TeamResults

The City of Long Beach's Neighborhood Resource Center (425 Atlantic Ave., Long Beach) will be hosting a FREE workshop for local tenants and their landlords. The workshop will be Wednesday August 1st, 2007 from 6:00pm to 8:00pm and there will be refreshments available.

Presented by the Fair Housing Foundation, Dispute Resolution Services, and Legal Aid Foundation; the event will cover landlord & tenant rights (responsibilities) as well as fair housing issues.

Everyone who rents or owns a rental should attend these types of events when they come up. In the ever changing legal climate its important to stay informed of changes in the law, as well as brushing up on current trends. If you learn just one thing Wednesday evening attending this free event will be worth while.

If you would like to RSVP: E-Mail Sharron_Hinkley@LongBeach.Gov or Call (562) 570-1010.

For Map and Directions Click here. 

{Serving Long Beach and surrounding communities}

TeamResults@Century21.com
www.TeamResults21.com

Here are the stats for our investor friends. If you're brave enough to enter the foreclosure market, give me a call and we'll discuss your plan. We have the pre-foreclosure lists available, and they're updated daily. For more information on default/foreclosure activity in Southern California e-mail John.Wall1@century21.com. Don't forget to have a good one!

Ta' 

-John

When buying a home, borrower's always try to find ways to save. Their first shot is usually asking the seller for a price reduction. Here's a better way;

Example:

(Traditional Sale)

Sales Price $550,000 - 20% Down Payment, $440,000 Loan Amount. 30 Year Fixed Rate at 6.25% =  $2,709 payment.

(Price Reduction of $20,000)

Sales Price $530,000 - 20% Down Payment, $424,000 Loan Amount. 30 Year Fixed Rate at 6.25% = $2,610 payment.
(a savings of $99.00 per month)

(Seller Credit of $20,000)

Sales Price $550,000 (with $20k in seller credit toward closing costs) - 20% down payment, $440,000 Loan Amount. 30 Year Fixed Rate at 5.00% (seller bought down rate) = $2,362 payment.
(a savings of $248.00 per month)

for these and other tips on saving money in your next home purchase call on TeamResults. TeamResults@Century21.com or www.teamresults21.com

Are all sub-prime borrowers, no good, dirty, deadbeats? The term ‘sub-prime' applies to a huge section of borrowers, and sometimes the majority of borrowers in some markets. As Lew Sichelman (LA Times, syndicated author) puts it, a "certain number shouldn't have been approved for a mortgage at any price". Referring of course to the increased media attention placed on the sub prime market of late.

The Mortgage Banker's Association says its difficult to define a sub-prime borrower, but admits that if you (as a borrower) have trouble coming up with one of your mortgage payments this year, you're sub-prime. Though, the association has said that 78% of you sub-prim(ers) are actually making your payments on time and are staying current on your mortgage. There is no avoiding the fact that sub-prime loans have a higher default rate, which is expected to increase in the near future.

In his recent article Lew has categorized the following list of borrower types as sub-prime;

Former Primes: borrower's who have suffered a major life event that has affected their financial position.

Future Primes: Those who have had mistakes in the past, take on higher interest rates or credit repair loans and promise to make payments on time, to once again reach their ‘prime' status.

Rookies: (My favorite kind) These are people who just don't have the funds for a large down payment but, meet or exceed every other qualification necessary for obtaining good terms on a loan.

Second Homers: These are borrowers who were able to qualify for a prime market loan for their first home, but didn't have the credit to qualify for similar mortgage status on their investment or vacation homes. Its estimated that this borrower only makes up 7% of the sub-prime market.

Fraudsters: There isn't much to say about these guys, other than they're crooks.

Ne'er-do-wells: Borrowers with messy financials, rarely pay on time, their approval's were just dumb.

Should Haves: These are folks who really are in the ‘prime' market but for one reason or another have chosen a sub-prime loan. (my experience is that these are the one's whom although, that are able to... they just don't want to put down a huge down-payment..

So which sub-prime borrower are you?

7/17/2008 

Much of the market information I receive comes from the same sources that everyone else sees. Here's an overview of whats happening in California.

According to DQNews, in California 36,975 new and resale homes were sold in May. Down 31.7% last year.

As of May 2007, the median price paid for a home was 484,000, up 2.5% a year ago, and, the typical mortgage payment borrowers committed to was $2,266. Thats down $46.00 from this time last year.

Market indicators have been all over the place, but its clear that adjustable rate mortgages have become increasingly unpopular. Foreclosure activity has not yet impacted home values in most markets. Down Payment amounts are stable, but investor activity is down.

From all this we learn that changes are taking place, but prices are still going up, and My guess would be that much of the sales decline has to do with potential buyers who are 'waiting to see' whats going to happen next. If you have any questions about local real estate activity, I am always happy to provide answers and share my observations. Please feel free to contact me, john.wall1@century21.com.

When homeowner's fall behind in their mortgage payments or foresee a future problem looming, the decision has to be made whether to sell the home or try a ‘work-out'. Failing that means the possibility for a costly, messy, and humiliating foreclosure becomes more likely.

There are a couple of things to consider when facing this or similar situations. First if, as the homeowner, you absolutely want to keep the house you'll have to be able to prove that you can afford the payments. That means doing a budget, a cash flow statement, and providing supporting documents like Tax returns and pay stubs. Also, getting in touch with your mortgage servicer should be a top priority. Getting your servicer on board early helps to ensure their cooperation with whatever options you choose to take. They won't be too helpful if you wait until the last minute.

When making the decision to sell your home; when you owe more on your mortgage than the house is worth, your lender will become involved in what is known as a "short sale". Basically, a short sale means the lender agrees to take less than what they are owed in order to sell the property. There are some requirements that must be met before a lender will agree to a short sale, and their Loss Mitigation Department will take a look at:

•          How far behind on payments is the borrower?
•          Can the borrower tap any other assets to cover any deficiencies?
•          What caused the deficiency? Was there a hardship?
•          and more...

If a short sale is agreed to by the lender, they will generally not seek any further payment from the borrower, but that doesn't mean the borrower is home free. A lender will usually submit an IRS 1099 in the amount of the difference between the sale price and the amount owed to the lender. The Internal Revenue Service considers this amount "forgiven" as earned income to the borrower, and therefore will tax that amount.

When a short sale isn't possible or undesirable; its time to begin negotiating for a loan "work out" or modification. A modification can be in the form of a rate adjustment, or change in the terms of the loan that make the house more affordable to the borrower. Or at least, make it easier to keep up on the payments. The types of modifications that a lender can do are extensive and to make a list, would make for a very boring read. Suffice it to say, that if a modification is necessary, getting in touch with the lender early and staying in touch, is the only way to encourage them to cooperate. Remember that if you don't ask... You won't receive! So if you need a lower interest rate, ask for it. If you have fallen behind on your payments because of an illness but are able to pay on time again, ask for your past due amounts be added to the end of your loan. If refinancing is a better option, ask for favorable ‘refi' terms. If you need help, ask for it! Above all, don't panic, try not to stress yourself out, and begin looking for better options. Your real estate agent, loan officer, mortgage servicer, and others are professionals who can help, all you have to do is ask.