Cash Is King For Second Homes

Certainly buyers with cash, vs a mortgage, have always had somewhat of an edge when negotiating with property sellers. This is particularly true for second and investment homes. The current difficult mortgage environment makes cash deals even more desirable. Why would a seller want to risk having their offer fall through due to the buyers' inability to secure a mortgage?

SmartMoney magazine has a very interesting article in the June, 2011, issue on why cash is especially important in purchasing 2nd homes. This article is on the SmartMoney.com website... here.

Ten Key Factors When Applying for a Mortgage Loan

Most 'mere mortals' don't apply for home mortgages very often. Generally, for second home buyers, you've applied for mortgages before, but it may have been years ago. Anyway, they are all a little different. Since home prices are an order (or 2 or 3) of magnitude higher than most other large purchases, they need to be approached with care. Your credit-worthiness becomes a major factor. So what are the most important factors that need to be considered before you apply for that mortgage?

I found a great article on Dun & Bradstreet's AllBusiness.com website that should help in preparing for the trip to see the mortgage banker. A few of the factors need some time to resolve if you've made a few credit maneuvers lately. Check out the article... Here.

Second-Home Owners - Likely "Out of Luck"

The Federal government seems to want to help just about everyone, except second home owners. Read the story on the Wall Street Journal's MarketWatch website.

The Home Valuation Code of Conduct

The Home Valuation Code of Conduct (HVCC) sprang out of the belief that, at least partly, the fault of the credit crises lies on the coercion of appraisers, by banks, to value homes higher than the houses warrant. The HVCC sets up a new layer of middlemen who will be immune from pressure from the banks. Appraisers will work for these middlemen.

Some feel that the cure is worse than the disease, causing harm to the appraisal industry and drive many appraisers out of the system. This article is from the Appraisal Press.

Home Ownership - Tax 'Advantages'

I've been working on my taxes the last few evenings and have wondered where the 'good old days' went, when I had a simple W2 to tell me what I made the prior year. Well, the good news that remains is that owning a home still provides tax advantages.

The primary tax advantage of owning a home is the mortgage interest deduction, which can add thousands of dollars to your purchasing power, every year! As good as it sounds, the mortgage interest deduction is just one of several tax perks of owning a home. There are some of the other tax deductions and advantages that are available only to homeowners. Go to HGTV's FrontDoor.com for a good article on maximizing the benefits of home ownership.

Pres. Obama's Housing Plan for Responsible Homeowners

It looks like President Obama's housing plan has a 'benefit' for the responsible homeowner (one who's continued to pay their mortgage payments on-time in spite of the realities of home value deterioration). The plan was carefully engineered to help only those 'responsible homeowners' who need help the most. Read the details in this CNBC.com article.

I have my own 'stimulus plan' for anyone Buying or Selling Outer Cape Cod real estate this spring. Call me for the details.

Tax Credit May Not Solve Housing Crisis

The Senate last night approved a $15,000 tax credit for home buyers as part of the Obama stimulus package. Some 'experts' call it a good start, but they believe that it won't do anything for the vast majority of potential home buyers. Go to the article on CNBC.com to read about the tax credit and why it may not be the solution our lawmakers are looking for.

Existing Home Sales - Up Significantly!!

In perhaps the best housing report of the great housing slump, existing home sales jumped 6.5 percent in December to a 4.740 million unit annual rate -- a gain that indicates lower mortgage rates are now boosting home sales. The jump cut nicely into supply on the market, now at 3.676 million homes and down nearly 12 percent from November and making for 9.3 months of supply at the current sales rate, down steeply from November's 11.2 months. Read the whole story on Bloomberg ... Here. Good news! Of note, the inventory in Eastham has dipped to under a year's worth of sales.

Check Your Credit History Year-Round, For Free

Statistics show that 80% of credit histories have at least one error. Most of them are minor and inconsequential but some can have an adverse effect on your credit score, often costing your thousands on mortgages and car loans. I believe credit bureaus were so lackadaisical about accuracy because it forced consumers to buy their credit reporting services. You wouldn't know there's an error unless you paid Equifax for a copy of your report. Fortunately, federal law now makes it possible for us to police our own records and force bureaus to correct them, all on their dime. Here's how:

The Fair Credit Reporting Act (FCRA) lets you request a free copy of your credit report from each bureau every twelve months at AnnualCreditReport.com. It's been mentioned numerous times before (along with all the scam sites looking to profit off it) but do you regularly check your credit history for errors?

It's no wonder consumers find an estimated 13 million inaccuracies on their credit reports each year.

From the Comsumerist at http://consumerist.com/

Mortgage Rates - Food for Thought

I looked this morning and the mortgage rates are at 5.25% for 30 yrs/no points. Look at what that means to the ‘affordability’ of an Eastham home.

For the same monthly payment (and a slightly increased down payment) you can buy 8% more house at 5.25% than at a 6% mortgage. This example is scalable, so go to my website’s Buyers Page and use your numbers in the mortgage calculator. Please note that the maximum mortgage currently offered at the 5.25% rate is $417K.

Food for thought.

Black Friday Mortgage Sale?

Call it a Black Friday sale or just the result of the economic meltdown, but mortgage rates have dropped to VERY attractive levels. I checked today and a local bank is offering a 30 yr, no points, mortgage rate of 5.5%. With the Outer Cape's inventories at good levels and low mortgage rates, now is the time to BUY!