Monopoly

In my education, at a Junior College, State School and later Private University; something I learned in every business class I took was that competition is good. It is good for the consumer, good for the provider and is a desirable condition to have. Our government has worked diligently in past years to make sure companies like Microsoft didn't have a monopoly in the IT market. Why is it then, our government has backed every bill that will give the FOUR big banks a monopoly on mortgage lending. They helped to bail these companies out, or encouraged mergers or acquisitions and then made the rules different for banks versus brokers. Brokers are competition and with the new legislation, brokers are almost completely forced out of the market. Funny how the banks all backed that legislation. You can check out this link:
Big Banks Slashing Retail LO Compensation - 10.06.10 Real Estate News for Real Estate and Mortgage Professionals http://t.co/X5n18R0
from Think Big Work Small and see what others in this industry are saying.

Back in the Saddle again....Mortgage Insurance explained as an interest rate.

Here I am, blogging once again. But I do have loan news to share today. As of yesterday, 10/4/10, the new FHA upfront and monthly mortgage insurance premiums have been changed for any case numbers pulled on or after 10/4/10. Just looking at the numbers doesn't mean much, but seeing them as a percentage rate makes them more understandable. For a client who would like to purchase a home today they will end up paying approximately .375% higher for their loan than those whose case numbers were issued prior to Monday. Now of course it won't be in your interest rate, but that is what the new premiums do to the payments. I understand that FHA has taken losses over the past few years and that our industry is still reeling, but when interest rates start moving up, buyers will have less and less ability to purchase. Also, this new increase hinders current FHA borrowers to take advantage of these amazingly low rates, because the savings is negated in the almost double mortgage insurance. I hope this move does what the government thinks it will do.

October Already!

I desperately want to be a good blogger. But I have never been good at keeping a journal or a diary. So much changes daily in our lives; work, family, friends. We have this great new world of media that allows us to touch base, but do we have the social interaction that we really need? I wonder if in the years and generations to come we will see a bigger split from family and friends? Do we really know one another? How easy is it to be whomever you want on this great wide web that we post to? You can tweet, facebook, blog, etc...whatever you want, but can you hold a conversation. I wonder where it will all lead...

It's Not Too Late!

The interest rate market has been on a roller coaster in the last month. When the American Government stopped purchasing mortgage backed securities on March 31 the market went into massive volatility. Today the stock market joined the roller coaster ride as it has seen losses up to 1000 points ending the day down only 347 points. These types of turns prove just how important the "global market" truly is. The issues facing Greece are causing volatility around the world.
The good news for those of you looking to purchase a home, rates improved today, significantly. Call or email me for more information.

Loan Modification Scams

Loan Modification is a word that is thrown around quite liberally these days. In essence, a loan modification is a changing of the original terms of a mortgage note that; may or may not be permanent, may or may not negatively impact your credit, and that may or may not directly reduce the principle amount due on the note.
Everyone should be very wary of companies in the market place looking to "scam" current home owner's who are desperate to keep their home. You should look at the following website, which FHA, HUD, FANNIE MAE and FREDDIE MAC all support: http://www.loanscamalert.org/ .
Most loan modifications can be done by the consumer themselves, if they just have patience. It is a long, arduous process, but in the long run can be very beneficial for the homeowner.
HUD has Loan Counselors to help answer questions you may have and talking to your current mortgage holder is always good idea.

Things are a Changing!

Ability Mortgage has undergone some major changes in the last few weeks. The most important change is that we are now a direct lender. We have made this change to be more competitive for our clients. In the ever changing environment that mortgages are in, new laws make it harder and harder to close a file in a timely manner. This is just one step we have taken to keep ourselves competitive.
We are very excited about the change and even though we are learning a new system, we can already see the difference it is making for our clients. Feel free to give me a call or shoot me an email if you have any questions about our newest endeavor.

Also remember: to qualify for the $8k tax credit you must me in contract by Friday April 30, 2010.

Change is in the air!

2010 will continue adding changes to the lending environment. There are new RESPA guidelines that need to be followed, specifically the 2010 Good Faith Estimate. Even though the government had the best intentions, I don't know if they consulted anyone who actually conducts business in the mortgage field. The new Good Faith puts restrictions on the buyer that I don't believe were the intentions of the government. It also gives the buyer a lot less information than they should have. It has some promise, but there are changes to be made. And the one thing I am sure about in our industry is that we can handle change.