How many of you have a budget? Not one that is "just in your head", or is constituted by living from one paycheck to another, or one that is made up of "spending what is left over after paying the bills" - or worse, a budget for paying bills and saving that is only established by "what's left over" after all the spending.
Whether you are an individual, a family, a business or a government, you must have a budget and a cash flow analysis. And if that budget can not be met without borrowing (such as paying for monthly expenses with a credit card), and does not allow for savings and for an emergency fund, then your budget needs to be re-calculated, re-worked and changed. Maybe more income is in order, most likely some debt needs to be eliminated, and probably a little of both.
The good news is I am now seeing more and more people, who come to me for a Pre-Approval to purchase a home, begin to budget for a paymnet below what they can actually get approved for. I am seeing more and more people getting back to the "old way" of financing their purchase; not exceeding 25 -28% of thier gross monthly income to pay for their total monthly Housing Expense. And with today's interest rates, it can definitely work.
What does your budget look like?
Tuesday, September 18, 2012
Friday, November 4, 2011
Obviously, NOT as smart as a Fifth Grader ?
What have we been told since day one? What have we tried to instill in our children, our grandchildren? TRY TO GET ALONG WITH EACH OTHER, WORK and/or PLAY TOGETHER. Whether it's with another sibling or the child down the street or the back of the bus.
That being the case, why is it, and especially in this real estate and mortgage environment that we find ourselves in now (and I am sure it may be true in other fields and industries as well) the Buyer / Seller / Realtor 1 / Realtor 2 / and Mortgage Lender can't put all their efforts in towards the end goal and get on the same page.
Once negotiations are done, isn't everybody looking to accomplish the SAME thing? I truly don't understand why certain parties seem to make it more difficult to do that? Trust me, I understand "stress". I understand "expectations", or even "unrealistic expectations". I understand "communication" and/or "lack of communication", and anything else that you want to add. I have been doing this, and doing this well, for a long, long time, as I am sure you have in your own fields.
Therefore, given the fact that everybody in the transaction is looking to accomplish the same thing, why do some just try to make it more difficult than it needs to be?
That being the case, why is it, and especially in this real estate and mortgage environment that we find ourselves in now (and I am sure it may be true in other fields and industries as well) the Buyer / Seller / Realtor 1 / Realtor 2 / and Mortgage Lender can't put all their efforts in towards the end goal and get on the same page.
Once negotiations are done, isn't everybody looking to accomplish the SAME thing? I truly don't understand why certain parties seem to make it more difficult to do that? Trust me, I understand "stress". I understand "expectations", or even "unrealistic expectations". I understand "communication" and/or "lack of communication", and anything else that you want to add. I have been doing this, and doing this well, for a long, long time, as I am sure you have in your own fields.
Therefore, given the fact that everybody in the transaction is looking to accomplish the same thing, why do some just try to make it more difficult than it needs to be?
Thursday, November 3, 2011
As the Gov't ordered more Home Loans...FannieMae and FreddieMac relaxed their standards...
The Gov't Fueled Mortgage Mess
Thu, 2011-11-03 07:15 — Mortgage News Ticker
... Rewind to 1994. That year, the federal government declared war on an enemy — the racist lender — who officials claimed was to blame for differences in homeownership rate, and launched what would prove the costliest social crusade in U.S. history.
At President Clinton's direction, no fewer than 10 federal agencies issued a chilling ultimatum to banks and mortgage lenders to ease credit for lower-income minorities or face investigations for lending discrimination and suffer the related adverse publicity. They also were threatened with denial of access to the all-important secondary mortgage market and stiff fines, along with other penalties. ...
... "HUD is authorized to direct Fannie Mae and Freddie Mac to undertake various remedial actions, including suspension, probation, reprimand or settlement, against lenders found to have engaged in discriminatory lending practices," the official policy statement warned.
The regulatory missive, which had the effect of law, advised lenders to bend "customary" underwriting standards for minority homebuyers with poor credit.
"Applying different lending standards to applicants who are members of a protected class is permissible," it said. "In addition, providing different treatment to applicants to address past discrimination would be permissible."
To that end, lenders were directed to "make changes in marketing strategy or loan products to better serve minority segments of the market." They were also advised to "change commission structures" to encourage brokers and loan officers to "lend in minority and low-income neighborhoods" — a practice Countrywide Financial, the poster boy of the subprime scandal, perfected. The government now condemns the practice it once encouraged as "predatory." ...
Please read the full article on Investor's Business Daily
http://news.investors.com/Article.aspx?id=589858&p=1
Thu, 2011-11-03 07:15 — Mortgage News Ticker
... Rewind to 1994. That year, the federal government declared war on an enemy — the racist lender — who officials claimed was to blame for differences in homeownership rate, and launched what would prove the costliest social crusade in U.S. history.
At President Clinton's direction, no fewer than 10 federal agencies issued a chilling ultimatum to banks and mortgage lenders to ease credit for lower-income minorities or face investigations for lending discrimination and suffer the related adverse publicity. They also were threatened with denial of access to the all-important secondary mortgage market and stiff fines, along with other penalties. ...
... "HUD is authorized to direct Fannie Mae and Freddie Mac to undertake various remedial actions, including suspension, probation, reprimand or settlement, against lenders found to have engaged in discriminatory lending practices," the official policy statement warned.
The regulatory missive, which had the effect of law, advised lenders to bend "customary" underwriting standards for minority homebuyers with poor credit.
"Applying different lending standards to applicants who are members of a protected class is permissible," it said. "In addition, providing different treatment to applicants to address past discrimination would be permissible."
To that end, lenders were directed to "make changes in marketing strategy or loan products to better serve minority segments of the market." They were also advised to "change commission structures" to encourage brokers and loan officers to "lend in minority and low-income neighborhoods" — a practice Countrywide Financial, the poster boy of the subprime scandal, perfected. The government now condemns the practice it once encouraged as "predatory." ...
Please read the full article on Investor's Business Daily
http://news.investors.com/Article.aspx?id=589858&p=1
Wednesday, October 26, 2011
Let's Do the Math ? Why Wait to Own?
Today, there is evidence that "Renters Outspend Owners on Housing", by Steve Cook, as posted by Susanne On October 25, 2011 @ 3:59 pm In Consumer News and Advice,Home Owner News,Real Estate News,Real Estate Trends,Today's Marketplace
"Renters now spend five percent more of their household budgets on housing costs than do homeowners, and the difference is growing as rents rise."
Why are people waiting?
For Example:
If today's House Price is $300,000.
And it could be financed at a 4.25% 30 year fixed rate.
The approximate monthly mortgage payment would be only $1,453.95
If house prices were to fall another 15%, and that
House Price became $270,000.
But it was financed at 5.25%
The approximate monthly mortgagepaymet would be $1,470.11
Do the Math ????
Even if interest rates remained the same, the difference in payment to OWN the home is only $125.71 per month.
Take in consideration mortgage interest and real estate tax deductions, pride of homeownership, and any one of the other number of reasons why owning your own home may benefit an individual or family, and I certainly don't understand why more homes are not selling.
"Since 2005, homeowners’ expenditures for housing have risen from 31.9 percent of their household budget to 33.2 percent, but renters’ costs have risen even more, from 35.6 percent to 38.4 percent, according to the October CoreLogic U.S. Housing and Mortgage Trends."
"Since 1985, homeowners have increased their housing expenditure allocation by 12 percent, while renters increased by 22 percent."
"As consumers allocate more of their expenditures toward housing, they have less money to spend on non-housing consumption. The largest decline in a household’s budget occurred in transportation expenditures which fell by 17 percent and 22 percent since 1985 for homeowners and renters, respectively, CoreLogic said."
"The increased spending allocation for housing, which is largely due to the stagnation of incomes among Americans of home buying age beginning in the 1990s, has actually contributed to the decrease in homeownership by making buying a home more difficult."
"Demographics have also contributed to the decline in homeownership. For the 25 to 34 age group, the homeownership rate fell from 51.6 percent in 1980 to 42.0 percent in 2010. For 35 to 44 year olds, homeownership rates fell from 71.2 percent to 62.3 percent over the same time period."
"The CoreLogic report also found that a significant number of foreclosures are remaining on the market for as long as four years or more. One out of five REO foreclosures (21 percent) are taking more than a year to sell. Nearly 10 percent, or 23,200 properties that were auctioned in 2006, remained in REO as of Q2 2010. In other words, these properties have been in REO continuously since 2006."
For more information, visit www.realestateeconomywatch.com [1].
"Renters now spend five percent more of their household budgets on housing costs than do homeowners, and the difference is growing as rents rise."
Why are people waiting?
For Example:
If today's House Price is $300,000.
And it could be financed at a 4.25% 30 year fixed rate.
The approximate monthly mortgage payment would be only $1,453.95
If house prices were to fall another 15%, and that
House Price became $270,000.
But it was financed at 5.25%
The approximate monthly mortgagepaymet would be $1,470.11
Do the Math ????
Even if interest rates remained the same, the difference in payment to OWN the home is only $125.71 per month.
Take in consideration mortgage interest and real estate tax deductions, pride of homeownership, and any one of the other number of reasons why owning your own home may benefit an individual or family, and I certainly don't understand why more homes are not selling.
"Since 2005, homeowners’ expenditures for housing have risen from 31.9 percent of their household budget to 33.2 percent, but renters’ costs have risen even more, from 35.6 percent to 38.4 percent, according to the October CoreLogic U.S. Housing and Mortgage Trends."
"Since 1985, homeowners have increased their housing expenditure allocation by 12 percent, while renters increased by 22 percent."
"As consumers allocate more of their expenditures toward housing, they have less money to spend on non-housing consumption. The largest decline in a household’s budget occurred in transportation expenditures which fell by 17 percent and 22 percent since 1985 for homeowners and renters, respectively, CoreLogic said."
"The increased spending allocation for housing, which is largely due to the stagnation of incomes among Americans of home buying age beginning in the 1990s, has actually contributed to the decrease in homeownership by making buying a home more difficult."
"Demographics have also contributed to the decline in homeownership. For the 25 to 34 age group, the homeownership rate fell from 51.6 percent in 1980 to 42.0 percent in 2010. For 35 to 44 year olds, homeownership rates fell from 71.2 percent to 62.3 percent over the same time period."
"The CoreLogic report also found that a significant number of foreclosures are remaining on the market for as long as four years or more. One out of five REO foreclosures (21 percent) are taking more than a year to sell. Nearly 10 percent, or 23,200 properties that were auctioned in 2006, remained in REO as of Q2 2010. In other words, these properties have been in REO continuously since 2006."
For more information, visit www.realestateeconomywatch.com [1].
Sunday, February 6, 2011
Moving Foreclosed and Distressed Properties off the Market
FHA Extends "Anti-Flipping Waiver" to Help Stabilize Housing Market.
One of the most aggressive ways to finance a house purchase today is through FHA Financing. Some of the benefits include;
* Only a 3.5% down payment is required
* Gift funds are allowed up to 100% of the down payment required
* Lower credit scores are allowed (640 minimum)
* Higher debt-to-income ratios allowed (sometimes as high as 55%)
In an effort to continue stabilizing home values and improve conditions in communities experiencing high foreclosure activity, the Federal Housing Administration extended it's temporary waiver of the agency's anti-flipping rule. The extension is intended to accelerate the resale of foreclosed upon homes in neighborhoods struggling to overcome possible property abandonment and blight.
With certain exceptions, FHA regulations prohibit insuring a mortgage on a home owned by the seller for less than 90 days. Early last year, FHA temporarily waived this regulation and FHA recently extended this waiver through the remainder of 2011. This action will permit buyers to continue to use FHA-insured financing to purchase HUD-owned properties, bank-owned properties or properties resold through private sales. It will allow homes to resell as quickly as possible, helping to stabilize real estate prices and to revitalize neighborhoods and communities.
Because of the tightened credit market, FHA-insured mortgage financing is often the only means of financing available to potential homebuyers. Research finds that in today's market, acquiring, rehabilitating and reselling these properties to prospective homeowners often takes less than 90 days. By prohibiting the use of FHA mortgage insurance for a subsequent resale within 90 days of acquisition, it would adversely impact the willingness of sellers to allow contracts from potential FHA buyers because they would have to consider the holding costs and the risk of vandalism associated with allowing a property to sit vacant over a 90-day period of time. This action will now enable borrowers, especially first-time buyers, to take advantage of this opportunity and buy a home that has recently been rehabilitated. It will also help to move more foreclosed properties off the market and reduce the number of vacant homes in neighborhoods throughout this country.
As previously mentioned, one of the biggest obstacles that real estate investors faced when purchasing properties, renovating them and then trying to re-sell them was the ability of the new Buyer to obtain financing. This action by the FHA is a major step in the right direction.
With FHA's temporary waiver being extended, and interest rates still near all time lows, it remains a great time for both investor and homeonwer to purchase real estate.
You may also follow Bob's Blog at: www.bobcasemortgage.com/blog
Get your FREE Download at: http://www.bobcasemortgage.com/ "9 Steps to Improve Your Credit Score"
One of the most aggressive ways to finance a house purchase today is through FHA Financing. Some of the benefits include;
* Only a 3.5% down payment is required
* Gift funds are allowed up to 100% of the down payment required
* Lower credit scores are allowed (640 minimum)
* Higher debt-to-income ratios allowed (sometimes as high as 55%)
In an effort to continue stabilizing home values and improve conditions in communities experiencing high foreclosure activity, the Federal Housing Administration extended it's temporary waiver of the agency's anti-flipping rule. The extension is intended to accelerate the resale of foreclosed upon homes in neighborhoods struggling to overcome possible property abandonment and blight.
With certain exceptions, FHA regulations prohibit insuring a mortgage on a home owned by the seller for less than 90 days. Early last year, FHA temporarily waived this regulation and FHA recently extended this waiver through the remainder of 2011. This action will permit buyers to continue to use FHA-insured financing to purchase HUD-owned properties, bank-owned properties or properties resold through private sales. It will allow homes to resell as quickly as possible, helping to stabilize real estate prices and to revitalize neighborhoods and communities.
Because of the tightened credit market, FHA-insured mortgage financing is often the only means of financing available to potential homebuyers. Research finds that in today's market, acquiring, rehabilitating and reselling these properties to prospective homeowners often takes less than 90 days. By prohibiting the use of FHA mortgage insurance for a subsequent resale within 90 days of acquisition, it would adversely impact the willingness of sellers to allow contracts from potential FHA buyers because they would have to consider the holding costs and the risk of vandalism associated with allowing a property to sit vacant over a 90-day period of time. This action will now enable borrowers, especially first-time buyers, to take advantage of this opportunity and buy a home that has recently been rehabilitated. It will also help to move more foreclosed properties off the market and reduce the number of vacant homes in neighborhoods throughout this country.
As previously mentioned, one of the biggest obstacles that real estate investors faced when purchasing properties, renovating them and then trying to re-sell them was the ability of the new Buyer to obtain financing. This action by the FHA is a major step in the right direction.
With FHA's temporary waiver being extended, and interest rates still near all time lows, it remains a great time for both investor and homeonwer to purchase real estate.
You may also follow Bob's Blog at: www.bobcasemortgage.com/blog
Get your FREE Download at: http://www.bobcasemortgage.com/ "9 Steps to Improve Your Credit Score"
Sunday, January 30, 2011
What's going on in the MORTGAGE and REAL ESTATE industries, and HOW it affects you!
For the past 32 years I have been working in the mortgage and real estate businesses. During that time I have helped finance thousands of mortgage transactions. I have been a licensed mortgage professional during that time in Massachusetts, Florida, New Hampshire and Rhode Island. I have purchased many real estate properties personally, leased and rented many more. I have had my Real Estate Broker's License since 1978. I have helped hundreds purchase single family homes, investment properties and helped many others negotiate such. If my expertise is lacking, my longevity in the fields is not. I believe that counts for something and hopefully I have learned a thing or two along the way.
With that said, what I am hoping to do, is to create both a FUN and INFORMATIVE Blog that everybody can share.
FOLLOW what's going on in the MORTGAGE and REAL ESTATE industries, and HOW it affects you!
I have a friend who used to call me up all the time and ask me for my opinion. Never shy about sharing one, I was then always told that I was "opinionated"? Who knew?
Anyways, we all have our own opinions, thoughts, comments, and ideas of how things should be. All of us, whether we be friends, acquaintances, business associates or other, like to weigh in on matters that we think are important, or topics which we feel we have some knowledge in, or at least some passion about. What I want to do is to offer a forum to do just that. But let's have FUN doing it. We should be able to express our thoughts and our points of view without feeling intimidated, critically judged or anything else.
Let's see where this takes us. Maybe we'll learn something from one another, maybe we'll have fun, maybe both, maybe none of the above.
Have a fabulous day!
PS Other topics of interest are also available to be discussed here. Let's just keep it all FUN and INFORMATIVE for all.
Look for the first Blog of the year in a couple of days!
With that said, what I am hoping to do, is to create both a FUN and INFORMATIVE Blog that everybody can share.
FOLLOW what's going on in the MORTGAGE and REAL ESTATE industries, and HOW it affects you!
I have a friend who used to call me up all the time and ask me for my opinion. Never shy about sharing one, I was then always told that I was "opinionated"? Who knew?
Anyways, we all have our own opinions, thoughts, comments, and ideas of how things should be. All of us, whether we be friends, acquaintances, business associates or other, like to weigh in on matters that we think are important, or topics which we feel we have some knowledge in, or at least some passion about. What I want to do is to offer a forum to do just that. But let's have FUN doing it. We should be able to express our thoughts and our points of view without feeling intimidated, critically judged or anything else.
Let's see where this takes us. Maybe we'll learn something from one another, maybe we'll have fun, maybe both, maybe none of the above.
Have a fabulous day!
PS Other topics of interest are also available to be discussed here. Let's just keep it all FUN and INFORMATIVE for all.
Look for the first Blog of the year in a couple of days!
Monday, May 17, 2010
Become a Master Networker
I have declared "2010", The Year of the Entrepreneur. Whether you are a business owner, sales professional, or company officer, we all have issues common to us all.
There is NO government bailout coming our way. We need to pay more attention than ever to each others needs. Listen, listen, listen. Remember, what goes around, comes around. Don't be afraid to help your fellow business associates.
Becoming a Master Networker
by Lynne R. Christen
Networking...1980s style was a fad. Over-dressed and over-ambitious people attended over-crowded cocktail parties and frantically swapped business cards while planning to "do lunch" soon. Networking in the 90s is a survival success skill. In our competitive business world, the more contacts we have...the more people who know about us and what we do...our talents and abilities...the more opportunities we will have. Try these tips to give yourself a jump-start and enjoy the rewards of becoming a Master Networker.
1. Develop the right ATTITUDE. You have to want to make the effort! We are all attracted to people who are approachable and friendly. SMILE and ENJOY the opportunity to make new contacts.
2. Network EVERYWHERE and with EVERYONE. The opportunities to make new contacts are endless. Some of the most productive contacts come from chance encounters...in the grocery check-out line, at the ball park, in the doctor's or dentist's waiting room, in an elevator, at a party, and the list goes on. Whenever and wherever there is another human being there is an opportunity to network.
3. Set a networking goal each week. Set a goal each week for the number of new contacts you want to make. Start with even one or two until your confidence grows. Then, increase the goal.
4. Make the first move. Greet everyone with a smile and a friendly hello followed by a positive comment or open-ended question to get a conversation going. At a party or other gathering approach people standing alone and draw them into conversation. Most people hesitate to approach a group of friends already in conversation. The individual standing alone will welcome your approach and you will find it easy to initiate an interchange.
5. Work up a memorable introduction. In twenty-five words or less be prepared to say who you are and what you do...in a way that will make the other person want to know more about you. Then, immediately ask questions to learn more about your new contact. Use their name several times during the first five minutes of conversation.
6. Arm yourself with professional cards and wear an attractive name tag. Both business cards and a name tag, especially a name tag that lists your profession or business name in an intriguing way helps attract the interest and reinforces name recognition. When you do swap cards with someone, jot down a reminder on the back such as where you met, what you discussed, sales opportunities, etc. Printing a quote, helpful hint, or other original and interesting information on your own card will encourage others to keep the card and remember you. Finally, always carry your cards in an attractive case. Dog-earred and stained cards dug from the depths of a handbag or pocket detract from your professional image.
7. Be prepared with a mental GIVE & GIVE list. Networking is a reciprocal process. It is about getting and giving information, resources, advice and referrals. Maintain a mental "Give List" ...a tip, idea, resource, or recent discovery you can share. Your "Get List" will be information you are seeking, people you want to meet, and referrals you would like to have.
8. Organize your network resource bank. Record new acquaintances and contacts in a rolodex, use computer software or even index cards. Set up whatever system works best for you to keep in touch and nurture your new contacts.
9. FOLLOW UP!!! Use your resource file to keep in touch with those in your network. Never give out your card and say, "give me a call." Follow-up is your responsibility. Research shows that amazingly only 20% of sales leads are ever followed up...80% of potential opportunities are lost by failure to follow-up. Use every opportunity to send a follow-up personal note, a thank you, a congratulations, or a relevant article of information.
10. WORK! The only place success comes before work is in the dictionary. Remember WORK makes up the better part of Networking.
Thank you for taking the time out of your busy day to read and enjoy. I welcome any and all feedback and value your opinions. If there is any way that I can help you and/or your business grow, or if I can help you make a connection, please ask.
Sincerely,
Bob
There is NO government bailout coming our way. We need to pay more attention than ever to each others needs. Listen, listen, listen. Remember, what goes around, comes around. Don't be afraid to help your fellow business associates.
Becoming a Master Networker
by Lynne R. Christen
Networking...1980s style was a fad. Over-dressed and over-ambitious people attended over-crowded cocktail parties and frantically swapped business cards while planning to "do lunch" soon. Networking in the 90s is a survival success skill. In our competitive business world, the more contacts we have...the more people who know about us and what we do...our talents and abilities...the more opportunities we will have. Try these tips to give yourself a jump-start and enjoy the rewards of becoming a Master Networker.
1. Develop the right ATTITUDE. You have to want to make the effort! We are all attracted to people who are approachable and friendly. SMILE and ENJOY the opportunity to make new contacts.
2. Network EVERYWHERE and with EVERYONE. The opportunities to make new contacts are endless. Some of the most productive contacts come from chance encounters...in the grocery check-out line, at the ball park, in the doctor's or dentist's waiting room, in an elevator, at a party, and the list goes on. Whenever and wherever there is another human being there is an opportunity to network.
3. Set a networking goal each week. Set a goal each week for the number of new contacts you want to make. Start with even one or two until your confidence grows. Then, increase the goal.
4. Make the first move. Greet everyone with a smile and a friendly hello followed by a positive comment or open-ended question to get a conversation going. At a party or other gathering approach people standing alone and draw them into conversation. Most people hesitate to approach a group of friends already in conversation. The individual standing alone will welcome your approach and you will find it easy to initiate an interchange.
5. Work up a memorable introduction. In twenty-five words or less be prepared to say who you are and what you do...in a way that will make the other person want to know more about you. Then, immediately ask questions to learn more about your new contact. Use their name several times during the first five minutes of conversation.
6. Arm yourself with professional cards and wear an attractive name tag. Both business cards and a name tag, especially a name tag that lists your profession or business name in an intriguing way helps attract the interest and reinforces name recognition. When you do swap cards with someone, jot down a reminder on the back such as where you met, what you discussed, sales opportunities, etc. Printing a quote, helpful hint, or other original and interesting information on your own card will encourage others to keep the card and remember you. Finally, always carry your cards in an attractive case. Dog-earred and stained cards dug from the depths of a handbag or pocket detract from your professional image.
7. Be prepared with a mental GIVE & GIVE list. Networking is a reciprocal process. It is about getting and giving information, resources, advice and referrals. Maintain a mental "Give List" ...a tip, idea, resource, or recent discovery you can share. Your "Get List" will be information you are seeking, people you want to meet, and referrals you would like to have.
8. Organize your network resource bank. Record new acquaintances and contacts in a rolodex, use computer software or even index cards. Set up whatever system works best for you to keep in touch and nurture your new contacts.
9. FOLLOW UP!!! Use your resource file to keep in touch with those in your network. Never give out your card and say, "give me a call." Follow-up is your responsibility. Research shows that amazingly only 20% of sales leads are ever followed up...80% of potential opportunities are lost by failure to follow-up. Use every opportunity to send a follow-up personal note, a thank you, a congratulations, or a relevant article of information.
10. WORK! The only place success comes before work is in the dictionary. Remember WORK makes up the better part of Networking.
Thank you for taking the time out of your busy day to read and enjoy. I welcome any and all feedback and value your opinions. If there is any way that I can help you and/or your business grow, or if I can help you make a connection, please ask.
Sincerely,
Bob
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