Clearwater Florida Homes Condos Real Estate

 

FHA first shared these changes on August 4th, after it had been approved by Congress and then the President signed off on it on August 11th. FHA has finally come out with the mortgagee letter, ML 2010-28, which puts it officially in writing now.

This mortgagee letter is effective on FHA loans in which the case number is assigned on or after October 4th, 2010. This policy will increase the monthly mortgage insurance and decrease the mortgage insurance premiums for purchase money and refinance transactions, to include FHA streamline refinances.

 

 

 

So what are the major FHA changes regarding mortgagee letter 2010-28? - For terms greater than 15 years -

• LTV's <= 95% will increase the monthly fee to 85 bps  >> Old monthly fee was .50 bps
  

• LTV's >   95% will increase the monthly fee to 90 bps  >> Old monthly fee was .55 bps 

 

And lastly, it will reduce the Upfront Mortgage Insurance Premium, UFMIP, from 225 basis points to 100 basis points.

 

 

How will this affect new homebuyers?

3 quick examples (these examples are putting the minimum down payment of 3.5%)

• On a $275,000 mortgage – the change in payment would be about $70 higher a month

• On a $200,000 mortgage – the change in payment would be about $45 higher a month

• On a $125,000 mortgage – the change in payment would be about $27 higher a month

 

Buyers Beware - If you have your eye set on a specific home, or are negotiating on a property, or are very serious about buying soon, you will have 31 days to make a mortgage application before these new changes take place.

 

 

FYI in regards to Charlie Ragonesi's  comment, #4 - I still don't think that this will move buyers from FHA loans to conventional loanss.  Here is my reason why... please read : FHA loans vs conventional loans  - The buyer's buying power will only decrease by about $10,000 or so. 

 

 

These 2 posts I wrote previously below go into more details about the changes and showing more detailed figures.

 

• Bill H.R. 5981 passes - FHA Mortgages to increase it's annual mortgage insurance premium

• STOP TAXATION? - The new changes for FHA loans are being called : The New Homebuyer Tax

 

 

 

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- FHA Loans - USDA Loans - VA Loans -

- Energy Efficient Mortgages - 

- Conventional Loans - 203 k loans -

- FHA Home Loans - Mortgages -

 

Experience & Knowledge at its BEST !!!

 

 

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For more information on FHA loans, please go to this link. The FHA Expert

For important mortgage insight to watch for, please read : Consumers need to be aware of these Red Flags!

For information about FHA myths & FHA rumors, please read : FHA Myths & Rumors

 

Copyright © 2010 by Jeff Belonger of Infinity Home Mortgage Company, Inc

 

 

 

 

Many of Laurie's friends have been chatting and realized that if we all sent flowers to her service in New York or to her Memorial Gathering in Long Beach there wouldn't be much room for people.  We have set up a Laurie Manny Memorial Fund for those who would like to make a donation.  I know there will be tons of flowers at her services in New York and we will be providing flowers in Long Beach so we thought that perhaps her friends might like to donate to a fund that will go to her family.  Your donation will not be tax deductible as you are sending a gift to a friend.

 We had thought we would be able to set it up with a national bank but the paperwork was more then seemed necessary.  Marlene Bridges is at her home in Palm Springs this week and was kind enough to inquire at a local bank and set up the account there.

Make Checks Payable to:   Laurie Manny Memorial Fund

Mail to:  

Attn: Tellers

El Paseo Bank

The Market Place

39580 Washington Street

Palm Desert, CA  92211

We plan to close the account on October 1 and distribute the money to the family at that time.   We will also have a place where you can make a donation at the Memorial Gathering in Long Beach for those who will be there.

If you have questions you can contact Kaye Thomas, Lynda Eisenmann or Marlene Bridges .  We hope to see you next Thursday iin Long Beach!

 

We tend to jump through lots of hoops to please a customer.  This morning I got a "TEXT" message on my phone that read:

               "We have selected another Realtor to sell our house. Thank you for your presentation"

Flashback to 2 weeks ago.

I had a call from a prospective client wanting to interview Realtor(s) about selling their home.   He was pressed for time and had to meet me at 9am the next morning, before he left town.   I got my research done, and was prepared.  

During our meeting at his home, his phone rang twice.  Both calls were from other Realtors®.   That confirmed that I was not the only agent he was interviewing, and I was not the last on his long list.

           **  He was not happy with the market statistics.

           ** He was not happy with my suggested list price.

           ** He wanted me to understand that his home was the best                              home in the neighborhood.

At the end of our meeting he asked if I would like to change my suggested list price on my presentation?  I told him that I would not make promises that I could not keep, and couldn't deliver a buyer at his high price goal.

I won't mislead my clients about the market, or the comparable sales that were used in my presentation.  I explained the issues with our buyers market.   A well informed "SELLER" is more important to me that just getting a listing.  Buyers want the biggest bang for their buck. As a  professional service, I rely on the Three P Approach: Price, Presentation, Promotion.  We want the buyers to want his home, and not one of the other 10 homes for sale in the same neighborhood.

                                    The market is what it is....not what we wish it to be.   

   

 

Let’s connect on these great social networks:

 

If you're looking for a home in the Gainesville area, you can visit my primary Gainesville FL Real Estate website at www.ehomesgainesville.com.  Thanks!

 

 

 

FHA first proposed the monthly mortgage insurance changes in the beginning of 2010. Bill H.R. 5981 was first passed by the House in the spring and was just passed by the Senate the other day.  What does this bill do for FHA mortgages? They have projected that it will yield approximately $300 million per month to the FHA insurance fund.

So what are the new FHA changes? - For terms greater than 15 years -

LTV's <= 95% will increase the monthly fee by 85 bps

LTV's >   95% will increase the monthly fee by 90 bps

And lastly, it will reduce the Upfront Mortgage Insurance Premium, UFMIP, from 225 basis points to 100 basis points.

The plan is to go into effect by September 7th, 2010 on all FHA case numbers. FHA gives it's reasons to this new plan. FHA letter from David H. Stevens

 

 

 

So what do the actual changes mean to the average borrower that will rely on FHA loans when purchasing a new home or refinancing?

                - The Old Plan -

LTV's <= 95% will increase the monthly fee by 50 bps

LTV's >   95% will increase the monthly fee by 55 bps

 

 

Example of the changes regarding the FHA monthly mortgage insurance known as MMI or annual mortgage insurance premium and the FHA upfront mortgage insurance premium known as UFMIP.

 

 

 

 

 

 

 

 

 

 

 

 

As you can see, it would be much cheaper monthly with the old plan, even though you pay $3,317 more upfront, on top of your loan. This can also be a tax write off since it's included in your principal. You break even point on this type of scenario is 47 months, which is roughly 3.9 years. After this break even point, you would have started to spend more money in reality. This is how FHA will increase it's mortgage fund. As you can see, it won't be increased as quickly upfront, but over a longer period of time. So if you held onto this mortgage for 7 years, you would have spent approximately $2,522.

Now, there are several other factors to consider when reviewing this kind of information.  Just for the fact that your original balance on the loan will be $3,317 lower and in 7 years, still be that much lower. And as I mentioned, you would have a little more of a tax advantage on the higher balance though.

All I wanted to do was to present the basics of FHA loans and not get into the extreme details on how one could show either side. What could this do to a potential home buyer?  It could reduce your purchasing power. In this scenario, if you had originally qualified for a $275,000 loan with qualifying ratios of 31/43, what would your new purchase price be.

 

 

- New Purchasing Power after September 6th, 2010 -

With the new FHA monthly mortgage insurance and the FHA upfront mortgage insurance premium changes, your purchasing value would drop approximately $10,000, a purchase price of $265,000. Now, these are just averages, because this will all be based on the actual purchase price. Meaning if values are higher or lower, the total amount could change some. But this should give you a good understanding of what changes lie ahead for FHA mortgages in the near future.

 

 

UPDATE : Travis Newton did a similar post, using a $200,000 purchase price and as you can see, the mortgage payment inceased by $45.29/month.   Notice *** FHA Changes

 

 

_____________________________________________________________________________________________________

 

                  

                                                                                                           FOLLOW ME ON FACEBOOK

 

 

- FHA Loans - USDA Loans - VA Loans -

- Energy Efficient Mortgages - 

- Conventional Loans - 203 k loans -

- FHA Home Loans - Mortgages -

 

Experience & Knowledge at its BEST !!!

 

 

Follow me on:

 

 

_____________________________________________________________________________________________________

For more information on FHA loans, please go to this link. The FHA Expert

For important mortgage insight to watch for, please read : Consumers need to be aware of these Red Flags!

For information about FHA myths & FHA rumors, please read : FHA Myths & Rumors

 

Copyright © 2010 by Jeff Belonger of Infinity Home Mortgage Company, Inc

 

City of Treasure Island Parking Pass

Treasure Island sells an annual parking pass that can be used for free parking at 6 parking lots. The pass costs $5 and is available only for Treasure Island residents and property owners.

The pass is plastic hanger designed to be hung from your windshield rear view mirror so it is visible to parking enforcement officers.

The parking pass is valid from 1/1 to 31/12 but can be bought anytime during the year.

If you want a pass, you must show proof of Treasure Island residency. You can bring in

• Vehicle registration
• Valid drivers License
• Current Voter ID
• Rental Agreement (6 months minimum)
• Utility Bills (4 months minimum)
• Treasure Island Property Owner (Tax Bill or Deed)

For more Info call: 727-547-4575 ext. 221

Metered Parking Lots where the pass is valid:

Heron Lot
Bay Shore Drive & 75th Avenue, Sunset Beach

Tern Lot
West Gulf Boulevard at 77th to 79th Avenues, Sunset Beach

Ring-Billed Gull Lot
West Gulf Boulevard & 81st Avenue, Sunset Beach

Brown Pelican Lot
West Gulf Boulevard & 88th Avenue, Sunset Beach

Sandpiper Lot
Gulf Boulevard & 100th Avenue, Mid Island

Gulf Front Lot
Gulf Boulevard & 104th Avenue, Downtown Treasure Island

Community Center Lot
106th Avenue & 1 Park Place, Downtown Treasure Island

White Egret Lot
126th Avenue, Sunshine Beach

 City of Treasure Island Parking Pass

This afternoon Wells Fargo foreclosed on Baywalk retail complex in downtown St. Petersburg. Other developers had expressed interest, but none placed a winning bid today.

Baywalk was a critical part in the redevelopment of St. Petersburg, and hopefully will again be a popular and successful destination. We enjoy Gratzzi's Italian restaurant, which is one of the original tenants. Chico's is another early tenant, as is Muvico. The existing businesses and restaurants will continue operating.

It's expected that Wells Fargo Bank will redevelop and improve the property prior to placing it actively for sale.

Congress Approved the $8,000 Tax Credit For Homebuyers.  Here are answers to frequently asked questions.  

Frequently Asked Questions About the $8,000. Federal Tax Credit

Q: A:	How much is the tax credit? The tax credit would be $8,000 or 10% of the purchase price, whichever is less.
Q: A:	Who is eligible? Similar to the $7,500 tax credit included in the Housing and Economic Recovery Act of 2008, the $8,000 tax credit (included in the 2009 economic stimulus plan) is available for the purchase of the primary residence by first-time homebuyers.
Q: A:	If this is for first-time homebuyers, how do I know if I am eligible for the tax credit? According to the IRS, any taxpayer who has not owned a home during the 3 years prior to the date of purchase can qualify for the credit.
Q: A:	Do I have to repay the $8,000.? No.  Unlike the previous $7,500 tax credit, the $8,000. does not have to be repaid UNLESS, the home is sold within three years of purchase; at that time, the credit will be reversed.
Q: A:	Are there any income limitations on the tax credit? Yes.  The tax credit is strictly for individuals with adjusted gross income of under $75,000 or $150,000 for joint filers.

Now that you're qualified for the Tax Credit, let's go shopping for Charlotte NC homes for sale today!

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About the author:

Debe Maxwell is a Charlotte Residential Real Estate Broker, Certified Neighborhood & Relocation Specialist, ABR & e-PRO who can assist you with the purchase and/or sale of real estate in the Charlotte NC Metro Area.  If you're relocating to or from any other area of the country, Debe connects you with any member of her team of relocation professionals in your destination or exit city of choice.  The destination service is of no cost to you!  The Maxwell House Group's quality service guarantee puts this team far ahead of the competition; providing unsurpassed customer service is their #1 priority!  Debe Maxwell -- Helen Adams Realty -- 704.491.3310

Copyright© 2009 By Debe Maxwell, All Rights Reserved...**$8,000 Federal Tax Credit FAQ **

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Disclaimer:  All information provided by this author is strictly an opinion, is not guaranteed, may be based on information collected from several sources, which may or may not be deemed reliable at the time of researching this article and may be time sensitive.

Sorry, I didn't get a chance to do updates during the week, things were moving so fast that I barely had the time to keep on top of them myself.  Pretty much everybody is fixated on the "crash" in the stock markets with major US indexes plunging about 17% on the week, but equity markets are just a symptom, it's important to look at the cause. 

The deterioration in the credit markets on a daily basis was simply stunning, and resulted in a near lock down of both intrabank lending and financial commercial paper markets by the end of the week.

Bond market dislocates

We saw what is referred to as a dislocation in the bond market early this week, and these types of dislocations, historically without fail have lead to stock market crashes.  Basically we had money fleeing long term US treasury bonds, causing their price to plummet and thus the yield to increase.  This happened at the same time the opposite occurred in short term US treasury bonds as people flocked to safety, and at times in the week even drove the yield on 13 week treasuries negative (yes it is possible). 

There is a very strong correlation between equities (stocks) and bonds, as money moves out of stocks it typically moves into bonds and vice versa.  So if stock prices are going up, bond prices are going down.  We saw this correlation totally destroyed this week, as stocks were crashing, long bond prices were plummeting (yields increasing). This indicates capital (probably foreign capital) fleeing long term US treasuries.  Chart below of the ten year treasury yield and second the DOW during the week. Yes, this is VERY bad.

What caused the dislocation?

Simply put it was CAUSED by the $700B bailout and the FED's buying of the commercial paper early this week.  The reason is simple supply and demand economics. It was something many people saw coming and I mentioned was one of the reasons I was so adamant the bailout had to be stopped.  The bailout means the US Treasury has to issue significantly more long term US Treasuries to fund it at the same time the demand for them is staying essentially flat or possibly even decreasing.  Increased supply with flat demand means prices of long term treasuries are going way down and yields (interest rates) are going way up.  It's not rocket science. Even though the treasuries have yet to issued the bond market is beginning the process of pricing it in.

The more we try to bail things out the higher we will force long term interest rates, ultimately extending and deepening the real economic pain.  If the stock market had not crashed at the same time forcing money into bonds to hide, we would have seen an absolute explosion in long term rates this week.

What does it mean?

As a real estate agent or loan officer the implications will probably scare the you know what out of you.  Rates are almost certainly going much higher over the next few months, and I think there is a probability of a 1930's style bond market collapse being triggered.  If this type of bond market collapse does occur, we're not talking a 1 or 2% increase in rates, I'm talking at minimum double where they are now and in the space of a year.  Yes, I know it that seems improbable, but it's happened before under similar circumstances.

Below is a chart of the 1930's bond market collapse, and we are almost matching the event chain and timing perfectly (we're finishing the flight to quality stage).  While i hope history does not repeat, our policy makers seem dead set on following the exact same ill fated path and the bailout may have pushed us across the event horizon.

 

* Lower bond prices mean higher yield/interest rates.

Credit market indicators

I mentioned above many indicators of stress in the credit markets went through unbelievable deterioration on a daily basis during the week.  One of the main ones I watch is the TED spread which is the spread between 3 month treasury yields and 3 month LIBOR rates.  The higher it goes the more stress. This is because short term treasury yields drop in times of fear because they are considered the safest place to stash money while LIBOR will increase as banks become more fearful of lending.

The long term average spread is about 30 basis points and anything over 200 basis points is crisis mode.  We started the week at 382 basis points and continuously ramped to finish at 464 basis points.

As indicated by TED spread LIBOR rates continued to explode during the week.  Overnight LIBOR rates ramped to well over 4% as banks became fearful of lending to each other, until collapsing on Friday due to coordinated central bank action.  But 3 month LIBOR continued on it's ramp and is now close to double what is was a couple months ago. LIBOR rates are extremely important because there is over $300T in worldwide debt that is in someway tied to these rates.  So they go up, borrowing costs for banks and businesses go way up, and almost every business is reliant on credit to some degree.

From a banking perspective banks often borrow at LIBOR and lend at a rate tied to the the FED's target rate.  So the increasing spreads and other effects on the yield curve are absolutely destroying the ability of the banks and other financial institutions ability to make money.

Other significant events

* Iceland's banking and financial system collapses during the week forcing them into official bankruptcy on Friday

* Hungary's bond market collapses

* Japan's main banks began firewalling themselves off from other world banks and refusing to lend

* World equity markets plunged, in most cases worse than US's, with trading suspended indefinitely by several of them including Russia

* G7 meetings going on this weekend and everybody is scrambling for a solution

Stock market stuff

Even though I'm a very active trader myself I generally avoid talking about stock markets on my blog here at ActiveRain.  I try to keep it to credit markets that have a direct impact on rates and loan availability and thus the real estate industry.  The stock plunge we've seen in the last couple weeks has certainly been pretty devastating, for comparison here's the 2000 dot com crash on a monthly chart vs. our current one.

For many reasons both technical and fundamental I think we are very overdue to a violent snap back rally in this bear market, possibly starting this week, but we probably have a long ways to go still before we put in an ultimate bottom.  So be safe...