the clown will create her unique balloon art for all the young visitors while Miss Donna paints Christmas trees on young faces. Santa arrives by 4 o'clock via a fire truck. Hop on a horse-drawn carriage, a hay wagon or the town trolley for rides about town. Bundle up! All is Free and All are Welcome! Sunday, December 7, 4:30 - 6:30 PM is the annual ADULT Get-Together in Town Hall. Meet & Greet Your Neighbors and enjoy live music , refreshments and the festive decorations All is Free and All are Welcome!