WHEN CAN I BUY A HOME

          So if you have had a foreclosure or short sale or bankruptcy – when can you buy a home? The chart attached from the Realtor Magazine, March 2013 provides some helpful information. All cases are different so this chart is not set in stone. We just closed a couple who short saled their home 2 years ago and they were ready to buy. The key is to re-establish good credit after the incident took place. If the house foreclosure/short sale is the only incident on your credit report, it’s explainable. The same holds true for bankruptcy.

          See attached, but give us a call if you are 2 years removed from your housing crisis. We may have a plan that can get you back into homeownership.

Thanks,

 

Brian

Click For Short Sale Chart

 

BETTER HURRY

          Its been awhile but that’s because its busy busy busy…. Prices across town are up to $300,000 and starting to rise and the market is a Sellers’ Market. If you are a seller, get your home on the market before rates go up and more competition. If you are a buyer, you should buy before prices and rates go up.

           Hope to see you soon!!

 Brian

 

This week’s blog: Courtesy of Kevin Bent Academy Mortgage 719-339-2728

  

2012 FINAL STATISTICS FOR HOME SALES IN COLORADO SPRINGS

           Yes all reports that 2012 was a rebound year are true. We finished the year with 2933 homes for sale which was 11.7% less than 2011. Sales equaled 9146 sales which was 8.1% better than the year before. Average sales price went up 5.8% to $230,415.

          So what does this mean for 2013? Home prices will go up! They will especially go up on homes below $300,000. Homes above $500,000 will continue to be flat if not dropping more. The reason is we still do not have enough high paying jobs to support all the upper end inventory. Interest rates are projected to stay low thru summer with slight increasing late spring.

          All of this is recovery! If you wait now, you will miss the end of the market. Get in if you can. We can show you how. Call us at 719-593-2963

Thanks,
Brian

COVENTIONAL LOAN VS. FHA LOAN

The housing finance market is again taking another hit with FHA   raising their MIP (Mortgage Insurance Premiums). They are raising the premium to 1.5% of the loan balance. When I started in 1986 this rate was .5% which made FHA a good option for folks. The advantage is and always has been low down payment. The required down payment for FHA is 3.5%. These funds can be gifted from family members and was a nice beginner home option.

Today, with a little more down payment, 5%, conventional loans may be a better option. Mortgage insurance varies depending on credit scores. The higher your credit score the lower your mortgage insurance premium. The attached graph illustrates the point with good credit scores. Today on a $200,000 loan with 5% down payment and a 721 FICO score, you would save $106 per month.

We used to always recommend FHA for folks with low down payment options. In addition, there is still VA, but it’s only available to veterans. Some private banks and credit unions are offering 3% down with 1% mortgage insurance premiums. All institutions have various guidelines. All are a little tougher.

Please give us a call and let us help with your decisions. Allow my 27 years of experience to work for you. See the graph attached and I will talk next week about Bond options.

Thanks,

Brian

Will the Elections change the market? Not right off! The effects of the elections will not really affect the market until there is a solution for jobs. Here in Colorado Springs the market is red hot below $250,000. Above $400,000 it’s real slow. The reason-JOBS. Our city has lost 1000’s of jobs and it’s our local government that needs to improve our area. It’s not directly related to the presidential election. The president can only do so much. Congress needs to work together. Our city needs to do the same thing. Our mayor Bach can only do so much. The city council needs to approve tax breaks to companies. Our Economic Development council needs to go looking for jobs. Our city utilities need to keep costs down. Our roads department needs to improve our roads. We need to expand the airport. We need to turn the lights on and let the world know we’re here.

So elect people who get these things done and our market will improve.

Thanks,
Brian

 The 2013 Real Estate Tax- I hope this article lends clarity to all your questions about the Health Care Bill. This is an effort to pay for it!


Click the book for your copy to open in a seperate window.

           Now is a great time to sell!!  See the attached stats and you will see that inventory is down 19.9% and prices are up 3.8%.  In addition interest rates are still in the low 3’s.  We are selling homes on average in 61 days while the city average is 91.  Call us and we can show you how to take advantage of this turnaround.

Thanks,

Brian

 

Dear Friends,

 

            I hope my letter finds you well and getting used to writing “2012” on everything. We are coming out of 2011 with one of our better years. We closed 173 homes which is right up there with some of our record years. How did we do it? Your REFERRALS were a big part of our success. Over 110 of those transactions were a result of past clients and referrals. THANK YOU!! Your support and trust mean the world to us. I take that very seriously and we do the best we can in every situation.

 

            The other part of our success is honest straight forward information. The Colorado Springs market has now been on a downslide for 5 years. In 2011 we saw across the board another 5% drop in prices. Foreclosures and short sales remain a constant factor in pricing. They are affecting all price ranges, and all areas. We are battling this everyday as buyers want “Good Deals”. As you can imagine, this is a hard conversation to have with seller clients.

 

            That said, there is Good News! In 2011 we saw inventory has dropped 24% from 2010. So far through February 2012 that figure is remaining constant. There are a lot less foreclosures and short sales in the market. I still expect there to be a constant supply of these homes for next few years. The other Good News! Interest rates remain VERY LOW! As of today Kevin Bent @ Academy Mortgage quoted 3.75 on 30 year fixed mortgage.

 

            So what are we doing to succeed in these times? In addition to being straight forward with information, we have embraced technology. My website at www.maecker.com is the hub of all activities. That site is linked with over 60 domain names. We capture leads here and Realtor.com as well as Remax.com. We use 24 hour hotlines that text message my phone, it provides instant information to buyers and notifies me. We blog at coloradospringsblog.net weekly. I provide updates of the real estate market and yep, we also do facebook. Come visit and become a fan of “The Brian Maecker Team” and most important is the lead follow up. This is one area that hasn’t changed-I call and or email ALL LEADS.

 

            What’s 2012 market going to do? Recover. I think the bottom is here right now, except for the high end market. I see stabilization. I see some improvement in lower and middle priced homes. I see interest rates remaining low into the summer. I think our city is on the mend as long as we keep all our military here and employed. We do need more higher paying jobs to help the high end market.

 

            I am here to serve your Real Estate needs. I’m in my 26^th year and have sold over 4000 homes. Let me know if I can help you or your friends. I REALLY APPRECIATE YOUR LOYALTY AND YOUR REFERRALS!!

 

Thanks,

 

 

 

Brian

Anatomy of a Note Rate

How the Gfee change impacts rates and pricing

Our “new” mortgage business is full of complexities, regulation, and more regulation.  Over the past couple of weeks I’ve had many inquiries regarding the increase in guarantee fees (GFee) mandated by FHFA per Congress.  To dispel the confusion, I would like to take a couple minutes of your time to explain how this affects your borrower’s note rate. 

 

First, what is the actual Gfee?  The main component is charged to protect against credit related losses in the mortgage portfolio (think of it like Mortgage Backed Security Insurance), but small sub fees are also deducted to cover internal expenses for such services as:

 

·         Managing and administering the securitized mortgage pools

·         Selling the MBS to investors

·         Reporting to investors and the SEC

·         Maintaining the MBS on the open market,  general and administrative expenses

·         And now at least 10bps to cover the extended Payroll Tax cut (Note this is a 10 Year effective period)

Below is the FHFA release from December 29, 2011:         

“On Dec. 23, 2011, President Obama signed into law the Temporary Payroll Tax Cut Continuation Act of 2011. Among its provisions, this new law directs the Federal Housing Finance Agency (FHFA) to increase guarantee fees charged by Fannie Mae and Freddie Mac (the Enterprises) by no less than 10 basis points from the average guarantee fees charged by these companies in 2011 on single-family mortgage-backed securities.

 

This requirement is effective immediately, meaning that the average guarantee fees charged in 2012 need be at least 10 basis points greater than the average guarantee fees charged in 2011 and that this increase be remitted to the U.S. Treasury, rather than retained as reserves by the Enterprises. The law also requires FHFA to determine a schedule for guarantee fee increases over a two-year period that must satisfy other requirements of the law.

 

To begin implementation of these requirements, today I am directing Fannie Mae and Freddie Mac to announce before year-end to their seller-servicers that, effective April 1, 2012, the guarantee fee on all single-family residential mortgages shall increase by 10 basis points.

 

In early 2012, FHFA will further analyze whether additional guarantee fee increases are appropriate to ensure the new requirements are being met. FHFA will announce plans for further guarantee fee increases or other fee adjustments that will then be implemented gradually over the two-year implementation window, taking into consideration risk levels and conditions in financial markets. FHFA will monitor closely the increased guarantee fees imposed as a result of the new law throughout its effective period, which ends Oct. 1, 2021.”

 

How does it really work?

We know that they will charge at least 10bps and probably more in the near future.  Here is how it works:  The 10bps is actually built into the borrower’s note rate.  My example below uses round numbers for the sake of an easy demonstration.  Say the client wants a 3.50% note rate or 350 basis points.  That rate or yield actually contains various parts that are distributed monthly as the payments are made.  The majority of yield is sent to the investor, also known as a pass through rate.  This pass through rate is the base rate we derive pricing from.  In my example, the pass through rate is 3.00% or 300 basis points.

The next chunk to be carved off is this rate is mandated by Fannie and Freddie to be no less than 25bp.  Now, that leaves us just 25bp left from the borrower’s original 350bp rate.  Enter the Gfee - Let’s say prior to the change the Gfee was at 15bp, and now it’s 25bp with the required 10bp bump.  Prior to the change there would have been an extra 10bp in excess servicing that would have improved the price on the loan for the borrower.  Now that has been redistributed to the Gfee, effectively lowering the price value of the loan.  The price impact can be many multiples of the yield change.  For example, every 1bp in yield change there can be at least 5-8bps in price change.

 I hope this clears up some of the murkiness of the changes that occurred.  2012 is positioned to be a pivotal year in many ways. If you have any pricing questions, never hesitate to contact me at lori.sorrels@caliberfunding.com or (719) 440-0433.

This week’s blog is courtesy of Lori Sorrels of Calibur Funding regarding new Gfee.

Jack Hough of Smart Money.com this weekend declared “It’s Time to Buy That House.” Yes in this weekend’s Wall Street Journal, Jack announced its time to buy a house as a home or an investment. Now before you interpret this as a blanket statement, there are some caveats.

Detroit, Miami, Dallas and Phoenix are definite buyers markets. Places like Washington D.C., Los Angeles and New York are still very expensive for what you get. Colorado Springs is in the low range but not on the most affordable. I believe it’s because we never grew exponentially just nominally. We thought it was too much when we grew 10% year. Many other areas were growing at 10% a month. Typically here in Colorado Springs, one will see 3% a year. Generally our job base supported that very well. We “exploded” when we heard Ft. Carson was expanding. We “imploded” when they didn’t all come and the technology firms left.
 
Bottom line, interest rates are at 4 ½%. Prices are at 2003 levels. Stocks are down. Rentals are up. Real Estate is a GOOD INVESTMENT.

          It looks like finally someone is thinking! These are good changes for our military buyers.

Enjoy,

 Brian

Click here to see full document

 Well folks, its official!!! It’s a good time to buy a home. The Wall Street Journal has officially declared what I have been telling you for months. The time to buy a home - IS NOW!!!

          I have been telling you for a couple of months that here in Colorado Springs, it’s time to buy. Home prices seem to be stabilizing and interest rates are back to mid to high 4% levels. The Wall Street quotes that we are back to pre bubble (2002) levels and that in some markets, Las Vegas and Detroit, we are at 1990’s levels. Per the journal, home affordability is at a 50 year low.

          The future is looking good. As the future and employment get better we will see an increase in prices. Inflation concerns will raise interest rates. Rarely does anyone hit the absolute bottom, but I will say we are pretty darn close. I am practicing what I preach. I have offers on 2 investment properties that are 70% of their high price. Both are at 2001 levels. Don’t be one of those who will say “I should have bought in 2011-2012.”

          Call us and we’ll show you how.

 

Thanks,

Brian

 

 

                I just read an article in Money Magazine by the Wall Street Journal. The writer James B. Stewart is a winner of a Pulitzer Prize and just wrote a new book called “Tangled Webs”.  His article is what I want to talk about today.

 

                In Mr. Stewart’s article he feels home ownership may not always be a sound financial decision. He does say that home ownership perhaps provides stability in our country because countries that are less stable have less home ownership. I do agree over the last couple of years its hard to say its good to own a home. But as this weekends Gazette pointed out for Colorado Springs, homes had appreciated on average 20% over the last 10 years. Its been slow but it’s a gain. If your home was $100,000 in 2000 its work at least $125,000 compounded. If you had 100K of stock then, I think it would be worth less than 100K now. Second he fails to point out that buyers over bought in the boom years. He does point out, accurately, that folks need to buy within their means. And this is the crux of everything Buy within your means. Buy Resale. Buy Foreclosures. People have to live somewhere so why not own it.

 

                Owning a home gives you a forced savings account. Mr. Stewart does acknowledge this. Owning allows for tax benefits. Owning and staying builds equity. We use to stay in our homes 7.3 years. Over the last 10 years it has dropped to 4 years. Stay longer and enjoy the benefits.

 

                To learn more call me at 888-593-2963

 

Thanks,

Brian

Below is a letter from my great insurance agent E.J. Nusbaum of State Farm Insurance.

You will see below that roofs are now a major concern when purchasing or selling. Please call us if you have questions. Our number is 719-593-2963 and E.J.’s number is 719-597-5100.

 

Thanks,

Brian

Subject:  T- Lock Shingles      

 

Situation:

T-lock shingles are no longer being manufactured and the inventory of these shingles has been depleted.  Therefore, if a T-lock shingle roof is damaged, the entire roof will need to be replaced.  This situation has increased risk for insurance companies.  When roofers could get T-lock shingles, it was possible to repair a roof that was slightly damaged or only damaged on one slope.  Now, any damage, no matter how slight necessitates an entire replacement.

 

Because of the increased risk, insurance companies have reacted in various ways.  Some companies will not insure a home with T-lock shingles.  Others require a higher deductible when insuring a home with T-lock shingles.  Others are insuring the home, but modifying the coverage so that a roof loss is paid for using an “Actual Cash Value” (ACV) calculation.  An ACV calculation works as follows:

 

Full cost of replacing a roof:  $10,000

Age of roof at claim time:  6 Years

Life of roof:  20 years (determined at time of claim)

Policy Deductible: $1000

 

Calculation:

$10,000 x 14(Average life-age)/20 (Average life) = $7,000 – 1000 (deductible) =$6,000 Payment

This is $3000 less than a replacement cost claim

 

Recommendations:

 

Listings-If you have the opportunity to list a home that has a T-lock roof, it would be a good idea to have a qualified roofer inspect the roof to determine if there is any damage.  If the damage was caused by an insured peril, the current homeowner should be able to get the roof replaced.

 

Purchases-If you have the opportunity to assist a client that is buying a home with T-lock shingles, it would be a good idea to 1)have the roof inspected immediately and 2)have the buyer discuss the roof with their insurance carrier so that they will know how the insurance company will handle the T-lock roof.

 

This is a brief example of some of the coverages limitations.   It is not a recommendation of coverage.  All coverages are subject to the terms and conditions contained in the policy and endorsements.  Each situation is fact dependant and all parties should get individual counsel from their professional advisors for their specific situation.

FACEBOOK

 

          How many of you are on Face Book? I am and have been for a while it’s pretty cool to see or touch old friends and mostly acquaintances.

          This is the part that I wonder about Acquaintances! I get asked to “friend” lots of people who I do not know. So how are they my friend? What’s the purpose? Why do I care or my friends care what someone is doing? So I ask why do we say yes or friend strangers? Is it our egos that say I have to have a million friends? I don’t get this part of it. Help me understand!

          By the way you maybe my friend of my personal site but you can definitely be my friend on my business site at Maecker Team Listings.

 

Thanks,

 

Brian

Did you know that home affordability is down to 2004 levels? Yes, today’s prices are in line with values that were before the “bubble”. This data and statement are supported by the Wall Street Journal on Feb. 9, 2011. In the Colorado Springs area as well as most of the country we have dropped 15-20% from the peaks of 2008.

 

            In the years from 2004-2008 the only thing driving the market was “funny money” you know the creative financing. Today remains a great time to buy as interest rates remain around 5%

            So why aren’t more people out here buying a home? Are you thinking values will continue to fall? Let’s look at this. One other fact that needs to be introduced is that interest rates will go up. So let’s look at why “NOW” is a good time. For example today a $200,000 loan @ 5% is a $1074.00 a month payment principal and interest. Let’s assume prices drop another 5% and rates go up to 6%. So a $190,000 loan @ 6% = $1139.00 a month. See what I mean!

 

            The solution is offer and hope to get the 5% price savings now and get the good rates. A $190,000 loan at 5% = $1020.00 per month. Sellers are anxious to make this work. They will also help with closing cost.

 

            Call us at the Brian Maecker Team and we will show you how to take advantage of this market.

 

Thanks,

 

Brian

I hope all of you had a nice Christmas season. Did you get what you asked for? Was Santa good to you? I hope so! Well as we roll into 2011, it’s all about what the market will give you.

            If you are a seller, the market is going to give you values that are similar to what we saw in 2004 and 2005. The market has lost all gains that we saw in the boom years. Those boom years stole buyers from today with all the creative mortgages and almost all those purchases are the foreclosures of today. If you are a seller the market will allow you to sell, but at a value that is probably much lower than you want.

            If you are a buyer, the good values are starting to go away. Most of the inventory below $300,000 has remained steady for the last 6 months. Below $200,000 we have actually seen some increases in some areas as inventory is tight. Interest rates have started to rise. We saw a low of 4 1/4% and today we are around 5%. I expect rates to gradually increase throughout the year topping out at just over 6%. If you are a buyer, the low point seems to be here if not already passed. The perfect storm of low rates and desperate sellers occurred in October and November.

            So as I have been preaching all year in 2010, I preach again in 2011. Don’t sell unless you are doing a move up or you have to. If you are a buyer, BUY NOW before rates and prices increase. Very few can hit the absolute low point. If we are not there, we are close. 2011 will be stable with no real appreciation. We still have lots of inventory to sell. There will be no booms like 2006-2008. Those were record years. We are closer to normal than most remember. I think 2012 will see growth and perhaps 2-3% appreciation and that will be the norm. When you compare to the volatility of stocks, real estate is stable and very safe over the long haul.

            HAVE A PROSPEROUS, SAFE AND HAPPY NEW YEAR!          

 

Thanks,

 Brian

           

           

This week’s blog is courtesy of the Wall Street Journal’s Brett Arends. Below is his article on 10 Reasons to Buy a Home.

HOME

OWNERSHIP

MATTERS

TO PEOPLE…TO COMMUNITIES…TO AMERICA.

Studies show that home ownership has a significant positive impact on net worth,

educational achievement, civic participation, health and overall quality of life. That’s why,

for more than 100 years, REALTORS® have helped people find their piece of the American Dream.

Now, with some questioning whether home ownership is still good for America, it’s more

important than ever to stand up for home ownership... in your community and in the nation’s capital.

Find out more about why Home Ownership Matters, how the NATIONAL ASSOCIATION OF

REALTORS® is standing up for it, and how you can help spread the word, at REALTOR.org/homeownership.

©2010, National Association of REALTORS®

WHY HOME OWNERSHIP MATTERS

TO PEOPLE…

_  Home owners are happier and healthier and enjoy a greater feeling of control over their lives.

_  Owning a home is one of the best ways to build long-term wealth. Historically, a home

owner’s net worth has ranged from 31 to 46 times that of a renter.

_  Home owners are free to redecorate, renovate, and modify their homes as they wish.

_  Most home owners enjoy stable housing costs—a fixed-rate mortgage payment might not change

for 15 to 30 years while rent typically increases 3 % a year.

_  Home owners can typically deduct mortgage interest and property taxes on their federal

individual income tax return.

TO COMMUNITIES…

_  People who own homes vote more, volunteer more and contribute more

to their neighborhoods.

_  Home owners do not move as frequently as renters, providing more neighborhood stability.

In turn, this stability helps reduce crime and supports neighborhood upkeep.

_  Children of home owners do better in school, stay in school longer, are more

likely to participate in organized activities and spend less time in front of the television.

TO AMERICA...

_   67% of American households are owner-occupied. America is a nation of home owners.

_   Home owners pay 80 to 90% of federal individual income taxes, contributing to

federal programs that benefit all Americans.

_   Every home purchased pumps $60,000 into the economy for furniture, home

improvements and related items.

_  Housing accounts for more than 15% of the national Gross Domestic

Product, a key driver of our national economy.

_  For these reasons and more, home ownership is the American Dream!

As REALTORS®, we know all this. But not everyone does.

So spread the word: Home Ownership Matters!

For more information and data on the points above, see REALTOR.org/Homeownership

 

By now, we are all seeing the results of the 2010 election. Whether your candidate got in or not, how will the results affect housing?

 

            In my opinion, in the short term not much. While the Republicans did make gains in the House and Senate, it will not change the amount of foreclosures in the system. Foreclosures will continue to make headlines throughout 2011. As a result, home prices will not see any gains and in fact we will probably see a bit more of a drop. Right now here in Colorado Springs and throughout the country inventory is up. In El Paso County, home inventory for sale is up 15%. The good news in this, is that I believe with a republican resurgence there should be more confidence. People hopefully will become more confident their jobs will stay intact. Because of the republicans there should be tax incentives for businesses to hire more people; this combined with record low interest rates should help eliminate the standstill in the economy.

 

            Long term, there are still issues. As well as the foreclosures, there are inflation concerns and the infamous health plan bill has some spikes in it that affect housing. I have not read it, but I have seen 3 reports now that says the Health Bill will tax housing in the future. I have heard it will be a 3% tax to pay for health. How housing and health bills got on the same laws, tells you how jacked up our government is. If that is true and the democrats raise capital gain taxes, you can kiss off any long term recovery.

 

            In all this is the “New Normal”. It was similar in the 1980’s & 1990’s. I don’t see any spikes in value anytime over the next 3-5 years. In El Paso County I think we will be flat in 2011 and start seeing some appreciation in 2012. Appreciation will probably not exceed 5% in any given year and 2-3% per year will be normal. Lenders need to loosen up a bit too. They have really heightened their standards and that needs to change to foster growth.

 

            Lets all forget about the “Good Ole Days” of 2004-2007. It’s almost 2011 and let’s start accepting the fact that a home is solid investment with slow growth. It’s not a cash register.

 

 

 

Thanks,

 

 

Brian

 

           

I keep running into this scenario -“I see that on Zillow my house is worth $200,000.” From a buyer -“I see on Trulia that house should be priced at $175,000.” I need to ask – Sellers and Buyers why do you trust a National website with values of local homes? What makes them an expert?  I am tired of people thinking they are experts in real estate values because they can click a few buttons on Trulia or Zillow.

 

                People do you read websites about medical procedures or car repairs? How about legal matters of divorce or estate work? Do you think you are an expert when you look at this information? I would hope not. I would hope that when it’s important you trust the experts. I know I wouldn’t operate on myself. I know I would not prepare my own estate. So why do you gamble with the LARGEST investment you have? – Your Home!

 

                You need to let a Professional Experienced Realtor assist you with your home advice. The more

homes and years experience a realtor has does make a difference. I have seen this type of market before. I have sold 4000 homes in my career and it’s real hard to hear people tell me how to price. It simply is sound principal to trust an experienced veteran. It’s like surgeons and doctors, you want the busy ones because they are good. Who is better at analyzing a home than a local experienced broker who is in the market daily? Who better to do a current analysis based on “Today’s Trends?”

 

                A good realtor will pull all the area information and compare it to your home. They will address the competition as well as the solds. Trulia and Zillow do not do that. A good realtor will address maintenance and condition. Trulia and Zilow do not. A good realtor will see trends. Trulia and Zillow do not. I hate using the term “Trust Me” but people you trust your doctor, your lawyer and your mechanic. Find an experienced realtor who you can trust and rely on that advice. Quit trusting a machine and trust the one that is in the market daily for many years.

 

Thanks,

 

Brian

This week’s blog is courtesy of the Wall Street Journal’s Brett Arends. Attached is his article on 10 Reasons to Buy a Home.

Click Here To View This Article

Banks, Fannie Mae and Freddie Mac you are ripping the American consumer off. In the last 4 weeks, we have had 4 short sale offers declined by banks. WHY?

           

            I will tell you why. Banks are getting refunds from Freddie Mac and Fannie Mae to cover their losses. When a bank takes a loss of $50,000 the government gives it back to them. Check out this YOU TUBE site and it helps explain http://www.youtube.com/watch?v=ssl5yb7FewA&aia=true

            I hopes this link works because it clearly illustrates the banks getting money behind the scenes. Why else are so many short sales being denied? Why are banks not processing offers? I believe it’s a racket and that is why the banks are showing profits.

 

            Spread the word. Lets complain and stop this travesty.

 

Thanks,

 

Brian

(719) 570-8928

Please contact us for any questions or assistance

Over the past week, Congress has taken quick action and passed H.R. 5981. The bill gives FHA the authority to adjust its annual mortgage insurance premium, yielding approximately $300 million per month in value to the FHA Mutual Mortgage Insurance Fund at a time when its reserves are perilously low.

As I have previously stated in my testimony before Congress, FHA will lower its upfront premium simultaneously with the increase to the annual premium¹. It is our intention that effective on September 7, 2010, FHA’s upfront mortgage insurance premium will be adjusted down to 100 basis points on all amortization terms and the annual mortgage insurance premium will increase to 85-90 basis points on amortization terms greater than 15 years². A Mortgagee Letter will be forthcoming once President Obama signs the bill into law, but with today’s passage of H.R. 5981 and our expedited implementation schedule, I wanted to immediately inform the industry of our plans so the lending community can begin preparing for the operational and system changes required to implement FHA’s new mortgage insurance premium structure on all new case numbers by September 7, 2010.

With this authority, FHA is in a better position to address the increased demands of the marketplace and return the MMI fund to congressionally mandated levels without disruption to the housing market.

While we appreciate and applaud this recent action, there is still work to be done. HUD remains steadfast in its commitment to comprehensive FHA reform legislation, similar to the FHA Reform Act passed earlier this year by the House, which would further enhance FHA’s lender enforcement capabilities and risk management efforts. We hope Congress will take swift action to pass a broader FHA reform bill when they return from the August recess. FHA’s risk management efforts will not be complete without the ability to monitor lender performance and ensure compliance with our rules.

Although the transition timeframe is short, implementation by September is critical. Thank you in advance for the efforts of you and your organization to make this change happen on such short notice. We appreciate your hard work and continued partnership.

¹The upfront and annual premium changes do not apply to the following FHA Programs: Title I, HECM, HOPE for Homeowners (H4H), Section 247 (Hawaiian Homelands), Section 248 (Indian Reservations), Section 223 (e) (declining neighborhoods), Section 238(c) (Military Impact areas in Georgia and New York).
² LTV’s <= 95% will increase to 85bps and LTV > 95% will increase to 90 bps

  Sellers are you smoking Hopeium? Homes will sell if they are priced right and in good condition and staged to show. I recently went showing some homes in the Woodmoor/Tri Lakes area. I was amazed how poorly homes were showing between $300,000-$400,000. We saw peeling paint, weedy yards, run down carpet, heavy pet odors and busy streets.

            The people I was with dropped their price $100,000 to get it to the right price. I then had it staged and we sold it for $575,000 in month. I have sold 20 homes this month. I would like to publicly thank my SELLERS in Briargate, Downtown, Fountain , Powers, Norwood, Black Forest, Rockrimmon and Broadmoor for listening to my pricing strategies and applying our staging services.

            The market is what it is. Sellers you need to get real and understand that buyers know value and will not overpay. Get real and prepare and your hope will sell.

            Quit smoking HOPEIUM and get a clear view of the market and you will see success!

 

Thanks,

Brian

This week’s Blog is courtesy of LORI SORRELS of Bank of America (719) 570-8928

Please contact us for any questions or assistance

 

This article shows the pains in the mortgage industry....why there is frustration

 

http://online.wsj.com/article/SB10001424052748704799604575357183960027478.html

 

I know you’ve been experiencing “new lending” practices from all lenders around the country.  For a long time here at Bank of America, I thought it was just us tightening the lending requirements to this degree.  But as I talked to friends in the industry (Wells Fargo, Chase, and Citi) and watched other loans that are perfectly good loans struggle to close it became apparent that we are into this for the long haul.  I think from our team stand point, the best thing you can do to help the Buyer get through this “new lending” is from the beginning to set the expectation that …there is a new sheriff in town and the name of the game is  explain everything.

 

Income – two years….I know what the guidelines say, but two years same employer or same line.  Must document.  Verifications happen at the beginning of the loan process and yes, on the day of closing….someone could quit..and have.  I’ve been asked, why didn’t they verify the employment sooner in the loan process and the answer is that we do…we just do it again on the day of closing.  For self employed, two years of tax returns.  If they started their company in the middle of a year…you’ll have to be self employed for two full tax cycles so in this case 2 and a half years.

 

Credit – 620 (yes, 580 is possible, but beat your head against the nearest wall – this simply means when you are writing a contract for someone in this situation – give more time to close because it usually requires more than one level of underwriting.  And guaranteed there will be many letters written to the Underwriter. The article says that 75% of the loans purchased by Fannie Mae had 720 or better scores.  That means that FHA is picking up the rest…so yep, more FHA buyers on our plates (see why FHA 203K is becoming a popular loan).

 

Letters of Explanation – have become huge.  It used to be that we’d do a quick “note” to the Underwriter and call it a day.  Not anymore, we now have to write letters explaining almost everything:  deposits into the bank account that are not payroll, addresses on the credit report that the borrower never lived, or even explaining 10 year old derogatory entries on credit (got any documents to back that up?).

 

Paying for appraisals and credit reports – in the past I never collected money up front, I considered it a cost of doing business and in my  18 years I’ve probably paid for $3500 in appraisal costs over the years.  Not bad.  Not anymore.  Fees have to be paid upfront or the loans can’t go into processing/underwriting.   The reason for this is simple, the Appraiser wants paid whether the loan closes or not. 

 

30 day closes – I thought these were going to become a thing of the past, but not so fast.  I think the automation has caught up with the demand for 30 day closes on standard work flow.

 

You know how the saying for Realtors is “location, location, location”.  Well our saying is “document, document, document”.  The above article is great at explaining the buyback Lenders are experiencing and hopefully helps you to understand that when I ask the Buyer for a DNA sample, that I really do need it for loan approval; see the pendulum really has swung too far,  it will swing back, but for now to be successful we have to document, document, document.

Rates today are 4 ½%

            This is huge for you as a buyer. The difference on a $200,000 loan from 5 ½% is a hundred dollars. What are you waiting for?

            I have been selling for 25 years, and this is crazy low! We are here all weekend and most days 7-6. Call The Brian Maecker Team to help you.

 

REPEAT à RATES ARE AT 4 ½%

                I for one say enough with tax credits to help the housing market. It’s time the real estate market deals with the issues that ail it. The market is over supplied still with homes that are overpriced and over loaned. We need to deal with this head on to get through it

 

                Yes the tax credit was a good thing, but now, the buyers are waiting again for it to come back. If we as a government eliminate it, the buyers will come into the market to enjoy great interest rates. The sooner buyers quit waiting, the sooner we get through the inventory and the sooner to a balanced market.

 

                The tax credit is a crutch that we need to forever more leave behind. Loosen mortgage guidelines. Give people loans with 5% down payment and lower the credit score requirements. Over 40% of the public is having financial distress. Loosen the guidelines and allow people to stay in their homes and eliminate ½ of the foreclosures. Banks get off you *** and work with sellers and homeowners. If banks would work faster and efficiently through the defiencies, it would solve lots of our problems. But, NO, they keep taking the government bailout and pocket it themselves.

 

                Bottom line! Government get out of real estate. Then lenders and investors might start solving all the loan issues that plague us.

 

Thanks,

 

Brian

FHA CHANGES

 

            Good morning all. More changes are here in regards to FHA backed mortgages. While these changes don’t have a big impact it’s one more obstacle for the buying public.

 

                Product/Program Changes:

Change	Current Factors	NEW Factors
FHA Upfront Mortgage Insurance Premium Factors	Purchase and Rate and Term Refinances: 1.75%                         Streamline Refinances: 1.50%	Purchase and Rate and Term Refinances: 2.25%                         Streamline Refinances: 2.25%   Note: Annual MIP is not affected with this change

 

                As you can see not a real big deal. FHA still allows a buyer a low downpayment. I have always believed a buyer should have some “skin” in the game and this is a nice alternative for financing.

 

            Pleas give us a call if you have any more questions.

 

Thanks,

 

Brian

Its February 19^th and its cold cold outside. I am ready for winter to be over. It has been so cold that our signs are frozen in the ground and we need a 10lb sledge hammer to pound them in.

 

                I don’t know about you, but in a perfect world, the mountains could get 6’ of snow and we should enjoy 60 degree plus weather here. Wouldn’t it be nice to always be able to go outside and exercise? I haven’t been able to golf since the last week of November. That’s a real long time!

 

                I know I’m not so sure about global warming. I feel all this weather is natural evolution. It’s the ebb & flow of the ocean and tilts of the earth. I know I would like a little global warming here in Colorado Springs. What do you think?

 

                Well in the meantime I won’t be here next week Palm Desert and hot weather is calling. Have a great week.

 

Thanks,

 

Brian

Did you read this morning’s Gazette Telegraph about Colorado Springs and its budget woes. People we have made national headlines with our budget cuts. ABC News, NBC News and even Canadian News has brought attention to our Colorado Springs area. We are the national poster child of budget cuts. People are you happy now?

 

            Are you happy that your street lights have been turned out? Are you happy that there will be no water for our parks and that trash cans have been removed? Are you happy that the city is selling both of the police helicopters? I bet you folks in Powers, Briargate and Central areas are thrilled to know the police can’t get there fast enough. How about that fire call? When your home has burnt 5 minutes longer I bet you’ll be happy to know that you’re saving taxes.

 

            I think you get the point. I am not happy. I have been preaching for years that inner city residents need to approve some spending for their schools. Now the majority voted “NO” across the board for taxation. Look at what we have now. We have a city that new jobs don’t want and our own people won’t support.

 

            I hope your happy now!

 

Thanks,

 

Brian

This week Forbes Magazine rated Colorado Springs the 9th Best Bang for the Buck city in the United States. The top city was Omaha NE. This is more good news for our little city. Last week Forbes rated us 14th most likely city to rebound from the housing slump.

I believe Colorado Springs is a good value. In affordable housing, most of our prices hover between $90-$110 per feet. In the heyday it rose to $130-$150 per foot. The one golden thing that has happened with the housing slump is that it’s made housing affordable again. In Colorado Springs you can find decent housing around $100,000. In markets like Florida, Arizona, Las Vegas and California home prices dropped 50-70% from the peak. Now there is value in owning a home.

I also think now is the time to buy and invest in real estate. Many people catch it when its on its way up. Almost always people buy into the frenzy when it’s peaking. Now is the time. We have been at bottom for about 8 months. I think we will stay here for only a couple more months before we start increasing values. Fact is, sales this year in 2009 are equal to 2006 and inventory is down 1800 units. That spells relief and increasing values.

Yes, buy into the fact that Colorado Springs is a good value. Say yes that Colorado Springs is rebounding. Get on board the bus before it passes you by.

Thanks,

Brian

Did you see the article by Forbes Magazine listing Colorado Springs as the 14th fastest recovering city in America? Do you believe it? Are we really in for a rebound? Well, let’s see!

Forbes online produced a list yesterday that names Colorado Springs the 14th most likely place in America to Rebound. It ranked Omaha NE #1 most likely. It took into account Gross Metropolitan Product (measure of city economy) foreclosures, home prices, and sales rates. They ranked based on statistics compiles through the month of September.

I think this is great news but is it really true? Now that Doug Bruce has gotten his way in raping our city dry, are we really going to be a quality place to live? By voting for his anti tax measures I feel our city is going to dry up and die. You don’t need to look far to see it.

1st check out our infra-structure and roads. Why do we waste money on a bridge overpass at Woodmen & Academy but vote down public transportation? Why are we closing inner city schools and not putting money into educating Dist 11 kids. Today Dist 11 can’t make ends meet and those of you who don’t have kids in school you keep voting down amendments. That is why your home values don’t climb like other areas. How many of you were fooled by Doug Bruce’s amendment for abolishing storm water. Soon, you will figure out when curb gutter and sewer systems don’t work it was your vote that caused it.

People you need to be more long term thinking! You need to look past the slight increase and look at the big picture. No real airport, bad schools, no public transportation, brown grass parks, broken curbs, gutters, sewers, pot holed streets and slow fire and police protection does not make us an appealing place to live. If we are not appealing you won’t get good prices for your homes. People you need to think beyond today and look to tomorrow. If you don’t we certainly won’t be a top place to live.

Thanks,

Brian

This week’s Blog is being written by my friend Peter Davidson. He is an expert with reverse mortgages. We will be having a seminar on October 22, 2009, at 6:30 at my office (5590 North Academy Blvd.) Please call me at 593-2963 if after reading the following article if you would like to come. Please enjoy and we hope to see you soon!!

 

Thanks,

Brian

 

What is a Reverse Mortgage?

 

Simply put, a reverse mortgage is a loan that enables homeowners aged 62 and over to tap into their home equity.  www.ReverseMortgageGuides.org says “A reverse mortgage is a low-interest loan for senior homeowners that uses a home's equity as collateral. The loan amount is a percentage of the home's value determined by the age of the youngest homeowner. The loan does not have to be repaid until the last surviving homeowner permanently moves out of the property or passes away. At that time, the estate has approximately 12 months to repay the balance of the reverse mortgage or sell the home to pay off the balance. All remaining equity is inherited by the estate. The estate is not liable if the home sells for less than the balance of the reverse mortgage.”

 

History of Reverse Mortgages

 

Many people believe that reverse mortgages are fairly new, when actually the first reverse mortgage was done by Deering Savings & Loan in Maine during 1961.  Growth was very slow until 1988 when the Federal Housing Authority Insurance Program was signed into law.  The first government-insured reverse mortgage was given in 1989 under a pilot program initiated by the federal government under the guidance of the AARP.  The program was small to begin with, but was expanded nationwide due to its success.

Since then in excess of 400,000 reverse mortgages have been done in our country.

 

Why a Reverse Mortgage?

 

The FHA reverse mortgage was created to allow seniors to stay in their homes for the rest of their lives.  The homeowner can receive payments in a variety of ways; monthly payments, lump sum payment, line of credit, or any combination, and because they are receiving rather than paying, they can never be evicted or foreclosed on for non-payment.  Reverse mortgages are easy to qualify for because there are no credit or income requirements.

 

What Can Be Done With The Proceeds of a Reverse Mortgage?

 

According to a report on the 2006 AARP National Survey of Reverse Mortgage Shoppers, the top 5 uses of a reverse mortgage are:

 

Expenses for health or disability

Improve quality of life

Pay off debt

Home repairs and improvements

Everyday and emergency expenses

 

The proceeds are not taxable and the borrower can do almost anything they want with them.