The Blog Report

Ok there has been a lot of discussion about the extension of the tax credit so let me try and clear up some of the confusion in this blog. On June 28th it had become somewhat public, at least on the internet, that the Senate was looking into extending the tax credit.  However what most people didn't realize was that it was not to extend the credit to potential homebuyers, but to extend the mandatory close date of June 30th.  In other words, for borrowers that had entered into an agreement by April 30th they needed to close that loan by June 30th.  On June 29th we in the industry were notified that the House did not pass the extension, it had failed by 2 votes (I have yet to find out who voted it down).  So now the mad rush continues and what a hair pulling experience this became. Tempers were flying, frustration levels hit a new high and I have heard that even tears were shed. 

Now where the confusion continues is somewhere between June 30th and July 1st, the House reconvened and passed the extension (of course after the damage was done) to a close date of September 30th.  Again, this is for closing existing loans only, not for new loans.  So since I can already hear the next question, let me answer it now.  Yes, if you have a contract dated on or before April 30th and you can close before September 30th, technically you would be eligible for the tax credit.  However, you better have a good reason why you waited 3 months before applying for your loan application!

With that now out of the way, let me leave you with this.  Rates are at a 50 year low, what are you waiting for? Go buy a house!! This is the closest we will get from legally stealing money.  Some APR's are as low as 3.75%!

If you think you are ready be sure to get pre-approved at www.centerpointemortgage.com/getpreapproved

So now that we reflect on the Tax credit that has been not only extended but made available to step up buyers, what happens after April 30th when it expires?  Along with the Governments decision to back away from purchasing mortgage backed securities which will come into play March 31st?  Some say good bye to the low rate environment we have been in for the last 5 years, while others think this is good.  Fannie Mae and Freddie Mac finally "get it", meaning no more zero down programs, no more stated income loans, and no more subprime lending.  So if your wondering where does that leave you, this is my opinion.  Are you now paying rent? If so, how much? Are utilities included? Is your Landlord "cool"?  Are you concerned about write off's?  Do you want pride of ownership? Do you like your neighbors?  Are your parents "buggin" ya? 

I think you know where I'm going.  Even if you miss out on the tax credit I believe that owning real estate is the best thing a young person can do.  My first home came with a mortgage rate of 11% but I was still able to afford it (thanks to some great roommates) and I loved owning and entertaining in my own home.  It is an experience everyone needs to feel at least once in their lifetime.  Only then can you decide if home ownership is cut out for you.

So seriously, you really have to take advantage of home prices today along with the low interest rates.  It is a buyers market and you need to jump in.  Looking back, you will have great memory's and I hope to read about them on your blog.  Call me to get pre-qualified today, remember at CenterPointe Mortgage pre-qual's are always fast, easy and free!

Well, well, well, here I am deep into the Red Flag Rules, the Grahmm-Leach-Bliyley Act, RESPA, TIL, Section 32, Reg Z, Reg X, Reg C, so on, and so on, and so on.  So... how do I feel now? I asked for it, I got it.  Those that know me personally, know that I have been inviting licensing into my industry for years (actually decades, but who's counting?). Well, I got my wish, cause here it is and now I must pass a test that I have not had to do since leaving college 20+ years ago.  Cramming now, doesn't seem to have the same fun I remember from my college days, you know, dorm rooms, funnels, buddy's etc... I have been finding myself hitting the books after work every night for the last 3 weeks, and I must say after 8+ hours of work, it hurts.  But again, I asked for it so I better accept it, and I do.  Not just for me but for you. Yes you, the customer, the Realtor and every other potential client I may have.  Call me old school, but I truly want to offer the best financing solutions available.  I really do believe that this instrument known as a "mortgage" can help us reach our financial goals.  It is not and let me repeat NOT a commodity, if structured professionally by a licensed Mortgage Loan Originator, one who has put the time into studying, to be better, to know more, to offer more, than you may think twice about asking your Banker "whats your 30 year rate" because there is so much more to wealth creation through your mortgage than just shopping rate. 

Ok, well I must go back to the books, I have a Federal test coming up shortly, please wish me well at john@centerpointemortgage.com.

Well here we are, another year gone by and if you are in the Real Estate business as either a Realtor or mortgage professional you probably didn't let the door hit you in the tush.

So where does that leave us?  The first word that comes to mind is "patience". For the first time in decades, the mortgage industry is going through some significant changes, some good and some...well lets just say that is to be determined.  But good or bad, as a Realtor and Mortgage Planner you must practice patience.  We are all learning the do's and don'ts with the HVCC laws and I can say they have mostly been don'ts.  Now even though HUD has suspended the HVCC requirements on FHA appraisal's it is earmarked to start on February 15th, so it appears for now it is here to stay.

As of this writing, we all have to contend with a new Good Faith Estimate and I have yet to see how this will make the industry any clearer for the consumer.  By the way these changes are not just going to affect the mortgage broker, they will affect the mortgage Banker, Realtor and consumer.  Let me give you one example of how the process could be impacted very negatively.  The new GFE now requires the Lender to be held to very strict closing costs figures with very slim tolerances on some items.  The problem is that if there is a delay due to documentation, appraisal, legal work etc..that may lead to a rate expiration. That process will no longer be a simple phone call into the pricing department to adjust.  It will now require something similar to a change order that may trigger a "rescission period" before the new clear to close can be issued. It will have to be determined if the expiration was due to an acceptable condition before a rate can be changed or extension fee can be granted. In the past this was usually handled very quickly and adjustments could be made at the closing table. My suggestion would be to stick tight to 30 day commitment time frames and 60 day closing time frames on your purchase contracts.  It is always better to under promise and over deliver.  At least lets see how the new guidelines impact closing times before we shorten our dates. 

Lets also keep in mind that these are industry changes, the consumer will have no idea that the process and documentation has recently gone through an overhaul, and they probably won't care much since they are focused on buying their new home.  I am planning on taking a "business as usual" approach but will stay very close to the behind the scenes details that our industry is going to experience.  Hopefully excellent communication with Lenders, compliance officers, Fannie, Freddie and HUD will smooth out the bumps.

My suggestion to all Realtors would be to contact your loan officer and discuss the new changes, see how you both can handle questions that may come up and make sure you both are under promising and over delivering.

Good luck in 2010, I believe it will be a great one!

It has been announced today on Fox business news that rates will not only remain stable but may even drop another 50 basis points, the new tax credit which offers the step up buyer a $6,500 tax credit along with the extended $8,000 for first time buyers is going to pump new life into a very volatile real estate market.  ARE YOU READY? Now lets not get too excited because the realty is that you and me the tax payer is going to subsidize this tax credit.  However most of us do agree that this credit will stimulate not only real estate sales but will also add to durable goods sales, real estate tax infusion which should help local districts and our community.  It should help small business and hopefully the overall cost should eventually reach a breakeven or at least a positive dent in our deficit.

Well, lets get past the boring stuff and talk about the exciting opportunities here.  Lets face it, 2009 has been challenging and has also weeded out some people, mostly part timers. And I have always said, there is no room for part timers in this business, or in the mortgage business.  If you are looking to supplement your income call Macy's they can use the Xmas help. Real estate is big business, not for the faint of heart.  I may be offending some but I must say you have already offended your client once you list their property and give them part time service. 

I am expecting to see big numbers for 2010 and I am happy to see that my loyal and very hard working Realtor partners are gearing up for it.  Don't throw in the towel, remember when the going gets tough, the hard working tough get going!

I am announcing now...2010 is The Year Of The Realtor

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