The financial reform legislation signed into law on July 21 by President Obama will precipitate some key changes within the mortgage market that will likely affect homebuyers, according to U.S. News and World Report. Under the legislation, a new consumer financial protection bureau will be set up to establish and enforce rules for the financial marketplace and protect consumers’ interests. The law will force lenders to make sure that borrowers have the financial means to repay the mortgage loan before they approve it. It also bans brokers from receiving additional fees for putting borrowers into risky mortgages.
Great information from CRS Member Connect, on-line newsletter.
Fannie Mae has launched a new website to help homeowners who are behind on their mortgage payments or are facing foreclosure.
Knowyouroptions.com features practical information and resources homeowners need to avoid foreclosure and either stay in their home or sell it. Resources include a list of local foreclosure prevention events, housing counselors, Fannie Mae resources, credit score information, forms, videos, calculators and more. The site also provides important tips for recognizing and avoiding foreclosure scams. For more information, visit www.knowyouroptions.com.
from CRS Member Connect on-line newsletter.
Remodeling spending is expected to increase by the end of the year and accelerate to double-digit growth in the first quarter of 2011, according to the latest Leading Indicator of Remodeling Activity (LIRA) report by the Joint Center for Housing Studies of Harvard University.
Kermit Baker, director at the Joint Center for Housing Studies, says homeowner optimism is driving the trend toward investing in the home again. “The recovery in home improvement activity appears to be moving beyond simple replacement projects and energy retrofits to broader remodels and upgrades,” Baker says. “A wider activity base would help generate the expected growth in the quarters ahead.”
from CRS MemberConnect on-line newsletter
When you buy a home, there will be many jobs to accomplish, from changing your address and having your utilities shut off at your old residence to cleaning and unpacking at your new home. Don’t overlook these important tasks to help ensure your safety:
- Immediately have the locks changed. You never know how many contractors, neighbors, or maintenance providers possess copies of the keys. Although these people may be trustworthy, your keys could get into the wrong hands.
- Change the codes on security systems and garage door openers. Similar to choosing a password for your computer, make sure your cods aren’t easy to guess: don’t use your house number as the code for your garage.
- Replace the batteries on the smoke alarms. Buy one fire extinguisher for each level of the house and garage.
- Make sure the house numbers are at least 6-inches tall. They should be clearly visible from the street to help emergency vehicles spot your house should the need ever arise.
Whether you’re in the market for a new home, or applying for a loan, before you start looking at neighborhoods, you need to look at something else-your credit score. Here are some of the key terms you should know:
Payment History-Your payment history is a significant factor in determining your credit score. A history of late payments on current and past accounts is likely to have a nigative impact on your score.
Amounts Owed-What you owe counts significantly in the calculation of your credit score. Maintaining large balances on your credit cards may be a signal to lenders that you have accrued more debt than you can handle.
Length of Credit History-A portion of your score is based on how long you’ve had established credit. A longer credit history can help earn you a better standing with creditor grantors and lenders.
New Credit Requests-Consider ways to manage new credit wisely. Applying for many different types of credit in a short period of time can take a toll on your score.
Credit Diversity-Mix it up. Having a combination of account types including installment, revolving and mortgage is a good way to help diversify your credit.
Landscaping with native wildflowers and grasses improves the environment. A native plant species is one that occurs naturally in a particular region, ecosystem and/or habitat without direct or indirect human actions. Natural landscaping affects a variety of beneficial insects, birds, butterflies, and other animals. And the beauty of native wildflowers and grasses creates a sense of place, both at home and in commercial applications. The native plants increase our connection to nature, help educate our neighbors and provides a beautiful, peaceful place to relax.
Native landscaping practices can help improve air quality on a local, regional and global level. Gas lawn and garden equipment, on average, produces5% of ozone forming VOC’s in area with smog problems. Once established, native plants do not need fertilizers, herbicides, pesticides or even regular watering, thus benefiting the environment, conserving resources, and reducing maintenance costs.
go to www.epa.gov/greenacres for more information about ec0-friendly landscaping information and resources.
Street trees are a great asset to the community, as well as individual property owners. For many years, the City of Fremont has maintained street tree and repaired the damage caused by them to residential sidewalks as a service to the adjoining property owner. This approach was always contrary to State law, which maintains property owners are responsible. Now, due to budget and staffing reductions, these services will no longer be provided.
Beginning June 24, the responsibility will now shift to property owners to maintain their street trees and sidewalks. In addition, property owners will be responsible for damages caused by improper tree maintenance.
To view the new Street Tree Guidelines and Sidewalk Repair Guidelines, go to Fremont.gov Or call the city maintenance at 979-5700
information from Fremont’s summer 2010 “Fremont City News”
Home buyer credit extension heads to Obama Congress passed a bill this week extending the deadline to close escrow and qualify for the federal home buyers tax credit. President Obama is expected to sign the bill extending the deadline to Sept. 30, 2010, instead of its original June 30 deadline.
KEEP THIS IN MIND
• The bill extends the deadline to close escrow for home buyers who entered into a home purchase contract by the April 30 deadline. First-time buyers may be eligible to receive up to $8,000 and qualified existing homeowners may receive up to $6,500 if the home buyer closes escrow by Sept. 30.
• Home buyers entering into sales contracts May 1 or later are not eligible for the federal tax credit, but they may qualify for the California home buyer tax credit.
• The CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) and the NATIONAL ASSOCIATION OF REALTORS® worked closely with members of Congress to extend the deadline. Estimates from NAR show nearly 180,000 home buyers nationwide would have missed out on the tax credit if the deadline was not extended, including nearly 17,700 home buyers in California.
• Many of the home buyers who would have missed out on the tax credit are in the midst of purchasing a short sale or foreclosure, which generally take longer to close due to the amount of paperwork involved in the transaction.
Consumers are still cautious when it comes to how they spend their money. According to a recent Harris Poll, nearly two-thirds of U.S. adults (63%) say they have purchased more generic brands in the post six months in an effort save money, while an additional 12 percent say they have considered doing so.
The survey also finds that each generation saves money in different ways. For example, Gen Xers (ages 34-45) are more likely to brown-bag lunch (56%) and cut back on going to hair salons (43%). Matures (65 & older) are more likely to cancel a magazine subscription (45%). Members of Generation Y (age 18-33) are more likely to cancel their landline phone service and use only a cell phone (20%) and to carpool or use mass transit (26%).
New research suggests buyers applying for mortgage loans immediately after house hunting often make poor choices—sometimes selecting the first loan option presented, regardless of the terms with which it is associated.KEEP THIS IN MIND
• The research, conducted by two George Washington University instructors, found “cognitive resource depletion” to be a determining factor in why some borrowers make poor choices in selecting a home loan. Cognitive resource depletion implies willpower is a limited resource that can be exhausted. The study suggests the depletion of willpower may be one reason borrowers choose loan products such as pick-a-pay mortgages, interest-only loans, loans with balloon payments, and mortgages with negative amortization.
• To test the theory of cognitive resource depletion, two test groups were created. One was presented with an online-shopping simulation, the other was not. The group completing the simulation then was tasked with selecting a set of mortgage alternatives. The second test group only was asked to select a mortgage product. Almost half of those participating in the house-shopping exercise selected a higher-risk mortgage, while less than one in five of those who did not participate in the experience selected a higher-risk mortgage.
• Although most sales contracts require buyers secure financing within a designated time period, the authors of the study recommend even financially savvy borrowers institute a waiting period of at least two days after selecting a home to purchase before applying for a home loan. To address this, the authors and most real estate professionals advise home buyers apply for a home loan and receive preapproval prior to searching for a house.
reprinted from CAR’s “Market Matters” newsletter, original article: LA times
The financial reform legislation signed into law on July 21 by President Obama will precipitate some key changes within the mortgage market that will likely affect homebuyers, according to U.S. News and World Report. Under the legislation, a new consumer financial protection bureau will be set up to establish and enforce rules for the financial marketplace and protect consumers’ interests. The law will force lenders to make sure that borrowers have the financial means to repay the mortgage loan before they approve it. It also bans brokers from receiving additional fees for putting borrowers into risky mortgages.
