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As a Buyer The Mortgage Rate Change Could Hurt You

Cheap mortgages cannot last forever and years from now there is a good chance home buyers will look back at today's super-low rates.  More expensive mortgages will hurt the already lousy housing market.  Refinancing drove consumer spending before the crisis and it can still save homeowners a lot of $$.  The last quarter of 2011 had $281 billion in refinancing yet $79 billion below a year ago when the rates were higher.  Remember that when rates register a lasting rise, be prepared for another nasty side-effect of low rates...the impact of each percentage-point increase on payments seems more painful.  That is one more reason we will remember the good old days of low rates.

Carbon Monoxide Law for State of Washington SOLD Homes

State of Washington New Carbon Monoxide Law for Sold HomesEffective April 1, 2012 the new code requires a property owner to install carbon monoxide alarms when alterations, repairs or additions requiring a permit or when one or more sleeping rooms are added or created.Requires the Seller of any owner-occupied single-family residence to equip the residence with carbon monoxide alarms before a buyer or any other person may legally occupy the residence following the sale. This requirement applies to all single family residences, including single family homes, condominiums, and manufactured/mobile homes. 

When is the all going to get better?

Apparently looking for signs of a housing recovery might be like watching grass grow.  "The good news is that we're in a recovery...but we've got a ways to go so says Jed Smith who is the director of research for the NAR.  He says that distressed home sales are going to continue to account for 35% of all home sales for the next 2 to 3 years.  Foreclosures and short sales are not going to get worse, not going to get a lot better.  A promising sign for housing:  "We've got 10 million more households now than we did 20 years ago," which provides some pent-up demand when the market accelerates.  The shadow inventory of homes that have been foreclosed upon but haven't yet been listed for sale has contributed to consumers' uncertainty, he said, as prospective buyers don't know whether a foreclosed in their market or 1,000 homes may be hitting the market.  There is a huge overhandg of show inventory that's going to come into the market.  Not every city is Phoenix or Las Vegas.  The homeownership rate may overcorrect on the down side, sinking below the traditional standard of 64 to 65%, but once home prices stabilize...and consumers realize home prices have stabilized..there will be a resurgence in the homeownership rates.  The good news is that we're moving in the right direction.  The bad news is we don't believe that's going to be in the offing in the next few months. 

A Mini Look At the RE Market

While the numnber of Realtors has dropped in most location, the more experienced and successful agents are happy with optimism.  Home priced correctly are selling; some banks are becoming more efficient in selling foreclosures and short sales; and another drop in rates has encouraged Buyers.  This may be the best opporutunity in that it could be classified as a "clearance sale" HELPED BY LOW RATES.  The primary ingredient missing is still the first time Buyer.  Fears listed for the first time Buyer range from the lack of a down payment, unable to qualify, fear of job loss and concerns about values dropping further.  Underwriting is tight, but many low or no down payment programs exist.  Credit scores can be improved and lenders are lowering the minimum scores for approval.  Jobs are making very slow progress.  A few lenders offer job loss protection, some at no charge. 

What to watch regarding the real estate market conditions?

1)  Forget the national situation and instead concentrate on your local community and neighborhood.  2)  Talk to your local expert the Realtor about their opinion of the market status.  3)  The inventory of homes.  4)  Days for sale homes are on the market.  5)  Compare asking/listing price with the actual sales prices.  6)  Whether the local properties in your price range have gone up or down in value, and at what price.

How Long to Live In a Particular House

About how long should a buyer plan on living in their current or newly purchased house?  The average is now extended to beyond 6+ years and whether you have children or not does play a role.  Possibly you may need a larger residence or din a community with better amenities for your children and that will increase the likelihood of moving.

HomePath Loans Are Easy To Close

NO other loan will close as quickly as a HomePath loan. No appraisal req and No MI req. Investors can do only 10% down with no MI.


#1 – Inflation.  Public Enemy #1 of all fixed income investments.  #2 –The Federal Reserve.  As part of its 2008-2010 stimulus effort, the NY Fed spent almost all of its $1.25 TN budget buying mortgage bonds. Many believe this strategy kept mortgage rates lower over a 15 month period.  #3Unemployment.  Decreasing unemployment will suggest that mortgage rates will rise.#4- GDP – GDP, or Gross Domestic Product, is a measure of the economic output of the country.  High levels of GDP growth may signal increasing mortgage rates. The Federal Reserve slashes short-term rates when GDP slows to encourage people and business to borrow money. #5- Geopolitics – Unforeseen events related to global conflict, political events, and natural disasters will tend to lower mortgage relates.  Anything that the markets didn't see coming causes uncertainty and panic.