Wednesday, October 21, 2009

Forclosures Are More Profitable Thank Loan Modifications, According To New Report

Mortgage companies are more likely to foreclose on homeowners than modify their loans because they make more money off foreclosures, argues a new report by a consumer advocacy group.

While homeowners, lenders and investors typically lose money on a foreclosure, mortgage servicers do not, says report author Diane E. Thompson, of counsel at the National Consumer Law Center. Servicers are the companies that manage the mortgages and collect payments.

"Servicers may even make money on a foreclosure," she writes. "And, usually, a loan modification will cost the servicer something. A servicer deciding between a foreclosure and a loan modification faces the prospect of near certain loss if the loan is modified and no penalty, but potential profit, if the home is foreclosed."

Thompson attributes this to a system of perverse incentives created by lawmakers and rulemakers in the market, like credit rating agencies and bond issuers. The private rulemakers typically dictate how a servicer can account for potential losses and profits. They hold enormous sway over securitized mortgages, which are owned by investors. More than two-thirds of mortgages issued since 2005 have been securitized, notes the report, using data from the industry publication Inside Mortgage Finance.

In those cases, the servicer is empowered to handle virtually all aspects of the mortgage, from collecting the monthly payments to initiating foreclosure proceedings. While they're obligated to do what's best for the ultimate owners of the mortgage -- the investors -- servicers have some latitude in deciding what course of action to pursue, be it a foreclosure or loan modification.

When a homeowner is delinquent on a mortgage that's been securitized, the servicer must front the late payment to the investors. When a home is foreclosed, the servicer is typically first in line to recoup losses. But if a mortgage is modified, the servicer typically loses money that isn't necessarily recoverable.

"Servicers lose no money from foreclosures because they recover all of their expenses when a loan is foreclosed, before any of the investors get paid. The rules for recovery of expenses in a modification are much less clear and somewhat less generous," she said.

That's part of the reason why the Obama administration created a $75 billion program to limit foreclosures. The money is to be distributed to servicers who successfully modify home loans, with the hope that the incentives to modify outweigh the incentives to foreclose.

Thompson's report outlines eight specific steps to reverse this trend. They include mandating that servicers attempt to modify a loan before initiating foreclosure proceedings and reforming bankruptcy laws so judges can modify distressed mortgages.

Source: The Huffington Post


New Listing: 44 Strawberry Hill Ave - Stamford, CT - MLS # 98440145

Elegant sophisticated remodeled spacious 2Beds/2Baths unit with modern just painted tasteful colors, gorgeous brand new hardwood floors throughout, gourmet kitchen with granite countertops, stainless-steal almost new appliances, new cabinets, and marble floors. This unit also offers several very large closets and lots of storage space. You can also enjoy almost never ending city views, from a screened in porch overlooking south. This great complex also offers a 24/7 concierge service, a garage space (plus extra outside spaces available for a fee), more storage in basement, in-building laundry. The common fees include central air, heating and hot water. It is located within walking distance of (or near) several shops, grocery stores, mall, restaurants, train station, parks, hospital, health clubs, public transportation, and so much more.

Tuesday, October 20, 2009

Are You Qualified for a Mortgage Modification, or Is Refinancing Your Best Route?

The Government loan modification progress reports inspire institutions to take the foreclosure prevention program more seriously. Find out if you are one of the many that qualifies for a mortgage modification, or if refinancing is a better option.

The Home Affordable Modification Program was launched in March 2009 to help qualified home owners receive a lower monthly payment and avoid foreclosure. The United States Treasury Department recently reported only 9 percent of home owners eligible for the government's $75 billion loan modification program have been offered help. This equates to just 235,247 loans that were at least two months delinquent.

The government hopes to help up to 4 to 5 million financially distressed home owners modify their mortgages and has promised to reach 500,000 home owners by November 1st. In order to fast track these goals, the government has cracked down on the institutions participating in this program and will be supplying the public with monthly progress reports and will be performing random audits to see if borrowers are being improperly rejected.

Now that the government has drawn attention to these institutions, expect to see a greater number of loan modification applications being reviewed and accepted. If you are one of the many home owners who find it difficult to make monthly mortgage payments or you know someone who needs help, then read on and find out if you are a viable candidate for a mortgage modification, or if refinancing is your best option:

Primary Residence

Is the home you are trying to get a mortgage modification for your primary residence? If not, you may not be eligible for a mortgage modification, since a home must be “owner occupied”. If your home is occupied by tenants, vacant or condemned, you may want to contact Traditional Mortgage at 203-881-5572 to determine whether or not you qualify to refinance your current mortgage at a lower rate.

Monthly Mortgage Payments
Are you behind or in danger of falling behind on your mortgage payments? If you are experiencing a great deal of hardship due to a change in your circumstances (i.e. rising mortgage payment or an increased expense such as emergency medical care) and foresee defaulting on your current monthly mortgage payments, contact a Traditional Mortgage mortgage professional today to see if your current financial situation qualifies you for a mortgage modification. If not, refinancing your current loan may be another viable option to avoid foreclosure.

Mortgage Signing Date
Did you get your current mortgage on or after January 1st, 2009? If your answer is yes, then don't count on being considered for a mortgage modification. Instead contact us directly at 203-881-5572 to determine alternate options.

Loan Balance
Is your loan balance less than $729,750? The mortgage modification program is only available to those who owe less than $729,750. If you owe quite a bit on your home, you'll want to speak to your Traditional Mortgage mortgage professional to learn whether or not you are eligible for a mortgage refinance. A refinance could potentially reduce your monthly mortgage payments and save a great deal of money over the life of your loan.

A few other items that may rule out a mortgage modification include both your savings account and employment status. Those home owners with a significant amount of savings in the bank are likely to be turned down for a mortgage modification as they have what may be considered sufficient funds put aside for emergencies and are not shown to be experiencing a financial hardship. In this case, refinancing may serve as a solution and help by decreasing future monthly payments.

On the other hand, those home owners who are jobless and have depleted savings and checking accounts are also unlikely to receive a mortgage modification as the program requires that applicants show proof of current income and that the income is likely to continue for at least nine months. Whatever the case, it is always a good idea to work closely with your Traditional Mortgage mortgage specialist when researching the best options for your specific situation.

Source: William Lund - Traditional Mortgage

Click here for the listing info: 44 Strawberry Hill Ave, Unit 4J, Stamford, Connecticut -MLS#98440145

Elegant remodeled spacious 2Beds/2Baths unit with modern just painted tasteful colors, gorgeous brand new hardwood floors throughout, gourmet kitchen with granite countertops, stainless-steal almost new appliances, new cabinets, and marble floors.

Monday, October 19, 2009

Apartment sales soar 31% in Queens, 29% in Bklyn

After seven consecutive quarterly declines, apartment sales in Brooklyn and Queens picked up in the third quarter, according to a new industry report.

Apartment sales in Brooklyn and Queens picked up in the third quarter, despite a rise in unemployment and the ongoing credit crisis, according to the latest industry report released Thursday.

Mirroring results reported last week in Manhattan, apartment sales in both boroughs rose from the previous quarter. In Brooklyn, the number of sales surged 29.4% in the third quarter from the previous quarter. In Queens, they did even better, soaring 31%. The sharp upticks are the result of pent up demand and an increase in confidence, noted Jonathan Miller, chief executive of Miller Samuel.

“People on the fence made a decision to buy,” said Mr. Miller (from Miller Samuel Inc., appraisal firm). “I think one primary catalyst is that the stock market went up (so strongly) in the third quarter.”

Despite the recent rise, the report underscored that activity remained well below the depressed levels of the third quarter of 2008. Sales in Brooklyn were down 19.6% to 1,847 from the same time last year, and were down 13.9% to 2,789 in Queens.

“Because the first two quarters of the year saw such a dearth in activity any modest uptick end up being good news,” said Mr. Miller. “That does not suggest we have reached the bottom.”

The increased activity in the third quarter had a positive impact in Brooklyn on median sales prices, which increased 7.9% to $476,000 from the second quarter, while median sales prices in Queens were unchanged at $362,000. In Brooklyn, the rise in median sales price in the third quarter is the first increase recorded after seven consecutive quarters of declines.

The report recorded some signs that the market may be approaching the bottom in the two boroughs. Inventory is down sharply from a year ago—in Brooklyn, inventory is down 21.2% to 5,600 units and in Queens it is down 13.9% to 9,797 units.

By Amanda Fung, Crain's New York Business


Frequently Asked Questions
In 2008, Congress enacted a $7500 tax credit designed to be an incentive for first-time homebuyers to purchase a home. The credit was designed as a mechanism to decrease the over-supply of homes for sale.

For 2009, Congress has increased the credit to $8000 and made several additional improvements. This revised $8000 tax credit applies to purchases on or after January 1, 2009 and before December 1, 2009.

Tax Credits – The Basics

1. What’s this new homebuyer tax incentive for 2009?

The 2008 $7500, repayable credit is increased to $8000 and the repayment feature is eliminated for 2009 purchasers. Any home that is purchased for $80,000 or more qualifies for the full $8000 amount. If the house costs less than $80,000, the credit will be 10% of the cost. Thus, if an individual purchased a home for $75,000, the credit would be $7500. It is available for the purchase of a principal residence on or after January 1, 2009 and before December 1, 2009.

2. Who is eligible?

Only first-time homebuyers are eligible. A person is considered a first-time buyer if he/she has not had any ownership interest in a home in the three years previous to the day of the 2009 purchase.

3. How does a tax credit work?

Every dollar of a tax credit reduces income taxes by a dollar. Credits are claimed on an individual’s income tax return. Thus, a qualified purchaser would figure out all the income items and exemptions and make all the calculations required to figure out his/her total tax due. Then, once the total tax owed has been computed, tax credits are applied to reduce the total tax bill. So, if before taking any credits on a tax return a person has total tax liability of $9500, an $8000 credit would wipe out all but $1500 of the tax due. ($9,500 – $8000 = $1500)

4. So what happens if the purchaser is eligible for an $8000 credit but their entire income tax liability for the year is only $6000?

This tax credit is what’s called “refundable” credit. Thus, if the eligible purchaser’s total tax liability was $6000, the IRS would send the purchaser a check for $2000. The refundable amount is the difference between $8000 credit amount and the amount of tax liability. ($8000 – $6000 = $2000) Most taxpayers determine their tax liability by referring to tables that the IRS prepares each year.

5. How does withholding affect my tax credit and my refund?

A few examples are provided at the end of this document. There are several steps in this calculation, but most income tax software programs are equipped to make that determination.

6. Is there an income restriction?

Yes. The income restriction is based on the tax filing status the purchaser claims when filing his/her income tax return. Individuals filing Form 1040 as Single (or Head of Household) are eligible for the credit if their income is no more than $75,000. Married couples who file a Joint return may have income of no more than $150,000.

7. How is my “income” determined?

For most individuals, income is defined and calculated in the same manner as their Adjusted Gross Income (AGI) on their 1040 income tax return. AGI includes items like wages, salaries, interest and dividends, pension and retirement earnings, rental income and a host of other elements. AGI is the final number that appears on the bottom line of the front page of an IRS Form 1040.

8. What if I worked abroad for part of the year?

Some individuals have earned income and/or receive housing allowances while working outside the US. Their income will be adjusted to reflect those items to measure Modified Adjusted Gross Income (MAGI). Their eligibility for the credit will be based on their MAGI.

9. Do individuals with incomes higher than the $75,000 or $150,000 limits lose all the benefit of the credit?

Not always. The credit phases-out between $75,000 – $95,000 for singles and $150,000 – $170,000 for married filing joint. The closer a buyer comes to the maximum phase-out amount, the smaller the credit will be. The law provides a formula to gradually withdraw the credit. Thus, the credit will disappear after an individual’s income reaches $95,000 (single return) or $170,000 (joint return).

For example, if a married couple had income of $165,000, their credit would be reduced by 75% as shown:

Couple’s income $165,000

Income limit 150,000

Excess income $15,000

The excess income amount ($15,000 in this example) is used to form a fraction. The numerator of the fraction is the excess income amount ($15,000). The denominator is $20,000 (specified by the statute).

In this example, the disallowed portion of the credit is 75% of $8000, or $6000

($15,000/$20,000 = 75% x $8000 = $6000)

Stated another way, only 25% of the credit amount would be allowed.

In this example, the allowable credit would be $2000 (25% x $8000 = $2000)

10. What’s the definition of “principal residence?”

Generally, a principal residence is the home where an individual spends most of his/her time (generally defined as more than 50%). It is also defined as “owner-occupied” housing. The term includes single-family detached housing, condos or co-ops, townhouses or any similar type of new or existing dwelling. Even some houseboats or manufactured homes count as principal residences.

11. Are there restrictions on the location of the property?

Yes. The home must be located in the United States. Property located outside the US is not eligible for the credit.

12. Are there restrictions related to the financing for the mortgage on the property?

In 2009, most financing arrangements are acceptable and will not affect eligibility for the credit. Congress eliminated the financing restriction that applied in 2008. (In 2008, purchasers were ineligible for the $7500 credit if the financing was obtained by means of mortgage revenue bonds.) Now, mortgage-revenue bond financing will not disqualify an otherwise-eligible purchaser. (Mortgage revenue bonds are tax-exempt bonds issued by a state housing agency. Proceeds from the bonds must be used for below market loans to qualified buyers.)

13. Do I have to repay the 2009 tax credit?

NO. There is no repayment for 2009 tax credits.

14. Do 2008 purchasers still have to repay their tax credit?

YES. The $7500 credit in 2008 was more like an interest-free loan. All eligible purchasers who claimed the 2008 credit will still be required to repay it over 15 years, starting with their 2010 tax return.

Some Practical Questions

15. How do I apply for the credit?

There is no pre-purchase authorization, application or similar approval process. All eligible purchasers simply claim the credit on their IRS Form 1040 tax return. The credit will be reflected on a new Form 5405 that will be attached to the 1040. Form 5405 can be found at

16. So I can’t use the credit amount as part of my downpayment?

No. Congress tried hard to devise a mechanism that would make the funds available for closing costs, but found that pre-funding would require cumbersome processes that would, in effect, bring the IRS into the purchase and settlement phase of the transaction.

17. So there’s no way to get any cash flow benefits before I file my tax return?

Yes, there is. Any first-time homebuyers who believe they are eligible for all or part of the credit can modify their income tax withholding (through their employers) or adjust their quarterly estimated tax payments. Individuals subject to income tax withholding would get an IRS Form W-4 from their employer, follow the instructions on the schedules provided and give the completed Form W-4 back to the employer. In many cases their withholding would decrease and their take-home pay would increase. Those who make estimated tax payments would make similar adjustments.

Some “Real World” Examples

18. What if I purchase later this year but can’t get to settlement before December 1?

The credit is available for purchases before December 1, 2009. A home is considered as “purchased” when all events have occurred that transfer the title from the seller to the new purchaser. Thus, closings must occur before December 1, 2009 for purchases to be eligible for the credit.

19. I haven’t even filed my 2008 tax return yet. If I buy in 2009, do I have to wait until next year to get the benefit of the credit?

You’ll have a helpful choice that might speed up the process. Eligible homebuyers who make their purchase between January 1, 2009 and December 1, 2009 can treat the purchase as if it had occurred on December 31, 2008. Thus, they can claim the credit on their 2008 tax return that is due on April 15, 2009. They actually have three filing options.

· If they purchase between January 1, 2009 and April 15, 2009, they can claim the $8000 credit on the 2008 return due on April 15.

· They can extend their 2008 income-tax filing until as late as October 15, 2009. (The IRS grants automatic extensions, but the taxpayer must file for the extension. See for instructions on how to obtain an extension.)

· If they have filed their 2008 return before they purchase the home, they may file an amended 2008 tax return on Form 1040X. (Form 1040X is available at

Of course, 2009 purchasers will always have the option of claiming the credit for the 2009 purchase on their 2009 return. Their 2009 tax return is due on April 15, 2010.

20. I purchased my home in early 2009 before the stimulus bill was enacted. I claimed a $7500 tax credit on my 2008 return as prior law had permitted. Am I restricted to just a $7500 credit?

No, you would qualify for the $8000 credit. Eligible purchasers who have already claimed the $7500 credit on a 2008 return for a 2009 purchase may file an amended return (IRS Form 1040X) for the 2008 tax year. This amended return will enable them to obtain the additional $500 credit amount.

21. If I claim my 2009 $8000 credit on my 2008 tax return, will I have to repay the credit just as the 2008 credits are repaid?

No. Congress anticipated this confusion and has made specific provision so that there would be no repayment of 2009 credits that are claimed on 2008 returns.

22. I made an eligible purchase of a principal residence in May 2008 and claimed the $7500 credit on my 2008 tax return. My brother, who has never owned a home, wishes to purchase a partial interest in the home this spring and move in. Will he qualify for the $8000 credit, as well?

No. Any purchase of a principal residence (or interest in a principal residence) from a related party such as a sibling, parent, grandparent, aunt or uncle is ineligible for the tax credit. Since you and your brother are related in this way, he cannot qualify for the credit on any portion of the home that he purchases from you, even if he is a first-time homebuyer.

23. I live in the District of Columbia. If I qualify as a first-time homebuyer, can I use both the $5000 DC credit and the $8000 credit?

No; double dipping is not allowed. You would be eligible for only the $8000 credit. This will be an advantage because of the higher credit amount, plus the eligibility requirements for the $8000 credit are somewhat more easily satisfied than the DC credit.

24. I know there is no repayment requirement for the $8000 credit. Will I ever have to repay any of the credit back to the government?

One situation does require a recapture payment back to the government. If you claim the credit but then sell the property within 3 years of the date of purchase, you are required to pay back the full amount of any credit, including any refund you received from it. A few exceptions apply. (See below, #24). Note that this same 3-year recapture rule applies, as well, to the $7500 credit available for 2008. This provision is designed as an anti-flipping rule.

25. What if I die or get divorced or my property is ruined in a natural disaster within the 3 years?

The repayment rules are eased for many circumstances. If the homeowner who used the credit dies within the first three years of ownership, there is no recapture. Special rules make adjustments for people who sell homes as part of a divorce settlement, as well. Similarly, adjustments are made in the case of a home that is part of an involuntary conversion (property is destroyed in a natural disaster or subject to condemnation by eminent domain by an authorized agency) within the first three years.

26. I have a home under construction. Am I eligible for the credit?

Yes, so long as you actually occupy the home before December 1, 2009.


Note: The impact of estimated tax payments would be the same.

Situation 1: Sally plans her withholding so that her withholding is as close as possible to what she anticipates as her income tax liability for the year. When she fills out her 1040, her liability is $6000. She has had $6000 withheld from her paycheck. She also qualifies for the $8000 homebuyer credit.

Result: Sally’s withholding satisfies her tax liability and reduces it to zero. She will receive a refund of the full $8000.

Situation 2: Nick and Nora file a joint return. Nick is self-employed and makes estimated payments; Nora has taxes withheld from her salary. When they compute their taxes, their combined withholding and estimated tax payments are $11,000. Their income tax liability is $9800. They also qualified as first-time homebuyers and are eligible for the $8000 refundable tax credit.

Result: Ordinarily, their combined estimated tax payments and withholding would make them eligible for a refund of $1200 ($11,000 – $9800 = $1200). Because they are eligible for the refundable tax credit as well, they will receive a refund of $9200 ($1200 income tax refund + $8000 refundable tax credit = $9200)

Situation 3: Cesar and LuzMaria both have income taxes withheld from their salaries and file a joint return. When they file their income tax return, their combined withholding is $5000. However, their total tax liability is $7200, generating an additional income tax liability of $2200 ($7200 – $5000). They also qualify for the $8000 first-time homebuyer tax credit.

Result: Cesar and LuzMaria have been under-withheld by $2200. Ordinarily, they would be required to pay the additional $2200 they owe (plus any applicable interest and penalties). Because they are eligible for the refundable homebuyer tax credit, the credit will cover the $2200 additional liability. In addition, they will receive an income tax refund of $5800 ($8000 – $2200 = $5800). If they owed penalties and/or interest, that amount would reduce the refund.

Click here for the listing info: 44 Strawberry Hill Ave, Unit 4J, Stamford, Connecticut -MLS#98440145

Elegant remodeled spacious 2Beds/2Baths unit with modern just painted tasteful colors, gorgeous brand new hardwood floors throughout, gourmet kitchen with granite countertops, stainless-steal almost new appliances, new cabinets, and marble floors.

Source: William Raveis Real Estate & Mortgage Services

Sunday, October 18, 2009

Real Estate Market Recap

The U.S. economy continues on its path to salvation. Retail sales, an arbiter of economic activity, declined 1.5% in September, which would seem a step back at first glance. On second glance, the numbers suggest sales are improving nicely. Stripping out autos (which everyone knew would decline after the “cash-for-clunkers” program expired) and volatile gasoline and building materials, sales actually increased 0.5%, building on the 0.7% increase in August.

Just as important, people are not just buying more here, but abroad too. World trade is accelerating, evinced by the dollar value of exports, which rose 0.2% in August. Signs of an upward turn in world trade are good news for us, because they will spur an increase in production and hiring in exporting sectors that are plagued by high unemployment.

Unemployment remains “the” ongoing concern, but concerns are also rising over housing's ability to deflate an inflating economy. Integrated Asset Services reported house prices declined 0.2% in August, the second month of declines after a fourth-month-long rally that brought a 2.8% increase. This piece of data has led a few pundits to speculate that we are headed for a double-dip – a return to falling home prices.

We are unconvinced that is the case. It is worth noting that IAS also reported price increases of 0.7% in the Midwest and Northwest, while New York City and San Diego both posted 1.3% month-over-month increases. Yes, pockets of price deflation persist: namely, in the South and West, which reported declines of 0.1% and 1.2%, respectively, but those percentages were influenced by concentrated trouble spots, such as San Joaquin County in California and Lee County in Florida .

The price-deflation believers also point to the market-propping effect of the $8,000 first-time homebuyer’s tax credit, set to expire on November 30. The credit has helped support prices, to be sure, but we should not overlook the impact of an improving economy. Besides, we still think odds favor a credit extension, though we cannot say for sure how long the extension will last, or what bells and whistles will be added.

We also think that odds still favor a rising mortgage-rate environment, which is tougher to refute, considering gold traded at over $1,070 an ounce last week. Treasury yields moved slightly higher, and so did mortgage rates, though they are still very good. showed the state average remains below 5.15% in all 50 states. We will say it again: If you are looking for a mortgage loan, there's no better time than the present.

S&P/Case-Shiller 10-City Composite Home Price Index rose 3.6% between April and July, following a decline of 4.8% in the previous period, between January and April. But that's nothing new. Robert Shiller, the index's co-founder, found a close parallel at the end of the 1990-91 recession, where home prices rose 2.3% from April to July 1991 after having fallen 2.1% from January to April that year.

Here is another interesting fact to suggest price volatility is the norm: Since 1979, residential real estate prices have had two 10-year long cycles where prices have risen significantly, then retreated approximately 15% to 20% over the subsequent two years. This tendency to increase then tumble back has kept housing appreciation more or less on pace with inflation over the past 100 years.

Mortgage rates have also demonstrated spurts of volatility. In 1977, the prime 30-year fixed-rate mortgage averaged 8.8%, spiking to 13.7% in 1980 before topping out at 16.0% in 1982. From 1984 through the present, mortgage rates have steadily trended lower to today's unprecedented levels, with no significant spikes in the interim. Does that mean mortgage-rate volatility is a thing of the past? All we can say is that it is worth heeding the late economist Hyman Minsky's admonition on stability. According to Minsky, the longer things are stable, the more likely they are to become unstable.

Source: Mortgage Matters

Click here for the listing info: 44 Strawberry Hill Ave, Unit 4J, Stamford, Connecticut -MLS#98440145

Elegant remodeled spacious 2Beds/2Baths unit with modern just painted tasteful colors, gorgeous brand new hardwood floors throughout, gourmet kitchen with granite countertops, stainless-steal almost new appliances, new cabinets, and marble floors.

Saturday, October 17, 2009

Mortgage Rates from William Raveis Real Estate, Mortgage & Insurance

Here is William Raveis weekly email that provides a current view of interest rates for some of our popular mortgage products.

Please feel free to contact me for help or questions about our mortgage products or any other of your Real Estate needs.

Mortgage Rates for CT


Interest Rates

Annual Percentage Rate

15 YR Fixed Conforming



15 YR Fixed Jumbo



30 YR Fixed Conforming



30 YR Fixed Jumbo



30 YR Fixed Super Jumbo



5/1 YR ARM Conforming



5/1 YR ARM Jumbo



5/1 YR Portfolio Arm



Mortgage Rates for NY


Interest Rates

Annual Percentage Rate

15 YR Fixed Conforming



15 YR Fixed Jumbo



30 YR Fixed Conforming



30 YR Fixed Jumbo



30 YR Fixed Super Jumbo



5/1 YR ARM Conforming



5/1 YR ARM Jumbo



5/1 YR Portfolio Arm



Last Updated On:
Friday, October 16, 2009

The rates and APR above are based upon the following assumptions: a 20% down payment, $1,500 in finance charges, and 30 days prepaid interest, 1 point, and a 60 day rate lock. The rates and APR will vary depending upon the actual down payment percentages, points and fees for your transaction. Rates are subject to change without prior notice and may vary with your unique credit history, and terms of your loan. Property taxes and homeowners insurance are estimates and subject to change.

Friday, October 16, 2009

44 Strawberry Hill Ave, Unit 4J, Stamford, Connecticut

Elegant remodeled spacious 2Beds/2Baths unit with modern just painted tasteful colors, gorgeous brand new hardwood floors throughout, gourmet kitchen with granite countertops, stainless-steal almost new appliances, new cabinets, and marble floors. This unit also offers several very large closets and lots of storage space. You can also enjoy almost never ending city views, from a screened in porch overlooking south. This great complex also offers a 24/7 concierge service, a garage space (plus extra outside spaces available for a fee), more storage in basement, in-building laundry. The common fees include central air, heating and hot water. It is located within walking distance of (or near) several shops, grocery stores, mall, restaurants, train station, parks, hospital, health clubs, public transportation, and so much more.

Click here for the listing info: 44 Strawberry Hill Ave, Unit 4J, Stamford, Connecticut

MLS # 98440145

Click here for the listing info: 44 Strawberry Hill Ave, Unit 4J, Stamford, Connecticut

Tuesday, October 13, 2009

Manhattan Real Estate Market Report - 3rd Quarter 2009

Significant findings in Q3 2009

CLOSING PRICES CONTINUE TO DECLINE FROM A YEAR AGO. Condo and co-op resale median prices have declined since last quarter and are still significantly down from a year ago. The overall average Manhattan sale price (which includes: condo resales, co-op resales, and new development closings) decreased by 2.3% to $1.254M since last quarter, and by 16.4% since last year. Similarly, the overall median Manhattan sale price declined by 0.3% since last quarter to $760K, and by 11.6% since last year.

  • Condo resale median prices increased by 5.3% since last quarter to $937,500, but decreased by 14.6% since last year. Average price ($1.471M) is up 11.1% for the quarter but down 26.2% since last year.
  • Co-op resale median prices decreased by 2.1% to $575K compared to last quarter and by 11.5% since last year. Average sales price ($878K) decreased by 4.3% since last quarter and by 21.3% since the prior year.
  • New Developments median sales price increased by 1.8% since last quarter to $1.212M and by 24.3% since last year. Average sales price ($1.77M) also increased by 1.8% since last quarter and by 23.1% since last year.

VOLUME OF RESALE CLOSINGS INCREASE SIGNIFICANTLY. The number of closings has increased by 68.4%, from the 2,040 closings of last quarter, but is down by 21.7% from a year ago. Co-op resales have increased by 85% since last quarter and condo resales have increased by 75% since last quarter. The number of new development closings increased by 31% since last quarter but is still down by 65.3% since a year ago. New development closings made up 18.8% of the closings while co-op resales dominated activity at 54.9%.

INVENTORY STEADILY DECLINES. Inventory of available listings in Manhattan declined steadily since it peaked around 11,800 units in mid-May. At the time of this report, inventory is currently at 10,163 units. According to our listings database, an average of 314 new listings came onto market every week in this quarter, a decrease of 13.5% since last quarter, which averaged 363 new listings per week. Condos made up 52.1% of all available listings on market this quarter (co-ops 47.3%, townhouses 0.6%). Inventory levels this quarter are 24.6% higher than they were a year ago.

CONTINUED INCREASE IN NEW CONTRACTS. This quarter, there were 2,632 listings that went into contract, a 6.3% increase from last quarter’s number of new contracts (2,477). Additionally, there were 142 broken contracts, a 7.6% increase compared to last quarter’s 132.

FEWER PRICE CUTS. This quarter, 36.1% of all Manhattan listings had price cuts, a total of 5,363. Of all available listings for condos this quarter, there were about 2,400 condo listings with price cuts, a 1.9% decrease since last quarter but 72.4% more cuts since last year. Co-ops had about 2,900 cuts, a 4.4% decrease in the number of price cuts since last quarter but 77.2% more cuts than a year ago. The average price cut this quarter for condos was 8.4%, and for co-ops, the average cut was 8.1%.

LISTINGS SPEND A LONGER TIME ON MARKET FROM A YEAR AGO. The average time on market for condo resale listings decreased by 3.7% since last quarter but increased by 9.1% since last year, while co-ops sat on the market for 1.7% longer than last quarter, and 19.4% longer than the prior year. This quarter, condo resales stayed on the market for an average of 126 days, while co-op resales were on the market for an average of 120 days.

source: StreatEasy

Sunday, October 11, 2009

Bailout can help you buy a home

President Barack Obama's economic stimulus plan includes strategies to help homebuyers and stimulate the U.S. housing market.

The primary feature of the housing portion of the 2009 Obama economic stimulus package features an $8,000 first-time homebuyer refundable tax credit for qualifying buyers who purchase a home between Jan. 1, 2009 and Dec. 1, 2009. The total tax credit a homebuyer can get in this initiative is equal to 10 percent of the purchase price, or a maximum of $8,000 -- to get the full $8,000 credit, the property must cost at least $80,000.

This is a refundable tax credit, which is far better than a tax deduction. If the total taxes you owe the IRS for the year -- whether withheld from your pay or not -- are less than $8,000, you will get a refund for the balance.

As an example, if you buy a house as a first-time buyer for say $85,000, you are entitled to an $8,000 tax credit. If your total tax owed for the year is $10,000 and you've already paid in $6,000 (still owe $4,000) you will not have to pay the $4,000 and you will get another $4,000 refunded to you.

"If you have been thinking about buying your first home, I can't think of a better time to do so," says mortgage expert Rodney Anderson, managing partner of Plano, Texas-based Rodney Anderson Lending Services.

Anderson says the program differs greatly from last year's $7,500 housing tax-credit program for first-time buyers, which was essentially an interest-free loan that required repayment over 15 years. That was not widely utilized, in part because it was voluntary for banks. Because the new Stability Initiative rewards banks for participating, the new credit is becoming widely available, Anderson says.

Basics of the tax-credit plan

  • Married couples making less than $150,000 in modified adjusted gross income -- with some sliding reductions beyond that income total -- are eligible. Both spouses must be first-time homeowners, however. For unmarried people making a joint purchase, only one party (the claimant) must be a first-time homeowner
  • Individuals making less than $75,000 in taxable income are eligible, with sliding reductions above that.
  • Participants can't have owned a principal residence in the last three years. Individuals who have owned a rental or vacation home in that period may still qualify.
  • Condos, townhomes, new-construction homes and mobile homes qualify.
  • Participants can get the tax credit for the purchase on either their 2009 or 2008 taxes. Owners can move this savings into the 2008 tax year even if they've already filed for the year, by amending their returns (IRS Form 5405). "That way, homeowners can use this early credit to help fund their home purchases," Anderson says.
  • Participants must live in the house for three years.

While the tax-credit program is enticing, Anderson warns that mortgage qualifications based on income, assets and credit are stricter than the pre-bust years. In early April 2009, most banks needed to see a credit score of at least 620 to lend, he says.

Also, the market remains "flooded with homes right now and the (tax incentive) may not be as big of incentive as hoped for, but it does give an extra push," says mortgage expert Joe Gross, president of Teaneck, N.J.-based Qualified Mortgage Inc., and author of "How The Greed Of Wall Street And Your Mortgage Lender Are Destroying America's Credit." But the program is already generating deals, he adds. "Realtors say there is more traffic and as the year rolls on and more people learn about the program, there will be even more," Anderson concurred. "It is encouraging."

The new credit aims to boost sales in the nation's sagging housing market.

Lawrence Yun, chief economist for the National Association of Realtors, predicts homebuyers will purchase an additional 300,000 homes in 2009 as a result of the tax credit.

"We think this year's tax credit will certainly have a much bigger impact because it is a true tax credit which is also refundable," Yun says. "For instance, if you owe $1,000 in taxes and qualify for the first-time homebuyers tax credit, you will receive a tax refund of $7,000."

Although Yun and others are hopeful about the new credit's impact on the housing market, not everyone shares the optimism.

Greg Smith, a Certified Financial Planner with The Wise Investor Group in Reston, Va., says it's important to be realistic about the credit's potential in light of the increasingly shaky economy and souring job market.

"This incentive only works for people who have complete job security, who know they won't be transferred within three years, who qualify as first-time homebuyers and have the ability to obtain financing," he says. "In addition, they need to live in an area with reasonable home prices."

Michael Dooley, a financial planner with The Patriot Financial Group in Beverly, Mass., is also a skeptic.

"While the theory behind the tax credit is great, I just don't think $8,000 is enough," Dooley says. "The people who would benefit from this the most are looking to survive financially or are even leaving their homes because they can't afford them."

While the tax credit is meant to cover 10 percent of the purchase price (up to $8,000), an $8,000 credit covers only about 4 percent of the purchase price of a home with the 2008 national median single-family price of $197,000, Smith says.

Meanwhile, homeowners that are more affluent will not be able to take advantage of the new credit, which phases out for individuals with an adjusted gross income of $75,000 or above and for married couples with a combined adjusted gross income of $150,000 or above.

By Steve McLinden •

Rates tumble for 6th week

Mortgage rates fell for the sixth week in a row, to a level last seen in the spring.

The benchmark 30-year fixed-rate mortgage fell 3 basis points to 5.22 percent, according to the national survey of large lenders. A basis point is one-hundredth of 1 percentage point. The mortgages in this week's survey had an average total of 0.34 discount and origination points. One year ago, the mortgage index was 6.2 percent; four weeks ago, it was 5.4 percent.

The benchmark 15-year fixed-rate mortgage fell 4 basis points to 4.6 percent. The benchmark 5/1 adjustable-rate mortgage fell 3 basis points to 4.66 percent.

The 30-year fixed has been below 6 percent all year in Bankate's weekly survey. It rose as high as 5.95 percent in early June, not long after hovering at 5.2 percent or lower for four weeks in a row in March and April. There was a minor refinancing boomlet back then, and another one now.

According to the Mortgage Bankers Association, loan applications spiked 16.4 percent last week, led by a surge in refinance applications. There was a big increase in purchase applications, too, as people took advantage of the first-time homebuyer credit, which expires Nov. 30. Even so, two-thirds of applicants were homeowners wanting to refinance.

Low rates drive activity

Low rates were the impetus, says Bob Walters, chief economist for Quicken Loans. "In the first weeks of autumn, mortgage rates have surprisingly inched down to levels we haven't seen since May, encouraging people to get off the bench and into the homeownership game," he says.

But is the game about to end? Paul Descloux, publisher of Mortgage Maxx, an independent index of mortgage activity, writes in his weekly analysis: "The now-intensifying foreclosure crisis, fueled by surging unemployment, may push housing past a tipping point where the only green shoots will be along the foundations of abandoned homes."

Descloux points out that 6 percent to 7 percent of mortgages have been refinanced so far this year, which is much below expectations. When the first-time homebuyer tax credit expires and rates rise, people won't exactly have to take a number and wait in line to file a mortgage application.

Closings take longer now

That's probably just as well, because it's taking longer to close on a mortgage. At the end of July, the Federal Reserve imposed new rules that require waiting periods before a loan can close. The regulation compels a waiting period of seven business days between the time the initial loan disclosure documents are sent and the transaction can be closed.

But that's not all. If the lender's good faith estimate was off, and the loan's annual percentage rate changes by one-eighth of a percentage point or more (in either direction), then the lender has to send out more disclosures -- and another three-day waiting period begins before the loan can be closed.

The idea was to protect borrowers from lenders surprising them with last-minute changes in rate or fees. But some borrowers end up paying fees to extend their rate locks past 30 days in case of delays.

"The intention is good, but if all of a sudden it means that people now have to do 45-day rate locks to meet the law, well, that's great -- you just spent the money you saved," says Dick Lepre, senior loan consultant for Residential Pacific Mortgage in San Francisco.

By Holden Lewis •