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Tuesday, November 25, 2008
New Northtown, Phoenix
Central A/C
FEDERAL RESERVE TO PUMP $600 BILLION INTO HOUSING
It is about time they deal with the issue: Supply and Demand of Housing. That is it. To stop the bleeding, the supply of homes coming to the market must be slowed. Demand is back as buyers purchase homes at values not seen in nearly 5 years. Value is back. But the problem is there are still too many homes coming to the market and they are fighting for the buyers with their price. Here in Phoenix, one big problem is Short Sales. The government must stream line short sales now. Due to the long waiting period to get any type of answer, I am talking 3 to 8 months, buyers and Realtors are avoiding Short Sales. What does that do, the Short Sales must drop to outrageously low prices to attract a buyer. This drives the whole market lower! This is the $6 million dollar question; how to stabilize the Short Sales before the drive all values to ZERO! For example, single family home at Tatum and Bell, selling in the DAY for $400K, last sale $240K, NEW SHORT SALE LISTED at $175K. That is tomorrow's comp.
Just My Opinion...Jeff Cameron
Fed Unveils Plan to Support Mortgages, Consumer Credit
Topics:Interest Rates Consumers Federal Reserve Economy (Global) Economy (U.S.)
Reuters and CNBC.com 25 Nov 2008 08:27 AM ET
The U.S. Federal Reserve, in another massive life-support intervention for the U.S. financial system, Tuesday announced a $600 billion program to buy mortgage-related debt and securities and a $200 billion facility to buy consumer debt securities.
The U.S. central bank said it would buy up to $100 billion in debt issued by Fannie Mae, Freddie Mac, and the Federal Home Loan Banks, the government-sponsored mortgage finance
enterprises.
The Fed also said it would buy up to $500 billion in mortgage-backed securities backed by Fannie Mae, Freddie Mac, and Ginnie Mae.
The move is intended to strike at the heart of U.S. economic woes, the collapsed housing market.
"This action is being taken to reduce the cost and increase the availability of credit for the purchase of houses, which in turn should support housing markets and foster improved financial conditions more generally," the Fed said in a statement.
Read the rest of the story: http://www.cnbc.com/id/27906891
Just My Opinion...Jeff Cameron
Fed Unveils Plan to Support Mortgages, Consumer Credit
Topics:Interest Rates Consumers Federal Reserve Economy (Global) Economy (U.S.)
Reuters and CNBC.com 25 Nov 2008 08:27 AM ET
The U.S. Federal Reserve, in another massive life-support intervention for the U.S. financial system, Tuesday announced a $600 billion program to buy mortgage-related debt and securities and a $200 billion facility to buy consumer debt securities.
The U.S. central bank said it would buy up to $100 billion in debt issued by Fannie Mae, Freddie Mac, and the Federal Home Loan Banks, the government-sponsored mortgage finance
enterprises.
The Fed also said it would buy up to $500 billion in mortgage-backed securities backed by Fannie Mae, Freddie Mac, and Ginnie Mae.
The move is intended to strike at the heart of U.S. economic woes, the collapsed housing market.
"This action is being taken to reduce the cost and increase the availability of credit for the purchase of houses, which in turn should support housing markets and foster improved financial conditions more generally," the Fed said in a statement.
Read the rest of the story: http://www.cnbc.com/id/27906891
Q3 GDP DROPS 0.5%
We are so statistic driven. OK, now that we have a recorded drop in the Q3 GDP of 0.5% will everyone agree we are in a recession that could get worse. My shock is that this was inevitable last year. You can't stop building homes and not affect the economy. I remember arguing with my stock broker last year, when selling retirement funds and going to an all cash position. He said, "you can't time the market Jeff!" I said, I can use my brain. Why walk through the big hole when I could walk around it????
Just My Opinion...Jeff Cameron
Economy Drops 0.5%, Worst Fall in 7 Years
AP 25 Nov 2008 08:50 AM ET
The economy took a tumble in the summer that was worse than first thought as American consumers throttled back their spending by the most in 28 years, further proof the country is almost certainly in the throes of a painful recession.
The updated reading on the economy's performance, released Tuesday by the Commerce Department, showed gross domestic product shrank at a 0.5 percent annual rate in the July-September quarter.
That was weaker than the 0.3 percent rate of decline first estimated a month ago, and marked the worst showing since the economy contracted at a 1.4 percent pace in the third quarter of 2001, when the nation was suffering through its last recession.
Read the rest of the story: http://www.cnbc.com/id/27905989
Just My Opinion...Jeff Cameron
Economy Drops 0.5%, Worst Fall in 7 Years
AP 25 Nov 2008 08:50 AM ET
The economy took a tumble in the summer that was worse than first thought as American consumers throttled back their spending by the most in 28 years, further proof the country is almost certainly in the throes of a painful recession.
The updated reading on the economy's performance, released Tuesday by the Commerce Department, showed gross domestic product shrank at a 0.5 percent annual rate in the July-September quarter.
That was weaker than the 0.3 percent rate of decline first estimated a month ago, and marked the worst showing since the economy contracted at a 1.4 percent pace in the third quarter of 2001, when the nation was suffering through its last recession.
Read the rest of the story: http://www.cnbc.com/id/27905989
Friday, November 21, 2008
Fannie Mae to Temporarily Halt Foreclosure Sales and Evictions
Fannie Mae has issued Lender Letter 04-08 announcing that it is halting all foreclosure sales on occupied single-family properties that are scheduled to occur from November 26, 2008 through January 9, 2009. This temporary halt also applies to eviction lockouts of occupied single-family properties.
These actions allow affected borrowers to retain their homes while Fannie Mae works with its regulator and conservator, the Federal Housing Finance Agency, to implement the previously announced streamlined loan modification program by December 15, 2008.
To facilitate borrower communications, servicers must instruct foreclosure attorneys to send letters to borrowers whose foreclosure sales are halted urging them to contact their servicer, so that together, the servicer and borrower can continue working to resolve the delinquency.
For complete details, including other servicing and reporting requirements, please see Fannie Mae Lender Letter 04-08 on our 2008 Lender Announcements and Letters page on eFannieMae.com and the news release on fanniemae.com
These actions allow affected borrowers to retain their homes while Fannie Mae works with its regulator and conservator, the Federal Housing Finance Agency, to implement the previously announced streamlined loan modification program by December 15, 2008.
To facilitate borrower communications, servicers must instruct foreclosure attorneys to send letters to borrowers whose foreclosure sales are halted urging them to contact their servicer, so that together, the servicer and borrower can continue working to resolve the delinquency.
For complete details, including other servicing and reporting requirements, please see Fannie Mae Lender Letter 04-08 on our 2008 Lender Announcements and Letters page on eFannieMae.com and the news release on fanniemae.com
FHA Lowers Loan Limits
FHA lowers limits on loans, an article from azcentral.com, reports that starting in January the new FHA loan limit for Maricopa County will be $271,050. The current FHA limit in the Valley is $346,250. So, for anyone interested in using an FHA loan to purchase a home - now is the time to do it. Every Arizona county will see their FHA loan limit drop to $271,050, except Coconino, where it will be $333,750.http://www.azcentral.com/arizonarepublic/business/articles/2008/11/19/20081119biz-catherine1119.html
Please call or email me with questions.
Staci McCarville
480-778-2614
staci.mccarville@prospectmtg.com
Please call or email me with questions.
Staci McCarville
480-778-2614
staci.mccarville@prospectmtg.com
Monday, November 17, 2008
Short Sale 101
You see them everywhere, SHORT SALE, signs or in advertisements. Essentially a short sale is trying to sell your home for less than you owe, and having the bank agree to accept less than owed. After two years of heavy short sale activity, buyers and buyer’s agents continue to veer away from short sales. Long processing times by banks make it difficult for any buyer to hang on to the hope this approval will come. Generally this leads to the home being foreclosed on, driving the market further down.
Why do so few short sales go through? Is it the banks? Is it the buyers? Is it the Realtors?
Maybe the answer is all of the above.
With the banks, most first mortgages are actually cooperative, if they feel the home is bing sold within 92% of its value. Their problem is it takes between 90-120 days to get an approval. The bigger set-back is with the second mortgages. Due to their Mortgage Insurance requirements, they do better on the foreclosure with an insurance claim, then they do accepting a short pay-off.
Buyers are hurting short sales by not having the patience to wait for the approval from the bank. By the time the bank approves the deal, many buyers have bought another home. Most people need a place to live now, or need to move within a certain time frame. Open ended deals just lead to buyers finding another home.
Realtors are hurting short sales in two ways. One, by pricing homes way under market value to attract a buyer, only to have the bank reject the offer and two, by detouring their clients from buying a short sale. Who can blame them, with only a 20% success rate!
Unfortunately, these short sales are hurting everyone as they drive prices lower than, REO, bank owned homes, would have sold for.
Why do so few short sales go through? Is it the banks? Is it the buyers? Is it the Realtors?
Maybe the answer is all of the above.
With the banks, most first mortgages are actually cooperative, if they feel the home is bing sold within 92% of its value. Their problem is it takes between 90-120 days to get an approval. The bigger set-back is with the second mortgages. Due to their Mortgage Insurance requirements, they do better on the foreclosure with an insurance claim, then they do accepting a short pay-off.
Buyers are hurting short sales by not having the patience to wait for the approval from the bank. By the time the bank approves the deal, many buyers have bought another home. Most people need a place to live now, or need to move within a certain time frame. Open ended deals just lead to buyers finding another home.
Realtors are hurting short sales in two ways. One, by pricing homes way under market value to attract a buyer, only to have the bank reject the offer and two, by detouring their clients from buying a short sale. Who can blame them, with only a 20% success rate!
Unfortunately, these short sales are hurting everyone as they drive prices lower than, REO, bank owned homes, would have sold for.
Friday, November 14, 2008
ANOTHER SHORT SALE FALLS THROUGH
I can't tell you how disappointed I am to see how banks are responding to Short Sales. A Short Sale is the sale of a home where the seller owes more than the home is worth. We present the offer, comps and financial distress of the seller to the bank and hope to get it approved. This is an opportunity for the banks to sell them home without taking it back in foreclosure. Many times the bank would be able to sell the home at a higher price than after foreclosure due to condition and timing.
This short sale fall through was for one of my buyers. This is the second home that this buyer tried to purchase, that was a short sale and did not go through. The first and second mortgage companies were not apposed to the deal. It was the mortgage insurance company for the 2nd mortgage that killed it. It does not make sense. This would have been better for all involved, but the mortgage insurance company wanted the seller to sign a note in order to approve the deal. The note, had no amounts nor interest rate stated. They were going to fill those numbers in later. Who in their right mind would sign a note like that???
This also happened to one of my sellers mid summer. These are not the type of actions that will help us get through this period.
Just my Opinion...Jeff Cameron
This short sale fall through was for one of my buyers. This is the second home that this buyer tried to purchase, that was a short sale and did not go through. The first and second mortgage companies were not apposed to the deal. It was the mortgage insurance company for the 2nd mortgage that killed it. It does not make sense. This would have been better for all involved, but the mortgage insurance company wanted the seller to sign a note in order to approve the deal. The note, had no amounts nor interest rate stated. They were going to fill those numbers in later. Who in their right mind would sign a note like that???
This also happened to one of my sellers mid summer. These are not the type of actions that will help us get through this period.
Just my Opinion...Jeff Cameron
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