Fannie to offer closing cost aid on foreclosures WASHINGTON – Feb. 1, 2010 – Fannie Mae, the largest provider of residential home funding in the United States, announced on Friday that it would start to pay closing costs for buyers of foreclosed homes in its inventory. Buyers of qualified properties will get up to 3.5 percent in closing costs or an equivalent amount for the purchase of new appliances.
Fannie wants to clear out the nearly 50,000 properties it has in inventory – listed on HomePath.com, the Web site created by Fannie Mae last year to sell the growing number of foreclosed homes. The offer is available to any owner-occupant who closes on the purchase of a property listed on HomePath.com before May 1, 2010. Applicable properties can be found on HomePath.com, along with property descriptions, photographs, community and school information, and more.
In addition, some Fannie Mae-owned properties are eligible for special HomePath Mortgage and HomePath Renovation Mortgage financing, which offers qualified homebuyers the ability to purchase with as little as 3 percent down.
© 2010 Florida Realtors®
It’s not if interest rates will rise but when COLLEGE STATION, Texas – Feb. 1, 2010 – According to Dr. Mark Dotzour, chief economist for the Real Estate Center at Texas A&M University, mortgage interest rates are low right now but don’t expect that to last. When the government quits buying mortgage-backed securities, rates will head up and away.
Dotzour says that mortgage rates were low at the end of 2009 because “the global consensus among bondholders appeared to be that inflation will remain low in the United States for an extended period. This caused the ten-year U.S. Treasury rate to fall to between 3.2 and 3.6 percent for much of the second half of 2009.”
With extraordinary levels of federal deficit spending, Dotzour says it is unlikely that the low-inflation scenario will be popular when the economy starts to rebound. Consumers should expect mortgage rates to rise when signs of improvement appear.
A second factor contributing to the low mortgage rates is the Federal Reserve Bank’s unprecedented purchase of nearly all the mortgage-backed securities issued by Fannie Mae and Freddie Mac in 2009, he adds. Totaling more than $1 trillion for the year, this program has been extended through the end of March 2010.
“The Fed has never done this before in its history,” says Dotzour. “They are doing this to stimulate the economy by keeping mortgage rates as low as possible. When the Fed stops buying these securities from Fannie and Freddie, mortgage rates are likely to increase, and possibly quite abruptly.”
How far will rates go up when the Fed terminates its buying program? Dotzour says that question is difficult to answer precisely because this has never been done before; but many experts think that rates could move up one-half to 1 percent.
“The combination of extraordinarily low mortgage rates and current price levels are making homes extremely affordable to American families. In fact, national and Texas housing affordability indices indicate that homes are more affordable than ever. But this will not last. When the economy recovers and the Fed stops purchasing mortgages, rates will rise.”
© 2010 Florida Realtors®
YOUR FLORIDA KEYS REAL ESTATE CONNECTION
Rob Skeel , Realtor- e-Pro - Cell --305-393-6300 Email--rob@robskeel.com
Century 21 Keysearch Realty--877-660-4637
Web Site-- www.RobSkeel.com
Tuesday, February 2, 2010
Tuesday, January 26, 2010
Florida Home Sales & Interest Rates
If your thinking about purchasing Florida Keys property the cost of your purchase may start going up as the year progresses.
Please contact me and let me know what type of property and where you'd like to be and your price range and I will work to find just what your looking for.
Rob Skeel Realtor
Century 21 Keysearch Realty
305-393-6300
rob@robskeel.com
Florida’s existing home, condo sales up in December 2009
Dec. existing-home sales down, prices rise; 2009 sales up, says NAR.
ORLANDO, Fla. – Jan. 25, 2010 – Florida’s existing home sales rose in December, marking 16 months that sales activity has increased in the year-to-year comparison, according to the latest housing data released by Florida Realtors®.
Existing home sales rose 33 percent last month with a total of 14,630 homes sold statewide compared to 11,013 homes sold in December 2008, according to Florida Realtors. Statewide existing home sales last month increased 4.3 percent over statewide sales activity in November.
Florida Realtors also reported a 91 percent increase in statewide sales of existing condos in December compared to the previous year’s sales figure; statewide existing condo sales last month rose 22 percent over the total units sold in November.
Seventeen of Florida’s metropolitan statistical areas (MSAs) reported increased existing home sales and higher condo sales in December. A majority of the state’s MSAs have reported increased sales for 18 consecutive months.
Florida’s median sales price for existing homes last month was $140,400; a year ago, it was $155,300 for a 10 percent decrease. Housing industry analysts with the National Association of Realtors® (NAR) note that sales of foreclosures and other distressed properties continue to downwardly distort the median price because they generally sell at a discount relative to traditional homes. The median is the midpoint; half the homes sold for more, half for less.
The national median sales price for existing single-family homes in November 2009 was $171,900, down 4.4 percent from a year earlier, according to NAR. In California, the statewide median resales price was $304,520 in November; in Massachusetts, it was $285,000; in Maryland, it was $245,569; and in New York, it was $210,000.
According to NAR’s latest outlook, home sales are seeing a boost from the federal homebuyer tax credit. “There are many more potential buyers who can enter the market in the months ahead,” said NAR Chief Economist Lawrence Yun. “Activity should ramp up for another surge in the spring when buyers take advantage of the expanded tax credit, which hopefully will take us into a self-sustaining market in the second half of 2010. In all, 4.4 million households are expected to claim the tax credit before it expires, and balance should be restored to the housing sector with inventories continuing to decline.”
In Florida’s year-to-year comparison for condos, 5,968 units sold statewide last month compared to 3,132 units in December 2008 for an increase of 91 percent. The statewide existing condo median sales price last month was $107,000; in December 2008 it was $130,300 for an 18 percent decrease. The national median existing condo price was $178,000 in November 2009, according to NAR.
Interest rates for a 30-year fixed-rate mortgage averaged 4.93 percent last month, significantly lower than the average rate of 5.29 percent in December 2008, according to Freddie Mac. Florida Realtors’ sales figures reflect closings, which typically occur 30 to 90 days after sales contracts are written.
Lifelines dry up for mortgage lending WASHINGTON – Jan. 25, 2010 – For more than a year, the government pulled out the stops to revive homebuying by driving down mortgage rates.
Now, whether the housing market is ready or not, the government is pulling out.
The wind-down of federal support for mortgage rates, set to end in two months, is a momentous test of whether the Obama administration and the Federal Reserve have succeeded in jump-starting the housing market and ensuring it can hold its own. The stakes for the economy are massive: If the market again falls into a tailspin, homeowners could face another wave of trouble, and it would deal a body blow to President Obama’s efforts to get the economy on track.
Keeping the mortgage rates at historic lows, which required a commitment of more than $1 trillion, was viewed within the administration as a central plank of the economic strategy last year, senior officials said. Though the policy did not attract as much attention as rescue efforts to bail out banks, it helped revitalize homebuying in some parts of the country and put money in the pockets of millions of homeowners who were able to refinance into lower monthly payments, the officials added.
“We did what we thought was necessary to stabilize the market, but we don’t think the government should continue special efforts forever,” said Michael S. Barr, an assistant secretary at the Treasury Department. “As you bring stability, private participants come back in. We do expect this now that the market has stabilized. I’m not going to say there will be no effect on rates, but we do think you are seeing market signs and market signals that there should be an orderly transition.”
A few federal officials and many industry advocates disagree, saying the government is exiting too soon. They offer dire warnings of higher rates and a slowdown in home sales. Fed leaders say they will end a marquee program supporting the mortgage markets in March. Obama’s economic team, led by Treasury Secretary Timothy F. Geithner, has decided not to replace it and has been shutting down its own related initiatives.
Over the past year, these programs have enabled prospective homebuyers to get cheap loans, helping those buying and selling property as well as those eager to refinance existing mortgages. If the end of the initiative drives up interest rates, say from 5 percent to 5.5 percent, homeowners could be deterred from refinancing, industry officials say. A sharper increase in rates could make homes too expensive for many buyers, forcing them from the market and causing the recent pickup in home sales to stall.
“Mortgage rates are the lifeblood of the housing market, and we have cautioned the Fed about the sudden stoppage of this program,” said Lawrence Yun, chief economist of the National Association of Realtors.
But senior government officials said it could be hard to reverse course without damaging the credibility of the Fed and the administration. If the government loses the trust of the financial markets, preparing them for policy changes could be tougher, possibly resulting in economic disruptions. The officials said they also worry that the mortgage market is becoming overly dependent on federal support, inserting the government too deeply into private enterprise.
Only a new crisis would be able to persuade the administration and the Fed to change their minds, officials said.
“This is a worthy experiment to see if they can begin exiting after providing an unprecedented amount of money to one sector of the economy,” said Mark Zandi, chief economist at Moody’s Economy.com. “It’s a close call, though. I can see why they are debating it.”
The Fed’s policymaking body sets a key interest rate at periodic meetings, which in turn influences rates for all kinds of loans. But mortgage rates also are shaped by the health of the market financing these loans.
Banks typically create giant pools of home loans and turn them into securities that can be traded on the open market. When the system is working, many investors buy these mortgage-backed securities, providing a stream of money for lenders so they can make loans at relatively cheap rates. But the trading of these securities seized up when the financial crisis struck and panicked investors. Government officials feared that the mortgage market would collapse.
The Fed and the Treasury stepped into the breach, becoming the only major buyers of these mortgage-related securities, and they kept the mortgage market flush with cash. The Treasury spent about $220 billion, and the Fed pledged $1.25 trillion, the single largest foray the central bank has made into the markets since the onset of the crisis. In essence, the Fed has been printing money and funneling it to people looking to buy a house or refinance an existing mortgage.
At the same time, the federal government stood behind mortgage-finance companies Fannie Mae and Freddie Mac by taking them over and pledging to cover their losses. That helped the firms lower borrowing costs, since lenders know they can’t fail, and the companies passed on their savings to mortgage borrowers in the form of low rates.
Combined, these federal efforts helped push down the rates ordinary Americans pay for a mortgage. The 30-year fixed-rate mortgage declined from 6.04 percent in November 2008, according to Freddie Mac data, and hit an all-time low of 4.71 percent about a year later.
Refinancings surged, while homebuying perked up. Existing-home sales climbed nearly 10 percent in September, their highest level in more than two years.
The policy was the government’s most effective salve for the ailing housing market at a time when other initiatives, such as the administration’s attempts to modify the mortgages of struggling homeowners, produced far more disappointing results.
Now the government wants to end its support for low rates and has been striving to persuade others to buy mortgage securities.
The success of this approach hinges on the willingness of private investors, from China to big Wall Street funds, to buy large amounts of the mortgage securities and fill the void left by the government.
On Christmas Eve, Treasury officials announced a move that would cover losses suffered by investors who buy these securities from Fannie Mae and Freddie Mac, which together now back about half of the nation’s $12 trillion mortgage market. The goal was simple, officials said. They wanted private investors to be reassured that mortgage securities are safe to buy.
As the economy showed signs of recovery at the end of last year, the administration and the Fed decided to end their support.
The Treasury stopped buying mortgage securities in December. The Fed said it would taper off purchases gradually, ending them by March 31.
Obama’s economic team could have raised the limits on how much mortgage securities Fannie and Freddie can buy, allowing those firms to replace the Fed’s purchasing program. But Barr said the administration thinks the mortgage business will stand on its own without such special assistance, similar to the way the nation’s biggest banks weaned themselves off federal bailout funds by raising private capital.
“The basic goal is to implement a gradual process where the government’s role in the economy goes down,” Barr said. “It has to be consistent with the basic goal of stability, but it is appropriate.”
Administration and Fed officials expressed confidence that rates will rise only modestly – perhaps a quarter of a percentage point. They attribute their optimism to the lengthy notice they have given the market. The markets already should have anticipated the government’s exit by adjusting interest rates higher. Yet mortgage rates have been falling slightly the past few weeks.
The optimism at the White House and the Fed, however, is not shared across the government. A few senior policymakers at the central bank view the economic recovery as still too fragile, suggesting that purchases perhaps should expand further. These dissenters also warn that mortgage rates could shoot up, perhaps to 6 percent or higher, because private investors buying securities would demand a greater rate of return than the Fed. To reach it, lenders may have to raise rates for consumers.
“Presumably, there is pent-up demand from the private sector, but the question is: At what rate are they going to be interested?” said Eric S. Rosengren, the president of the Federal Reserve Bank of Boston, who has indicated that he supports expanding the Fed’s mortgage securities purchase program.
There also could be unintended consequences to the government’s pull-out. Last year, big investors such as Pimco sold their mortgage-backed securities to the government and used that money to buy bonds and stocks. That extra cash, which propped up stock prices, could drain away after federal support ends.
Real estate and mortgage finance officials said the timing of the government’s exit seems especially ill-conceived, since the Fed’s support would end just a month before a homebuyer tax credit program, which the real estate industry has credited with jump-starting home sales.
Given the importance of the housing market, some industry officials doubt whether the government will follow through with its pledge to exit the mortgage market in March. Fannie and Freddie officials say that the companies together can buy about $300 billion of mortgage securities by the end of the year before they hit their federally mandated limits. Though it appears reluctant to do so, the administration could use that buying power to cushion the blow after the Fed’s program ends, the industry officials said.
Please contact me and let me know what type of property and where you'd like to be and your price range and I will work to find just what your looking for.
Rob Skeel Realtor
Century 21 Keysearch Realty
305-393-6300
rob@robskeel.com
Florida’s existing home, condo sales up in December 2009
Dec. existing-home sales down, prices rise; 2009 sales up, says NAR.
ORLANDO, Fla. – Jan. 25, 2010 – Florida’s existing home sales rose in December, marking 16 months that sales activity has increased in the year-to-year comparison, according to the latest housing data released by Florida Realtors®.
Existing home sales rose 33 percent last month with a total of 14,630 homes sold statewide compared to 11,013 homes sold in December 2008, according to Florida Realtors. Statewide existing home sales last month increased 4.3 percent over statewide sales activity in November.
Florida Realtors also reported a 91 percent increase in statewide sales of existing condos in December compared to the previous year’s sales figure; statewide existing condo sales last month rose 22 percent over the total units sold in November.
Seventeen of Florida’s metropolitan statistical areas (MSAs) reported increased existing home sales and higher condo sales in December. A majority of the state’s MSAs have reported increased sales for 18 consecutive months.
Florida’s median sales price for existing homes last month was $140,400; a year ago, it was $155,300 for a 10 percent decrease. Housing industry analysts with the National Association of Realtors® (NAR) note that sales of foreclosures and other distressed properties continue to downwardly distort the median price because they generally sell at a discount relative to traditional homes. The median is the midpoint; half the homes sold for more, half for less.
The national median sales price for existing single-family homes in November 2009 was $171,900, down 4.4 percent from a year earlier, according to NAR. In California, the statewide median resales price was $304,520 in November; in Massachusetts, it was $285,000; in Maryland, it was $245,569; and in New York, it was $210,000.
According to NAR’s latest outlook, home sales are seeing a boost from the federal homebuyer tax credit. “There are many more potential buyers who can enter the market in the months ahead,” said NAR Chief Economist Lawrence Yun. “Activity should ramp up for another surge in the spring when buyers take advantage of the expanded tax credit, which hopefully will take us into a self-sustaining market in the second half of 2010. In all, 4.4 million households are expected to claim the tax credit before it expires, and balance should be restored to the housing sector with inventories continuing to decline.”
In Florida’s year-to-year comparison for condos, 5,968 units sold statewide last month compared to 3,132 units in December 2008 for an increase of 91 percent. The statewide existing condo median sales price last month was $107,000; in December 2008 it was $130,300 for an 18 percent decrease. The national median existing condo price was $178,000 in November 2009, according to NAR.
Interest rates for a 30-year fixed-rate mortgage averaged 4.93 percent last month, significantly lower than the average rate of 5.29 percent in December 2008, according to Freddie Mac. Florida Realtors’ sales figures reflect closings, which typically occur 30 to 90 days after sales contracts are written.
Lifelines dry up for mortgage lending WASHINGTON – Jan. 25, 2010 – For more than a year, the government pulled out the stops to revive homebuying by driving down mortgage rates.
Now, whether the housing market is ready or not, the government is pulling out.
The wind-down of federal support for mortgage rates, set to end in two months, is a momentous test of whether the Obama administration and the Federal Reserve have succeeded in jump-starting the housing market and ensuring it can hold its own. The stakes for the economy are massive: If the market again falls into a tailspin, homeowners could face another wave of trouble, and it would deal a body blow to President Obama’s efforts to get the economy on track.
Keeping the mortgage rates at historic lows, which required a commitment of more than $1 trillion, was viewed within the administration as a central plank of the economic strategy last year, senior officials said. Though the policy did not attract as much attention as rescue efforts to bail out banks, it helped revitalize homebuying in some parts of the country and put money in the pockets of millions of homeowners who were able to refinance into lower monthly payments, the officials added.
“We did what we thought was necessary to stabilize the market, but we don’t think the government should continue special efforts forever,” said Michael S. Barr, an assistant secretary at the Treasury Department. “As you bring stability, private participants come back in. We do expect this now that the market has stabilized. I’m not going to say there will be no effect on rates, but we do think you are seeing market signs and market signals that there should be an orderly transition.”
A few federal officials and many industry advocates disagree, saying the government is exiting too soon. They offer dire warnings of higher rates and a slowdown in home sales. Fed leaders say they will end a marquee program supporting the mortgage markets in March. Obama’s economic team, led by Treasury Secretary Timothy F. Geithner, has decided not to replace it and has been shutting down its own related initiatives.
Over the past year, these programs have enabled prospective homebuyers to get cheap loans, helping those buying and selling property as well as those eager to refinance existing mortgages. If the end of the initiative drives up interest rates, say from 5 percent to 5.5 percent, homeowners could be deterred from refinancing, industry officials say. A sharper increase in rates could make homes too expensive for many buyers, forcing them from the market and causing the recent pickup in home sales to stall.
“Mortgage rates are the lifeblood of the housing market, and we have cautioned the Fed about the sudden stoppage of this program,” said Lawrence Yun, chief economist of the National Association of Realtors.
But senior government officials said it could be hard to reverse course without damaging the credibility of the Fed and the administration. If the government loses the trust of the financial markets, preparing them for policy changes could be tougher, possibly resulting in economic disruptions. The officials said they also worry that the mortgage market is becoming overly dependent on federal support, inserting the government too deeply into private enterprise.
Only a new crisis would be able to persuade the administration and the Fed to change their minds, officials said.
“This is a worthy experiment to see if they can begin exiting after providing an unprecedented amount of money to one sector of the economy,” said Mark Zandi, chief economist at Moody’s Economy.com. “It’s a close call, though. I can see why they are debating it.”
The Fed’s policymaking body sets a key interest rate at periodic meetings, which in turn influences rates for all kinds of loans. But mortgage rates also are shaped by the health of the market financing these loans.
Banks typically create giant pools of home loans and turn them into securities that can be traded on the open market. When the system is working, many investors buy these mortgage-backed securities, providing a stream of money for lenders so they can make loans at relatively cheap rates. But the trading of these securities seized up when the financial crisis struck and panicked investors. Government officials feared that the mortgage market would collapse.
The Fed and the Treasury stepped into the breach, becoming the only major buyers of these mortgage-related securities, and they kept the mortgage market flush with cash. The Treasury spent about $220 billion, and the Fed pledged $1.25 trillion, the single largest foray the central bank has made into the markets since the onset of the crisis. In essence, the Fed has been printing money and funneling it to people looking to buy a house or refinance an existing mortgage.
At the same time, the federal government stood behind mortgage-finance companies Fannie Mae and Freddie Mac by taking them over and pledging to cover their losses. That helped the firms lower borrowing costs, since lenders know they can’t fail, and the companies passed on their savings to mortgage borrowers in the form of low rates.
Combined, these federal efforts helped push down the rates ordinary Americans pay for a mortgage. The 30-year fixed-rate mortgage declined from 6.04 percent in November 2008, according to Freddie Mac data, and hit an all-time low of 4.71 percent about a year later.
Refinancings surged, while homebuying perked up. Existing-home sales climbed nearly 10 percent in September, their highest level in more than two years.
The policy was the government’s most effective salve for the ailing housing market at a time when other initiatives, such as the administration’s attempts to modify the mortgages of struggling homeowners, produced far more disappointing results.
Now the government wants to end its support for low rates and has been striving to persuade others to buy mortgage securities.
The success of this approach hinges on the willingness of private investors, from China to big Wall Street funds, to buy large amounts of the mortgage securities and fill the void left by the government.
On Christmas Eve, Treasury officials announced a move that would cover losses suffered by investors who buy these securities from Fannie Mae and Freddie Mac, which together now back about half of the nation’s $12 trillion mortgage market. The goal was simple, officials said. They wanted private investors to be reassured that mortgage securities are safe to buy.
As the economy showed signs of recovery at the end of last year, the administration and the Fed decided to end their support.
The Treasury stopped buying mortgage securities in December. The Fed said it would taper off purchases gradually, ending them by March 31.
Obama’s economic team could have raised the limits on how much mortgage securities Fannie and Freddie can buy, allowing those firms to replace the Fed’s purchasing program. But Barr said the administration thinks the mortgage business will stand on its own without such special assistance, similar to the way the nation’s biggest banks weaned themselves off federal bailout funds by raising private capital.
“The basic goal is to implement a gradual process where the government’s role in the economy goes down,” Barr said. “It has to be consistent with the basic goal of stability, but it is appropriate.”
Administration and Fed officials expressed confidence that rates will rise only modestly – perhaps a quarter of a percentage point. They attribute their optimism to the lengthy notice they have given the market. The markets already should have anticipated the government’s exit by adjusting interest rates higher. Yet mortgage rates have been falling slightly the past few weeks.
The optimism at the White House and the Fed, however, is not shared across the government. A few senior policymakers at the central bank view the economic recovery as still too fragile, suggesting that purchases perhaps should expand further. These dissenters also warn that mortgage rates could shoot up, perhaps to 6 percent or higher, because private investors buying securities would demand a greater rate of return than the Fed. To reach it, lenders may have to raise rates for consumers.
“Presumably, there is pent-up demand from the private sector, but the question is: At what rate are they going to be interested?” said Eric S. Rosengren, the president of the Federal Reserve Bank of Boston, who has indicated that he supports expanding the Fed’s mortgage securities purchase program.
There also could be unintended consequences to the government’s pull-out. Last year, big investors such as Pimco sold their mortgage-backed securities to the government and used that money to buy bonds and stocks. That extra cash, which propped up stock prices, could drain away after federal support ends.
Real estate and mortgage finance officials said the timing of the government’s exit seems especially ill-conceived, since the Fed’s support would end just a month before a homebuyer tax credit program, which the real estate industry has credited with jump-starting home sales.
Given the importance of the housing market, some industry officials doubt whether the government will follow through with its pledge to exit the mortgage market in March. Fannie and Freddie officials say that the companies together can buy about $300 billion of mortgage securities by the end of the year before they hit their federally mandated limits. Though it appears reluctant to do so, the administration could use that buying power to cushion the blow after the Fed’s program ends, the industry officials said.
Wednesday, December 16, 2009
Homebuyers need a good credit score even with 20% down
Thinking of purchasing a home? Good information regarding obtaining a mortgage even with good credit.
WASHINGTON – Dec. 15, 2009 – Five years ago, if your application for a mortgage included a 20 percent downpayment, your bank would have approved your loan by sundown and sponsored a parade in your honor.
But in this new era of tight credit, having a big downpayment no longer guarantees you’ll qualify for a mortgage. Starting this week, mortgage finance giant Fannie Mae will require borrowers with a 20 percent downpayment to have a credit score of at least 620. Previously, the cutoff was 580.
Fannie Mae buys loans, providing an important source of financing for lenders. For that reason, its guidelines are considered the gold standard for mortgage loans. Most banks are expected to adopt the new standards, if they haven’t already.
“Credit scores have never mattered quite as much as they do now,” says Bob Walters, chief economist for Quicken Loans.
In addition, Fannie Mae won’t approve loans for borrowers with a 20 percent downpayment if more than 45 percent of their gross monthly income goes toward debt. Fannie Mae didn’t disclose the previous debt limit, but it was higher than 45 percent, says Fannie Mae spokesman Brian Faith.
The higher standards could frustrate buyers hoping to take advantage of low interest rates, depressed home prices and generous tax breaks that were recently extended until next spring. Even buyers who qualify for a mortgage may find that they’re ineligible for the best rates because lenders have tightened their standards across the board, says Gerri Detweiler, credit adviser for Credit.com.
If you’ve already found a home you’d like to buy, there’s not much you can do to raise your score before you apply for a loan. But if you’re just starting to tour open houses, there are steps you can take to improve your credit profile, including:
• Review your credit reports for errors. Go to AnnualCreditReport.com and order your credit reports from the three main credit-reporting bureaus: Experian, TransUnion and Equifax. You’re entitled to a free credit report once a year from all three of the bureaus, but only if you go through this website.
Once you receive your credit reports, go through them and look for inaccurate information, such as accounts you never opened. All of the credit bureaus provide a process to dispute errors, says Craig Watts, spokesman for Fair Isaac, which created the widely used FICO score.
• Pay off credit cards and other debts. One of the factors used to calculate your credit score is your “credit utilization ratio,” which measures the amount of credit you have outstanding vs. your total available credit. This ratio accounts for 30 percent of your score. Paying off balances will increase the amount of unused credit you have available, which will help your score.
But even if you’ve decided never to use credit cards again, don’t close your accounts. Closing a credit card account won’t help your credit score and could hurt it, Watts says. When you close an account, you reduce the amount of your available credit, which could hurt your credit utilization ratio.
• Avoid opening any new accounts. “Every new account you open is likely to drop your credit score, at least a little,” Watts says.
Checking your score
When you order your free credit reports from AnnualCreditReport.com, your credit scores aren’t included; you’ll have to pay a fee to get them.
In recent months, though, several services, such as Quizzle, Credit Karma and Credit.com have launched programs that provide free credit profiles. These websites can provide a useful snapshot of your credit standing and provide tips on how to improve it, Detweiler says.
If you’re planning to buy a home a year from now, she adds, it doesn’t make sense to spend a lot of money to buy scores that could change by the time you apply for a loan.
But house hunters who plan to apply for a loan in the next few weeks should know their actual FICO scores, because that’s the score most potential lenders use, Detweiler says.
You can buy your FICO score and credit report from TransUnion and Equifax at www.myfico.com for $15.95 each.
Rob Skeel , Realtor- e-Pro - Cell --305-393-6300 Email--rob@robskeel.com
Century 21 Keysearch Realty--877-660-4637
Web Site-- www.RobSkeel.com
WASHINGTON – Dec. 15, 2009 – Five years ago, if your application for a mortgage included a 20 percent downpayment, your bank would have approved your loan by sundown and sponsored a parade in your honor.
But in this new era of tight credit, having a big downpayment no longer guarantees you’ll qualify for a mortgage. Starting this week, mortgage finance giant Fannie Mae will require borrowers with a 20 percent downpayment to have a credit score of at least 620. Previously, the cutoff was 580.
Fannie Mae buys loans, providing an important source of financing for lenders. For that reason, its guidelines are considered the gold standard for mortgage loans. Most banks are expected to adopt the new standards, if they haven’t already.
“Credit scores have never mattered quite as much as they do now,” says Bob Walters, chief economist for Quicken Loans.
In addition, Fannie Mae won’t approve loans for borrowers with a 20 percent downpayment if more than 45 percent of their gross monthly income goes toward debt. Fannie Mae didn’t disclose the previous debt limit, but it was higher than 45 percent, says Fannie Mae spokesman Brian Faith.
The higher standards could frustrate buyers hoping to take advantage of low interest rates, depressed home prices and generous tax breaks that were recently extended until next spring. Even buyers who qualify for a mortgage may find that they’re ineligible for the best rates because lenders have tightened their standards across the board, says Gerri Detweiler, credit adviser for Credit.com.
If you’ve already found a home you’d like to buy, there’s not much you can do to raise your score before you apply for a loan. But if you’re just starting to tour open houses, there are steps you can take to improve your credit profile, including:
• Review your credit reports for errors. Go to AnnualCreditReport.com and order your credit reports from the three main credit-reporting bureaus: Experian, TransUnion and Equifax. You’re entitled to a free credit report once a year from all three of the bureaus, but only if you go through this website.
Once you receive your credit reports, go through them and look for inaccurate information, such as accounts you never opened. All of the credit bureaus provide a process to dispute errors, says Craig Watts, spokesman for Fair Isaac, which created the widely used FICO score.
• Pay off credit cards and other debts. One of the factors used to calculate your credit score is your “credit utilization ratio,” which measures the amount of credit you have outstanding vs. your total available credit. This ratio accounts for 30 percent of your score. Paying off balances will increase the amount of unused credit you have available, which will help your score.
But even if you’ve decided never to use credit cards again, don’t close your accounts. Closing a credit card account won’t help your credit score and could hurt it, Watts says. When you close an account, you reduce the amount of your available credit, which could hurt your credit utilization ratio.
• Avoid opening any new accounts. “Every new account you open is likely to drop your credit score, at least a little,” Watts says.
Checking your score
When you order your free credit reports from AnnualCreditReport.com, your credit scores aren’t included; you’ll have to pay a fee to get them.
In recent months, though, several services, such as Quizzle, Credit Karma and Credit.com have launched programs that provide free credit profiles. These websites can provide a useful snapshot of your credit standing and provide tips on how to improve it, Detweiler says.
If you’re planning to buy a home a year from now, she adds, it doesn’t make sense to spend a lot of money to buy scores that could change by the time you apply for a loan.
But house hunters who plan to apply for a loan in the next few weeks should know their actual FICO scores, because that’s the score most potential lenders use, Detweiler says.
You can buy your FICO score and credit report from TransUnion and Equifax at www.myfico.com for $15.95 each.
Rob Skeel , Realtor- e-Pro - Cell --305-393-6300 Email--rob@robskeel.com
Century 21 Keysearch Realty--877-660-4637
Web Site-- www.RobSkeel.com
Monday, November 30, 2009
Positive Economic News
I hope everyone that reads this had a nice Thanksgiving.
I thought this article does a good job of explaining where the US economy currently stands and some of the positives that are at work. Lets all hope these positive signs continue and we have a much improved 2010.
The glass is half-full: Why the U.S. economy will strengthen in 2010
Joseph Lazzaro
It's been hard times for the U.S. economy. The unemployment rate essentially doubled as the economy contracted, making the recession from 2007 to 2009 the longest and worst since the 1930s.
But while long-term and structural factors are likely to weigh on economic growth in the quarters ahead, the outlook isn't all bad. Investors would be remiss if they didn't consider certain "rays of light," factors that are working in the economy's favor. Here are the major positives heading into 2010:
U.S. unemployment rate is nearing its peak. Nothing symbolizes the nasty 2007-2009 recession more than the nation's high unemployment rate, now at 10.2%. It's just awful, and broader measures of joblessness -- such as those that include part-time workers who want full-time work and discouraged workers -- are above 15%.
The bright side? Unemployment is likely nearing its peak. True, the rate may rise to 10.5% or 10.7%. Historically, it goes up for at least six months after a recovery starts. But the major job-cutting period is likely over. Temporary hiring, which usually telegraphs the start of the hiring cycle, is now trending up.
What's more, the U.S. economy could see a net gain in jobs per month as early as the first quarter of 2010. Yes, we need lots of new jobs -- probably about 13 million to 15 million -- but you have to start somewhere.
Consumer confidence is rising. Although it's meandered much of the second half of 2009, consumer confidence nevertheless appears to have bottomed. As measured by The Conference Board, confidence rose to 49.5 in November, which is hardly spectacular (base year 1985 = 100). But when one considers that the index hit a record low of 25.3 as late as February, it's easy to see how far the nation has come.
In general, consumers understandably have taken a cautious, wait-and-see stance toward the economy. They're encouraged by improving business conditions and the stock market's rise, but they remained concerned about high unemployment and the lack of job creation.
And while a segment of consumers likely have permanently cut back on their spending, another large bloc is most likely just waiting for more signs of economic growth before making a purchase or two. When that occurs, that should help the economy grow at a faster pace.
Lean and mean inventories. You won't read much about "totally unsexy" business inventories in the popular press, but know this: Businesses have cut inventories about as much as they can. In fact, many have pared inventories too much, because they thought they would be left with tons of products and no buyers when it looked like the economy was headed for a second Great Depression during the financial crisis's acute stage.
And inventory declines lead to production declines, which is one reason the unemployment rate has soared. Nevertheless, those same lean inventories will provide an above-normal boost to employment and GDP in 2010, as businesses start to replenish inventories during an economic recovery. Manufacturing is already signaling the start of this cycle: Industrial production has increased for four straight months.
Corporate bond sales soared. Here's another under-the-radar statistic, but it's vital for U.S. economic health: U.S. corporations raised a record $1.171 trillion in bond sales in 2009, compared to just $874 billion in 2008, according to data compiled by Bloomberg News. Corporations took advantage of superlow interest rates to raise the money they need to expand.
The significance for investors? First, credit markets continue to heal. The U.S. Federal Reserve's facilities and guarantees are enabling corporations to get the capital they need and to borrow at reasonable rates. Second, corporations aren't going to raise money to expand if that money isn't going to be deployed. They expect to use that money to expand, start new projects and take other positive steps.
In short, companies are expecting economic growth ahead. That's good news for hiring trends. It's also obviously bullish for GDP because it tends to increase when businesses start to invest, make purchases and expand.
The stimulus is with us. The Obama administration's $786 billion fiscal stimulus package has its share of critics, but know that its aid to states and related support programs prevented a deeper recession. Equally significant: The remainder of stimulus funds will be spent in the first half of 2010, hence the package will continue to boost the economy.
The stimulus is kind of the "Rodney Dangerfield" of policy actions: It gets no respect. Or, as U.S. Rep. Barney Frank (D-Mass.) often says, "Congress gets no credit for averting something." But Americans should understand that the stimulus is helping to fill a very big GDP hole: Who knows how many states would have faced very dire circumstances without the assistance.
Make the best, ship it to the East. During the recent expansion, export-dominant economies in emerging markets came to the fore, and their mantra was "Make the best, and ship it to the West." To be sure, the economies of China, India, Brazil, etc. were too dependent on exports and remain so, and they have inadequate domestic consumption. But now it looks like another country may be joining the export party: the U.S.
We're very early in the global economic recovery cycle, but at least initially, it looks like demand in countries like China, India and Brazil is rising, with higher consumer spending. Combined with a weak dollar, this is boosting U.S. exports. If the trend continues, it will provide another (and unexpected) upward push to U.S. GDP.
Don't ignore the positive side of the ledger. No one should harbor any illusions about the size and seriousness of the economic challenge the U.S. faces as it enters 2010. To paraphrase Irving Black, the track-and-field coach at my high school, "the U.S. economy has a minor problem that nothing short of, oh, 13 million to 15 million new jobs can't solve." The task ahead is enormous.
But neither should investors ignore the positive side of the ledger: Key economic fundamentals have turned or are starting to turn in the U.S. economy's favor, as the housing, inventory, bond market and export statistics attest. Now if the U.S. economy can identify a new sector or engines of growth -- as it has done during past restructurings -- that will do much to get the great American job creation machine rolling again. That would be the final piece of the recovery puzzle.
When you need real estate assistance in the Florida Keys please think of me.
Rob Skeel , Realtor- e-Pro - Cell --305-393-6300 Email--rob@robskeel.com
Century 21 Keysearch Realty--877-660-4637
Web Site-- www.RobSkeel.com
Green Certified Real Estate Professional, FHA Certified
Find a Home http://robskeel.com/homes_for_sale.shtml
I thought this article does a good job of explaining where the US economy currently stands and some of the positives that are at work. Lets all hope these positive signs continue and we have a much improved 2010.
The glass is half-full: Why the U.S. economy will strengthen in 2010
Joseph Lazzaro
It's been hard times for the U.S. economy. The unemployment rate essentially doubled as the economy contracted, making the recession from 2007 to 2009 the longest and worst since the 1930s.
But while long-term and structural factors are likely to weigh on economic growth in the quarters ahead, the outlook isn't all bad. Investors would be remiss if they didn't consider certain "rays of light," factors that are working in the economy's favor. Here are the major positives heading into 2010:
U.S. unemployment rate is nearing its peak. Nothing symbolizes the nasty 2007-2009 recession more than the nation's high unemployment rate, now at 10.2%. It's just awful, and broader measures of joblessness -- such as those that include part-time workers who want full-time work and discouraged workers -- are above 15%.
The bright side? Unemployment is likely nearing its peak. True, the rate may rise to 10.5% or 10.7%. Historically, it goes up for at least six months after a recovery starts. But the major job-cutting period is likely over. Temporary hiring, which usually telegraphs the start of the hiring cycle, is now trending up.
What's more, the U.S. economy could see a net gain in jobs per month as early as the first quarter of 2010. Yes, we need lots of new jobs -- probably about 13 million to 15 million -- but you have to start somewhere.
Consumer confidence is rising. Although it's meandered much of the second half of 2009, consumer confidence nevertheless appears to have bottomed. As measured by The Conference Board, confidence rose to 49.5 in November, which is hardly spectacular (base year 1985 = 100). But when one considers that the index hit a record low of 25.3 as late as February, it's easy to see how far the nation has come.
In general, consumers understandably have taken a cautious, wait-and-see stance toward the economy. They're encouraged by improving business conditions and the stock market's rise, but they remained concerned about high unemployment and the lack of job creation.
And while a segment of consumers likely have permanently cut back on their spending, another large bloc is most likely just waiting for more signs of economic growth before making a purchase or two. When that occurs, that should help the economy grow at a faster pace.
Lean and mean inventories. You won't read much about "totally unsexy" business inventories in the popular press, but know this: Businesses have cut inventories about as much as they can. In fact, many have pared inventories too much, because they thought they would be left with tons of products and no buyers when it looked like the economy was headed for a second Great Depression during the financial crisis's acute stage.
And inventory declines lead to production declines, which is one reason the unemployment rate has soared. Nevertheless, those same lean inventories will provide an above-normal boost to employment and GDP in 2010, as businesses start to replenish inventories during an economic recovery. Manufacturing is already signaling the start of this cycle: Industrial production has increased for four straight months.
Corporate bond sales soared. Here's another under-the-radar statistic, but it's vital for U.S. economic health: U.S. corporations raised a record $1.171 trillion in bond sales in 2009, compared to just $874 billion in 2008, according to data compiled by Bloomberg News. Corporations took advantage of superlow interest rates to raise the money they need to expand.
The significance for investors? First, credit markets continue to heal. The U.S. Federal Reserve's facilities and guarantees are enabling corporations to get the capital they need and to borrow at reasonable rates. Second, corporations aren't going to raise money to expand if that money isn't going to be deployed. They expect to use that money to expand, start new projects and take other positive steps.
In short, companies are expecting economic growth ahead. That's good news for hiring trends. It's also obviously bullish for GDP because it tends to increase when businesses start to invest, make purchases and expand.
The stimulus is with us. The Obama administration's $786 billion fiscal stimulus package has its share of critics, but know that its aid to states and related support programs prevented a deeper recession. Equally significant: The remainder of stimulus funds will be spent in the first half of 2010, hence the package will continue to boost the economy.
The stimulus is kind of the "Rodney Dangerfield" of policy actions: It gets no respect. Or, as U.S. Rep. Barney Frank (D-Mass.) often says, "Congress gets no credit for averting something." But Americans should understand that the stimulus is helping to fill a very big GDP hole: Who knows how many states would have faced very dire circumstances without the assistance.
Make the best, ship it to the East. During the recent expansion, export-dominant economies in emerging markets came to the fore, and their mantra was "Make the best, and ship it to the West." To be sure, the economies of China, India, Brazil, etc. were too dependent on exports and remain so, and they have inadequate domestic consumption. But now it looks like another country may be joining the export party: the U.S.
We're very early in the global economic recovery cycle, but at least initially, it looks like demand in countries like China, India and Brazil is rising, with higher consumer spending. Combined with a weak dollar, this is boosting U.S. exports. If the trend continues, it will provide another (and unexpected) upward push to U.S. GDP.
Don't ignore the positive side of the ledger. No one should harbor any illusions about the size and seriousness of the economic challenge the U.S. faces as it enters 2010. To paraphrase Irving Black, the track-and-field coach at my high school, "the U.S. economy has a minor problem that nothing short of, oh, 13 million to 15 million new jobs can't solve." The task ahead is enormous.
But neither should investors ignore the positive side of the ledger: Key economic fundamentals have turned or are starting to turn in the U.S. economy's favor, as the housing, inventory, bond market and export statistics attest. Now if the U.S. economy can identify a new sector or engines of growth -- as it has done during past restructurings -- that will do much to get the great American job creation machine rolling again. That would be the final piece of the recovery puzzle.
When you need real estate assistance in the Florida Keys please think of me.
Rob Skeel , Realtor- e-Pro - Cell --305-393-6300 Email--rob@robskeel.com
Century 21 Keysearch Realty--877-660-4637
Web Site-- www.RobSkeel.com
Green Certified Real Estate Professional, FHA Certified
Find a Home http://robskeel.com/homes_for_sale.shtml
Friday, November 20, 2009
Good Real Estate New-Tax Credits Extended- Interest Rates Stay Low
Good news for first time homebuyers and primary home buyers.
WASHINGTON –
The $8,000 tax credit for first-time home buyers was extended.
Lawmakers in Washington also added a $6,500 tax credit for other primary-home purchasers and raised the qualifying income limits to $125,000 for single taxpayers and $225,000 for joint taxpayers.
Buyers must have sales agreements in hand by April 30, but they will have until June 30 to go to settlement.
Other News.
Sales of homes continue to increase in the Keys as well as the rest of Florida. Asking prices are at levels we haven't seen in a number of years and interest rates remain near record lows. When your ready to start looking or buying please keep me in mind.
Please contact me if I can be of assistance with your home search.
Thanks
Rob Skeel , Realtor- e-Pro - Cell --305-393-6300 Email--rob@robskeel.com
Century 21 Keysearch Realty--877-660-4637
Web Site-- www.RobSkeel.com
WASHINGTON –
The $8,000 tax credit for first-time home buyers was extended.
Lawmakers in Washington also added a $6,500 tax credit for other primary-home purchasers and raised the qualifying income limits to $125,000 for single taxpayers and $225,000 for joint taxpayers.
Buyers must have sales agreements in hand by April 30, but they will have until June 30 to go to settlement.
Other News.
Sales of homes continue to increase in the Keys as well as the rest of Florida. Asking prices are at levels we haven't seen in a number of years and interest rates remain near record lows. When your ready to start looking or buying please keep me in mind.
Please contact me if I can be of assistance with your home search.
Thanks
Rob Skeel , Realtor- e-Pro - Cell --305-393-6300 Email--rob@robskeel.com
Century 21 Keysearch Realty--877-660-4637
Web Site-- www.RobSkeel.com
Thursday, November 5, 2009
Mortgage Loan Limits & Home Buyer Credits
FYI--Extensions pending for programs which will assist you with purchasing your dream home in the Florida Keys.
Congress extends higher mortgage loan limits
WASHINGTON – Nov. 2, 2009 – On Thursday, the U.S. Congress passed a congressional resolution to extend the current higher Fannie Mae, Freddie Mac and FHA loan limits through 2010. The present, higher loan limits expire at the end of 2009 and revert to previous lower limits. The move still needs to be signed by President Obama, which is expected shortly.
The National Association of Realtors® (NAR) thanked Congress for speedy action.
“NAR commends both houses of Congress for their quick action in continuing these higher limits during a time for recovery in the housing market and national economy,” says NAR President Charles McMillan. “The higher limits, along with the homebuyer tax credit extension, are necessary to keep the markets moving at this critical time.
“Home sales have shown significant movement upwards in the past six months, and reduced inventory in some segments of the housing market, but not in all. Home purchases in the middle-income and higher brackets have not moved much, and those markets must improve before we can experience a fully sustained housing recovery. These higher loan limits will help motivate qualified homebuyers to purchase in those markets,” McMillan said.
The resolution would extend the present loan limits for FHA, Fannie and Freddie through the 2010 calendar year at 125 percent of local median home sales prices, up to a maximum of $729,750 in high-cost areas. The floor for FHA is $271,050; the floor for Fannie Mae and Freddie Mac conforming loan limits is $417,000.
© 2009 Florida Realtors®
Senate panel OKs extension for home buyers’ credit
WASHINGTON – Oct. 29, 2009 – Senators reached a compromise to extend the $8,000 tax credit for first-time home buyers, a boost the housing industry expects will help it pull out of its two-year-old downturn.
Lawmakers in Washington also added a $6,500 tax credit for other primary-home purchasers and raised the qualifying income limits to $125,000 for single taxpayers and $225,000 for joint taxpayers, housing-industry sources said.
Under the Senate compromise, buyers must have sales agreements in hand by April 30, but they will have until June 30 to go to settlement, the sources said. The measure still faces votes in the full Senate and the House.
Please contact me if I can be of assistance with your home search.
Thanks
Rob Skeel , Realtor- e-Pro - Cell --305-393-6300 Email--rob@robskeel.com
Century 21 Keysearch Realty--877-660-4637
Web Site-- www.RobSkeel.com
Congress extends higher mortgage loan limits
WASHINGTON – Nov. 2, 2009 – On Thursday, the U.S. Congress passed a congressional resolution to extend the current higher Fannie Mae, Freddie Mac and FHA loan limits through 2010. The present, higher loan limits expire at the end of 2009 and revert to previous lower limits. The move still needs to be signed by President Obama, which is expected shortly.
The National Association of Realtors® (NAR) thanked Congress for speedy action.
“NAR commends both houses of Congress for their quick action in continuing these higher limits during a time for recovery in the housing market and national economy,” says NAR President Charles McMillan. “The higher limits, along with the homebuyer tax credit extension, are necessary to keep the markets moving at this critical time.
“Home sales have shown significant movement upwards in the past six months, and reduced inventory in some segments of the housing market, but not in all. Home purchases in the middle-income and higher brackets have not moved much, and those markets must improve before we can experience a fully sustained housing recovery. These higher loan limits will help motivate qualified homebuyers to purchase in those markets,” McMillan said.
The resolution would extend the present loan limits for FHA, Fannie and Freddie through the 2010 calendar year at 125 percent of local median home sales prices, up to a maximum of $729,750 in high-cost areas. The floor for FHA is $271,050; the floor for Fannie Mae and Freddie Mac conforming loan limits is $417,000.
© 2009 Florida Realtors®
Senate panel OKs extension for home buyers’ credit
WASHINGTON – Oct. 29, 2009 – Senators reached a compromise to extend the $8,000 tax credit for first-time home buyers, a boost the housing industry expects will help it pull out of its two-year-old downturn.
Lawmakers in Washington also added a $6,500 tax credit for other primary-home purchasers and raised the qualifying income limits to $125,000 for single taxpayers and $225,000 for joint taxpayers, housing-industry sources said.
Under the Senate compromise, buyers must have sales agreements in hand by April 30, but they will have until June 30 to go to settlement, the sources said. The measure still faces votes in the full Senate and the House.
Please contact me if I can be of assistance with your home search.
Thanks
Rob Skeel , Realtor- e-Pro - Cell --305-393-6300 Email--rob@robskeel.com
Century 21 Keysearch Realty--877-660-4637
Web Site-- www.RobSkeel.com
Thursday, October 1, 2009
It is a very quiet time in the Florida Keys but continues to be buyers here looking to purchase a home in Paradise.
September set a record for rain but we didn't have any storms and we are more than half way through hurricane season. In a few weeks we should start to feel a change to less humidity and the rainy season will come to an end.
Fishing continues to be good, just the other day a boat went out just past the reef and came back with 14 (Dolphin) Ma hi Ma hi.
One of the years biggest festivals is set to start towards the end of October-Fantasy Fest in Key West. It will run for about 2 weeks concluding with a great parade on the last Saturday of the month. Its a lot of fun and the people watching is great.
On the real estate side there continues to be plenty of inventory and sellers ready to negotiate a fair price. Interest rates remain low but there are signs they will be going up so if your thinking of buying this could be the right time to make your move.
As always, I'm here to assist you in your home search. just contact me via email or phone and I'll do my beat to assist you to find the right home at the right price.
Rob Skeel , Realtor- e-Pro - Cell --305-393-6300 Email--rob@robskeel.com
Century 21 Keysearch Realty--877-660-4637
Web Site-- www.RobSkeel.com
September set a record for rain but we didn't have any storms and we are more than half way through hurricane season. In a few weeks we should start to feel a change to less humidity and the rainy season will come to an end.
Fishing continues to be good, just the other day a boat went out just past the reef and came back with 14 (Dolphin) Ma hi Ma hi.
One of the years biggest festivals is set to start towards the end of October-Fantasy Fest in Key West. It will run for about 2 weeks concluding with a great parade on the last Saturday of the month. Its a lot of fun and the people watching is great.
On the real estate side there continues to be plenty of inventory and sellers ready to negotiate a fair price. Interest rates remain low but there are signs they will be going up so if your thinking of buying this could be the right time to make your move.
As always, I'm here to assist you in your home search. just contact me via email or phone and I'll do my beat to assist you to find the right home at the right price.
Rob Skeel , Realtor- e-Pro - Cell --305-393-6300 Email--rob@robskeel.com
Century 21 Keysearch Realty--877-660-4637
Web Site-- www.RobSkeel.com
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