Cash Is King in the Housing Market

Current homeowners looking to downsize, upsize or relocate are increasingly using more cash to purchase  their next home.

Despite near record low mortgage rates, homebuyers are finding it advantageous, in the current housing  market to shop with cash. Low returns on money deposited in banks as well as mortgage approval hassles also are pushing homebuyers to consider all cash or mostly cash transactions.


Using cash is a definite way to get discounts when buying distressed properties such as foreclosures or short sales and it's unlikely that the proportion of distressed property will be declining anytime soon.
An enormous number of foreclosures remain in the pipeline and the artificial suppression of that inventory by mortgage servicers has kept the proportion of distressed property lower than it otherwise would be.
Hassles with slow underwriting, accentuated by tardy appraisals, cause some homebuyers to give up on mortgages.

It takes about 60 days to close a ‘non-troubled’ FHA loan. About 30 days longer than it had prior to the housing bubble bursting. Other government insured Fannie Mae and Freddie Mac loans are taking about 45-60 days. Appraisals are also holding things up.

These are the average prices reportedly paid for various types of properties in Florida over the past 12 months :

                              Foreclosure
                    Damaged        Move In Ready               Short Sale                  Non Distressed

Florida         $92,765         $166,155                         $148,716                      $248,575

National       $105,247        $187,415                         $198,054                     $257,338



Looking at these statistics makes you wonder why more buyers and sellers aren't taking advantage of the current opportunities to buy and sell short sales. Many properties that are foreclosed could have been sold earlier as a short sale. In many instances faulty processing of the short sale file by either the borrowers agents or the lenders servicer still make them difficult to embrace. Lack of acceptance by 2nd mortgage holders also contributes to the inability to close a short sale. Typically if Fannie Mae or Freddie Mac are the 1st mortgage holder they will allow a small percentage of the 2nd mortgage balance to that lender. If the 2nd demands more the deal will likely die, opening the door again to foreclosure. Closing a short sale is not impossible. Sometimes the stars align. It requires diligence, communication and patience. Three virtues that actually work.

If you have any questions please call me directly at 561-306-6736 or email me.  I'll be glad to help in any way that I can.

Why Struggling Homeowners Get No Help

The administrative mistakes of the largest lenders is surpassed only by their arrogance.

With all the rhetoric spewed on American homeowners by banks and politicians about "continued efforts" to help struggling homeowners you would think that the now depressingly familiar stories of lenders unwilling to help would have stopped. People who deal with mortgage lenders and borrowers hoping for help know that the horror stories continue.


Big banks like J.P.Morgan Chase, Bank of America & Wells Fargo are realizing unprecedented profits.They measure their assets in trillions of dollars. Helping struggling homeowners is not a priority. They make no mistake about that. Bank of America & Wells Fargo have announced that they are cutting 30,0000 jobs. A move likely designed to appease shareholders and likely detrimental to anyone hoping that they may get help through a mortgage modification or some other "foreclosure alternative" they've applied for.

Together the George W.Bush and Obama administration spent over a trillion dollars of taxpayer money to bail out big banks and corporations with no requirement to utilize any portion of that taxpayer money to help struggling homeowners. No "quid pro quo" as it's called. No responsibility or obligation to help hundreds of thousands of struggling homeowners while these same corporations continue to enjoy tremendous profits. The struggle to hold big banks accountable is somehow delegated to state and local governments. Most of these fights are insignificant. They are merely a nuisance to big banks because of their size and financial clout. NY City officials consider banking as important to them as the auto industry is to Detroit.

The Obama administrations parade of mortgage relief programs have failed miserably, largely due to the lack of any requirement by lenders to adhere to them. Any government program that has been touted by the administration as mortgage relief attaches financial incentives for banks. Like a reward for a good grade. It's like asking banks to choose between record profits or "atta boy"

What does it take for the American people to wake up? What would it take for the American public to say "no more"? I struggle everyday with these questions and I always come away with this. I know that the answers are in the American public, not the politicians, not the power mongers and not the corporate giants feeding off taxpayer money. Unless we Americans regain control of "our government" we will continue to spend days and nights struggling for answers in our own lives.

George Sinacori
GES Real Estate, LLC

Mortgage & Foreclosure Fraud Crackdown

From foreclosure frauds to subprime shenanigans, mortgage fraud is a growing crime threat that is hurting homeowners, businesses, and the national economy. From industry insiders to straw buyers, nearly 500 people have been arrested in a nationwide mortgage fraud takedown that reflects the coordinated efforts of law enforcement to address the growing problem of crime in the housing industry. The FBI has initiated it's largest mortgage fraud takedown to date with "Operation Stolen Dreams"

“Mortgage fraud ruins lives, destroys families, and devastates whole communities,” Attorney General Eric Holder said at a press conference to announce the results of “Operation Stolen Dreams.” Launched on March 1, 2010, the multi-agency initiative has led to a total of 485 arrests. More than 330 convictions have been obtained, and nearly $11 million has been recovered. Losses from a variety of fraud schemes are estimated to exceed $2 billion. The FBI is currently pursuing more than 3,000 additional mortgage fraud cases, almost double the number from last fiscal year.

The numbers are staggering and even more surprising given the difficulties of legit buyers in obtaining any mortgage financing.




George Sinacori
GES Real Estate, LLC

Short Sale or Foreclosure Seem To Be The Only Choice

Home foreclosures are accelerating. More than a year after the government launched HAMP (Home Affordable Mortgage Prevention) a program to aid financially distressed borrowers, many more are losing their homes.


Modifications now look like nothing more than a band aid, temporarily stopping the bleeding for a few. Eventually just about everyone who owns a home will either need to sell or will decide that it's beneficial to just walk. People are beginning to ask "is it worth sacrificing health and well being" in order to avoid losing a house. As the housing market continues to struggle, more and more are deciding that it's time to move on. After all if the market isn't going to recover any time soon it may be time for folks to begin considering their own personal recovery.

With foreclosures again on the rise many are attempting to move a property through a short sale whereby a seller will sell for less than what is owed on the mortgage. A tedious and complicated process because the first mortgage lender will decide how much they'll accept after all outstanding debts against the property are considered, including any HELOC or 2nd mortgage. A short sale requires that the property be listed with a Realtor and required documents must be submitted to the lender.

Foreclosure filings in March totaled 367,056, jumping nearly 19 percent from February and up almost 8 percent from March 2009, according to RealtyTrac.
It was the highest monthly total since January 2005, when RealtyTrac began issuing its reports.
Lenders repossessed nearly 260,000 properties in the first quarter – a record for any quarter, and a 35 percent increase from a year earlier, RealtyTrac said.


More than a year after the Obama administration launched its foreclosure prevention program, only 230,000 homeowners have gotten permanent modifications with lower monthly mortgage payments, (according to a report Wednesday by the Treasury Department) while more than 1.4 million homeowners received offers for trial modifications, which typically last for three months. A band aid.

The Home Affordable Modification Program (HAMP) is lagging well behind the pace of the crisis, and most homeowners in financial trouble will never receive help, according to a report this week by a congressional oversight panel.
For every borrower who avoided foreclosure through the federal program last year, another 10 families lost their homes, that report said.

For more info or for a complimentary consult please call or email me at 561-306-6736 or rebuygeorge@yahoo.com

Federal Mortgage Campaign Set To Expire

According to Freddie Mac rates on mortgages dropped below 5% again last week, just a few weeks before a government program designed to help keep rates low is scheduled to end.

The average rate on a 30 year fixed rate mortgage was 4.97% last week or down from 5.05% a week earlier. Rates had been as low as 4.71% in December of 2009 but have hovered close to 5% since then being held pretty much in check by a Federal Reserve program hoping to spur more home buying by lowering the cost of obtaining a loan.

The Fed set aside $1.25 trillion to buy mortgage backed securities. That campaign is scheduled to end or expire on March 31. Questions remain as to how effective the program has been. Most home buyers did not see any significant change in the cost of obtaining a new mortgage, although guidelines for lenders making mortgages have changed.

The other part of the equation of course, to encourage more lending by banks into the mortgage markets has not seemed to work at all. Data provided by the National Association of Realtors shows that pending sales, (homes in contract) of existing homes dropped 7.6% in January from December. That is the lowest reading since April 2009 and a disappointment. That index had declined for 2 of the past 3 months and was widely expected to improve.

Some market analysts think that mortgage rates may begin to rise once the Federal program ends later this month. This may be a good indication that potential home buyers and sellers should get into a contract and lock rates now.

If you or someone you know have been considering buying or selling a home in Southeast Florida please call me directly at 561-306-6736 or drop me an email at rebuygeorge@yahoo.com.

For more info on buying and selling visit www.ges-realty.com . It's easy to use and totally free. What could be better than free in this economy?

FHA Policy Changes Require More Skin In the Game

January 21, 2010. Proposed Federal Housing Authority (FHA) policy changes this year will require "more skin in the game from borrowers" according to FHA Commissioner David Stevens in a statement released yesterday on the HUD website.

Following is an outline of these changes:

- New loan to value and credit score requirements. Borrowers with a credit score below 580 will be required to put a minimum 10% down. Borrowers with a credit score of 580 or above will still be allowed the traditional 3.5% down payment.

- Upfront mortgage insurance premium (MIP) will increase to 2.25% (presently it is 1.75% of the loan amount).

- Additionally FHA will pursue conditional legislative authority to increase the annual MIP according to the financial health of FHA: "triggered either by a decline in the capital ratio below the two percent requirement, or by a certification by the Secretary that the higher cap is necessary".

- Allowable seller concessions or seller contributions to borrowers closing costs etc. will be reduced from 6% to a maximum of 3%.

Commissioner Stevens went on to say that he hopes to implement all changes by early summer after going through the appropriate channels and notification process. He also states that these policy changes will not disrupt the housing market and will contribute to it's future sustainability.
To read the complete statement go to hud.gov.

Considering the increase in capital outlay for even the best FHA borrower any prospective borrowers should act now, or at least before these changes are implemented. If you have questions about FHA insured financing or just buying a home in todays market please call me directly at 561-306-6736 or email rebuygeorge@yahoo.com

To search for available FHA homes in Southeast Florida please visit my website at
ges-realty.com

Changes To Mortgage Originators Compensation Ahead

Radical changes in loan officer pay practices laid out by the Federal Reserve Board in late August mean that major alterations in how the industry works could be around the corner.

“Yield-spread premiums [YSPs create a conflict of interest between the loan originator and consumer,” the Fed states in its rule proposal. A 120-day public comment period is slated to end Dec. 25, 2009.

In its 195-page rule rewrite, the Fed asserts that consumers don’t know what they’re paying loan originators, and as a result they are often being taken advantage of. “Creditors’ payments to mortgage brokers are not transparent to consumers and are potentially unfair to them,” adds the Fed.

Payments from lenders to brokers often include a YSP, which results in a higher rate for the borrower. “Yield-spread premiums … present a significant risk of economic injury to consumers,” notes the Fed in its rule proposal. “Currently, consumers typically are not aware of the practice or do not understand its implications and can't effectively negotiate its use.”

The Fed adds, “The Board’s recent consumer testing suggests that many consumers do not shop for mortgages and often rely on one broker or lender because of their trust in the relationship.” By not shopping a consumer may not get a competetive rate, according to the Fed.
Under the proposal, consumers still could choose a higher rate loan if they want to finance closing costs. However, the Fed rule would “prohibit any person from basing a loan originator’s compensation on the loan’s rate or terms.”

For more on mortage loans, and current rates contact me directly at 561-306-6736 or rebuygeorge@yahoo.com

Visit my website at http://www.ges-realty.com to search for properties anywhere in SE Florida

Lenders Fail to Modify Homeowner Loans

Politics and corporate greed continue to eat away at the hearts and wallets of American homeowners and the American dream.



According to Bankrate.com just 2000 homeowners have received loan modifications beyond the typical 3 month trial period nationally in the 7 months since the administration issued it's guidelines to lenders in order to help homeowners avoid or avert foreclosure. That equates to approximately 4 successful modifications per month per state. Lenders will typically stall short sale efforts simply because they can't see beyond dollars and cents. If the Bankrate.com information is correct they have danced around and away from folks asking for modification assistance and the Fed isn't concerned.



The Obama administration's claims of 500,000 homeowners being helped may be little more than political grandstanding again at the expense of homeowners who have been brought to their knees financially leaving many without any other recourse but to eventually walk away and try starting over somehow.



If you need help or have question regarding todays real estate and mortgage markets in SE Florida please call me directly 561-306-6736 or email your questions to rebuygeorge@yahoo.com Find more information about the SE Florida Real Estate market at GES-Realty.com

Is Housing Nearing Bottom?

May 2, 2009 - As the housing market slowly moves closer to bottoming, rates on 30 year fixed rate mortgages tied a record low this past week.
Average rates on the 30 year fixed rate mortgages fell to 4.78%. A year ago average rates were 6.06%. A considerable difference for any borrower. A new 30 year fixed rate mortgage taken today could mean a savings of $165 monthly or close to $2000 a year.

Inventories are dropping as homes have become more affordable. Recently inventories of single family homes month to month in certain areas of South Florida that I like to watch closely have declined by 30% or more.As availability declines and prices begin to stabilize, lower more affordable mortgages are attracting more buyers.

Some REO or bank foreclosure inventories still not showing on the market could stall the momentum as lenders again begin to process and place foreclosed inventories on the market. It's my belief that once a bottom is recognized these lenders will indeed flood the market with inventories, creating another round of competition between sellers, albeit on a more even playing field, where pricing is key.

If rates remain low and prices bottom, affordability would than be more related to individual incomes, credit and employment stability. Housing may very well be near bottom. The underlying question may now be - will other economic conditions recover or lag behind housing?

Stimulus - American Recovery??

Now that "Stimulus" has become an everyday word we, the good tax paying, corporate rescuing, stimulus funding Americans find ourselves preoccupied wondering.... "what's in it ?" Even more important ..."what's in it for me ?" Relatively very little is the answer. But than as long as they throw us a bone here and there, we should be humbled and awe inspired at the abilities these great and powerful decision makers have in figuring all this complicated stuff out.

First let me say that they haven't even begun to figure anything out. I have lots of issues with the handling of the Economic Tsunami fiasco being called the "American Recovery & Reinvestment Act of 2009"

Providing banks with billions of dollars in (taxpayers) bailout money with no requirement as to how that money could be used should never have happened. But it did. Not addressing the core or root of the problem, which is housing is still another short sighted, arrogant, ignorant message that our fearless politicos unashamedly send. The message is simple, when it comes to housing banks are more important than individual homeowners.

I tend to look at economic problems in business as if they were a barrel of water with a hole in the bottom. Unless you plug the hole you'll never refill the barrel. In order to plug the hole we need to address housing which requires addressing property values as they relate to mortgages. Unless lenders agree to modify each and every mortgage to current market value the barrel bottom will remain unplugged. Marking down mortgages to market value could quickly stabilize housing. People could confidently sell a property at market without "permission" to reduce the amount owed from a bank allowing sellers to sell with their heads above water. Banks and lenders could concentrate on loaning money to borrowers rather than foreclosing on properties. Many buyers who have gone back to the sidelines after a horrific experience with a short sale attempt would come back into the market and begin buying again. This time directly from sellers. Buyers and sellers today are not market makers. In what there is of a housing market banks and lenders are today's market makers. In order for any free market to thrive and survive it must be comprised of buyers and sellers. When you take them out of the equation (one or the other) there is no market. Stabilizing mortgage values in housing will stimulate spending even further. Any homeowner having or anticipating problems going forward would feel much more confident spending if they weren't so preoccupied with the unknowns. Sellers of homes would again become buyers and stimulate new construction. Buyers of homes buy furniture, TV's, appliances, equipment. Corporations hire when consumers spend, consumers spend when they are confident in the future, housing has always been the key and from my perspective it remains the key. Plug the hole in the barrel before you throw more water into it or it will just drain out of the barrel as it has since the first stimulus attempt in 2008 under the previous administration. And the subsequent $700 billion failed corporate bailout last year. You can't fill a leaky barrel. Fix housing, reset mortgages to today's market value and we can restore the economy.

First Time Homebuyer Tax Credit
One of the items in the "new" Stimulus revisits a failed attempt from the previous plan. Last years legislation approved a First Time Homebuyer Tax Credit up to $7500 with certain restrictions. This shortsighted piece of legislative work required that the credit be paid back to the government, albeit interest free, over a prorated period to the IRS and in full if you sold before it was fully paid back.

The "new revised edition" of First Time Homebuyer Tax Credit allows up to an $8,000. tax credit or 10% of the value with no requirement to repay. Provisions come with income levels that begin to phase out for individuals earning over $75,000 and married couples filing jointly earning more than $150,000. It is available to First Time Homebuyers (anyone who has not owned a home in the past 3 years) buying a home between Jan. 1, 2009 and Dec. 1, 2009 . The credit is forfeited if the property is sold within the first 3 years of ownership.

"Hooray" they got it right this time but my goodness why do they have to fail before the light goes on. Is this going to help? The last measure was an absolute failure and this one is doomed as well until the correlation between home values and outstanding mortgages are seriously attacked.

I'd be remiss if I failed to mention a couple of other "perks" from the stimulus, unrelated to housing that you may benefit from.

- In 2009 you are eligible to receive a tax credit up to $400 per individual and up to $800 per married couple based on 6.2% of your earned income. This fades once incomes of $75K for individuals or $150K for couples are reached. You are eligible whether or not you have a Federal tax liability. This according to a summary of the stimulus bill that the Senate Finance and House Ways and Means committees released.

- If you're fortunate enough to be able to buy a "new" car this year the taxes both State and Federal are deductible. Stipulations are on income limitations.

- Unemployment benefits are not taxed up to the first $2400 of benefits you receive.

- Health Insurance. If you get fired, your company is required to allow you to pay to keep your health insurance, generally for up to 18 months. Now, the federal government will subsidize 65 percent of the premium for up to nine months. You need to have been forced out of your job between Sept. 1, 2008, and Dec. 31, 2009. There are also income limitations in the year you receive the subsidy.

Here's a link to the text of the Legislation which at this writing had not been signed into law by the President.

I've attempted to list some of the items that you and I may directly benefit from as the hundreds of billion of dollars are dispersed in yet another attempt by a clueless Congress, Senate & Administration to "get our economy back on track."

Please call me directly with any questions relating to mortgages, home values, loan modification, refinancing, or buying or selling a property.

George Sinacori

561-306-6736

877-566-2430

rebuygeorge@yahoo.com

http://www.ges-realty.com/

Todays Mortgage Rates

Todays Fixed Rate Mortgage
Current mortgage rates are much more attractive than I can ever recall. A qualified borrower may now be able to obtain a 30 year fixed rate mortgage for less than 5%. Todays rate is an incredible 4.87%. It's amazing.

Anyone with any type of adjustable rate mortgage taken years back should be taking a hard look into reducing or solidifying that mortgage payment for the long term. Considering that many of us will now be forced to remain in our current homes for many years to come a low fixed rate mortgage makes sense. Selling a home today is difficult. Market prices are below what most are willing or even able to accept. Homes selling are either foreclosed properties being discounted by lenders or short sale properties with a lenders agreement to accept less than what they are owed on the current mortgage. These sales make todays market and consequently todays market price. Buyers willing to take advantage of todays rates and prices are looking to foreclosed homes first. Unless a private seller is able to compete with these market prices thier home understandably will not sell.

Alternatively a homeowner may consider a loan modification. Many lenders today are willing to reduce the interest and monthly payments on mortgages that they currently hold in order to keep a good borrower in that home. A loan modification makes sense if your mortgage is higher than the market price of your home. In other words, as a result of the decline in home values and your lenders overzealous lending practices in the past, you are upside down in your home mortgage. Loan modification and refinance require similar documentation although they are completely different. For example with a refinance you can shop for a new rate, term and lender. A loan modification must be negotiated and provided by your current lender. In a modification the lender decides what to offer you, if anything and you than have some time to decide if you'll accept the newly presented terms. If you choose to accept, a new payment plan will begin on a predetermined date. Rarely will a lender reduce the principal amount owed on a loan. More likely the rate is lowered below current fixed rates for a period of 3 or 5 years reducing the monthly payment accordingly.

Refinancing until the market mends may be the best next step. A new fixed rate loan at todays historically low rates may reduce your present or future monthly payments considerably. The monthly savings on a $100,000 mortgage at 7% refinanced to 5% is approximately $125 monthly. On a $200,000 mortgage the savings is $257 monthly. That's more than $3000. a year. If you were to invest that same $3000 recieving a nominal 3% annual return will give you approximately $16,400 after 5 years. That makes sense. Lowering monthly payments in order to save money in a very tough economy is not just good, it's a giant step in the right direction.

Call me directly with any questions you have on refinancing, buying or selling a home, loan modification, or current mortgage rates and terms. I'll be glad to help. 561-306-6736.

How Mortgage Relief Options Work

Loan Modification - Short Sale - Deed In Lieu - Forbearance

Forbearance -Temporarily suspends all or a portion of your monthly payment, followed by a formal plan using another option listed here to return your account to a current status. Your hardship is expected to be short term in nature, or you know that you will be able to pay a particular amount on a specific future date and continue with your payments from that point forward.

Repayment Plan - Adds a portion of past due amounts to your regular monthly payment until your account is current. Your hardship is expected to be short term in nature, and may even be over, and you have the ability to make an increased payment for a short period of time.


Partial Claim - Returns your account to a current status using funds from your mortgage insurer or guarantor. Your mortgage is insured and your hardship is short term. Subject to mortgage insurer or guarantor approval.

Modification - Makes your payment more affordable by permanently changing one or more of the terms of your original note and mortgage. Delinquent amounts can sometimes be added back into the loan balance. You can afford a reasonable payment that is less than your current payment and/or you don't have enough cash to bring your loan current.

Assumption - Transfers title to a credit-qualified buyer, even if your loan is non-assumable. You can not make any payment but want to avoid foreclosure.

Short Sale - Allows you to sell your home for its current value, even if it is worth less than what you owe when you can not make the payments but want to avoid foreclosure.

Deed-in-Lieu of Foreclosure - Transfers title to the property back to lender to satisfy the amount you owe. You can not make the payment but want to avoid foreclosure and you have had your home listed for sale for at least 90 days. This option is reserved for the most extreme situations and is subject to investor approval.

For more information or help with these options please call me directly at 561-306-6736 or send an email to rebuygeorge@yahoo.com .

Is Great Credit Still Important ?

It may seem like an odd topic for discussion or consideration at a time in our economy when overextended credit has gotten us into such a mess. If you've had a difficult time getting a loan lately it can be unsettling although there may be some comfort in knowing that your not alone. Because of the condition of the markets, getting a loan will become increasingly more difficult.

Our credit scores reflect our behavior as borrowers. You may not consider your credit score as important as it was a few years ago being that it's so difficult to get any these days. Credit and credit worthiness still matter for many reasons. You may eventually need a new mortgage because you're relocating for employment or for any number of reasons. You may need your good credit to send a child to college. You may need it to continue using credit cards because your income has fallen or disappeared for awhile. Your good credit may help get you through the difficult, unexpected times that seem to inevitably sprout up on us from time to time. We can't always know when our credit may be a factor but if a need to borrow becomes apparent it could be too late to repair any credit problems.

Our credit is something that we still have control over. We can see our credit history and credit report in the privacy of our own homes by going to annualcreditreport.com . A copy of your FICO score which is the combined credit rating from 3 reporting agencies is available also at myfico.com . Currently the median FICO score is 720 but that number may very well change in coming months. As more people default on loans the average or median score will get lower.

If your considering a new mortgage the rule of thumb now is the larger the down payment the better the rate as long as your credit is good. If you don't have a large down payment there are still good loans available. FHA insured loans require as little as 3% down even if your credit score is below average. It would be great if these conditions for lower scoring people were available for other types of loans. Until they are our credit score is crucial to our survival and we can protect it, improve it and preserve it.

Check your credit report for any possible errors. Look for accounts you may not recognize and report any discrepancy to the credit bureau. They could be an indication of identity theft. Report any incorrect late payment recordings or other derogatory errors that could negatively affect your score. They should respond to your requests in no more than 30 days. Preserving our credit may seem like an exercise now but at least it's something that we each still have complete control of.

For more information on FHA or conventional mortgage requirements or for the latest available mortgage programs and rates call or email George Sinacori 561-306-6736. Visit GES Realty online or any of my websites to search for a home in Southeast Florida.