Fernando Rivera's Blog

You’ve found the perfect home for your client and now they need to get a mortgage. The question is – do they know their mortgage basics? According to a Zillow Mortgage Marketplace survey conducted on April 13, 2011, you might be surprised what your customer doesn’t know.*

42% of those surveyed didn’t know FHA financing is available for everyone. Let’s face it, a customer with an average credit score and a down payment of less than 20% may benefit greatly from an FHA loan.

55% of those surveyed didn’t know that mortgage rates, like stocks, are subject to change constantly and can do so throughout the day. It pays to be familiar with the ups and downs of the market.

57% of those surveyed think that ARM’s always reset at a higher rate, not realizing that if the margin plus the index are lower at the change date, their ARM will reset at a lower rate.

45% of those surveyed believe you should always pay discount points to get a lower rate. Your customer should ask themselves if they plan to be in this home for many years, if not, it may not be in their best financial interest to pay points to lower the rate.

37% of those surveyed believe that being prequalified for a mortgage means they have secured financing for that mortgage. It’s important for them to know that a prequalification is typically used to help them determine a loan amount they can afford based on the financial information they had discussed with the mortgage loan officer.

Lots of questions, which is why it is so critical to help them through the biggest financial commitment they will ever make. Sovereign can help. Financing your home is about much more than just finding an attractive rate. It takes know-how, experience, and the right tools to get the job done. So when you’re thinking about the right lender, think of Sovereign. Despite today’s changing market, Sovereign is uniquely positioned to help your customer enjoy the personal and financial benefits of homeownership.

Information provided by Linda Landmesser Of Sovereign Bank. She can be contacted either by email – LLandmes@sovereignbank.com or by Phone – 732-713-2218.

Freddie Mac recently released the results of its Primary Mortgage Market Survey®, showing mortgage rates easing to new all-time record lows for all products covered in the survey helping to keep homebuyer affordability high. The average for the 30-year fixed mortgage rate has been below 4.00 percent for six consecutive weeks.

The survey concluded that the 30-year fixed-rate mortgage averaged 3.89 percent, with an average 0.7 point for the week ending January 12, 2012, down from last week when it averaged 3.91 percent. Last year at this time, the 30-year FRM averaged 4.71 percent.

The 15-year FRM this week averaged 3.16 percent with an average 0.8 point, down from last week when it averaged 3.23 percent. A year ago at this time, the 15-year FRM averaged 4.08 percent.

Additionally, the 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 2.82 percent this week, with an average 0.7 point, down from last week when it averaged 2.86 percent. A year ago, the 5-year ARM averaged 3.72 percent.

Results showed that the 1-year Treasury-indexed ARM averaged 2.76 percent this week with an average 0.6 point, down from last week when it averaged 2.80 percent. At this time last year, the 1-year ARM averaged 3.23 percent.

“Mortgage rates eased slightly this week to all-time record lows following mixed indicators in the labor market,” says Frank Nothaft, the vice president and chief economist of Freddie Mac. “Although the economy added 1.6 million jobs in 2011, which was the most since 2006, the unemployment rate remained historically elevated.”

Source RISMEDIA.

Copyright ® 2012 RISMedia, Inc. All Rights Reserved.

Higher-than-normal levels can increase cardiac inflammation, study found

TUESDAY, Jan. 10 (HealthDay News) — Studies have shown that vitamin D is critical for bone health and could have a protective benefit for the heart, but new research suggests that too much of it could actually be harmful.

“Clearly, vitamin D is important for your heart health, especially if you have low blood levels of vitamin D. It reduces cardiovascular inflammation and atherosclerosis, and may reduce mortality, but it appears that at some point it can be too much of a good thing,” study leader Dr. Muhammad Amer, an assistant professor in the division of general internal medicine at the Johns Hopkins University School of Medicine, said in a Hopkins news release.

In conducting the study, published in the Jan. 15 issue of the American Journal of Cardiology, researchers examined five years of data from a national survey of more than 15,000 adults. They found that people with a normal levels of vitamin D had lower levels of a c-reactive protein (CRP), a marker for inflammation of the heart and blood vessels.

On the other hand, when vitamin D levels rose beyond the low end of normal, CRP also increased, resulting in a greater risk for heart problems.

“The inflammation that was curtailed by vitamin D does not appear to be curtailed at higher levels of vitamin D,” Amer explained.

The researchers concluded that people should be aware of the potential risks associated with taking supplements, particularly vitamin D.

“People taking vitamin D supplements need to be sure the supplements are necessary,” Amer said. “Those pills could have unforeseen consequences to health even if they are not technically toxic.”

It is unclear why higher levels of vitamin D are not beneficial for the heart, the researchers said.

More information

The U.S. National Institutes of Health provides more information on vitamin D.

– Mary Elizabeth Dallas

SOURCE: Johns Hopkins Medicine, news release, Jan. 4, 2012

Copyright © 2012 HealthDay. All rights reserved.

The Federal Housing Administration is extending its “anti-flipping” waiver through the end of 2012, which allows buyers to purchase homes that have already been sold in the last 90 days.

The waiver, which was soon set to expire, is “intended to accelerate the resale of foreclosed properties in neighborhoods struggling to overcome the possible effects of abandonment and blight,” Carol J. Galante, the acting Federal Housing Administration commissioner, said in a statement. “FHA remains a critical source of mortgage financing and stability and we must make every effort to promote recovery in every responsible way we can.”

An anti-flipping rule originally took effect in 2003 to stop a spike in home flipping that was being blamed on driving up home prices during the housing boom. The rule prevented FHA-backed loans from being used to purchase homes that had been owned by a seller for less than 90 days. But the U.S. Department of Housing and Urban Development decided to reconsider the 90-day limit in 2010 after skyrocketing foreclosures and abandoned homes were causing blight in neighborhoods across the country and hampering nearby property values.

The temporary waiver to the anti-flipping rule will allow buyers and investors to quickly resell refurbished homes and not have to wait 90 days to do so. Since the waiver took place in 2010, FHA has insured nearly 42,000 mortgages worth more than $7 billion on homes resold within 90 days of the last purchase, according to HUD.

“It’s certainly an inducement to move real estate and reduce inventories,” says Don Cameron, a real estate investor who owns a franchise of We Buy Ugly Houses in South Florida. “Why wait 90 days before you can close on a home?”

The waiver, however, still prevents predatory flipping, and sellers must justify any increases in value if the sales price of the property is 20 percent more than what the seller had recently purchased it for (such as by providing extra documentation on renovation expenses). Sales also must be in “arms-length, with no identity of interest between the buyer and seller or other parties participating in the sales transaction.”

Source: “Government Extends Waiver of Anti-Flipping Law, Allowing Homes to be Bought and then Sold in 90 Days,” McClatchy-Tribune Regional News (Dec. 29, 2011) and HUD.gov

Posted By susanne In Best Practices,Business Development,Real Estate,Real Estate Trends,Today’s Marketplace | Comments Disabled

When it comes to seller contributions, the real estate and mortgage industries are well overdue for a new way of thinking. That’s because the majority of agents (and buyers and loan officers, too) simply think the only use for seller contributions is to cover closing costs, and that means you’re missing out on a tremendous opportunity to help your buyer.

Many don’t realize seller contributions can be used in a variety of ways that can increase a buyer’s purchasing power or help them lower their monthly payments.

In the following scenarios, if a buyer with a 760 FICO score and 5% downpayment had opted for a 30-year fixed rate conventional loan with mortgage insurance (MI) and used the seller contribution to either buy down the interest rate or pay the MI premium in cash as a one-time fee at closing, they would have gained more than $50,000 in purchasing power for the exact same monthly payment.

Buying Down the Interest Rate
In this example, the buyer opts to use the seller contribution to buy down the interest rate to 4.75% and gains $55,105 in purchasing power.

[1]

Paying the MI Premium in Cash
In this example, the buyer opts to use the seller contribution to pay the MI premium in cash as a one-time fee at closing and gains $52,315 in purchasing power.

[2]In this limited and very competitive market, it’s important to find a way to differentiate yourself. Being a knowledgeable resource for your buyers on all aspects of the home-buying process can help you accomplish that more successfully. Just by outlining the opportunities to better leverage seller contributions and pointing your buyer to their loan officer to discuss the options, you can increase your value, your sales and your referral business.

Brien McMahon is chief franchise officer of Radian Guaranty Inc.

Copyright ® 2012 RISMedia, Inc. All Rights Reserved.

Free WiFi is great. Almost every coffee shop has it. But have you ever stopped to think: Is this WiFi network safe? Who might be trying to hack my computer? Can people see private information such as email, client information, and my passwords?

The short answer: Yes, it’s possible. But now you can protect yourself and your information with a free download for both Mac and PC called “HotSpot Shield.”

Named by PC Magazine as one of its “Best Free Software Downloads,” Hot Spot Shield will:

Secure your connection with HTTPS encryption
Protect you from identity theft online
Hide your IP address for privacy
Access all content without censorship or firewall blocking
Protect you from snoopers at hotels, airports, coffee shops, and corporate offices
The free version of HotSpot Shield includes ad banners which appear on the top of your screen from time to time, but it’s far from obtrusive. If you’d rather go pro (and ad-free) a year-long subscription to the premium version is only $44.95, and currently includes a 2-hour Skype voucher.

Next time you have an impromptu client meeting at Starbucks, don’t forget to fire up Hot Spot Shield to keep your information safe. It’s comforting to know you’re reducing the chances of exposing yourself and your data to prying eyes.

Information provided by Scott Levitt.

Copyright (C) 2009 – 2011, Scott Levitt – Oakley Signs & Graphics, Inc. All rights reserved.

Where are rates heading? You may soon get more insight with a new proposal the Federal Reserve is weighing.

The Federal Reserve doesn’t traditionally make a point to reveal its predictions for future actions on interest rates widely known to the public — that is, until recently. This summer in a rare step, the Fed announced that it would keep short-term interest rates at nearly zero until 2013. The Fed may start making it a tradition to reveal more with a regular forecast of its future decisions on interest rates.

The Fed may consider adopting such a move at its Tuesday meeting, but if it does adopt an action, it most likely wouldn’t be announced to the public until January, The New York Times reports.

According to a recent article, the minutes of the Federal Reserve committee’s last meeting in November revealed that “participants generally expressed interest in providing additional information to the public about the likely future path of the target federal funds rate.”

In 2007, the Fed weighed a similar move but decided against it because they feared that public would take the predictions as commitments, and the Fed wanted to be able to change course if needed without public misunderstanding.

If the Fed adopted a forecast, it likely would predict where interest rates are heading for the next three years, and it would be similar to the forecasts it already publishes about economic growth, unemployment, and inflation four times each year, The New York Times reports.

Source: “Fed to Weigh Publishing a Forecast on Rates,” The New York Times (Dec. 11, 2011)

Suggestions for newborns and young children

(HealthDay News) — Even baby’s gums and teeth can decay, potentially leading to future problems with permanent teeth.

The American Academy of Pediatrics suggests how to prevent tooth decay in children:

Brush baby’s teeth and gums regularly.

Never allow baby to take food or a bottle to bed.

Restrict a bottle or sippy cup to mealtimes only.

Make sure your water is fluoridated, or talk to your dentist about fluoride supplements.

Avoid sticky, sweet treats such as candy, cookies or fruit roll-ups.
– Diana Kohnle

Last Updated: Dec. 14, 2011

Copyright © 2011 HealthDay. All rights reserved.

Posted By beth On December 12, 2011, In Real Estate,Real Estate News, Real Estate Trends

Freddie Mac (OTC: FMCC) recently released the results of its Primary Mortgage Market Survey [1](R) (PMMS(R)), showing average fixed mortgage rates largely unchanged and near their record lows helping to keep housing affordability high for those borrowers who are in the market. The 30-year fixed dipped to 3.99 percent, and at 3.27 percent, the 15-year fixed averaged just slightly above its all-time low of 3.26 percent on October 6, 2011. According to the report:

• 30-year fixed-rate mortgage (FRM) averaged 3.99 percent with an average 0.7 point for the week ending December 8, 2011, down from last week when it averaged 4.00 percent. Last year at this time, the 30-year FRM averaged 4.61 percent.

• 15-year FRM this week averaged 3.27 percent with an average 0.8 point, down from last week when it averaged 3.30 percent. A year ago at this time, the 15-year FRM averaged 3.96 percent.

• 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 2.93 percent this week, with an average 0.5 point, up from last week when it averaged 2.90 percent. A year ago, the 5-year ARM averaged 3.60 percent.

• 1-year Treasury-indexed ARM averaged 2.80 percent this week with an average 0.6 point, up from last week when it averaged 2.78 percent. At this time last year, the 1-year ARM averaged 3.27 percent.

Average commitment rates should be reported along with average fees and points to reflect the total upfront cost of obtaining the mortgage. Visit the following links for Regional and National Mortgage Rate Details [2] and Definitions [3]. Borrowers may still pay closing costs which are not included in the survey.

According to Frank Nothaft, vice president and chief economist, Freddie Mac, “Thirty-year fixed-rate loans have declined 0.62 percentage points from a year ago, and median sales prices on existing homes are off 4.7 percent in the year ending with October. These low rates and home prices have pushed housing affordability to record highs this year. For instance, the National Housing Affordability Index, which dates back to 1971, reached another all-time record high in October for the sixth time in 2011, according to the National Association of Realtors®. Monthly principal and mortgage interest payments accounted for a mere 12.6 percent of median family incomes that month. This level of affordability likely contributed to the rise in conventional mortgage applications for home purchases over the week of December 2nd to the most in nearly a year.”

Information provided by RISMedia.

Copyright ® 2011 RISMedia, Inc. All Rights Reserved.

WARNING: Unless extended the much lauded Mortgage Forgiveness Debt Act expires end of 2012. If you have underwater owners on the fence about when to list their homes as a Short Sale (to avoid a foreclosure) they must act before its too late…

….there is no guarantee the the Forgiveness Act will be extended into 2013. Bottom line, take action now!

From MarketWatch.com

Thirty-five percent of current clients surveyed by YouWalkAway.com said that they’re walking away from their homes sooner because of the upcoming expiration of the Mortgage Forgiveness Debt Relief Act at the end of next year, according to a news release from the company.

YouWalkAway.com markets itself as an authority on foreclosure laws and consequences, which helps underwater homeowners “take control of their financial future,” with many of them deciding to walk away from their home and allowing it to enter foreclosure.

The Mortgage Forgiveness Debt Relief Act gives tax relief to homeowners who have sold their home via short sale or lost their home to foreclosure. It takes about a year to complete the foreclosure process, the company says.

“The survey results are not surprising; YouWalkAway.com has seen a number of homeowners reach out to us due to the impending 2012 deadline,” said Jon Maddux, chief executive of YouWalkAway.com, in a news release. “Many are deciding to begin the foreclosure process sooner rather than later in order to ensure their foreclosure is complete by the end of 2012.”

Read more real-estate news in this week’s pages, including the latest results of the Mortgage Bankers Association’s quarterly mortgage delinquency report. Plus, read about the latest mortgage scams and find out details of government’s revamped Home Affordable Refinance Program in this week’s Realty Q&A.

“Today, about 80% of the people who come to me inquiring about foreclosure tax ramifications qualify for tax relief under the Mortgage Debt Relief Act,” said Cheryl Gerhardt, a CPA who has worked with some YouWalkAway.com clients, in a news release. “These are usually people who purchased during the height of the market from 2005 to 2007 and never had the opportunity to take out a second, whereas a few years ago clients who were getting foreclosed upon had made purchases in the early 2000s, took out a home equity line of credit and could not qualify.”

If the expiration of this law is, indeed, a factor in people choosing to walk away from their homes sooner rather than later, it will interesting to see how it plays out in the foreclosure numbers in the year ahead.

Information provided by Harris Real Estate University