October 2011

Found 13 blog entries for October 2011.

“The millionaire says to a thousand people, ‘I read this book and it started me on the road to wealth.’  Guess how many go out and get the book? Very few. Isn’t that incredible? Why wouldn’t everyone get the book? A mystery of life.”  – Jim Rohn

money_door_400Mr. Rohn explains that if we want to make the right financial decisions in our lives, we should depend on the same sources the wealthy read. This past month four different iconic financial resources said the same thing:


Here are all four resources.

Forbes Magazine: The Next Mortgage Crisis

Wall Street Journal: It’s Time to Buy That House

MarketWatch.com: Now Might Be the Best Time Ever to Buy a Home

JP Morgan Market Insights: Housing: A Time To Buy

Enjoy reading

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checklist_400Short sale success does not stop at educating the seller as to their loss mitigation options and then successfully negotiating with the seller’s bank to accept a short payoff.  Serious attention need to be given to Educating the buyer regarding the proper short sale procedures.

Educating the buyer and setting the correct expectations is imperative to a successful short sale transaction. Nothing is more discouraging than successfully negotiating a short sale only to have the buyers walk from or not be able to close the transaction. The following are some precautionary and educational items to consider which would avoid such buyer fallout. 

Patience is a Virtue

Not every buyer is a short sale buyer.  However, one important characteristic a short

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At a campaign stop inNevada on Monday, President Obama announced an expansion of the HARP (Home Affordable Refinance Program) which would eliminate the current maximum LTV of 125%. The initiative is being looked at as a way to reward those homeowners who have been good payers of their mortgages but, because of declining home values, they could not take advantage of today’s lower interest rates.

While the actual details on the program will not be released until next month, here’s the buzz:


  • It will only pertain to loans currently being serviced by Fannie Mae or Freddie Mac
  • Because of the removal of the LTV cap, appraisals may not be required
  • With the only qualifying criteria announced being that the last six payments be on time, it is
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home_sweet_home_400If you are in the market to buy a home of your own, you need to ask yourself one question: WHY?

It seems like a simple enough question yet it is not.  Many buyers are on the fence of indecision hoping to buy at the optimum time.


What if your purchase is more about improving the quality of life for you and your family? Or moving into a school district where your child’s talents will be maximized? Or being closer to friends and family? There is a cost to delaying any of these decisions.

We realize everyone wants to make a sound financial decision no matter the actual reason for moving. Delaying in a hope to ‘time’ the market might not make sense however. Forbes.com addressed this issue in an article by John E. Girouard last week:

“Trying to

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Most people get it backwards. They shop for a home, THEN, they try to structure the financing for it. They make the emotional decision of buying the home of their dreams, THEN, try to apply logic in how they pay for it. Many even go “online” and play with what is affordable by underwriting standards without TRULY considering their future.

I am always fascinated by mortgage underwriting “standards” when they don’t even take into account some very large variables that affect an applicant’s cash flow, and thereby, their ability to repay the loan or maintain a lifestyle they want:


  • Are you single or a family of six? Costs for food and clothing alone are very different.
  • Do you live in a state that requires State Income Tax or not? Another
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OC Home Sales Jump 6.5%, Spurred by Lower-Priced Units

Although home sales remain mired in a market of oversupply, Realtors and sellers can point to some good news in the form of rising sales, especially over the last two months.

And, in the current market, any positive news is welcome.

A recent DataQuick survey of Orange County homes found that sales in September rose 6.5 percent from one year ago. The bad news for sellers was that the median selling price dropped 6.7% from last year.

The current median price in Orange County is $420,000. In Fountain Valley, the median price stands at $559,000, according to eVantage Real Estate.

But the drop in price is somewhat deceiving. Much of the recent sales activity has been for

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When Cynthia and Gerald Matthews relocated from Ottawa to Bloomington, Ind., house hunting had some pleasant surprises. “It was much cheaper than we thought it would be,” says Cynthia Matthews, who bought a three-bedroom, brick neocolonial-style house for 5 percent less than the $196,999 asking price and got a mortgage rate close to 4 percent. “To say it’s a buyer’s market would be an understatement.”

People like the Matthewses who survive the scrutiny of mortgage lenders are getting the best deals of the five-year U.S. housing bust—and perhaps the best deals of a generation—after a 31 percent decline in home prices since 2006. It’s the bright side of an otherwise bleak real estate market: Good houses at cheap prices are plentiful, and

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Today we will quote what those outside the real estate profession are saying to the people who look to them for financial advice.

The Wall Street Journal

Last week, in an article entitled It’s Time to Buy That House, the WSJ told their subscribers:

“It’s an excellent time to buy a house, either to live in for the long term or for investment income…Houses aren’t the magic wealth creators they were made out to be during the bubble. But when prices are low, loans are cheap and plump investment yields are scarce, buyers should jump.”

In an article two weeks ago, MarketWatch.com (the on-line blog for WSJ) told their readers:

“Now could be the best time in history to buy a home.”


In a report to their subscribers,

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Four Facts...

Contrary to everything the media is still reporting, Orange County real estate sales trended upward for the seventh month in a row. Foreclosure rates are dropping. The market is humming—not overheated, but not softening either. It’s kind of on cruise control. And after what we’ve been through in the past three years, that’s a good thing.
When analyzing sales data, I look at four key indicators. And all four are looking good. Here’s what I see:
•   Pended Sales—there were 3,209 recorded in July, 2011, up 281 over June, and up significantly over
    July 2010: a 1,042 gain.
•   Months of Inventory (closed sales)—this figure stands at 5.2 months. Sure, it’s up from the June figure
    of 4.5, but way below last July’s 6.8 months.

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Your email made me think about my parents when they bought their home in 1987 at 17.5% interest.  Check out the REAL LIFE scenario that has happened with their home


My parents bought their home in 1987 for $250,000 at 17.5% interest.  There monthly payment was $3,265.99/month. 


My parents sold the house in 2005 for $820,000 to a buyer who paid 6.5% interest for a monthly payment of: $5,239/month


There same model just sold for $595,000 at 3.94% interest rate.  These buyers monthly payment will be: $3,049.39/month


Now that is some crazy Math!  Home prices are back to 2001 levels, but with interest rates as low as they are, the monthly payments are down pre-1987.   WOW




thanks to clay kilbarger

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