Realtor Diane Bell's Hilton Head and Bluffton Real Estate Blog

                         **  FROM THE DESK OF THE CZAR OF COMMON SENSE IN GOVERNMENT  **

WHY DID NOT THE GOVERNMENT MANDATE MORTGAGE BALANCE REDUCTION FOR BANKS RECEIVING TARP MONEY???

IN THE SPIRIT IF A TRUE BELIEVER IN THE CONSPIRACY THEORY, it all makes sense now.

James Downing's post this a.m. DARN IT - I got one of "THOSE" calls today... was enough to cause a few little brain synapsis in my head to begin stirring. . . .

One fact that James' article reinforces is that the banks will do nothing to assist a home owner if their mortgage payments are still current.   So, faced with the inability to sell their home because the home owner owes more than the house will sell for, SHORT SALE is the only alternative to foreclosure. **

WHY DO BANKS REQUIRE THAT A HOME OWNER BE IN ARREARS BEFORE SHORT SALE APPROVALS?

"WE DON'T LOOK AT SHORT SALE PACKAGES UNTIL THE HOME OWNER IS BEHIND IN THEIR PAYMENTS."  How many times have we heard that?  There is no benefit to a mortgage company to modify a home loan.  If a mortgage loan is modified to reduce the principal amount, the credit rating of the mortgagor will not be affected.  The mortgagor's credit rating would not be affected by a reduction of the mortgage note.  The only change in the home owner's credit report would be the balance owed to the mortgagee. 

I've been advocating for a write-down of the principal balance of home mortgage amounts to appraisal or assessment numbers, but it would take a significant amount of money from the government to cover that loss to the mortgage companies and, if we know anything, we know one thing:  The government is not going to do anything that would cause harm to the profitability of the financial institutions that originate or service or hold the millions of home loans.

That the government is dedicated to preserving the profitability of the banks is a given.  Why then are the financial institutions and the government determined to force a home owner in trouble to ruin their credit before any relief by the mortgage company will even be considered??  That is the question of the day.

MORTGAGE LOAN MODIFICATION WOULD NOT HARM THE CREDIT RATING OF THE CONSUMER.

However. . . .

ONE 30 -60 DAY LATE MORTGAGE PAYMENT WILL REDUCE A CONSUMER'S CREDIT SCORE FOR YEARS.

Could it be that the new "sub-prime", "Alt-A" mortgages will be mortgage instruments invented to serve the millions of consumers with a short sale transaction on their credit report??

What is the benefit to the banks to force the home owner to ruin their credit rating?  Could it be the higher interest rate that can be charged to home buyers with a previous short sale on their credit report?

What could this new mortgage instrument with higher than market rates be named? 

The "SS" loan, for "Short Shrift". 

The "SSS" loan, for "Shafted By Short Sale"

The "SS2" loan, for  the "Short Score" loan

The "Stiff" loan, for "Stiffed by Short Sale Score" loan

No matter what happens or doesn't happen, the consumer loses.  As the number of home owners who accrue 1, 2, 3, months late on their credit reports, they are prime suspects for future home loans with higher interest rates. 

Of course, they are also prime suspects for credit cards with even higher interest rates. 

** A change in the bankruptcy law/code that would permit bankruptcy judges to modify loan principals was a solution proposed.  However, it didn't get through Congress. 

Courtesy, Lenn Harley, Broker, Homefinders.com, 800-711-7988, E-Mail. 

                           

                                            "HEY, WHO'S LOOKING OUT FOR US??"

Has anyone heard about this?  Received an email today from StreetLinks:

"FHFA formally announced the final version of the Home Valuation Code of Conduct with implementation required by May 1. Clearly, this will have a major impact on all facets of the mortgage industry... Specifically, the code prohibits:

• Direct contact between a loan originator and an appraiser.
• Passing an expected or desired value.
• Requesting estimated values or sales comparables prior to completion of an appraisal report.
• Direct payment for appraisals to appraiser by origination-related personnel

"The Federal Housing Finance Agency (FHFA) has formally announced the final version of the Home Valuation Code of Conduct (HVCC) to be implemented by May 1, 2009.  As expected, the code specifically addresses appraiser independence, pre-valuation requests and the passing of any expected value by a loan originator."

To find out more, click on the following link: https://www.streetlinks.com/hvcc.nsp?utm_source=uni&utm_medium=em&utm_campaign=hvcc

Join my NEW group for professionals who work from their home office at http://activerain.com/groups/virtualoffice

Regina P. Brown
Broker, Realtor®, e-Pro
Author of eBook "Stop Foreclosure Fast: Solutions to Save your House"

Text copyright © 2008 R.P. Brown, All Rights Reserved

 

Definition of Proactive:

Controlling a situation by causing something to happen rather than waiting to respond to it after it happens.

 

 

 

 

Reactive marketing is waiting for the sale or client to "walk through the door".  Being reactive also involves putting your message in places where you think large numbers of people have a good chance of seeing it. This would include farming - sending postcards and flyers regularly to keep your name in front of potential sellers or advertising in local newspapers or maybe drip email campaigns to your sphere of influence.  It involves sending YOUR message to many people who at the given time, may or may not have a need or interest in what you are offering them.  The hope is that when they do have that need, they will think of you.

Being proactive is the art of creating new client interest.  Accomplishing a proactive sale is only limited by the confines of creative thought.  A proactive opportunity means looking around to see how an opportunity can be created.  The key is in the creation. 

Historically, I think I was more reactive.  I planted lots of seeds and when they sprouted I was here to answer the phone call of opportunity.  Great!  But I have no control on when that consumer will need my service.  There is a definite place for reactive selling in our business, but there has to be a balance.

 

 

 

Today, I want to build my business NOW!  I want to work on identifying and connecting with potential clients who need what I’m offering. Similar to using the yellow pages, when a consumer needs to fix their car, they look up auto mechanics and hire someone to get the job done. 

When a homeowner wants to sell, I want to be who they find when they search for a Realtor.  Whether they ask their friends, Google “Manalapan NJ Realtor”, see my advertising that I’ve strategically placed on home search sites or go to one of the many real estate agent directories you can find on the internet, or heck, even if they find me when the open the yellow pages!

 

 

 

I’m also going to shoot for more of a proactive vs. reactive dialog:

In the past, reactive… “I don’t want to bother you but I’m calling to see if maybe you have an interest in possibly selling your home some time?”  “No?  Ok, but can you pretty please, with sugar on top, promise to call me if you change your mind”

Today, proactive… “I’m calling to tell you that there has NEVER been a better time to upsize.”  “You don’t believe me?  Do you have a calculator?”

 

 

In Stephan Covey’s 7 Habits of Highly Effective People, Covey suggests that Proactive language, embraces responsibility and takes charge of the situation. Nothing is left to chance. If something is being done, it’s not because we are forced to it, but because we choose to do it. Remember, we are response-able, free to choose our response. So we are not victims, but we are the masters. And proactive language exuberates this.

 

  How Active a Pro are you going to be this year?

 Go out there and figure out how to make something good happen today!

 

 

Jo

JoAnna Siminerio
Weichert Realtors - Manalapan - Marlboro
New Jersey
www.JoTheRealtor.com

 

 

Shopping for Charlotte NC Real Estate?

Well, you've come to the right place!  If you're looking for up-to-date information on Charlotte NC real estate and events in the area, look no more!  Our extensive history, research, statistics and daily updates to our sites are just for YOU.  


Where else can you learn about local shopping, sports, news, schools, transportation and real estate all in one place?   We offer a wealth of information about, not only real estate but, everything Charlotte!



Charlotte NC's economy remains substantially more stable than alot of other citys'.  Many national firms call Charlotte NC  home (with headquarters from numerous companies located here in the Charlotte Metro area) and over 300 Fortune 500 companies are represented in the Charlotte Metro area. Read current news on the economy in Charlotte here.


Visit www.WeBuyAndSellCharlotte.com for more information than you'll ever need--all in one place!




Here are a few articles about home buying:

What's YOUR Credit Score?

What Do You Do If Your Home Does Not Appraise?

Buyer Tips to Homeownership

10 Steps in Shopping for a New Home

Locating the Perfect Neighborhood

New Construction Contract Signed, Now What?

And, if you're selling, this is a must-read:  Dear Seller:

See below for a few homes listed in the Charlotte area.  For a more precise list--one that fits YOUR specifications--contact us!  We'll set you up with a FREE 'website' that will allow you to be the first to be alerted of new listings that fit your preferences.  You can visit this site at your convenience and receive updates as long as you'd like to 'just shop around' and contact us when you're ready.  We'll take you on the grand tour and you'll receive nothing but, Southern hospitality here!  

About the author:

Debe Maxwell is a Charlotte Residential Real Estate Broker, Certified Neighborhood and Relocation Specialist who can assist you with the purchase and/or sale of real estate in Charlotte NC or any place in the country by connecting you with a relocation professional in your destination of choice. Debe has created a team of professionals throughout the country to ensure that you enjoy a smooth transition to your new area. These professionals are experts in the field of relocation and can serve many purposes beyond a simple home search. The destination service is of no cost to you! Please visit www.TheMaxwellHouseGroup.com  for your relocation and/or your local needs.   Debe Maxwell- HELEN ADAMS REALTY - 704.491.3310  Debe@DebeMaxwell.com

                                      Copyright © 2008 By Debe Maxwell, All Rights Reserved...*Shopping for Charlotte NC Real Estate?*

Disclaimer:  All information provided by this author is strictly an opinion, is not guaranteed, may be based on information collected from several sources which may or may not be reliable at the time of researching this article and may be time sensitive.

Shop for your Charlotte NC real estate here.

 

 

 

 

HUD announced MORTGAGEE LETTER 2008-36 on November 7, 2008 for the new FHA loan maximum mortgage limits. My main concern is that the correct information is put out there for all to read. I have read a few blogs in the last few days that state that the mortgage under the current loan limits have to close or fund by January 1st, 2009, when this goes into effect. Fiction : This is not true by FHA's standards, but could be that of the lender that is putting that information out there.

In regards to the new FHA maximum mortgage limits, you have to have a FHA case number and credit approval prior to January 1, 2009 in order to use the old FHA loan limits.  The old FHA loan limits was all part of the Stimulus Bill signed into Congress back in February of 2008. The higher loan limits were suppose to help those refinance that were in higher rate mortgages, jumbo mortgages, or those with adjustable rate mortgages with high end balances.

 

 

 

How does one dissect the new loan limits in each county?  I don't want to bore you and give you language such as language that you would find in a law book.  You basically have what are called 'Ceiling' and 'Floor' limits. These limits are based on a certain percentage of the medium house price in that county. The ceiling limit is set at $625,500 and the floor limit is set at $271,050. In layman's terms, basically your highest loan amount and the lowest loan amounts that are allowed for FHA loans. There are special exceptions to where the FHA loan amounts can exceed the ceiling limits. The potential loan limit is $938,250 in parts of Alaska, Hawaii, Guam, and the Virgin Islands. These higher limits account for the higher construction costs.

 

 

So, if you are sitting on the fence about purchasing or refinancing and your loan amount would be higher than the new FHA maximum loan limits in 2009, then you better act quickly, or forever hold your peace.

 

 

For a better understanding of these new FHA loan limits or to find out what your new county limit may be, please don't hesitate to contact me.   jbelonger@ihmci.com   thanks, Jeff

 

 

 

 

- FHA Loans - FHA Mortgages - Conventional Loans - VA Loans -

Experience & Knowledge at its BEST !!!

 

 

____________________________________________________________________________________

For more information on FHA loans, please go to this link. The FHA Expert

For more information on how you can obtain your dream home, please click here : Mortgage Financing Options

For important mortgage insight to watch for, please read : Consumers need to be aware of these Red Flags !!!!!

Copyright © 2008 by Jeff Belonger

                               * * * *   DANGER!  HARD CORE REAL ESTATE TALK AHEAD  * * * *

2008 - IT WAS WHAT IS WAS! 

Published in December, 2007, now a year later, one would think this real estate broker was prescient.  Would that it were so.  It doesn't take special insight to read bold writing on the walls.  The growing trend of foreclosures and short sales accurately forcast lower home prices. 

The prediction for higher interest rates for 2008 was correct for about 9 months of the year.  Then, the bottom fell out of interest rates when the government lowered the cost of money to banks ever lower to 1/4%, an all time low.  Further, since interest rates respond to supply and demand, with

• businesses contracting (demand for goods and services down)
• banks sitting on the money (or sitting on each other)
• denying credit to consumers (freezing equity lines, tightening lending guidelines)
• denying credit to small businesses (resulting in more layoffs)
• negative equity in real estate holdings* (can't buy if you can't sell)

*Negative equity reflects the evaporation of the financial estate of most home owners.  The financial estate of home owners once provided for

• retirement funds
• college tuition
• seed money for small businesses
• emergency funds

It's gone.  It's all gone for many Americans.

IF THE BANKS ARE NOT MAKING CONSUMER LOANS, WHAT ARE THEY DOING?  There is no demand for use of credit so the rates continue to fall.  Banks that were once in the business of making loans to consumers and small businesses are now in the business of using tax money (TARP) for - - well, we really don't know because there was no requirement that the recipients of this relief disclose details of the use of the money.  Inquiries have been advised that the banks have been rebuffed.

"We have not disclosed that to the public. We're declining to," Kelly (J.P. Morgan Chase) said.

There have been reports that some of the $700,000,000,000 has been used for:

• shareholder dividends
• lavish executive retreats
• executive bonuses
• acquiring competitors

OUR LOWER INTEREST RATES ARE NOT CAUSED BY A LACK OF CONSUMER DEMAND.  it appears that the financial institutions have made a concious decision to sit on their capital, even the capital that was gifted to them by the tax payer's agents, Treasury, the Federal Reserve, the Congress and the President of the United States. 

Normally, banks would be raising interest rates to encourage the consumer to save.  The banks would then use that capital to make consumer and small business loans.  Our financial institutions no longer need consumer accounts to meet capital requirements or to balance their profit and loss statements. 

They have TARP money. 

~~~~~~~~~~~~~ PUBLISHED DECEMBER 31, 2008 ~~~~~~~~~~~~~ 

PREDICTIONS FOR THE REAL ESTATE INDUSTRY IN 2008

                                             * * * * DANGER!  HARD CORE REAL ESTATE TALK AHEAD.  * ** *

REAL ESTATE IN 2008 WILL BE . . . . . ?                                   

Predictions are commonplace at this time of the year.  While it isn't a good idea for real estate practitioners to give investment advice, we can certainly speculate about what we believe to be the condition of a future market.  Inspired by Jim Crawford who asks 10 questions about our predictions for 2008, it's worthwhile to know why our thoughts are what they are.  Of course, the below are my thoughts and my thoughts alone and, if I could have found a way to paint a brighter picture, being the eternal optimist and naturally cheerful person that I am, I would have. 

1.  Mortgage Rates Lower or Higher?   Higher. 
This is a matter of supply and demand.  The money supply has been tightening for months and relying far too much on government intervention, foreign investment.  Major lenders have tightened their underwriting requirements and eliminated marginal borrowers. 

2.  Credit Loosen or Tighten?  See #1.

3.  Numbers of Agents in Your Market Up or Down?  Down!!!    Let me say it again -Down!!!
Of course, real estate is local, but financial forces are dynamic and what affects one area will eventually affect other areas.  A few reasons why I believe that the number of agents will be down:
        a.  Real estate is a business. 
        b.  Business requires capital.          
        c.  Capital is money.
        d.  Money comes from savings, spousal income, other income.
        e.  Income from one source to generate income from another source is risky.
        f.   Risky marketing will quickly deplete capital. 
        g.  Go back to "c".

4.  Real Estate Inventory Levels in Your Market Increase, or Decrease?  Increase.
The average list price of real estate for sale in my market is about 20% higher than the average home buyer's ability to buy.  If they can't qualify, they can't buy.  If they don't like what they can qualify to buy, they won't buy.

5.  Better Real Estate Market or Worse?  Worse.
Overall slowing of the economy, slow price reductions, stagnating wage increases, more restrictive and expensive mortgage financing will worsen the real estate industry in 2008.

6.  Buyer's Market or Seller's Market?   Buyer's Market.
By the classical definition, "more sellers than buyers", we have a buyer's market.  This will make pricing increasingly harder as comparative sales become harder to find.  Agents with little experience or ability to price correctly will have homes with few showings, few offers and few sales.  Negotiating, presentation and skillful pricing become more important when qualified buyers are rare.  The Internet has empowered the consumer to search for real estate, but doesn't provide them with the skills to evaluate the market.  Experienced agents with buyer clients will thrive in 2008. 

7.  More Foreclosures or Less?  More.
As ARM mortgage instruments reset and payments increase beyond many home owners' ability to pay, natural relocations for employment and inability to sell for what is owed will send more homes to the foreclosure market and, if the banks are willing to write the asset values down, offer opportunities for buyers and more competition for home owner sellers. 

8.  Homes Sales Prices Flat, Rise, or Fall?  Fall.
Foreclosure sales, short sales, relocation sales and other market forces will force prices down. 

9.  Condo Sales Prices Flat, Rise, or Fall?  Free Fall!!!
As the price of town homes and single family detached homes fall, condominium homes will return to their historical position as the "last resort home" available for lower price buyers.

10.  Commercial Real Estate Stay Strong or Start to Soften? Start to Soften.
General slow down in the overall economy will cause a retraction in commercial real estate investment.  Commercial real estate is sensitive to the world economy. 

What Will Be Will Be.

 

On New Years Eve last year I wrote a post, Market and economic predictions for the new year where I set out 10 predictions mainly about markets and the economy for the new year.  I tried to choose topics where my predictions were differed from the majority of mainstream economists and market pundits.  Since the year is now coming to an end, it's time to revisit this list and see how I did.  I should have a new predictions list for 2009 coming within the next couple days.

1. The fear of inflation is misplaced, deflation is coming...

Correct -  There has been massive monetary deflation as credit throughout the world has significantly contracted.  While price inflation in commodities surged for the first half of the year due to hot money speculators trying to find the next asset bubble, this bubble collapsed rather spectacularly mid-year.  Between massive demand destruction from slowing economies around the world, and the continuing deleveraging in our financial systems this will almost certainly continue.  It wasn't until October that I heard the first mention of deflation not inflation in the main stream media.

People are screaming that we are going to experience near term hyper-inflation do to the central banks pumping liquidity.  The central banks ability to pump money pales in comparison to the size and speed of the credit contraction.  Consider over $30 Trillion in wealth evaporated this year across the various asset classes, compared to a couple trillion pumped by the central banks.  Plus most of this money particularly pumped into banks in simply being hoarded in US treasuries, so it really has no inflationary effect at all.

2. The dollar will strengthen against most currencies... 

Correct - The dollar index started the year at about 76 and appears that it will end around 81 with most of the US dollars strength coming against the Euro.  My prediction was based on the fact that world economies were in just as bad of shape if not worse than the US economy and there would be massive rate cuts not in the US but internationally.  There were also massive bets being made against the dollar that would b unwound during global deleveraging and the market realization economic problems are not limited to the US.  The global decoupling theory spouted by many economists and market analysts is proving to have more holes than Swiss cheese, the world economy really is dependent on the US consumer.

3. The housing downturn will continue...

Correct - Yup, last I checked it's still going on and I think we've got several years left until "bottom" is hit.  We have many substantial regional housing down turns in the past to look at for a model, and they usually lasted 5-7 years from peak to trough.  It should be noted the steepest price declines happened in the first two years and then it was a slow grind down for several years.  The main driver behind the housing market this time is almost totally availability of cheap credit, so until you see a turn in the credit markets there won't be in housing.

4. It is not subprime...

Correct - Look no further than default statistics on mortgages in general and it's obvious in it's not just subprime, Fannie and Freddie should be proof of that.  Secondary markets for everything from credit card debt to students loans are now pretty much dead, and we even saw it spread all the way into the municipal bond markets this spring as they locked down (I wasn't expecting that to happen so soon).  The worst effects are yet to be felt, as some of the secondary credit market troubles have yet to have spread down to the consumer.  I do not believe the credit crisis is over, in fact I believe we are experiencing another lull in the storm just like we did last fall, then again in the winter, and then again after Bear Stearns.

5. Real estate commissions will increase... 

Maybe Correct - Most people were claiming average real estate commissions on a percentage basis were going to contract due to new business models such as Redfin.  My prediction was made on the basis that commissions typically increase in down turns as it becomes harder to sell properties and that many "innovative" models will die off because they can't survive in an environment of lower transaction volumes.  I haven't seen any hard numbers on this, but I have lots of anecdotal evidence that my prediction was correct.

6. Several large regional banks will fail...

Correct - My prediction was "This next year several large regional banks will fail and end up being seized/merged by the OTS for violating capital requirements.  There is a very significant possibility of at least one of the top ten banks in the US having a similar fate.  I won't mention any names but several candidates come to mind."

Out of the large regionals we saw IndyMac, Washington Mutual, Wachovia, Downey Financial go down.  Both WAMU and Wachovia laid claim to being in the top 10 largest banks in the country.  Additionally, the only reason Citigroup (the largest) made it through the year was several hundred billion in bailout money being thrown at them.  Back in April 2007 when I started really investigating the banking system I put together a list of banks that I thought were dead men walking based on their exposure to bad debt and low capitalization.  All of these failed banks were near the top of the list.  There are MANY banks on that list, that I still believe are walking dead even with the government intervention and I actually expect the rate of bank failures to increase significantly in the next year.

The accounting fraud in are banking system, which the regulatory agencies like the FDIC and OTC are assisting to cover up is massive.  There is no other way to describe it other than criminal, the agencies put in place to protect us have instead been assisting in the crimes for years.  See: The TRUTH Behind The Credit Market Lockup

7. More bail-out schemes than you can shake a stick at will be proposed...

Correct - Does this one need any further explanation?  I think I'd need about 10 pages just to list the bailouts set in motion in the last two months alone.  Keep in mind one line from the 2008 prediction though, "Yet, none of them will fundamentally do anything."  I'm sticking with that, mathematically they can't solve the problem, it's all a smokescreen, all they do it drag out the economic pain longer, and act to distribute the losses wider in the system.  History has shown you can not have a true economic recovery until you take the losses and get them out of the system.

8. The FED substantially lowers the target rate...

Correct - What are we at, .25% now from over 4% at the start of the year?  Welcome to ZIRP (Zero Interest Rate Policy), it's gonna last for a while, and no that isn't a good thing.

9. ActiveRain will launch many cool new features and several new faces will join the ActiveRain team... 

Correct - ActiveRain launched the redesign Localism, Outside Blogs, and is preparing to launch channels which may be the biggest overhaul to the main ActiveRain.com site in years.  Many new faces too, though I've moved onto to start a new venture.

10. Despite all my bearish predictions we will survive and life goes on...

Correct - I'm still here writing this...

Now I have some work to do to come up with a whole new set of predictions...

WORDLESS WEDNESDAY - FOR THE HOLIDAY

-----------------------------------------------------------------------------------------------------------

HAPPY HOLIDAYS TO THE ACTIVE RAIN COMMUNITY AND TO YOUR FAMILIES!

Usually on Wordless Wednesday, I would post an inspiring photo of a landscape.

Being Christmas eve, I opted for a holiday pup.

This is actually the photo on my Christmas cards this year.

How cute is this puppy....

Recently, my division put up a website dedicated to provided information to veterans regarding the VA Mortgage Loan.  The site is here.  Hopefully this will help veterans understand how to utilize their VA Certificate of Eligibility to purchase their first home, refinance their existing loan, or use the benefit for a subsequent use . 

One of the benefits of the VA loan is that there is no monthly mortgage insurance payment.  Instead, there is a one time funding fee which can either be financed into their loan or paid upfront.  Most veterans opt to finance the funding fee.

Here is a basic guide to the VA Funding Fee*:

Purchase and Construction Loans
Type of Veteran	DOWN PAYMENT	Percentage for first time use	% Subsequent Use
Regular Military	None	2.15%	3.30%
	5% up to 10%	1.50%	1.50%
	10% or more	1.25%	1.25%
Reserves/National	None	2.40%	3.30%
Guard	5% up to 10%	1.75%	1.75%
	10% or more	1.50%	1.50%
Cash-Out Refinancing Loans
Type of Veteran		% First Time Use	% Subsequent Use
Regular Military		2.20%	3.30%
Reserves/National		2.40%	3.30%
Guard
Interest Rate Reduction Refinancing Loans
First Time or Subsequent		0.50%	0.50%
Either type veteran

* 

Our division's VA site is a work in progress, and any feedback is appreciated.  Once again the site is listed at www.vamortgageassistance.com .

 

Michael Byrne

www.mortgageprosforum.com

 

*As always, the market is constantly changing.  Check with your lender at time of application for specific fees for your loan.  Not an offer to lend.

If you are considering buying a home in 2009, or perhaps have been working on it but it hasn't happened, you might want to do some planning.

What IS your real estate buying strategy?

Do you HAVE a strategy or are you going to just go about it haphazardly?

Consider the following:

DON'T IGNORE THE INTEREST RATES

Interest rates are historically low and there are predictions of 4.5%. It's worthwhile checking into what programs you can qualify for and what this means financially for your monthly budget. Be aware that loan qualification requirements remain very tight and a good number of folks may simply not qualify for the lowest rates, or at all. 

UNDERSTAND NEW LOAN LIMITS AND CHANGES AND GET PRE-APPROVED

It's wise to consult with a knowledgeable mortgage broker to get the low down on all the programs and some of the new loan limits - FHA, VA and conforming - that are being implemented in 2009. And find out what you qualify to borrow, and make sure you get a Good Faith Estimate from your mortgage professional. Check back in with your mortgage broker if you were pre-approved some time ago

CONSIDER ALL AVAILABLE HOMES IN YOUR PRICE RANGE

More foreclosures are expected in 2009. Provided you have the stomach for waiting for a short sale or foreclosure to close, there may be even more opportunities. I would not recommend focusing only on distress properties, although for some budgets and markets you may not have a choice. Consider all your options so you can make the best choice for you, and understand the risks and implications of the distress versus the typical sales.

READ MORE: Buying a Short Sale

BE THOROUGH IN YOUR RESEARCH, BUT DON'T GET PARALYZED BY THE INTERNET

Make sure you do your research to learn about your local housing market and the homes available to you. But don't get so hung up on on-line searching and avoid the real world - drive bys and open houses for example. The Internet is a tool but don't depend on it to the extent you cannot or will not make a decision.

READ MORE: Tips on Becoming a Good Buyer

HOOK UP WITH A QUALIFIED REALTOR IN YOUR MARKET

If you are still going it alone, I recommend hiring a knowledgeable REALTOR who knows your market to help you navigate the transaction, especially if you are considering short sales, foreclosures and REOS (make sure your agent has some experience with these properties). Distress sales can be complicated and frustrating and you want someone who will be an advocate, not a paper-pusher. Use social media to help you if you don't have a referral - blogs, Twitter, Facebook and LinkedIn and other social networks where agents congregate.

                        

None of this probably matters if you aren't committed. If your need to buy is not real, or you are waiting for the bottom to arrive, I'd say the commitment to buy is not really there. Plus you ought to have an idea of what you want to buy, or where you want to live, etc.

A strategy won't do you much good if you don't know what your goal is. You need to know where you are going in order to figure out how best to get there.

********************************

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If I can provide more information about Carlsbad and surrounding areas, or the housing market in general, or otherwise assist you in your homes search, please contact me by phone or text at (760) 840-1360 or email me at JDowler@remax.net.

All content copyright © 2008 Jeff Dowler Carlsbad Homes and Real Estate Tidbits