Mortgage News

Mortgage News and Media

Architect Homes: Streamlined Yet Sophisticated

March 28, 2015

Many luxury buyers seek homes with complicated floor plans, high-end finishes and the latest technology. But architects’ homes are often simple, yet sophisticated structures.

Fashion Designer Max Azria Is Listing Los Angeles Mansion for $85 Million

The elaborate estate in Holmby Hills includes a theater with a candy and popcorn bar, tennis court with an elevated viewing box and two greenhouses.

Top Spots for Luxury Getaway Homes

Buyers looking to buy or build a luxury vacation home can start the house-hunt at these five popular destinations.

Vacation Equation: Financing a Second Home

Behind the surge in vacation-home purchases: a rebounding real-estate market—and baby boomers looking for a retirement destination.

China Tries to Help Property Firms Get Back in the Black

Several property developers recently have received loans or investments from state-owned firms. But is the government making a good bet by investing in them amid a slump, or is it trying to keep the companies afloat?

A Modern ‘Antebellum’ Home in Austin

March 27, 2015

An interior designer is selling her recently built, 3,853-square-foot home for $2.15 million. ‘The inspiration came from my youth’ growing up in historic Natchez, Miss., she says.

A Modern ‘Antebellum’ Home in Austin

March 26, 2015

An interior designer is selling her recently built, 3,853-square-foot home for $2.15 million. ‘The inspiration came from my youth’ growing up in historic Natchez, Miss., she says.

A Wright House Rubs the Wrong Way

A fight over construction of a Frank Lloyd Wright has divided a peaceful British village.

‘Sonny and Cher’ Producer’s Beverly Hills Estate Listing for $25 Million

Owned by the late Nick Vanoff, the home is about 8,800 square feet with nine bedrooms and 12 bathrooms.

How Victoria Clark Learned to Be Fearless

The Tony-winning actress recalls a lively childhood home in Dallas

A Manhattan Penthouse With Views to Spare

March 25, 2015

This spacious, two-level penthouse apartment in the Financial District has it all: stellar views of the Hudson River and downtown Manhattan, ample outdoor space and all the amenities to feel like home.

‘Sonny and Cher’ Producer’s Beverly Hills Estate Listing for $25 Million

Owned by the late Nick Vanoff, the home is about 8,800 square feet with nine bedrooms and 12 bathrooms.

Zombie Apocalypse? Where to Hide

Researchers at Cornell University have developed a statistical model for simulating the spread of a fictional zombie epidemic.

Market Day in London’s Covent Garden

A former fruit market-turned-tourist spot is drawing a new wave of high-end real-estate development.

A Beachside Villa in Bali

March 24, 2015

This 10,000-square-foot home comes with a guesthouse, two pools and a private tennis court.

The Race to the $100 Million Spec House

More developers and investors are racing to build increasingly lavish homes on spec. Built on prime lots, many of these homes are also attempting to break new price records.

Los Angeles Estate Once Owned by Kenny Rogers Sells for $50 Million

The newly renovated Bel Air estate was asking $65 million in December.

Washington, D.C.’s Priciest House Is Seeking $22 Million

The roughly 20,000-square-foot home is owned by Samuel Lehrman, whose family co-founded the Giant Food s¼upermarket chain

New York Duplex Returns to Market for $27.5 million

The apartment returns to market in the wake of a record-setting sale of another unit at 740 Park Avenue, one of New York’s best-known buildings

A Former Senator Elects to Sell a $5.999 Million Compound

March 20, 2015

The 1.07-acre property sits directly on the white sandy beaches of Siesta Key, a barrier island off Sarasota, and includes three houses. Former Sen. Judd Gregg and his family are asking $5.999 million

Credit Card Crackdown Making Headlines

At Florida Mortgage Specialists we've warned our friends, family and colleagues of the pitfalls of the credit card fine print. It seems Fed Chief Ben Bernanke may have been listening. The Federal Reserve recently announced a plan to crack down on this and other "unfair" features of credit cards. According to Bernanke, this plan is "intended to establish a new baseline for fairness in how credit card plans operate."  Here are some highlights of his plan that is currently open for public comment, and what it could mean to you as a customer. The plan aims to eliminate the following:

· Universal default clause: One credit card company cannot raise interest rates on you simply because you are having trouble paying another credit card account.

· Diverting funds: Lenders can no longer allocate payments to lower balances while you rack up interest on higher balances. This is a common practice currently for cash advances, which often have higher rates than your normal APR.

· Unfair time constraints on payments: Under Bernanke's plan, you must be given a reasonable amount of time before a payment is deemed late, such as 21 days.

· Retroactive rate increases: Lenders can no longer increase rates on existing balances under this plan.

· "Security deposits" and other fees: Lenders will no longer be allowed to tack on fees simply for issuing credit or increasing available credit.

· Deceptive credit offers: The language on this section is not clearly defined yet, but it's good to know that this area is being addressed – especially if you have college-aged children, who are a big target for misleading credit offers.  It's important to note that this plan, or any part of it, has yet to be implemented. Even if it gets approved as-is, without any changes, it might not take effect until 2009 or beyond. Although these changes may not take effect for some time, it's imperative to be an educated consumer of credit.  During economic slowdowns, with increases in the costs of gas, food, healthcare, and education, it's more important than ever to stay on top of credit card use.  Another concern we have is that, if and when this plan is implemented, the credit card companies will try and spin the new rules in their favor, to make it seem as if this action was their creation to offer better, safer credit options that, again, lure you into utilizing expensive credit options that could bury you in credit card debt. Don't let this happen.

 

Street Smarts

Clip the Cost of Groceries

The high price of food these days is making many consumers hungry for better deals at the grocery store. The good news is an estimated $360 billion in coupons are available right now for the taking, according the Grocery Coupon Guide. Here are a few tips to help you save money without making coupon-clipping a full-time job:

· You don't have to wait for the Sunday paper anymore to collect money-saving coupons. There are many websites that offer coupons, newsletters, and coupon saving strategies, including couponmom.com and coupons.com.  Be cautious of expiration dates and plan your shopping accordingly.

· Use a coupon organizer and keep it in your car. This way you'll always have access to the coupons you need, when and where you need them.

· Make a grocery list before you review which coupons to clip or print out. If you know what you're buying, it's much easier to find the coupons you need, especially online.

· Use your club card and receive instant savings as well as additional coupons in the mail on items you already buy.

· Pick up coupons at the store. Some stores have "instant coupons" right in the area of the items you intend to buy. In some stores, your receipt is even printed on coupon paper. Flip it over and see what you may have been throwing away.

· Bring your own bags and save a few more cents. Some stores offer small rebates for saving the store, and the environment, on paper and plastic.

· Take advantage of double discount days.  Call your grocery store and find out if and when they offer double coupon savings.

 

Home News

Strategies for Savvy Sellers

If you're thinking about putting your home on the market this summer, you'll find yourself in good company and with some heavy competition. Increased foreclosures, short sales, and growing inventories will create some scorching summer deals. With this in mind, here are few seller strategies to keep you from getting burned this summer:

Small fixes, big impact – Don't be an as-is seller. You can really stand out in a crowd just by making some minor repairs and improvements to your house and property. Call us for a free copy of our 33 Ways to Sell Your Home Fast booklet to get started.

Stage your home – Curb appeal is important, but don't forget about the inside of your home as well. Home staging experts suggest not only getting rid of any clutter or bulky furniture and other items, they also suggest getting rid of items that personalize your home as well: photos, diplomas, heirlooms, to name just a few. Here's why: you want potential buyers to imagine themselves in their new home, not your old home. And the best way to do this is to create a blank canvas, a neutral environment where their minds are free to fill the spaces as they please.

 Get a professional – This is the wrong time and wrong market to go at it alone. If you're selling your home, hire a real estate agent, an experienced professional who knows how

to negotiate and how to strategically market and realistically price your home. We'll gladly refer you to the real estate professionals we work with on a regular basis.

Find the first-timers – First-time home buyers typically make up about 40% of the real estate market each year. The great thing about these buyers is that they're not usually flippers or investors looking for bottom-of-the-barrel foreclosure prices. They're looking for a home. By utilizing seller concessions and creative financing to market to this large group, you'll be far more successful. Plus, you won't have to lower the price of your home to make it happen. If you're not sure how special financing options can increase your marketing capability, give us a call.

 

Facts and Figures

Top Jobs for Your College Grad

If your college kids are still wavering over which major to select, maybe this list of top entry-level job salaries for the class of 2008 might help them to finally decide. Or if you have a recent graduate in the house who is weighing their options, here's a look at their earning potential. According to the National Association of Colleges and Employers, these numbers represent a 4% increase over last year's graduates with the same degrees.

Chemical Engineers - $63,749

Other Engineering fields- $56,336

Economics - $52,926

Nursing - $52,129

Chemistry - $52,125

Finance and Accounting -

$48,795 and $47,413

Business Administration/Management -

$43,823

Political Science/Government - $43,594

Marketing - $43,459

Human Resources - $40,250

History - $35,956

Communications - $35,196

English Language and Literature - $34,757

 

 Tax Documents: How Long Should You Keep Them?

Tax season is over, and what a relief! But what do you do with all of this paperwork? For years, the rule of thumb for individual tax filers has been to keep federal tax returns and all supporting documents for three full years. This is based on the principle that the IRS can audit your last three returns only if they believe that you made a good-faith error. However, be aware that the IRS can audit your returns for up to six years if they suspect that your income was misrepresented on any tax return by 25% or more. Therefore, to be completely safe, keep tax returns and supporting documents for seven years before shredding them. In addition, it's a good idea to keep a permanent copy of all 1040 forms from each year's return in one file.

Gas-saving Tips

With oil prices reaching record highs, the price of filling up the tank is becoming more and more challenging for many American households. Here are a few simple tips to help you save money at the pump this spring:

Use the octane level recommended by your owner's manual – According to the Federal Trade Commission,

"Using a higher-octane gas than the manufacturer recommends offers no benefit in most cases." So, as long as your engine's not knocking or pinging, you can save up to 40 cents a gallon in many cases simply by switching to lower-octane fuel. If you're convinced that super unleaded is the best choice for the life of your engine, use lower-octane fuel every other time you fill up just until peak gas prices drop to more manageable levels.

Slow down and plan ahead – In most cars, gas mileage decreases at speeds above 60 mph, so leave early and take the slow lane to save a few bucks on fuel costs. Also, you can avoid costly extra trips and traffic by carefully planning out your route in advance. Why not go to the grocery store on your way home from work? While you're there, use the store's ATM and avoid another trip to the bank.

Don't pay more for the same gas – Before you fill up, go online and look for consumer gas-saving sites like www.GasBuddy.com. Sites like these reveal which stations in your neighborhood have the lowest rates each day. Some even offer maps and directions! You'd be surprised at how much you can save sometimes at a gas station just three blocks away.

IRS Warns of Scammers:

Thanks to the Economic Stimulus Act of 2008, the US Treasury will send out rebate checks (not to be confused with tax refund checks) to more than 130 million households this spring. Eligible taxpayers will receive up to $600 ($1,200 for married couples), and an additional $300 for each eligible child younger than 17. However, with so much money floating around at one time, the IRS is warning taxpayers about new telephone and email scams designed to steal your stimulus rebate check and your identity.  With this in mind, there are two important things you need to know to avoid becoming a victim:

The IRS does not send unsolicited, tax account-related emails to taxpayers.

Scammers are using words like "rebate check" or "audit" in the subject lines to entice you to open their emails. Some of these emails have links to fake IRS sites. Don't fall for it.

1. There is no "rebate check" application of any kind.

The IRS relies solely on the 2007 tax return you've already filed to see if you qualify for a stimulus rebate check. Scammers are calling people asking for personal or tax information

over the phone claiming to be from the IRS or the Treasury Department. Don't give it up.

 

Increased Loan Limits This Year Only

The Economic Stimulus Act of 2008 did more than just authorize rebate checks. It also increased loan limits for Fannie Mae, Freddie Mac, and FHA-insured mortgages in many regions throughout the country. For those looking to purchase real estate in a "high-cost region," these loan limit increases could help you avoid the higher interest rates associated with jumbo loans. For current homeowners looking to refinance into a new "conforming loan," this could be your best chance in all of 2008. What's the catch? This legislation is a temporary tool designed to stimulate the economy and the housing market through 2008. This means qualifying mortgages or refinances under this plan must be in place before the end of the year. If you or someone you know would like more information on how to take advantage of this rare opportunity from the government, give us a call right away. We'll run the numbers and show you how much you can save.

 

The Federal Reserve and Inflation

Guiding the US Economy

President Woodrow Wilson signed into law the Federal Reserve Act in 1913, creating the Federal Reserve, the nation's central banking system. The Federal Reserve, or Fed, has also been called "the gatekeeper of the US economy" because of its unique power to influence US financial and credit markets.  Comprised of seven presidentially-appointed Board of Governors; the Federal Open Market Committee; 12 Federal Reserve Banks; and private U.S. banks and advisory councils, the Fed's mandate is "to promote sustainable growth, high levels of employment, stability of prices to help preserve the purchasing power of the dollar, and moderate long-term interest rates." In other words, the Fed's job is to regulate the nation's financial institutions while simultaneously keeping inflation in check.  To accomplish this important yet difficult task, the Fed studies economic indicators, creates, and then implements monetary policy - its specific plan of action or "target" for the economy - based on its findings. And while there are many tools at its disposal, the Fed has three main instruments of monetary policy: open market operations, interest rates, and reserve requirements, all of which can impact the mortgage industry.  Open market operations, the principal tool used by the Fed in its monetary policy, consist of the buying and selling of U.S. government and mortgage-backed securities (treasury bonds, notes, and bills) on the "open market." Basically, the Fed buys when it wants to increase the flow of money and credit, and sells when it wants to reduce it.  The Fed also controls two important interest rates: the discount rate and the fed funds rate. The discount rate is the interest rate charged by Federal Reserve Banks to commercial banks and other eligible financial institutions on short-term loans. The Federal Reserve Banks offer three discount window programs to depository institutions: primary credit, secondary credit, and seasonal credit, each with its own interest rate. Experts say that changes in the discount rate can serve as a clear announcement of a change in the Fed's monetary policy. These changes are important because they can impact lending rates for banks and interest rates for the open market. According to the Federal Reserve, the fed funds rate is the interest rate at which depository institutions lend balances at the Federal Reserve to other depository institutions overnight. Like the federal discount rate, the fed funds rate is another tool the Fed can use to control inflation and other interest rates. This interest rate is often a source of intense speculation whenever the Federal Open Market Committee meets, creating uncertainty that can move the financial markets as well.  Finally, think of reserve requirements, the last of the Fed's main monetary policy instruments, as the cash deposit requirement for a secured credit card. Reserve requirements represent the specific portion of deposits that banks are obligated by law to keep in non-interest-bearing funds at a Federal Reserve Bank, typically 10%.  Consequently, as banks attempt to stay as near to the reserve limit as possible without dropping below, they constantly lend money back and forth to each other. The Fed, interpreting signs of inflation in its economic indicators, may choose to reduce the amount of reserves available to banks by slowing the selling of securities. Generally, this causes interest rates to rise, the economy to slow, and inflation to slow with it. The reverse is generally true when indicators suggest a slowing economy or deflation.

 

The Federal Reserve and Mortgage Rates

Understanding What Causes Interest Rate Movement

Consumers are often misled when it comes to the subject of the Federal Reserve and how it affects mortgage interest rates. Often the media is the culprit causing the confusion. In the last few years, the Fed has taken action that caused mortgage interest rates to move in a direction other than what consumers expected, because the media provided weak reporting on the subject.  The Federal Reserve affects short-term interest rate maturities, the Fed Funds rate, and the Overnight Lending rate. These factors have a direct impact on the Prime rate. If you took only this into consideration, you may mistakenly conclude that changes made by the Fed will cause a similar movement in mortgage interest rates. However, mortgage interest rates are dictated by the trading of mortgage-backed securities, which trade on a daily basis. The real dynamic at the heart of interest rate movement is the relationship between stocks and bonds.  Stocks and bonds compete for the same investment dollar on a daily basis. There is literally only so much money to be invested. When the Federal Reserve feels that interest rates need to be decreased in an effort to stimulate the economy, this reduction in rates can often cause a stock market rally. When the market becomes bullish, the money to invest in stocks comes from the selling of mortgage-backed securities.  Unfortunately, selling mortgage-backed securities to fuel stock market rallies causes interest rates to go up, not down.  Historically, there have been many times when the Federal Reserve has increased interest rates. Stocks then sell off in fear that the increase will affect corporate profit margins, and the liquidated stock assets need a place to park until the next rally comes along. The safe haven is found in mortgage-backed securities which cause mortgage rates to drop.  The daily ebb and flow of money is what matters most when it comes to the movement of mortgage interest rates. I make it a point to continuously monitor interest rates for my clients, and advise them of opportunities to manage their mortgage debt at a better rate. This is the foundation of my business model as a Trusted Advisor.