March 2010

If You Are Counting On Taking Advantage of The Home Buyer’s Tax Credit, It Is Now Officially Crunch Time

It is looking like March Madness is about to give way to April If this was a basketball game, we would be getting close to the two minute mark. Desperation hasn’t set in yet, but you need to have a plan and you need to execute it quickly. There is just over a month left to find a home and get a contract together. You don’t have to close on the home by the end of April. You have until the end of June to get the financing together and close. So this is the time to take note of where you are and what still needs to be done to make sure you can take advantage of the tax credit. The Home Buyer’s Tax Credit is broken into two parts, a tax credit of $8,000 (or 10% of the purchase price if under $80,000) for qualified first time home…

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Chicago – FHA Keeping Down Payment at 3.5% – Other Changes Coming in April

FHA commissioner David Stevens made news last week when he announced that FHA would keep the minimum down payment at its current 3.5%. FHA critics have called for an increase in the minimum down payment up to 5%, but Commissioner Stevens told a congressional committee that raising the down payment would take out at least 300,000 buyers from the market, and mean a 40% reduction in loans, endangering the fragile housing recovery and putting the economy at risk. This statement wasn’t totally unexpected, but it is good news for anyone in the housing industry, and anyone who either owns a home or is in the market to buy a home. FHA mortgages are one of the most popular loans on the market, accounting for about 40% of the overall mortgage market. Most of the home buyers now are first time home buyers who don’t have a big down payment saved…

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Chicago Illinois Current Mortgage rates for Today, 02/12/2010

      This week has been a good example of how volatile rates can be without really changing. There was a lot of movement in the markets, and a good deal of information was released which rocked the markets, first in one direction, and then in the other. But in the end it all amounted to nothing. Rates ended in the same range as they started (but it is a very good range to be in). The wild swings happened all week, but look at the activity just on Friday. First thing in the morning, February retail sales were up by 0.3% when the market expected a decline of 0.2%. This is a big swing, and though these numbers are subject to revision and can swing wildly from month to month, the markets took this as a sign that the economy was back in recovery mode, so mortgage bonds…

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How Long Does it Take to Close on a Foreclosed Home? (And What Do You Need to Look Out For?)

The other day I wrote a post on how long it takes to close on a short sale, and the answer is that it depends, but it could take a long time. With the April deadline for the home buyer’s tax credit approaching fast, home buyers are wondering if they will have the same issues when they buy a foreclosed home. The tax credit has two components, first, the contract has to be written and accepted by the end of April, and second, the home has to close by the end of June. So the big question is, if you buy a home now, that is make an offer and get the property under contract, will you have enough time to get the financing wrapped up and the loan closed by the end of June. The answer here is yes, in most cases there will be plenty of time to…

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Chicago Illinois Current Mortgage Rates for Today, 03/08/2010

This is a slow week in the mortgage market, and rates are unchanged, hanging in at very attractive rates. The last several weeks mortgage rates have been flat as the proverbial pancake. The markets have moved daily, but the range has held steady. Over the past week the employment report came in better than expected, which hit rates for the day, but they quickly bounced back. The stock market is strong, and today marks the anniversary of the bottom of the market last year. Since then stocks have climbed about 62%. The Fed has spent almost all the money allocated for mortgage bonds, and the program ends at the end of the month, either way. So it is still curious why rates are so low. The consensus view was that rates would start to rise in the first quarter. So whether the low rates are here on borrowed time, or…

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Chicago Illinois Current Mortgage Rates for Today, 03/02/2010

Mortgage rates are flat today and holding their own even as we have a good day other states may be slightly different, give me a call in the stock market. The economic reports released over the last few days continue to be a mixed bag. Inflation continues to come in low, which is good news for keeping mortgage rates low, but there are also signs that the economy is gradually improving (or maybe a better description would be bottoming). In housing, residential spending was higher, a big surprise since this had been down for 9 months in a row, The inventory of homes on the market continued to rise, so no one expects a real pick up in new construction until the supply of homes stabilizes. Mortgage bonds continue to trade near the best part of their range, but the consensus is still that rates are likely to rise. Here…

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How Long Does it Take to Close on a Short Sale?

The purchase market is suddenly hot here in the Chicago area, and one of the big reasons is because buyers are lining up to buy in time to take advantage of the home buyer’s tax credit. Home buyers have until the end of April to get their new home under contract, and they have until the end of June to close. So there should be plenty of time to find a home, get a contract and close by the end of June, right? Maybe. But it depends. A major part of the market is now made up of distressed properties, that is, short sales and foreclosures. A lot of home buyers (especially first time home buyers) are focusing on these homes because buying distressed properties can often mean you are buying at a bargain price. Foreclosed properties are homes the bank has already taken back. They are vacant, boarded up…

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