Foreclosures in 2011 declined 34 percent which is the lowest levels since 2007, according to RealtyTrac.

"The number of units in foreclosure declined to 1,887,777, or one out of 69 homes, from 2,529,261, or one out of 44. Nevada, Arizona and California had the highest foreclosure rates." according to Business Insider. Colorado's rate of foreclosure was slightly lower than these states at 3,498 or one out of every 620 units.

RealtyTrac CEO Brandon Moore said that foreclosure activity will most likely go up as states with judicial processes begin to resolve issues with lenders.

"There were strong signs in the second half of 2011 that lenders are finally beginning to push through some of the delayed foreclosures in select local markets." said Moore. "We expect that trend to continue this year, boosting foreclosure activity for 2012 higher than it was in 2011, though still below the peak of 2010."

Business Insider reports that foreclosures fell in December to a 49 month low, down 20 percent, year over year.

Read the full Foreclosure Marketing Report at RealtyTrac

Read more at Business Insider . 

photo credit: merfam

Posted in Mortgage, National News

Officials announced revisions to the HARP Program that should help more homeowners who are underwater on their mortgages and looking to refinance. The changes get rid of the previous cap for homeowners who owe up to 125 percent of their home's value. Now homeowners who are deeper in debt can access this program.  "The new changes could potentially affect 11 million Americans." says U.S. News. 

The new guidelines have been named "HARP 2.0" and it will be up to each lender to implement the new rules, says Polyana da Costa at BankRate.com.  It's estimated that only about 1 million homeowners will actually qualify for refinancing.

Usually business is slow during the holidays, but Inquiries for refinancing are up at banks across the U.S. Last week, the 30 year fixed rate fell to 4.23 percent; a year ago, it was 4.58 percent. 

"More than 1 million borrowers are expected to benefit from HARP 2.0, according to the FHFA. But many in the mortgage industry remain skeptical about that expectation and say much will depend on how lenders respond to the new guidelines." writes da Costa.

Experts say that if you are looking to refinance during the holiday season, expect delays due to higher volumes and scheduled vacations.  "Be prepared for longer lock periods (this may come at the expense of a slightly higher interest rate), and be sure to let your mortgage professional know of any travel plans that may be in place during the loan processing," says David Kuiper, a mortgage planner in Michigan.

Read more at BankRate.com

Image from TotalMortgage.com

Posted in Mortgage, Real Estate Market Conditions

According to the National Association of Realtors, the typical U.S. homebuyer spent less and borrowed less in 2011.  Jann Swanson, of Mortgage Daily News, reported on the findings of the NAR's annual Profile of Home Buyers and Sellers released last week. 

The survey is a profile of recent homebuyers and the statistics include age, income levels, type of dwelling purchased, square footage, etc.

The typical first time buyer is 31 with an income of $62,400 who bought a 1,570 square foot home for $155,000 with a monthly payment of $794.

"The typical repeat buyer was 53 years old, earned $96,600 (up from a $87,000 reported last year) and purchased a 2,100 square foot home for $219,500 with a median payment of $1,006." reports Swanson.

The types of dwellings purchased were:  Single Family homes - 37%, condo's - 9%, Townhouse-8 percent, other types - 6 percent.

The median down payment was a full percentage point higher in 2011 than a year ago which is an indicator of tighter loan requirements.   "Fifty-four percent of first-time buyers financed with a low-down payment FHA mortgage and 6 percent used the VA loan program which requires no down payment." said Swanson.

"Banks need to get back into the business of lending," said NAR vice president of research, Paul Bishop.  "Buying your first home has never been particularly easy but we normally would expect a stronger performance. The bar has been raised to qualify for a loan."  He said it's important to relax restrictions.  "Higher home sales would help create more jobs through related economic activity."

Married couples made up the highest percentage of homebuyers.  "Sixty-four percent of all buyers are married couples, 18 percent are single women, 10 percent single men, 7 percent unmarried couples and 1 percent other." reported NAR. "Last year 58 percent were married couples, 20 percent single women, 12 percent single men, 8 percent unmarried couples and 1 percent other."

Read more at NAR.

Posted in Mortgage, Real Estate Market Conditions

"Generally, it's more difficult to qualify for a loan now than it was a year ago," writes Dian Hymer for Inman News.

Banks have stricter guidelines and some qualified buyers can be turned down for seemingly illogical reasons.  A frank conversation with your lender can help you figure out where you stand in the loan approval process.

The bottom line is that "most conventional lenders require a 20-25 percent down payment, your credit score needs to be in the 700 range and you need to have verifiable income and cash reserves, in addition to down payment and closing costs." writes Hymer.

What to Do Before Negotiating on a Contract to Buy a Home:  

Plan ahead:  Find a reputable lender, ahead of time, to assist you.  "Closing the deal should be your primary goal," writes Hymer, "don't make your decision based on interest rates alone, a good track record counts for a lot."

Be Honest:  Make sure you disclose anything in your finances that might impact your loan qualification.  "A good loan agent or broker will be able to assess your financial situation and anticipate what you'll need to do to satisfy the underwriter." says Hymer.

The Appraisal is Key:  Hire an appraiser that is familiar with the area.  It needs to come in at or above the purchase price.

Jumbo Loans:  The conforming jumbo mortgage limit has dropped in most expensive housing markets but there are more options available now. Hymer says you can expect to pay 25 percent more for a 30-year fixed jumbo loan.

Cash Reserves:  Banks will look at your available cash reserves; your retirement account counts towards this.

A little advanced planning will help the mortgage approval go faster. 

Read the full story at Inman News.

photo credit: UGA College of Ag

Posted in Mortgage, Real Estate Market Conditions, Home Selling Services

Everyone uses debit cards these days. They are the new checks, but faster and easier.  Will they replace credit cards altogether?

"For those who use credit responsibly," writes Rich Mintzer on CardRatings.com. "credit cards are still king." You must use credit wisely and avoid getting too deep in debt.  Thirty percent of your FICO score is based on debt-to-income ratio so it's important to avoid late or missed payments and not carry big balances.

"Debit cards, since they draw from existing funds in your bank account, are more for convenience than for establishing financial trust," writes Mintzer, "and as such they aren't nearly as powerful a financial tool as a credit card."

Credit cards give you purchasing power, says Mintzer. "Credit cards allow you to make a large purchase, whether a major kitchen appliance or a down payment on a new car, even if the funds designated for such purchases will be forthcoming in your next paycheck."

Both debit and credit cards offer protection from fraud, but credit cards offer a federal mandate, limiting your liability in case of fraud or identity theft. Plus the fact that with a debit card, the funds are taken directly out of your account and will need to be refunded after the dispute is settled.

Credit card companies offer purchase protection that allows you to withhold payment if there is a problem with your purchase that can't be resolved through the merchant.  "By contacting the credit card company and disputing the charge, you can prompt an investigation that could potentially result in a refund." writes Mintzer.

Extended warranties are a perk when using a credit card.  "Both Visa and MasterCard offer purchase security policies good for 90 days after purchase, meaning that items are eligible for replacement, repair or reimbursement if damaged or stolen." says Mintzer.

Most hotels and rental car agencies require a credit card to reserve a room or car.  'Those (rental car agencies) that let you use a debit card to hold a car will place a hold on the card, typically freezing anywhere from $200 to $500 in your bank account." warns Mintzer.

Mintzer says that, despite the growing surge in debit card use, it's safe to say that the 181 million credit card holders in the United States, roughly 77 percent of the nation's adult population, according to the U.S. Census Bureau, will likely keep credit cards at the forefront of consumer spending power for years to come.

Read 7 Reasons to Choose Credit, not Debit at CardRatings.com.

photo credit: Daquella manera

Posted in Headlines, Mortgage