As the year draws to a close, it’s time to squeeze in some tax deductions and credits that might save you money. If you are looking to reduce your tax liability, here are some 2011 year end tax planning tips or options you may want to consider READ MORE
This morning, FHFA announced their enhancements to the HARP refinancing program. Operational details of the plan are to be released on November 15. Only loans that were purchased or guaranteed by Fannie Mae or Freddie Mac on or before May 31, 2009 and have a current LTV over 80% are eligible. In addition, the loan must be current, no late payments in the last six months and no more than one late in the last 12 months. There are no restrictions on who may refinance these loans.
Program guidelines include:
- No limit on LTV, if new loan is a fixed rate loan (current LTV must be above 80%)
- Loans previously refinanced under HARP not allowed
- Certain agency fees will be waived if new loan is a shorter term loan
- Appraisals not required where Agency AVM is available
- Certain originator Reps and Warrants will be waived
The housing market still faces many challenges. High unemployment, foreclosures
and other distress sales are keeping negative pressure on prices. This of course
is good news if you are looking to buy as low rates and lower prices have
brought affordability to record levels.
- Since 1963, it has cost an average of approximately 43% of ‘per
capita’ or individual income to finance the cost of a median priced home (20%
down payment and prevailing 30 year fixed rate mortgage). Right now, it’s only
about half of that cost at approximately 22%.
Are you holding off
on a purchase for fear that prices might fall further? - Chances are
that some sellers might be thinking the same thing. If you’re smart about it,
you can use that as an advantage to strike the best possible deal on a home
today for once a seller believes that prices have bottomed or are going back up,
your advantage will be gone.
Don’t confuse Price with Payments
- Gambling on the expectation of a lower price tomorrow at the risk of
higher rates can cost much more in the long run than locking in a sure thing
today. Ex. $200,000 30 Yr. fixed loan @ 4.625% = $1028/mo. today vs. $180,000 @
6.5% = $1137 per month later. In other words, paying less can still cost you
Own, Rent, or Borrow - One way or another, a home
is something we all need every day. The numbers here tell the story and it’s no
secret that values have fallen, yet over time, that’s not the case. As you can
see by the chart, values over the last 10 years in most states show very healthy
appreciation. And over the long haul (map), all states have positive
We don’t get a history lesson in the news because
the news is about the moment and the more dramatic the better. That’s
what sells advertising and that’s how they get paid. For the rest of us, taking
a rational, longer term view of things makes more sense. This is particularly
true when it comes to a home, for this is something we are likely to own for
many years rather than just moments.
Before deciding on what terms lenders will offer you on a loan (which they base on the “risk” to them), they want to know two things about you: your ability to pay back the loan, and your willingness to pay back the loan. For the first, they look at your income-to-debt obligation ratio. For your willingness to pay back the loan, they consult your credit score.
The most widely used credit scores are FICO scores, which were developed by Fair Isaac & Company, Inc. (and they’re named after their inventor!). Your FICO score is between 350 (high risk) and 850 (low risk).
Credit scores only consider the information contained in your credit profile. They do not consider your income, savings, down payment amount, or demographic factors like gender, race, nationality or marital status. In fact, the fact they don’t consider demographic factors is why they were invented in the first place. “Profiling” was as dirty a word when FICO scores were invented as it is now. Credit scoring was developed as a way to consider only what was relevant to somebody’s willingness to repay a loan.
Past delinquencies, derogatory payment behavior, current debt level, length of credit history, types of credit and number of inquiries are all considered in credit scores. Your score considers both positive and negative information in your credit report. Late payments will lower your score, but establishing or reestablishing a good track record of making payments on time will raise your score.
Different portions of your credit history are given different weights. Thirty-five percent of your FICO score is based on your specific payment history. Thirty percent is your current level of indebtedness. Fifteen percent each is the time your open credit has been in use (ten year old accounts are good, six month old ones aren’t as good) and types of credit available to you (installment loans such as student loans, car loans, etc. versus revolving and debit accounts like credit cards). Finally, five percent is pursuit of new credit — credit scores requested.
Your credit report must contain at least one account which has been open for six months or more, and at least one account that has been updated in the past six months for you to get a credit score. This ensures that there is enough information in your report to generate an accurate score. If you do not meet the minimum criteria for getting a score, you may need to establish a credit history prior to applying for a mortgage.
To get a FREE Copy of your credit score, contact your Maine Mortgage Banker today.
Real Estate Agents in Maine are finding new ways to generate business everyday Online. Studies indicate that over 80% of today’s home buyers visit the Internet long before seeking the professional assistance of a Real Estate Professional.
Below are some popular sites to visit and become familiar with their features and benefits.
Property Listings & More
1) Redfin.com: In addition to listings, this site offers information such as how long a home has been for sale, its last sales price, and its current value. It also provides virtual tours to listed homes.
2) Trulia.com: Like Zillow.com, which offers satellite views and the estimated values of each home, Trulia’s “heat maps” show how hot or cold an area is based on prices, sales, and popularity among its users. Trulia.com also has free tools real estate agents can easily add to their own websites to increase functionality and traffic.
3) Maps.Google.com and Bing.com/maps: For a bird’s-eye view, even 360 degrees in some cases, these amazing map sites offer a virtual perspective of available homes that’s truly hard to beat.
4) Walkscore.com: Is an interesting site that rates any address based on the walking distance of its nearby stores, restaurants, schools, parks, coffee shops etc.
5) SchoolMatters.com: A Standard & Poor’s company, this site offers parents (and potential home buyers) an objective rating of public schools and public school districts by region, including test scores and demographics. GreatSchools.net offers similar info and ratings on private schools based on region.
Government Websites: Government loan programs offer great opportunities for many consumers in many regions across the country, especially first-time buyers and veterans. The following websites are likely one of the first of many sites potential home buyers visit during this process:
1) HUD.Gov is the official website for the U.S. Department of Housing and Urban Development (H.U.D.) This site lists HUD homes and provides information for home buyers, including financing options and home buying programs available through the Federal Housing Administration (FHA).
2) Homeloans.va.gov: This site houses information about government home loan programs specifically for veterans.
Contact me if you think of any more sites I should add to my list. I look forward to developing ways that we can grow our business together.
If you are considering a VA Home Loan the fastest and easiest way to find out if you qualify is by connecting to a VA Home Loan Specialist who can help to determine your eligibility, qualification level and let you know what your options are.
It doesn’t cost you anything and there is no obligation.
You May Be Eligible If Any One of the Following are True:
- Served 181 days during peacetime (Active Duty)
- Served 90 days during war time (Active Duty)
- Served 6 years in the Reserves or National Guard
- You are the spouse of a service member who was killed in the line of duty.
Get connected with a VA Loan Specialist who can help you maximize your VA benefits and let you know what you qualify for.
It’s still a great time to refinance and the purchase market couldn’t be better for a buyer.
These rates are based on no points, rate and term refinance or a purchase, with qualifying income, loan to value and fico scores. **
FHA 30 Year Fixed 4.50%
FHA 15 Year Fixed 3.875%
30 Year Fixed 4.75%
15 Year Fixed 4.125%
Jumbo 15 year Fixed 4.50%
Jumbo 30 year Fixed 5.125%
Here’s a couple of neat things we can do or do better!
With the current economy and a lot of people struggling, some new products have become available to help these borrowers.
1. FHA loans with FICO scores as low as 540.
2. FHA loans with up to 2 mortgage late payments in last 12 months.
3. Conventional loans 620 minimum fico, 1 mortgage late in last 12 months
4. Conventional loans with only 3% down or 97% LTV, NO monthly mortgage insurance
5. Jumbo Loans In house at great rates (see above)
6. We now have Maine State Housing
7. We now do everything under one roof! Appraisal Ordering, Processing, Title, Underwriting and Closing!
For a FREE evaluation contact me today!
The national median existing single-family home price was $158,700 in the first quarter, down 4.6 percent from $166,400 in the first quarter of 2010. The median is where half sold for more and half sold for less. Distressed homes typically sold at a discount of about 20 percent, accounted for 39 percent of first quarter sales, up from 36 percent a year earlier.
Lawrence Yun, NAR chief economist,said lower priced homes have seen the best sales performance. “The biggest sales increase has been in the lower price ranges, which are popular with investors and cash buyers,” he said. “The preponderance of sales activity at the lower end is bringing down the median price, so what we’re seeing is the result of a change in the composition of home sales.”
Although sales are slightly below a year ago, the volume of homes sold for $100,000 or less in the first quarter was 8.9 percent higher than the first quarter of 2010, creating a downward skew on the overall median price.
The share of all-cash home purchases rose to 33 percent in the first quarter from 27 percent in the first quarter of 2010.
How is Portland, Maine holding up?
Well ending March 31st 2011.. a total of 102 home and condo transactions transpired compared with 136 in 2010 and thus representing a somewhat significant volume decrease of 25% year over year! Despite the volume drop.. median prices continue to remain strong and actually showed a statistical 8% jump from $206,000 in the first quarter of 2010 compared with $222,000 this previous quarter. Buyers “from away” coupled with still many first time home buyers in the marketplace continue to help keep our market strong overall.
Employment in April was up across the band of specific jobs; retail jobs increased 57,100 the largest increase since April of 2000; manufacturing +29K, goods producing +44K, service-providing +224K, government jobs down 24K. Those unemployed fro more than 27 weeks declined to 5.839 mil frm 6.122 mil in March. The U-6 unemployment rate at 15.9%; U-6 measures total unemployment, plus all personnel marginally attached to labor force and total employed part time plus all persons marginally employed.