Featured New Home Community of the Week: The Reserve at Triadelphia Crossing

This week’s featured new homes community is The Reserve at Triadelphia Crossing.  This is a community of luxury single family homes in western Howard County, each on at least 1 acre of land (for those in other parts of the country, an acre of land is expensive and hard to come by in our local market!)  Enjoy the quick glance into the lap of luxury from the convenience of your own computer!

or click HERE to watch the source video on our Youtube Channel

Bernanke Weighs in on Housing Market and the Future

Chairman of the Federal Reserve Board, Benjamin Bernanke spoke last week at a conference of Economists in Jackson Hole, Wyoming (a much better place to visit in winter when its ski season, I might add) to discuss the economy and the challenges facing us moving ahead.    While there he took a few moments to prognosicate on the future of the housing market in this country.  Read his quote below the jump.

H.R. 600 or a New Tax Credit, Which Would Help the Housing Market More?

So today, in the word around the real estate world, we start to hear rumors that Obama and the treasury are discussing bringing back the homebuyer tax credits since housing sales have dropped off again since the credit went away at the end of April.  As much as I would love a boost in my business right now, as I am sure every Realtor and lender in the nation would, I am not sure this is truly the best thing to do to aid our market.  Lets look at two options in front of us right now.  Read after the jump and to answer today’s poll question.

Mortgage Rates and Programs: The Much Maligned ARM

As promised last week, today marks the second installment in our weekly article on mortgage programs and rates.  This week we will be discussing the Adjustable Rate Mortgage Loan, or ARM.

Its almost laughable how bad a rap the ARM has been given by the media.  This program has been saddled with the blame for most of our financial mess, though in reality it never had as much to do with the loan program as it did with the types of people that were able to get these programs at that time, who probably should have been buying homes at all!

Today, ARM’s are generally only given to high quality loan candidates, and are best used if you have a plan for the property that you are buying that involves moving again within 5-7 years.  Read Below for the rates, overviews of the loan programs, and the best ways to use them.

Could I be a Homeowner?

While we are being bombarded by the news outlets with information on how few people did buy a home in July of this year, I think I received a more interesting statistic earlier today.  There are over 14 million people in the United States right now that are not yet home owners, but make enough money for them to do so if they wished. 

Right now, to qualify for a $200,000 mortgage, a person/family would only have to make $55,000 a year (this statistic was created assuming a 5% interest rate-which is high compared to today’s real rates-and an average level of other monthly debts).  For a single person, this would mean a job making just over $26.00 an hour. For a married couple, whatever your definitions of married or couple happens to be, they would have to average a little over $13.00 an hour each to afford to buy a decent starter home right now.  Lets think about this…a reasonably well paid retail/grocery store worker married to a secretary can afford a home if they are reasonably fiscally responsable?  You bet they can!  Read more after the Jump

Featured New Home Community of the Week: Ellicott Station

Each week, on Tuesday, in addition to bringing you the latest in news around the real estate world, The Dream Home Digest will feature one new construction community from our local market (Howard County, Maryland-voted second best place to live by Money Magazine and 4th best school system nationally by Forbes) in a video segment.   Whether you are in the market to build your own dream home, or just like being able to visit builder’s models from the comfort of your own home, I hope you enjoy this weekly feature. 

Click below to watch this week’s video of  Ellicott Station, an Active Adult community built by Williamsburg Homes, a local high quality builder, in Northern Howard County.

…or click below to see the source video on our youtube channel.

http://www.youtube.com/watch?v=ZGgmxJDfo_w

Regulation misses its true target.

If all of the regulation that has been put in place over the last two years has been to protect consumers and to prevent mortgage fraud from occurring the way it did before 2006 (causing bad loans to be made), than I would have to say that the legislation and regulation has badly missed its mark.  My last two articles at the end of last week addressed how consumers are not protected by the new HUD rules or changed FHA MIP standards, and today we get news that Mortgage fraud is up

“Data prepared for The Wall Street Journal by research firm CoreLogic, examining about seven million home loans made by hundreds of lenders, show that losses from mortgage fraud—ranging from falsified credit reports to identity theft—rose 17% last year after declining 57% in the two years after its 2006 peak.” [http://online.wsj.com/article/SB10001424052748703824304575435383161436658.html?mod=WSJ_RealEstate_LEADTopNews, Wall Street Journal article written by Robbie Whelan]

Throughout history, the weapons of the agressor have always been better than the protections of the defenders, and this appears to be yet another case of this.

Lenders Closing Costs up 36.6% in 2010

So, at the beginning of this year, new regulations were put in place by HUD requiring lenders to be more accurate with their Good Faith Estimate (GFE), a break down of the fees associated with closing on a particular home which is given to clients at the time of loan application.  They also re-formatted the final “HUD-1” form used at settlement to supposedly be easier to understand and be more consumer friendly.  These changes were made to “help the consumer to better understand their loan and to make more clear where their money is going during a transaction.”
If everything was supposed to be so clear to the consumer and prevent those “evil” bankers from raising their fees any more, how do we end up with this lovely statistic, taken from Housingwire.com as reported by Bankrate?

FHA Monthly Mortgage Insurance to Go Up.

Last week, congress passed a law, and our President signed it, to allow FHA to increase its Mortgage Insurance Premiums charged monthly by up to 1%.  FHA Commissioner Stevens  has decided to delay the first of these increases, from .55% per month to .85% or .95% per month, until 10/4/10 to have time for public comment on these changes.  When these changes are put in place, they will cause housing costs to go up per month on all new home purchases for anyone that does not have enough money to make at least a downpayment of 20% (the point when FHA waives its monthly mortgage insurance premium costs).  This essentially becomes a tax on low to middle income family’s to pay for HUD programs-for those who are not aware, FHA is part of HUD.

While the same law did allow for a decrese in the Up Front MIP, payed to FHA at closing, from 2.25% to 1% (which the government tried to claim as a way to say this law was saving you money…which is a lie) these changes will cost consumers a great deal more per month in the end.  Since the up front MIP could always be added into your initial mortgage amount and didn’t have to be paid at the time of closing by the consumer, it only ever affected how much you paid per month for your home.  The decrease in the mortgage balance up front that this causes is much smaller than the cost increase created by the increase in the Monthly MIP.  Read an example and see a diagram breaking this down after the jump.

Weekly Feature: Rates and Programs

Every Week on Thursday, around noon, The Dream Home Digest will provide information on one type of loan program available its uses, and its current rate.

This week, our featured rate and program will give you a double dose of information, and a few days early to get you started. 
A great deal right now is a conventional loan program with a 3.875% rate for 15 years fixed.  This is great for refinancing your existing loan to be paid off faster and with less interest paid.
If you are looking to buy a new home, the cheapest way to do it right now is with an FHA loan.   FHA only requires 3.5% downpayment, has no lower limit on credit scores (though most banks that do FHA loans require a minimum of a 620 score regardless of what FHA requires), and has fixed rates for 30 years.  Today’s rate is 4.25% for a 30 year fixed FHA loan!  WOW!

Contact me at 443-745-1593 to receive an introduction to a loan officer that can get you these rates, or to find out more about buying a home!