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Guest Author:
Merry Christmas to all!!
Bob Chiodo, CFP
Equity Home Mortgage, LLC
(CLICK ON IMAGE FOR BETTER VIEW)
ALL ABOUT…..Portland.Oregon.Real Estate, is licensed under a Creative Commons Attribution-Noncommercial-No Derivative 
Works 3.0 Unported License. © Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws. Based on a Blog at WordPress.
(For more local and national real estate information, go to www.bettyjung.com).
Portland
Guest Author:
Bob Chiodo, CFP
Equity Home Mortgage
Forbes magazine just came out with their “Costliest Cities To Live” list and Portland ranks at #13. Seattle ranks #9 out of their top 10.
They looked at cost of living expenses in six categories: grocery items, housing, utilities, transportation, health care, and miscellaneous goods and services New York was #1 as the most expensive city in which to live.
You can click on this link to see the entire list.
ALL ABOUT…..Portland.Oregon.Real Estate, is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 Unported License. © Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws. Based on a Blog at WordPress.
(For more local and national real estate information, go to www.bettyjung.com).
Portland
From our RMLS™ comes this information regarding FHA:
We all know that FHA Loans have increased in the past few years with the changing market, but how much? I recently ran some numbers on financial terms, a required field in RMLSweb, that may shed some light. These numbers are for the Portland metro area (Clackamas, Columbia, Multnomah, Washington and Yamhill counties).
As you can see, sold listings with the financial terms “FHA” have increased in the RMLS™ Portland market area from just 1.2% in 2007 to 28.1% of sales through October 2009. These numbers are closely in line with national levels; a recent report stated that FHA loans are up to 30% this year from 3% in 2006.
Although buyers utilizing FHA financing has increased dramatically, the preferred method of financing (by 49.3% of sales) in the Portland metro area is still conventional financing. HUD is considering increasing the downpayment for FHA from the minimum of 3.5% to 5% for buyers. By the first of the year 2010, we should know whether this will take effect or not. I feel this is bad timing for this increase. The housing market hasn’t begun to improve or rebound sufficiently as yet, and to make it more difficult for buyers to purchase isn’t something the real estate industry, or buyers and sellers of houses, need at this point.
The home buyer tax credit extension for first-time home buyers and for move-up buyers couldn’t come at a worse time. With winter storms throughout the U.S. and the holiday season, the time to purchase is dwindling away rapidly for anyone wishing to utilize that credit. Personally, I don’t see where that will help with an uptick in sales at this time of the year.
ALL ABOUT…..Portland.Oregon.Real Estate, is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 Unported License. © Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws. Based on a Blog at WordPress.
(For more local and national real estate information, go to www.bettyjung.com).
Portland
Guest Author:
Bob Chiodo, CFP
Equity Home Mortgage, LLC
ALL ABOUT…..Portland.Oregon.Real Estate, is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 Unported License. © Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws. Based on a Blog at WordPress.
(For more local and national real estate information, go to www.bettyjung.com).
NEW SHORT SALE GUIDELINES
The Treasury announced new short sale guidelines that lenders must adhere to. 
With unemployment over 10 percent and millions of adjustable-rate mortgages primed to reset next year, a “tsunami” of distressed properties could be on the horizon. The new guidelines, as well as a growing acceptance by lenders and second-lien holders, give homeowners a better chance of closing a Short Sale rather than losing their house to foreclosure.
The new guidelines also ensure that real estate agents will be paid commissions for their work on Short Sales. Here are some of the program’s other key guidelines (download the program’s full details):
- Lenders must respond to Short Sale requests within 10 business days of receipt of the offer package.
- The seller will be released from all liability for repayment of the mortgage debt.
- Subsequently, the seller is entitled to a relocation incentive of $1,500, which will be deducted from the gross sale proceeds at closing.
- The lender will be paid $1,000 to cover administrative and processing costs for a Short Sale or a deed-in-lieu.
- The property must be listed with a licensed real estate professional who does regular business in the community where the property is located.
- The lender is prohibited from requiring, as a condition of approving the Short Sale, a reduction in the agreed-upon real estate commission.
- The investor will be paid a maximum of $1,000 for allowing a total of up to $3,000 in Short Sale proceeds to be distributed to subordinate lien holders, or for allowing payment of up to $3,000 to subordinate lien holders.
Here’s a YouTube video that also explains the guidelines.
The Foreclosure Alternatives Program provides financial incentives and simplifies Short Sale procedures by setting limits on the time it takes lenders to respond, freeing borrowers from debt and capping claims of subordinate lenders.
MORTGAGE ASSISTANCE
If you have a loan with OCWEN Mortgage, they now have a link on their website to obtain assistance. They launched a new Web site that connects mortgage borrowers with community groups and government agencies that provide assistance for distressed homeowners.
The Web site — at https://www.ocwencustomers.com/ — lists financial counseling resources, as well as sources for job training, food assistance and utility payment assistance for all 50 states, the West Palm Beach, Fla.-based subprime mortgage servicer said. According to a press release, customers can also access the same database of resources by calling Ocwen’s telephone representatives.
“Our goal is to help homeowners, including those experiencing financial troubles, stay in their homes,” said Ocwen president Ron Faris. “One of the multiple ways we do that is to lead customers to resources that can help them manage or solve personal and financial problems that may be at the root of missed or late mortgage payments.
ALL ABOUT…..Portland.Oregon.Real Estate, is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 Unported License. © Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws. Based on a Blog at WordPress.
(For more local and national real estate information, go to www.bettyjung.com).
Portland
Guest Author:
Steve Stenger, President
Condo Approval Professionals LLC
(847) 293-2962
E-mail: steve@condo-approval.com
Website: www.condo-approval.com
Changes to FHA Condominium Guidelines
FHA has made changes to the condominium guidelines as indicated in Mortgagee Letters 2009-46A and B. These changes are effective as of December 7, 2009. I have outlined the positives and negatives of the upcoming changes. First there are a couple of definitions:
There are two (2) types of project review:
- HRAP (HUD review and approval process).
- DELRAP (Direct Endorsement Lender Review and Approval Process). Direct Endorsement (DE) Lenders now have the option to submit projects under this process or HRAP if they choose. They must have the staff that has the capabilities to review and approve projects. Or they can use an experienced consultant to review their projects for compliance.
Positives:
- If the project has started construction prior to submission to FHA an Environmental Report will not be required. This means that if the plat or development plans and any delineated phase have been reviewed and approved by the local jurisdiction and construction of the streets, sewers, and utilities have proceeded to a point that changes cannot be made to the building an Environmental is not required. Not required under DELRAP reviews.
- Site condos (single family detached under condominium ownership) no longer require project approval.
- Project approval not required for FHA to FHA streamline refinance or FHA/HUD REO sales.
- Condominiums that consist of 2 or more units are now eligible for FHA financing. Previously FHA only considered condominiums consisting of 4 or more units.
- Right of First Refusal now acceptable as long as it does not violate discriminatory conduct under the Fair Housing Act Regulation.
- 30% pre-sale and 50% owner-occupancy down from 51%. That means in a 100 unit project only 30 percent will need to be under contract and only 15 units sold to owner-occupant/2nd home purchasers.
- 1 year waiting period for apartment conversions is eliminated. Previously, outside purchasers in an apartment conversion with tenants, had to wait for 1 year after the Declaration had been recorded in order to close on a unit.
- 10-year warranty not required on new construction as long as the local jurisdiction provides a building permit to start construction and also provides a certificate of occupancy prior to closing.
- Attorney’s Certification no longer required.
- Vertical Phasing in single building new construction or condo conversions is now acceptable. The floors must be legally phased in groupings of no less than 5 floors. At least a temporary Certificate of Occupancy has been obtained and all common areas and amenities have been completed.
- Increase in FHA loan concentration from 30% to 50% for new construction and condo conversions. 100% for existing condos that meet the following:
- Project has been completed for over 1 year
- 100% of the units have been sold
- No entity owns more than 10% of the units
- Budget has a 10% reserve contribution
- Control has been transferred to the homeowners
- 50% of the units are owner-occupied.
- Reserve Study not required on existing condo projects. It may be required if the budget doesn’t meet FHA’s 10% reserve requirement.
- FHA will now accept temporary/conditional Certificates of Occupancy for new construction and conversions under the following circumstances:
- All common areas and amenities for the project must be complete
- The temporary/conditional Certificate of Occupancy that was issued clearly indicates that the unit his habitable and eligible for immediate occupancy.
- The jurisdiction that is issuing the temporary/conditional Certificates of Occupancy have a standard protocol for this procedure.
- Vacant or tenant-occupied REO’s including properties that are bank owned maybe excluded from the required owner-occupancy percentage.
- Unrecorded documents are acceptable when a project is submitted for review. However, no loan can be insured until the recorded documents are received.
Negatives:
- No “spot” loan approvals. Existing condominiums must be submitted to FHA for their review and approval as of February 1, 2010. However, I can help with this process.
- No more than 10% of the units may be owned by a single investor. FHA is saying that this will apply to builders/developers that subsequently rent vacant or unsold units. In today’s market, developers are staying afloat by renting units until they can be sold. Now they cannot do that for more than 10% of the units.
- Developers will have to provide a certification that states that:
- The eligible condominium project complies the all applicable FHA requirements addressed in Mortgagee Letter 2009-46B.
- All condominium documents meet all HUD requirements, and state and local requirements.
- Projects consisting of 3 or less units will have no more than 1 unit use FHA financing.
- The 30% pre-sale requirement is indicated to be temporary, to be re-evaluated at the end of 2010. Hopefully, they will decide to keep it.
- FHA concentration level of 50% is temporary as well.
- HO-6 policy now required on FHA condominiums following Fannie Mae’s requirement.
- FEMA Flood Map required for all projects to verify whether or not a project is in a Flood Zone.
- Project approvals expire two (2) years from the date HUD issued their approval of the project. I can assist realtors, homeowner’s associations, and management companies with the recertification process.
- Projects that received approval prior to October 1, 2008 will require recertification on or before December 7, 2010. If they are not recertified by that date, they will be removed from the FHA approved list and have to reapply which requires a full document submission.
ALL ABOUT…..Portland.Oregon.Real Estate, is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 Unported License. © Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws. Based on a Blog at WordPress.
(For more local and national real estate information, go to www.bettyjung.com).
Portland
Guest Author:
Bob Chiodo, CFP
Equity Home Mortgage, LLC
(Click on Image for Better View)
ALL ABOUT…..Portland.Oregon.Real Estate, is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 Unported License. © Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws. Based on a Blog at WordPress.
(For more local and national real estate information, go to www.bettyjung.com).
HOORAY!!! My blog should did hit the 100,000 mark today. Thanks for reading.
RMLS™ October 2009 Stats
The October 2009 RMLS™ stats were published Thursday and I haven’t had a chance to look at them as yet. However, I am posting the report here. Our inventory of houses for sale is at the lowest we’ve seen since August 2007 and sales jumped by 64% the largest increase since 1996. I’ll post more data in the next couple of days. However, if you’ve been thinking of selling or buying, now’s a good time. With low interest rates, low inventory and the home buyer’s tax credit, it is a good time for all parties.
OTHER NEWS
There’s been a lot in the news lately but the over-riding news story has been the increase in unemployment benefits and the
extended/expanded home buyer tax credit. Here’s a great website with frequently asked questions and answers in regards to the new Home Buyer Tax credit that might come in handy for you.
There have been other news-worthy items as well:
Fannie Mae Offers Deed For Lease Program
There’s more info on their website about the Deed For Lease program.
Bend Named In Top 25 Cities
Yahoo!® recently had their Top 25 cities to recover from the economic downturn with a job recovery. The only Oregon city to make the list was Bend and it posted at #23.
23. Bend, Ore.
Q1 2010 annualized job growth: 0.8%
Q3 2009 annualized job growth: -4.7%
First quarter of recovery: Q1 2010
Unemployment rate: 14.5%
Median household income: $54,179
The economy of Bend, at the Cascade Mountains’ eastern foothills, is especially popular with hikers and skiers. Bend’s job market got hammered during the recession because it depends heavily on highly cyclical industries—construction, the retail trade, and tourism. As the overall recovery sets in, Bend and its highly volatile economy should bounce back faster than the rest of the country.
ALL ABOUT…..Portland.Oregon.Real Estate, is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 Unported License. © Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws. Based on a Blog at WordPress.
(For more local and national real estate information, go to www.bettyjung.com).
Portland
Guest Author:
Bob Chiodo, CFP
Equity Home Mortgage, LLC.
Estimated Rates for the week of November 9, 2009*
- 30 year fixed=4.750-4.875
- 30 year jumbo=5.50 to $500k; 5.75 – 5.875 above
- 7/1 ARM=4.00 – 4.25 various programs are available
- FHA/VA=4.75 – 5.00
- OR Vet=4.50 w/1.50 – 4.625 w/1.00
It’s been a while since my last update but it’s certainly not due to a lack of news in the mortgage world. As you can see, rates are still down and doing great. We all know that these won’t last forever but we should remain in a narrow range for the next month or so. And since the 1st time homebuyer tax credit was extended, I think buyers should immediately consider taking the necessary steps to get their first home.
I thought I would take a moment to talk about the impact foreclosures and the alternatives to foreclosure have on a consumer’s credit. This is meant to be just a guideline – lenders can and will have their own rules and these rules change often. On the research that I have done, it appears that most lenders – as well as the credit bureaus – treat a foreclosure, short sale, or deed-in-lieu of as the same in terms of the impact it has on a borrower’s credit profile. After speaking with an underwriter, it appears that FHA requires that a foreclosure or the alternative to be three years before new financing can take place. For VA, it looks like it is two years. Conventional is more convoluted. Per a recent Fannie Mae announcement, foreclosures have a 5 year time frame with additional requirements up to 7 years (principal residence only, 10% down and a 680 credit score). Deed-in-lieu of’s are 4 years with additional requirements up to 7 years. It appears, however, that short sales have only a two year waiting period. Most of these rules do allow exceptions for extenuating circumstances – which, of course, is very subjective. Now, of course, all of these programs require certain credit scores – conventional being higher than FHA. If the credit bureau dings a consumer’s credit hard for a short sale – as I heard that they do – the loan won’t be able go through with the poor scores. So we are back looking at an FHA loan with the three year wait period. I have also heard that some of the banks are going after borrowers after the short sale is completed and requiring the borrower to cover the short fall. If the credit hit is considered the same and the bank tries to collect on the short amount, it makes one wonder why a borrower would do a short sale in the first place. In any of the above circumstance, the key thing for a consumer to do after completion of a foreclosure (or alternative) is to immediately start rebuilding their credit. Getting a secured credit card would be a great start and working with someone is specializes in this area could well be worth the time and effort.
For homeowners facing foreclosure in Oregon, the state recently passed a bill that requires lenders to meet with borrowers either by phone or in person to evaluate whether the homeowner qualifies for a loan modification. Oregonians should watch their mail for the new notice. They have 30 days to act from the date of the notice to request a loan mod. Once received, they should call their lender to set up a meeting, complete the request form provided in the notice and call 1-800-SAFENET and ask for a referral to a nonprofit foreclosure counselor to help with the modification.
There is a lot more going on then time and space warrant. Fannie and Freddie are about to tighten up on their debt ratios and FHA just published their new condo rules – spot approvals are still good through the end of January. Fannie just released their Deed-for-Lease program which will allow for homeowners to rent back their home after completing a deed-in-lieu of to Fannie. And, of course, a huge change is about to happen January 1 when the new RESPA guidelines take place. More about all of this later.
Thanks for reading and have a great week!
*Rates quoted are for the use of Realtors and others in the real estate/financial service industries. They are not meant to be a quote for an individual situation. Rates change daily and those above are only listed to assist market participants by keeping them informed of current interest rates. Credit scores, down payment, and other risk related issues may change the rate. Quotes are usually shown for a 30 day lock period and a 1% origination or discount fee.
ALL ABOUT…..Portland.Oregon.Real Estate, is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 Unported License. © Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws. Based on a Blog at WordPress.
(For more local and national real estate information, go to www.bettyjung.com).
Guest Author:
Bob Chiodo, CFP
Equity Home Mortgage, LLC
ALL ABOUT…..Portland.Oregon.Real Estate, is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 Unported License. © Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws. Based on a Blog at WordPress.
(For more local and national real estate information, go to www.bettyjung.com).
Portland
Perhaps one of the greatest opportunities to create wealth or generate a high rate of return on an investment exists in buying real estate that can be fixed up or improved. The changes sometimes can be as simple as a coat of paint, new carpet, or even just floor and window coverings. During my marriage, we bought fixer uppers in different conditions of repair. We lived in the house and then resold each house at a future date. We did that for over 20+ years. Buying a fixer upper, however, is not for the faint at heart as it takes hard work.
However, with all the foreclosures that have been abandoned or destroyed, there are too many houses that need rehabing. If you’re wanting to become a rehabber, remodeler, etc. in today’s market, there is a financing tool that can assist you. Actually, it has been around for a very long time and in the 70s, 80s and even into the 90s, I sold houses using that financing.
When you purchase a home that needs repairs, often the bank won’t lend the money to buy the house until the repairs are complete, and the repairs can’t be done until the house has been purchased. HUD lets you purchase or refinance a property plus include into the loan the cost of making the repairs and improvements. The FHA insurance 203K loan is provided through approved mortgage lenders nationwide and is available to persons wanting to occupy the home. The program can be used for one-to-four unit dwellings. Maximum mortgage limitations are the same as for properties under Section 203(b).
The “Steamline (K)” Limited Repair Program permits homebuyers to finance an additional $35,000 into their mortgage to improve or upgrade their home before move-in. Homebuyers can quickly and easily tap into cash to pay for property repairs or improvements, such as those identified by a home inspector or FHA appraiser.
The FHA-backed 203K rehab loan is becoming increasingly popular in today’s market because there are too many properties that need repair. A stream-lined 203K provides money to pay for improvements such as a new roof, appliances, furnace, energy-efficient windows and cosmetic improvements such as carpeting, paint and even remodeled kitchens and baths.
“When a homebuyer wants to purchase a house in need of repair or modernization, the homebuyer usually has to obtain financing first to purchase the dwelling; additional financing to do the rehabilitation construction; and a permanent mortgage when the work is completed to pay off the interim loans with a permanent mortgage. Often the interim financing (the acquisition and construction loans) involves relatively high interest rates and short amortization periods. The Section 203(k) program was designed to address this situation. The borrower can get just one mortgage loan, at a long-term fixed (or adjustable) rate, to finance both the acquisition and the rehabilitation of the property. To provide funds for the rehabilitation, the mortgage amount is based on the projected value of the property with the work completed, taking into account the cost of the work. To minimize the risk to the mortgage lender, the mortgage loan (the maximum allowable amount) is eligible for endorsement by HUD as soon as the mortgage proceeds are disbursed and a rehabilitation escrow account is established. At this point the lender has a fully-insured mortgage loan.”
A licensed contractor must complete the work within 6 months. Some lenders will allow the borrower to do minor cosmetic work such as painting themselves.
Eligible Improvements
- structural alterations and reconstruction
- modernization and improvements to the home’s function
- elimination of health and safety hazards
- changes that improve appearance and eliminate obsolescence
- reconditioning or replacing plumbing; installing a well and/or septic system
- adding or replacing roofing, gutters, and downspouts
- adding or replacing floors and/or floor treatments
- major landscape work and site improvements
- enhancing accessibility for a disabled person
- making energy conservation improvements
Seeing a property and its potential for improvement presents an opportunity to create appreciation and increase its value.
ALL ABOUT…..Portland.Oregon.Real Estate, is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 Unported License. © Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws. Based on a Blog at WordPress.
(For more local and national real estate information, go to www.bettyjung.com).
Portland
Inspite of the new tax credit signed into law yesterday by President Obama, there is still some confusion and many people are now
starting to ask questions as to who qualifies, etc. Yesterday, in my post I submitted an easy to read chart with the particulars. To emphasize some information in that chart, a purchase to qualify would have to be made after enactment i.e. it was signed 11/6 by the President which means it is effective – November 7, 2009:
Who is Eligible
- First-time home buyers, who are defined by the law as buyers who have not owned a principal residence during the three-year period prior to the purchase, may be eligible for up to an $8,000 tax credit.
- Existing home owners who have been residing in their principal residence for five consecutive years out of the last eight and are purchasing a home to be their principal residence (“repeat buyer”), may be eligible for up to a $6,500 tax credit.
- All U.S. citizens who file taxes are eligible to participate in the program.
Income Limits
- Home buyers who file as single or head-of-household taxpayers can claim the full credit ($8,000 for first-time buyers and $6,500 for repeat buyers) if their modified adjusted gross income (MAGI) is less than $125,000.
- For married couples filing a joint return, the combined income limit is $225,000.
- Single or head-of-household taxpayers who earn between $125,000 and $145,000, and married couples who earn between $225,000 and $245,000 are eligible to receive a partial credit.
- The credit is not available for single taxpayers whose MAGI is greater than $145,000 and married couples with a MAGI that exceeds $245,000.
Effective Dates
- The eligibility period for the tax credit is for homes purchased after Nov. 6, 2009 i.e. effective November 7, and before May 1, 2010. However, home purchases subject to a binding sales contract signed by April 30, 2010, will qualify for the tax credit provided closing occurs prior to July 1, 2010. If a written binding contract to purchase was in effect by April 30, 2010, the purchaser will have until July 1, 2010 to close
Types of Homes that Qualify
- All homes with a purchase price of less than $800,000 qualify, including newly-constructed or resale, and single-family detached, townhomes or condominiums, provided that the home will be used as their principal residence. Vacation home and rental property purchases do NOT qualify.
Tax Credit is Refundable
- A refundable credit means that if the amount of income taxes you owe is less than the credit amount you qualify for, the government will send you a check for the difference.
- For example:
- A first-time buyer who qualifies for the full $8,000 credit who owes $5,000 in federal income taxes would pay nothing to the IRS and receive a $3,000 payment from the government. If you are due to receive a $1,000 refund, you would receive $9,000 ($1,000 plus the $8,000 first-time home buyer tax credit).
- A repeat buyer who owes $5,000 would pay nothing to the IRS and receive $1,500 back from the government. If you are due to get a $1,000 refund, you would get $7,500 ($1,000 plus the $6,500 repeat buyer tax credit).
- All qualified home buyers can take the tax credit on their 2009 or 2010 income tax return.
Payback Provisions
- The tax credit is a true credit. It does not have to be repaid unless the home owner sells or stops using the home as their principal residence within three years after the purchase.
The www.federalhousingtaxcredit.com site is being updated. Please check the site next week for more detailed information on the new tax credit!
- ALL ABOUT…..Portland.Oregon.Real Estate, is licensed under a Creative Commons Attribution-Noncommercial-No
Derivative Works 3.0 Unported License. © - Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws. Based on a Blog at WordPress.
- (For more local and national real estate information, go to www.bettyjung.com).
PortlandNow Official – President Obama has signed tax credit into law. 10 a.m.
We are very close to getting final approval for extension of the tax credit. The bill has passed both the Senate and the House of
Representatives, and the President’s signature is expected today.
The legislation includes the following components (here’s a link to a chart with more particulars of the tax credit):
- The $8,000 tax credit will be extended and available for first-time purchases before May 1, 2010. Prospective purchasers with binding contracts in place as of April 30, 2010, will be allowed an additional 60 days to complete the transaction. Income limits are expanded to $125,000 on a single return and $225,000 on a joint return.
- A new $6,500 tax credit will be available for repeat buyers who purchase between December 1, 2009, and May 1, 2010. To qualify for this provision, buyers must have lived in their homes consecutively for 5 of the previous 8 years.
There are many that don’t accept the “Buy Now” propaganda. However, prices are low, interest rates are historically low, there’s lots of inventory to choose from, and with the additional tax credit, how can one say now is not a good time to buy? Very rarely in my 34 years, and I’ve written about this before, have I seen where everything falls into place perfectly. Now is a time where it’s close to being perfect – low prices, low rates, lots of inventory, tax credits, etc.
If you have a job, have savings, have a down payment, what is stopping you from buying a home? As indicated in previous posts, I’ve always owned and I don’t believe in paying off someone else’s mortgage by renting. I believe it’s far better to build your own equity than someone else’s. Granted there are reasons and times you should rent instead of buy, however, for the most part, I believe in buying a home of your own (I know you’re thinking, but I’m the Realtor®).
Now is the time to get pre-approved for a loan if you are planning on utilizing the tax credit. Time passed quickly during the first tax credit time period and you don’t want to waste precious time this go-around — get pre-approved now.
Let me help, I’d love to be your Realtor®!
ALL ABOUT…..Portland.Oregon.Real Estate, is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 Unported License. © Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws. Based on a Blog at WordPress.
(For more local and national real estate information, go to www.bettyjung.com).
Guest Author:
Bob Chiodo, CFP
Equity Home Mortgage, LLC
ALL ABOUT…..Portland.Oregon.Real Estate, is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 Unported License. © Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws. Based on a Blog at WordPress.
(For more local and national real estate information, go to www.bettyjung.com).
Portland
Guest Author:
Bob Chiodo, CFP
Equity Home Mortgage, LLC
Just a quick note, FHA has once again postponed the condo re-approval changes until December 7, 2009. They mentioned that some of the changes won’t be as dramatic. That’s our good news for the day!
© Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws.
ALL ABOUT…..Portland.Oregon.Real Estate by Betty Jung is licensed under a Creative Commons Attribution 3.0 United States License.
Based on a Blog at WordPress.
(For more local and national real estate information, go to www.bettyjung.com).
100% Financing – USDA Loan
If you thought the no money down, 100% financing was a thing of the past, there is still the USDA 100% loan here in Oregon that you
might qualify for. There are income restrictions and limits as to the location of the property.
The USDA Home Loan program is a great program offering 100% financing with no down payment or mortgage insurance for those who qualify. Below are the general eligibility requirements.
- Applicants must not have an adequate down payment to secure conventional credit without the USDA guarantee.
- To intend to live in the dwelling as a primary residence. Non-occupant and co-borrowers are not allowed.
- Must be selling existing home, if applicable.
- To be a citizen of the United States or not restricted from permanent residency.
- Have income less than the maximum allowed by the USDA Home Loan Program.
- Purchase a property in an Oregon USDA Approved Area
Most people living in rural areas qualify for USDA Home Loans. Also, many people living in medium sized cities as well as those living on the outskirts of major metropolitan areas may also qualify. Check this page to see whether your income qualifies you.
- A 100% No Money Down Loan
The USDA home loan program requires no down payment and you may finance up to 102% of the appraised value. Since the end of down payment assistance programs in 2008, the USDA home loan program is one of the only remaining 100% loan programs.
- There are no Limits as to the Amount You Can Borrow
The USDA Home Loan program will finance what you can afford to pay. Unlike conventional loans which are insured by Freddie Mac or Fannie Mae, there are no official loan limits. The amount of the loan will be directly related to your ability to repay the loan.
- No Mortgage Insurance
The USDA home loan program requires no up front or monthly mortgage insurance; saving you hundreds of dollars each month. With FHA loans, you have both an up front mortgage insurance premium and a monthly mortgage insurance payment.
- No Credit Score Required
Unlike most home loans, the USDA Home Loan does not require a credit score. Instead, borrowers can use things such as rental history, insurance payments or utility bills to verify their credit worthiness. Check the USDA Home Loan credit guidelines to learn more
- Seller Concessions Allowed
The USDA Home Loan program, there are no rules regarding closing costs and who pays what portions. Some loans limit the seller concessions, but under this program the negotiations are not controlled.
- Rural Areas Are Not Necessarily That Rural
The USDA Home Loan is guaranteed by the United States Department of Agriculture. People may wrongly assume that this loan is meant for farmers or ranchers. Many homes in smaller cities as well as those in outlying suburbs of metropolitan areas are also eligible. Check this link to see if the area you are wanting to purchase qualifies or input the address of a house here in Oregon.
Federal V.A. and State of Oregon G.I. Loans
If you’re a qualifying veteran, there’s still the 100% Federal V. A. Loan program. Here’s the information to see if you are eligible.
The maximum Federal VA loan eligibility in OREGON for a veteran is $104,250 and the maximum loan amount with no down payment is $417,000. U. S. Department of Veterans Affairs (VA) home loan guarantees are made to servicemembers, veterans, reservists and unmarried surviving spouses for the purchase of homes. VA guaranteed home loans offer several important advantages over most conventional loans including a guarantee that protects the lender against loss due to nonpayment by the borrower. A VA Certificate of Eligibility is required. To ask about home loan guaranty information, call the U. S. Department of Veterans Affairs (USDVA) toll free, 1-888-349-7541 www.homeloans.va.gov or call the Oregon Department of Veterans’ Affairs (Toll Free within Oregon) 1-800-692-9666 or from outside of Oregon 503-373-2085 www.oregon.gov/ODVA
For more than 60 years, the Oregon Department of Veterans’ Affairs (ODVA) has made home loans to veterans at favorable interest rates. More than 330,000 home loans have been made to veterans in Oregon. The ODVA’s State Veteran’s Home Loan program offers favorable interest rates and enables honorably-discharged veterans to purchase a single-family owner-occupied home. Eligibility for the program can be established prior to making actual application for a home loan. A veteran’s eligibility for the program expires 30 years after discharge from qualifying active duty in the U.S. Armed Forces. For program qualifications, contact the Oregon Department of Veterans’ Affairs. Toll-Free within Oregon, 1-888-673-8387. From outside of Oregon 503-373-2070.
Portland Development Commission
The PDC has quite a few financing options that you may not know about. You can contact them at the following for further information:
Portland Development Commission | 222 NW Fifth Ave | Portland, OR 97209-3859
Phone: 503-823-3200 | Fax: 503-823-3368
Mortgage Credit Certificate Program
The Portland Development Commission’s Mortgage Credit Certificate (MCC) Program works to provide first-time homebuyers with a federal tax credit. This program is a dollar-for-dollar tax credit on the amount of income tax you owe instead of a deduction to your taxable income. Better yet, this program is good for the life of your home loan!
You do not have to pay back the MCC if you remain in your residence for the life of your mortgage loan. The MCC’s credit totals 20% of the interest paid on your mortgage annually, so an MCC awarded to a $250,000 mortgage could save you about $3,000, or $250 each month.
If you become a homeowner this year or next year, you could save more or get more money back at tax time! For more information on how the Mortgage Credit Certificate can work for you, visit www.pdc.us/mcc or give PDC a call at 503.823.3400.
Buying A Fixer
The Portland Development Commission has monies available within the City of Portland for renovation work on houses that needs repairs or if you just want to make some improvements. With the right renovations, you may be able to add immediate value to your home or put your personal touch on a previously-owned home. Moreover, in situations where repairs are required before a loan can be closed, the PDC’s Purchase and Renovation Loan is the perfect solution. That’s because the appraisal is performed based on the work to be done, and the work is completed after the loan closes.
Buying a Foreclosure in Portland
There’s a new program from PDC that offers assistance to purchase a foreclosed/bank-owned homes in certain neighborhoods in the Portland metro area. These areas include parts of North, Northeast, and Southeast Portland, and parts of Gresham, Fairview, and Troutdale. It is a silent second loan up to 20% of the purchase price plus closing costs or up to $50,000. This amount varies depending on whether the home requires repairs. It is not a 100% loan, a down payment of $1,000 from a buyer is required.
If you sell within the first 5 years, you need to pay back a portion of the profit. The percentage of the profit to be paid back varies depending on how many years you live in the house. You do not need to be a first-time homebuyer to qualify but the home does need to be owner occupied. Income restrictions apply (no more than 120% of median family income) as well as debt-to-income ratio (45% or less) and liquid assets of no more than $15,000. Not only is there a location restriction as stated above, but the home must be a foreclosure in one of those areas.
Home Repair, Weatherization Help
Home Repair Loans – City of Beaverton, City of Portland
There’s also a Hope-4-Homes program in Beaverton to assist low-income homeowners with help in making home repairs. And, the City of Portland home repair loan information is also here.
Weatherization Project – Clackamas County
Clackamas County offers free services if you meet certain income and resident requirements for insulation, weatherstripping and more depending upon the condition of your home. If you have questions regarding this project or to see if you qualify contact:
Clackamas County Weatherization. (503) 650-3338
© Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws.
ALL ABOUT…..Portland.Oregon.Real Estate by Betty Jung is licensed under a Creative Commons Attribution 3.0 United States License.
Based on a Blog at WordPress.
(For more local and national real estate information, go to www.bettyjung.com).
Inasmuch as I haven’t reported on condo stats lately throughout metro Portland, I thought I’d better post this before our official RMLS™ stats are published around October 15. Below are the August 2009 stats. You can see the large inventory of condos that were for sale in August and the relatively few that sold that month. September stats are also shown below and not a lot better. However, condos are selling and due in large part to the First-Time Home Buyer Tax Credit with the rush to close before deadlines in the lower price ranges.
Last Sunday I reported that the FHA rule for condos was put on the back burner until November 30th. I hadn’t received confirmation when I posted that as it was a rumor I heard. However, now comes a report from RISMedia that in fact it is being delayed. Read it here.
However, first here’s a report by another local real estate blogger on the recent Atwater Auction:
“It was a jam packed event with the usual hype and energy that these kinds of events generate. Although many people were evidently just attending out of curiosity, the bidding turned out to be more serious and competitive than most had expected. If you had anticipated picking up one of these units at or near the minimum bid, you should have considered some of the previous comps, as well as the fact that out-of-state bidders are likely to drive prices up beyond the norm. In the end 40 out of 41 units sold, generating just under $20 million in sales.”
August 2009 Stats:
September Stats 2009:
| September 1-29, 2009 Condo Stats | #147Lake Oswego | #147West Linn | #148Portland | #151Tigard |
| # For Sale | 180 | 32 | 591 | 70 |
| # Sale Pending | 22 | 7 | 96 | 17 |
| # Sold | 9 | 2 | 67 | 17 |
| Months of Inventory | 20 mos. | 16 mos. | 8.8 mos. | 4.1 mos. |
| Average Days On Market | 141 | 98 | 110 | 100 |
| Average $/sq. ft. Sold | $224 | $124 | $341 | $131 |
| Average Sold Price | $409,850 | $336,500 | $413,746 | $150,947 |
| Average List Price | $448,556 | $362,000 | $430,218 | $177,764 |
| % of Sale Price vs. List Price | 88.67% | 92.96% | 98.77% | 88.94% |
| Average Sq. Ft. | 1830 | 1477 | 1185 | 1224 |
| Source: RMLS™ |
© Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws.
ALL ABOUT…..Portland.Oregon.Real Estate by Betty Jung is licensed under a Creative Commons Attribution 3.0 United States License.
Based on a Blog at WordPress.
(For more local and national real estate information, go to www.bettyjung.com).
Guest Author:
Bob Chiodo, CFP
Equity Home Mortgage
*Estimated Rates for the week of September 22, 2009
- 30 year fixed=4.875-5.000
- 30 year jumbo=5.50 to $500k; 5.75 to $600k
- 7/1 ARM=4.50 – 5.25 various programs are available
- FHA/VA=5.00 – 5.25
- OR Vet=4.75 w/1.50 – 4.875 w/1.00
Rates are still holding steady. We have been in this current range for quite a few weeks. We have seen the recent Treasury auctions go very well, the Fed is still very engaged in the mortgage backed securities market and inflation isn’t on anyone’s radar. There is a very good chance that we can maintain these low rates through the rest of the year.
We are still seeing credit standards tighten with recent changes being announced by FHA and Fannie Mae. But even with HVCC, MDIA, and all the other changes, we are still getting deals done. When everyone works together we can still close loans within 30 days. It also appears that most companies are setting themselves up for what will hopefully be a big push in the first time homebuyer market before the expiration of the $8000 tax credit. With the current low rates, we could see some strong activity over the next month.
We had some good news – albeit temporary – that FHA has postponed the cancellation of the condo approvals. Currently, all condominiums that were approved prior to November of 2008 will no longer be eligible for FHA insurance unless they are re-approved. The re-approval process, which hasn’t been fully announced yet, will require approximately 15,000 complexes in FHA’s Santa Ana’s region to gain approval. There are some requirements that will pose as an obstacle for re-approval. These include the requirement that no more than 30% of the units can have FHA financing, all complexes need to have a current reserve report (I just reviewed one that was 135 pages – it couldn’t have been cheap to do) and the Association needs to have 60% of the report’s projected reserves in cash – verified cash. I was advised that in the State of Washington there could be over half of the complexes without the reserve requirement. I have a feeling that a large amount of the Associations won’t have the reserves on hand which means re-approval will be difficult, at best. Additionally, no more than 15% of the units can be delinquent on their association dues. Currently, FHA is out 11 weeks on their regular approval process. We can only imagine how bad the turnaround time will be when we all try to get the 15000 complexes re-approved. I guess 30 day locks are out of the question. My take on this is that we will go through a few months of some real tough times on the condos until FHA figures out a better way of doing things.
Since we are talking about changes, here are some recent notes from Fannie Mae’s announcement yesterday. The maximum allowed debt ratio will be 45% with some exceptions to 50%. Most of the industry is already following these guidelines but there are a few out there that weren’t. There are tougher requirements for reserves on second homes and investment properties. And, if reserves are in stocks, bonds, and mutual funds only 70% of their current value can be used to meet the requirements. Only 60% of retirement account balances will be available to meet those same requirements.
Fannie has also made it more difficult to qualify after a borrower has filed a bankruptcy or when they have experienced a short sale, foreclosure, or deed-in-lieu of. I’ll cover more about these in my next update.
Granted, a lot of these changes can make the overall tone of my update pessimistic but I have always been a firm believer that it is better to have all of the information that’s out there. How else can we plan our business? Besides, before we know it, these times will be over and we will be all rolling in the bucks again! Enjoy the rest of your week. Thanks.
*Rates quoted are for the use of Realtors and others in the real estate/financial service industries. They are not meant to be a quote for an individual situation. Rates change daily and those above are only listed to assist market participants by keeping them informed of current interest rates. Credit scores, down payment, and other risk related issues may change the rate. Quotes are usually shown for a 30 day lock period and a 1% origination or discount fee.
© Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws.
ALL ABOUT…..Portland.Oregon.Real Estate by Betty Jung is licensed under a Creative Commons Attribution 3.0 United States License.
Based on a Blog at WordPress.
(For more local and national real estate information, go to www.bettyjung.com).
This is a post I’ve been wanting to write for a very long time. In fact, I’ve drafted several posts and kept them in my “stash” and have
rewritten and rewritten them over time as the financial crisis has evolved. Last week I found this on the Internet because I too have been questioning the standards used to rate consumers on their credit. With the high foreclosure rates, unemployment, illnesses and extreme health insurance costs, stock market declines, there are many, many people unable to pay their bills. Many circumstances are certainly self-caused while other consumers have been at the mercy of the economy and are unable to “just keep up.” I’ve long felt that the credit bureaus needed to ease up as situations have become so dire for so many.
Here’s what I found on MSN:
Even the most responsible borrowers slip up sometimes.
Maybe a utility bill went unpaid after you moved and the missed payment went into collections. Or perhaps there are unpaid library fines or parking tickets in collections that are hanging onto your credit history and affecting your FICO credit score, which is widely used.
With the newest version of the FICO credit-scoring system, however, minor delinquencies are now overlooked in calculating creditworthiness.
Under the updated scoring model, called FICO 08, small missed payments lingering in collections with original amounts of $100 or less will no longer do damage to your credit score.
Consumers also are less likely to be penalized for any single delinquency if it occurred two or more years ago — and if their credit history is otherwise unblemished, says FICO (formerly Fair Isaac), which developed the FICO scoring system.
“There’s more flexibility with missing a payment,” said Careen Foster, the director of global scoring product management for FICO. “If you have a more habitual pattern of paying accounts late . . . you’re more likely to get penalized for that.”
If a consumer’s credit usage is high, that will be more likely to hurt his or her score with FICO 08. But getting close to your credit-card limits — even if you always pay on time — is penalized in some way in every FICO score, not only the recent edition, Foster said.
These new standards should also boost the housing market making possible for more buyers to purchase. It’s about time the consumers are getting some breaks.
© Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws.
ALL ABOUT…..Portland.Oregon.Real Estate by Betty Jung is licensed under a Creative Commons Attribution 3.0 United States License.
Based on a Blog at WordPress.
(For more local and national real estate information, go to www.bettyjung.com).
Betty Jung
Market Update: Financing Stats & The Debate Goes On
October 21, 2009 in Buying, Commentary, Financing, Credit, Debt | Tags: All About Portland Oregon Real Estate, Betty Jung, www bettyjung.com | Leave a comment
The major players in the housing market sent their letter to President Obama requesting that the home buyer tax credit be extended for
one year, that it be increased in amount and be made available to all home buyers. There’s been a final push in favor of the tax credit.
Mark Zandi, the Economist has said extending the home buyers tax credit and increasing its amount makes sense. We haven’t seen too many economists in favor of the credit, but I agree wholeheartedly with Zandi and if you’ve been reading my posts you know that I believe if you don’t fix housing, you won’t fix the economy. In case you missed it, here’s the news story.
However, yesterday USA Today reported that a housing credit isn’t needed and that 80% of financing for first-time home buyers is with FHA financing. I had written a post not too long ago on that very subject that in fact FHA financing in the three areas my blog covers wasn’t the primary source of financing. I decided to do another check since we are in the middle of the frenzy for first-time home buyers to purchase in order to get their tax credit.
For the month of September, RMLS™ #147, 148 and 151, showed that once again the bulk of purchases were not FHA financing. The bulk of the transactions in the above areas this blog covers were in fact Conventional financing.
(The stats aren’t broken down by RMLS™ for West Linn and Lake Oswego. The totals also include both residential detached and condos, townhouses and attached dwellings).
Methods of Financing
Lake Oswego
/West Linn
West Portland
Tigard
With the large number of houses and condos for sale in these three areas, I still feel that a tax credit should be extended, increased and open for all buyers.
© Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws.
ALL ABOUT…..Portland.Oregon.Real Estate by Betty Jung is licensed under a Creative Commons Attribution 3.0 United States License.
Based on a Blog at WordPress.
(For more local and national real estate information, go to www.bettyjung.com).