Discover little known facts about building wealth, buying a home, interest rates and more
This advice can save you thousands of dollars
Posted on 22nd April, 2009 by Janet French
It’s Financial Literacy Month. And to long with this, please read this perfect quote to think about as you go through this very changing period of time.
“What is” is always shifting. Be aware of the shift in order to create the life I want.
Please take a moment to watch my SHORT, yes it’s true, it’s only 1:56 mins, video
Posted on 26th March, 2009 by Janet French
It’s really nice to finally hear some good news on the home front. Sales of new single-family homes jumped 4.7 percent from January to February, the Commerce Department reported today. And interest rates are hitting all time lows since 1971.
But…Better compared to what?
What you are NOT hearing is that there is STILL a lot of volatility in the market. Now you may be aware of this but it’s important to keep that in perspective and definitely within your focus, especially when you are advising your clients on the right steps to take over the next few years. I couldn’t believe it, this morning on one of the major news channels, I actually heard the newscaster say that interest rates hit an all time low today of 4.375%! I couldn’t believe what I was hearing. Over the last 2 days interest rates have gone up .125% each day and 2 days ago we were on average at 4.75% for a conforming 30 year fixed loan, $417,000 or less. Take care who you get your information from.
So how does the volatility play out?…
Posted on 10th March, 2009 by Janet French
So the question is, do you qualify for the any of the new mortgage programs?
Since last week, I have been contacted repeatedly by clients, friends and family wanting to know if they qualify for any of the mortgage relief programs that have been signed into law over the past few weeks.
More details have been released by Fannie Mae and Freddie Mac on how they will handle refinance transactions authorized by the Home Affordable Refinance program. The complete details of both programs can be found by accessing the program guides from Fannie Mae and Freddie Mac, but I will point out some of the highlights below to help answer your questions.
Lenders and investors are in a holding pattern as they determine if and when and how they will accept these transactions. Even though this legislation has passed - they are not all required to participate. In all cases loans will have to be refinanced with the existing owner of the loan today. Meaning, if Fannie Mae is the owner of your loan, the loan must be delivered to Fannie Mae and underwritten according to their guidelines. The same is true for Freddie Mac.
So how do you know if your loan is owned by Fannie or Freddie?
You have the ability to do this by contacting your loan servicer (company that sends you your mortgage statement) and asking…or you can do this by using the links below. If you need help, I can submit the information for you, simply send me a copy of your current mortgage statement. Note that your property address must be entered exactly as the agency has it on file, or it may not be found (ie: Rd or Road? St or Street?
Let’s look at the guidelines for both Fannie Mae and Freddie Mac and some of the key factors I see that will impact or enhance your ability to participate. Even though these are some of the highlights, you can also read more detailed guidelines on your own.
One key point to remember is that these are the guides from the Freddie and Fannie. And just as participation in the programs is voluntary, individual lenders and servicers may choose to implement constraints that deviate from the guidelines on their own.
Posted on 19th February, 2009 by Janet French
RISMEDIA, February 19, 2009-(MCT/RISMedia)-President Barack Obama rolled out a bold $75 billion, three-part plan Wednesday to halt the soaring rate of mortgage foreclosures nationwide, one that seeks to encourage refinancing of homes now worth less than their mortgages and provides incentives for lenders to lower the debt load on struggling homeowners. The Homeowner Stability Initiative, which Obama unveiled in Phoenix, seeks to address one of the triggers of the global financial crisis: the 2.3 million U.S. foreclosures last year that are protracting the housing crisis and helping to drive down home prices across the nation.
The Homeowner Stability Initiative, which Obama unveiled in Phoenix, seeks to address one of the triggers of the global financial crisis: the 2.3 million U.S. foreclosures last year that are protracting the housing crisis and helping to drive down home prices across the nation.
Specifically, the Obama plan seeks to provide low-cost refinancing for as many as 5 million Americans. It seeks to help delinquent or at-risk borrowers get their mortgages modified so that no more than 31 percent of their income is tied up in their mortgages. And it provides financial incentives to lenders and even a new insurance program to promote more mortgage modifications.
Like the failed efforts under the Bush administration, however, the Obama plan doesn’t compel banks and other lenders to modify troubled mortgages. Instead, it provides a menu of incentives that may or may not prove sufficient.
“This is not just the treasury secretary going into the room and asking people to do the right thing,” said a senior Treasury official, speaking on the condition of anonymity to speak more freely. “This is the first time there has really been a systemic incentive strategy for them (lenders).”
Banks joined two prior voluntary efforts during the Bush administration _ Hope for Homeowners and the Federal Housing Administration’s FHA Secure _ but these efforts have resulted in relatively few mortgage modifications.
Now they’ll have a stick waved at them if they don’t comply with the subsidy plan. It will come in the form of Obama’s support for legislation pending in Congress that would allow bankruptcy court judges to modify the terms of a mortgage.
That’s forbidden right now, and banks and other lending institutions fiercely oppose what they call “cram down” legislation, warning that it’ll bring uncertainty for lenders, who will respond by restricting mortgage lending.
Banks may soon have to choose between the lesser of two evils. They could either modify loans - with a subsidy - to provide lower lending rates, and lose what they might have made from the higher lending rate over the life of the loan. Or they can do nothing and run the risk that a homeowner could file for bankruptcy and then have a judge order new loan terms that allow the borrower to stay in the home - and pay the lender less money.
The president’s plan also offers payments to mortgage servicers, who collect mortgage payments on behalf of investors who own the mortgages originally issued by banks but were sold into a secondary market. Servicers apparently would be offered a payment for modification on par with what they would collect in the case of foreclosure.
Posted on 18th February, 2009 by Kurtis Kooiman
February 17, 2009Just signed and sealed…a $787 Billion Stimulus Plan made up of tax cuts and spending programs aims at reviving the US economy. Although the package was scaled down from nearly $1 Trillion, it still stands as the largest anti-recession effort since World War II.
Home owners and potential homebuyers stand to gain from key provisions in this stimulus plan. Here is what we know as of today…
First-time homebuyers who purchase homes from the start of the year until the end of November 2009 may be eligible for the lower of an $8,000 or 10% of the value of the home tax credit. Remember a tax credit is very different than a tax deduction – a tax credit is equivalent to money in your hand, as opposed to a tax deduction which only reduces your taxable income.
The tax credit starts phasing out for couples with incomes above $150,000 and single filers with incomes above $75,000. Buyers will have to repay the credit if they sell their homes within three years.
Tax Incentives to Spur Energy Savings and Green Jobs — This provision is designed to help promote energy-efficient investments in homes by extending and expanding tax credits through 2010 for purchases such as new furnaces, energy-efficient windows and doors, or insulation.
Landmark Energy Savings — This provision provides $5 Billion for energy efficient improvements for more than one million modest-income homes through weatherization. According to some estimates, this can help modest-income families save an average of $350 a year on heating and air conditioning bills. Read the rest of this entry »
Posted on 12th February, 2009 by Kurtis Kooiman
Can you believe that financial literacy is still not taught at most schools? Some high schools give our teenagers lessons on how to write checks and balance their checkbooks but I’m sure you would agree that in these times that is not enough.As you know I am a big believer in financial education. In fact, one of my my top priorities is giving my clients the practical financial skills they need to navigate the rough financial waters that we are experiencing now. That is why I am excited to introduce you to an event designed to give young adults (age 14 to 28) real world money & business lessons. This event is called Money XLive and it is designed to teach real world money and business skills in a MTV award show style environment that today’s youth relate to.
Silverstar Finance and The Society for Financial Awareness has set aside a block of 50 tickets for our clients and we have made special arrangements so your entire family can attend this event complimentary.
The event will include appearances by: Wilmer Valderrama (event emcee), Cris Judd, Matt Leinart, Jesse Billauer, John Salley and video appearances by Brian Deegan, Travis Pastrana, Chuck Liddell, Christina Milian and a host of others. Money XLive is being held at The Grove of Anaheim on Feb 27th and doors open at 2:30 and the event will conclude at 7:00. Read the rest of this entry »
Posted on 23rd January, 2009 by Janet French
First off, what is happening with interest rates and reduced yield spread premium? 15 years ago it wasn’t uncommon to see nice buy-up schedules on many products, with an increased yield spread premium being offered in return for a higher interest rate. But then along came the refinancing frenzy of 1993 and 1998, followed by the grand daddy refi bonanza of 2002 to 2003. As home loan rates dropped ever lower over the years, you can imagine how the investors felt as they watched loans turn around to be paid off in a relatively short time, as increasingly lower rates made it attractive for clients to refinance, sometimes multiple times in a year. These losses on loans were very costly to lenders.
So…after learning their lesson many times over…the lenders got smarter and started to reduce the amount of par premiums, followed by making those premiums more expensive by demanding even higher rates in return for a smaller premium and have now nearly eliminated that premium pricing which cost them so much money in the past.
Read the rest of this entry »
Posted on 14th January, 2009 by Your Silverstar Team
It was raised last year to $729,750 in designated high-cost areas under the Economic Stimulus Act of 2008 — has been a continued source of confusion because it varies throughout our region.
And for 2009 it changed again…
Under the previous federal rules it was simple. Fannie Mae and Freddie Mac couldn’t buy loans larger than $417,000, the limit for conforming mortgages. Any loan greater than that was considered a riskier jumbo, or nonconforming, loan, and borrowers paid a higher interest rate on it.
For 2009, the revised maximum conforming limit is $625,500. And that’s what it is for the Los Angeles-Long Beach-Santa Ana metropolitan area. But for the Santa Barbara-Santa Maria-Goleta area it’s $603,750; for Oxnard-Thousand Oaks-Ventura, $598,000; and for San Diego-Carlsbad-San Marcos, $546,250.
Does this matter to consumers? Don’t most lenders charge a higher interest rate on loans above the $417,000 limit that applies everywhere else anyway? Or does it just mean that at least money (even at higher rates) is available to borrowers seeking larger amounts?
Read the rest of this entry »
Posted on 9th January, 2009 by admin
For some reason, when we can’t see the future clearly, we tend to see things as becoming worse rather than better. However, the optimistic attitude that gave us the world we now live in is what is needed to take advantage of the fantastic opportunities all the despair and market uncertainty is generating today.
Posted on 9th January, 2009 by Janet French
I was in the process of recording a video this week but I’m loosing my voice and the video was just not turning out so great.
So ….Continuing on from “Why Houses Make Great Investments”…that I wrote to you about a couple of weeks ago.
What a GREAT environment we’re in for buying real estate….yep that’s right, I said “Great“. I’m sure you’ve read or heard by now how fantastic interest rates are, hopefully you read my email from last week. =) And…you know that homes are on sale and investment earnings are down.
People who are self-employed who will not be getting a pension from their employer, myself included, need do some extra planning to put money aside for our retirement. And now, especially in today’s income and investment environment, it’s difficult to have enough money to save, right?!
Alright so even if you aren’t self-employed and you’re expecting a pension, how secure is it? Probably not something you are going to rely on solely, right?
So what are your alternatives. Although there are many, real estate happens to be an exce
llent choice. Think about your own Estate / Retirement plan, you do have one right? Use this simple form below to start thinking about how rental income can help your bottom line.
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