tom-beaty.com views on real estate

After dropping for 4 weeks in a row the 30 year rate rose slightly this week moving from 4.98 to 5.01. The 15 year rose from 4.39 to 4.40. The 5 and 1 year arms rose from 4.25 to 4.27 (5 year arm) and 4.29 to 4.22 (1 year arm). Below are rates from the weeks from Jan 07, 2010 to Feb 04, 2010

Feb 04, 2010
30-fixed 5.01 15-fixed 4.40 5 ARM 4.27 1 ARM 4.22

Jan 28, 2010
30-fixed 4.98 15-fixed 4.39 5 ARM 4.25 1 ARM 4.29

Jan 21, 2010
30-fixed 4.99 15-fixed 4.40 5 ARM 4.27 1 ARM 4.32

Jan 14, 2010
30-fixed 5.06 15-fixed 4.45 5 ARM 4.32 1 ARM 4.39

Jan 07, 2010
30-fixed 5.09 15-fixed 4.50 5 ARM 4.44 1 ARM 4.31

Aug 06, 2009
30-fixed 5.22 15-fixed 4.63 5 ARM 4.73 1 ARM 4.78

All in all we saw hardly any movement with any of the rates this week. And although rates fell the previous 4 weeks we saw very little movement as well. Since January 7, 2010 the 30 year rate has stayed in the range of 4.98 to 5.09. This is in contrast with the last year when rates have seen enormous volatility. Basically in the last month there has been no huge news that would affect the mortgage industry. For the time being, the economy doesn’t seem to be improving or getting much worse.

In addition to rates it is interesting to analyze mortgage payments. We took a today’s rates and translated it into a 200k loan we also did the same thing with rates from January, 21 2010 and rates from August, 06 2009 (six months ago).

Feb 04
30-year $1074.86
15-year $1519.78
5-year ARM $986.22
1-year ARM $980.37

Jan 21
30-year $1072.42
15-year $1519.78
5-year ARM $986.22
1-year ARM $992.09

Aug 06
30-year $1100.69
15-year $1543.3
5-year ARM $1040.88
1-year ARM $1046.91

As we can see the movement has been minimal in the last 2 weeks. In fact a mortgage for a 200k loan would only be 2.43 more a month today than 2 weeks ago. Six months ago a mortgage would have been $25.83 more a month.

So what is our advice to people looking for a mortgage in the next few months? The difference between a 30 year rate and the 5 and 1 year arm has grown over the last few months which makes them more enticing. But I would still recommend a 30 year mortgage. Basically, rates are near historic lows and it makes the most sense to lock in as long as possible. The second question is where are rates heading. Over the next few weeks it’s hard to tell. They might move down a little more if the economy continues to do poorly. But on the other hand sometime between now and the next 12 months the expectation is that rates are going to rise substantially. So there is probably a large risk for waiting to lock into a rate and there is little upside since its doubtful rates will drop substantially.

Ki writes about mortgage interest rates. His site covers Austin Texas real estate. In addition his site has a few mortgage widgets and a mortgage calculator widget along with a blog covering Austin Texas real estate.

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With interest rates near all-time lows, it is tempting for many to refinance their home loans. Before you find yourself in the throes of refinancing, you’ll need to determine several things.

* Are payments for PMI included in your current home loan schedule? If have you paid, at least, 20 percent on the principal of your mortgage, your lender is required by law to remove the PMI.
* Do you owe more on your home than it is worth? If you probably will not be approved for a refinance loan. The exception is the Home Affordable refinance program. If you want more information, do a search on the Internet for the program.

There are many reasons homeowners want to refinance their mortgages, and some might be to:

* Lower your monthly payments.
* Lower your interest rate.
* Combine unsecured debt to lower your interest rate on credit cards.
* Get cash out by loaning more than the balance due to upgrade your home, cover an emergency medical situation or pay for college for the kids.
* Refinance an adjustable rate mortgage (ARM) that is coming due.
* Remove the PMI from your loan, which will definitely lower your payments.

Keep in mind that if your goal in refinancing is either to obtain a lower interest rate or lower your monthly payments, you will restart the clock on your mortgage. When applying for a new loan, you need to decide the preferred duration of your new home loan. The most common are 10-, 15-, 20- or 30-year fixed rate notes. The fewer years on the note, the more you will save. You can save .7 percent or more on your new note. That can add up to thousands of dollars over the life of your loan.

All things considered, do you still want to refinance? If you can save money, there’s no reason not to. Interest rates have remained steady in the 4 percent range for some time now. That will save you loads over the period of a 30-year loan, even if your original mortgage was only a couple of points higher. You will have to pay closing costs, though. Depending on who you are lending from, there may also be administration fees or other fees required. A down payment will, most likely, be required, too.

If you want to avoid a down payment, you may want to consider getting a Fannie Mae or Freddie Mac loan for refinancing. You typically don’t have to come up with a down payment with either. Regardless of where you obtain your home loan, be sure to request all fees that will be included in the note. Get all fees in writing from each lender prior to making your decision. Before making the final decision to refinance, add up all new fees and closings. Divide that by the monthly amount you will save on your new loan. This will tell you how many months it will take you to recoup the charges for your new loan. Ideally, you want them paid off within a year.

If you will be living in the home much longer than it will take you to recoup the charges, then it will be to your advantage to refinance. Your final task will be to check out the lender’s reputation. Does it have any industry memberships or certifications? If so, check with the organization as to the business’ reputation. Also with the Better Business Bureau (BBB) and your state’s attorney general’s office. Compare all the company reputations, fees and interest rates. Select the one that stands out from the rest.

Ki’s works and lives in Austin Texas. His website brings a free search of Austin homes for sale to future homebuyers. Additionally, there is detailed information about Austin real estate. His website also has information on mortgage rate trends and a Austin real estate blog.

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Are you using the Internet to help you in your search for a new home? While the Internet is an excellent resource for browsing through listings and learning more about available properties, it can also be difficult to navigate and even misleading at times. This is because there are very few regulations surrounding Internet Websites, which means it is quite easy to come across information that is outdated, inaccurate or downright untrue. Here are a few of the most common reasons why searching for a home on the Internet can be quite difficult at times.

Outdated Information

One of the biggest frustrations with searching for a home on the Internet is that the information can very easily be outdated. While the Internet makes it possible for agents to post homes for sale on the day they are listed, the information may remain on the Internet for years after the home is sold. So, don’t automatically assume that the dream home you discovered online is still for sale, as this simply may not be the case.

False Information

Unfortunately, some Websites will compile and post links to homes that they know have been sold or even to rentals or other properties that aren’t actually for sale. These sites aren’t actually interested in trying to help you find a home. Rather, they are attempting to get more traffic to the site so they can make money through advertisements or by other means that are not directly related to real estate. Therefore, you should be sure to only use reputable Websites when looking at homes for sale. Otherwise, you may waste a whole lot of your time as you browse through homes that aren’t even on the market.

Foreclosure Properties

Another problem with searching online for a home is that some Web sites will list properties on which a notice of default has been filed. This does not necessarily mean that the home is or sale or that it will even go into foreclosure. So, don’t get your hopes up if you think you have found your dream home until after you have talked to your agent and confirmed the availability of the home.

Incorrect Information

One of the great benefits to browsing through online listings is that these listings typically provide many more photos than what you will find in newspaper listings. In addition, you can generally read more information about the home you are considering. On the downside, Internet listings are subject to human error. Therefore, some of the information you find on the Website may be incorrect. As such, you shouldn’t dismiss a home based entirely on the information you read. At the same time, don’t get your hopes up until you get all of the information from your real estate agent.

Simply put, the Internet is a great resource for viewing pictures and obtaining more information about homes that are for sale. At the same time, you need to remember that the Internet is only one of many tools available to you and that communication with your agent is essential in order to make certain the home you have found really is what you are looking for.

Ryan Lynch is part of the top notch marketing team for an Austin real estate company. They specialize in Lake Travis Homes and West Austin Homes and they are ready to help you.

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When it comes to taking out a loan for a home purchase, there are several questions that you should be prepared to ask. Since many homebuyers are first time buyers, however, most people do not know to ask anything beyond how much the interest rate will be and how much the monthly payments will be. In reality, there are several other things you should ask about and even insist upon before you take on a loan from a lender. Here’s a look at a few questions you should ask that could potentially save you hundreds or even thousands of dollars.

Will You Guarantee Your GFE?

The GFE, or Good Faith Estimate, is an estimate that the lender makes regarding the cost of the fees and other expenses associated with taking out your mortgage loan. Although lenders are required to provide a GFE to mortgage loan borrowers, they are not required to guarantee that number. As such, the estimate really doesn’t have much meaning behind it. Therefore, in order to make certain you are not mislead about these fees, you should ask the lender to put a guarantee on this estimate. If the lender refuses to stand behind its GFE, it is probably in your best interest to choose a different lender.

Does the Loan Include a Prepayment Penalty?

Many people don’t realize that mortgage loans commonly include a prepayment penalty. This means you will be assessed a few if you choose to pay your loan off early. While some states do not allow lenders to assess prepayment penalties, it is always in your best interest to ask. If the lender does charge a prepayment fee, ask the terms of the penalty. With some lenders, for example, you only have to pay the fee if you pay off the loan within the first two to five years. Regardless of the terms, you should also be sure to ask how much the penalty will be as well as whether or not the penalty will be assessed if you choose to refinance your loan at a later date.

What is the Yield Spread Premium?

If you are negotiating your loan terms through a lender representative, part of your terms may include paying a yield spread premium, or YSP. The YSP, which is the amount of money the representative receives as a commission, will be disclosed in your settlement statement. If you are unhappy with the amount of the YSP, you should negotiate this fee upfront rather than waiting until closing time.

Can You Approve Your Loans In-House

Before your mortgage loan is approved, it is sent to a professional known as an underwriter. The underwriter is responsible for reviewing your file and approving or rejecting the loan, as well as determining the conditions of the loan. Lenders with in house underwriters will be able to process your loan much ore quickly than those who farm the job out to contractors. Whether the underwriting is performed in house or not, you need to coordinate the approval date with the lender so you can set up a closing date for finalizing your loan.

Ryan Lynch is part of the top notch marketing team for an Austin
mortgage lender and a group of Austin Realtors that proudly serve the
capitol city. Their office is conveniently
located in West Austin and they are ready to help.

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Did you know that real estate commissions are negotiable? Many people assume that they cannot negotiate these fees, but the reality is that it is perfectly acceptable to ask your agent to lower his or her commission fee. Before you start the negotiating process, however, it is important for you to know more about how commissions are earned. This way, you will be better able to determine a fee that is fair to both you and the agent.

Determining the Split

One part of commission process involves agreeing upon a split. Since only real estate brokers can receive a commission, the agents who work for them must agree to receive a certain percentage of the commission. While some brokers simply split the commission 50/50 with the selling agent, others will pay a higher split to their more productive agents. Furthermore, if the listing broker and the selling broker are different, the commission may need to be divided between the listing side as well as the selling side before it is shared with the agent.

To understand the process better, it is helpful to look at an example. If an agent sells a home for $200,000 and receives a commission of 7%, for example, 4% of that commission may go to a listing broker while 3% goes to a selling broker. This means the selling broker receives $6,000 while the listing broker receives $8,000. The agent who sells the home may receive half of the selling broker’s commission. While this would come to $3,000, the agent may also need to pay a franchise fee of 8%. This means the total earned commission is down to $2,760. From that, the agent must also pay overhead expenses while also putting money away to pay for taxes and to put toward social security benefits. When all is said and done, the total “profit” from that sale will be slightly more than $1,300. If an agent only sells one or two homes per month, this doesn’t amount to a very attractive annual salary.

Starting the Negotiation Process

Now that you understand how the commission process works, it is time to let the negotiating begin. There are several bargaining chips that you can use to help encourage an agent to come down on the commission. Some of these include:

* Asking the agent to represent you in the sell of your home as well as the purchase of your new home, as the agent will be able to earn a commission off of both transactions.
* Agree to sell your home and to buy your home from the same agency.
* Offer to provide the agent with referrals that will help generate more business down the road.
* In states where it is legal, allow the agent to provide dual agency. With dual agency, the agent represents both the buyer and the seller, which means the agent receives both the listing and the selling commission.
* Offer to list multiple homes with the same agent. If you have several properties, an agent may be willing to reduce the commission if you offer to provide that agent with a number of exclusive listings.
* Shop around and find out the fees of other agents. If another agent offers comparable experience, knowledge and services, but charges a lower commission, use this as a negotiating chip if you would rather work with another agent who charges a higher commission.

Ryan Lynch is part of the top notch marketing team for an Austin
mortgage lender and a group of Austin Realtors that proudly serve the
capitol city. Their office is conveniently
located in West Austin and they are ready to help.

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Are you trying to decide whether or not you are ready to purchase a home? While there are certainly many advantages to homeownership, there are potential disadvantages as well. Furthermore, there are certain advantages associated with renting a home or apartment as well. Therefore, it is essential to explore the pros and cons of both homeownership and rental in order to determine which path is right for you. To that end, here is a look at a few things you should consider when trying to determine whether or not you are ready to become a homeowner.

Your Credit Report

One of the first things you should consider when trying to determine whether or not you are ready to be a homeowner is your credit report. If you have a credit score of less than 620, it is probably in your best interest to wait before you make a purchase. Otherwise, you will not qualify for a good interest rate and you may actually get taken advantage of by a predatory lender. Therefore, if you really have your heart set on becoming a homeowner, you should take some time to work on fixing your credit rating first.

Your Debt Ratio

Your debt ratio will also have an impact on the types of loans you are qualified to receive. In fact, if you have a high debt ratio, you may not even qualify to receive a loan. Or, if you do qualify for a loan, you may find yourself in a very precarious position that will likely lead to bankruptcy down the road. If your debt ratio is more than 50%, you should definitely take some time to focus on paying down your debts before you consider taking on more debt in the form of a mortgage.

Your Job

Your job is another factor that you should consider before purchasing a home. If your job is not stable, you may find yourself facing foreclosure shortly after you make your purchase. Or, if there is a good chance that you will be relocated to a different city within the next few years, it is probably in your best interest to continue renting until then. Otherwise, you will lose money when you sell your home.

Maintenance Issues

One of the perks to renting a home or apartment is the fact that you don’t have to worry about taking care of maintenance issues. Once you become a homeowner, on the other hand, you will need to take care of maintenance issues and will need to make any necessary repairs. If you are unable to make the repairs or perform the maintenance yourself, you will need to hire someone to do the job for you. Obviously, this can be a very costly endeavor. Therefore, you need to be sure you are ready to take on these added responsibilities before you make a purchase.

By taking all of these factors into consideration, you will be better capable of determining if you are emotionally, mentally and financially ready to make a purchase. By making certain you are truly prepared for the responsibilities of homeownership, you will have the greatest chance of finding and keeping a home that is affordable and that suits your needs.

Ryan Lynch is part of the top notch marketing team for an Austin real estate company. They specialize in Lake Travis Homes and West Austin Homes and they are ready to help you.

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If you are considering getting a short sale, you may be a bit concerned about the steps that are involved in the process. After all, if you are like most homeowners, you have never gone through this process before. As such, you have no clue what to expect. Although the exact steps in your shore sale process will very according to your individual situation, the basic steps are as follows.

Step #1: Contact the Lender

The first step in going forward with a short sale is to contact the lender. Unfortunately, you might have to do quite a bit of calling around before you find the right person to talk to, but the time you spend to actually get in touch with a supervisor will be well worth the effort.

Step #2: Submit a Letter of Authorization

In order to get the lender to disclose your information to the real estate agent that you are working with as well as other individuals who will be involved with the sell, you will need to submit a letter of authorization. This letter gives the lender permission to provide information to certain individuals who are involved with the process. The following information needs to be included in your letter:

* The address of the property
* The loan reference number
* Your name
* The date
* Your agent’s name and contact information

Step #3: Create a Preliminary Net Sheet

A preliminary net sheet is an estimate of the closing statement that includes the sale price you expect as well as the costs associated with the sale. Information such as outstanding payments that are due, late fees, the unpaid balance amount and any relevant real estate commissions should also be included in the net sheet.

Step #4: Write a Hardship Letter

Your hardship letter explains how you got into the financial situation you are currently facing and makes a plea to the lender to accept an amount that is less than the full payment. The sadder your letter, the better chance you will have of getting the lender to agree to a short sale.

Step #5: Prove Your Income and Assets

Next, you need to disclose information regarding your current financial situation, including providing information about your assets. This includes disclosing information about all of the following:

* Cash
* Money market accounts
* Negotiable instruments
* Real estate
* Savings accounts
* Stocks and bonds

Obviously, if you have a significant amount of assets, the lender isn’t likely to agree to a lesser payment than what you owe.

Step #6: Obtain Copies of Bank Statements

You will also need to obtain copies of your bank statements and, if your statements show that you recently made any large cash withdrawals or wrote an unusual number of checks, you will need to explain each of those items to the lender.

Step #7: Complete a Comparative Market Analysis

If one of the reasons for your troubles is the fact that your property value has fallen, submitting a comparative market analysis will help prove this claim. Your real estate agent should be able to help you create this analysis, which should include the prices of similar homes that are active on the market as well as information regarding pending sales and those homes that have been sold in the past six months.

Step #8: Create a Purchase Agreement and a Listing Agreement

When you reach an agreement with a buyer, you will need to submit a copy of the purchase agreement as well as the listing agreement to the lender. If all went well, the lender should agree to the purchase, though the lender may deny payment for items such as providing a termite inspection or a home protection plan.

Ryan Lynch is part of the top notch marketing team for an Austin
mortgage lender and a group of Austin Realtors that proudly serve the
capitol city. Their office is conveniently
located in West Austin and they are ready to help.

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Different professions and various fields have its own language, terms and rules. Most often, people who are trying to enter the business of real estate may get intimidated - and probably, you may be one of those people who have wanted to get into this kind of field. It is quite normal to feel a little awkward at first. Who wouldn’t be? During your first few days, you may easily get intimidated, and even feel like you are in a different dimension. The jargon that is being used in real estate are fairly overwhelming.

Understanding the jargon used in real estate will help you give a clearer thought on how the field of real estate works. You may ask, “Is it really needed to go through all these terms and understand them one by one?” Yes, indeed. It is greatly needed. Without getting to comprehend every single word, how are you supposed to understand the world of real estate? It totally makes sense, right? With that, here is a list of some jargon used, and some explanations that may help you give a better understanding how everything works.

In real estate, there are brokers, agents, house buyers and house sellers. Basically, a seller or a buyer will have to contact someone to make sure that the whole buying and selling process will run smoothly - and that person is called a real estate agent. An agent arranges the meeting. He/she is the one responsible for negotiating the price, as well as giving either the seller or buyer good deals. A broker on the other hand, is a person contacted by an investor. In general, either an investor or someone who wants to buy a house for personal use contacts an agent or a broker.

But, don’t think that once the price has already been agreed upon, the deal is closed. It doesn’t work that way. Real estate lawyers and accounting officers will now enter the scene. They are the ones responsible for determining how many terms should the house be paid. These people will also give you some information on the real value of the property, as well as the down payment that needs to be arranged.

After which, a background check can be conducted to determine whether the buyer is able to afford the property. This is to ensure that the seller will not be left empty handed but also to help the buyer not to foresee any debt issues in the near future. Home inspectors may also be needed at this point in time. A house inspector is normally hired by the home buyer to check the possible risks that the property has. The inspector will have to check the materials used, the construction of the house, electrical outlets, plumbing and such.

Once everything is settled with the bank, seller, buyer and the agency the papers shall be processed. This may take some time. It may even need to be approved by the court depending on the country or state where you live in. Once the deal is already closed, both parties including the agency have to sign all these papers, reflecting all the fees that the bank may charge.

Looking to buy or sell a home in the Bothell, WA area? Check out Bothell Real Estate.

The Barton Creek neighborhood in Austin, Texas, boasts stunning views in all directions. The quaint neighborhood, which is just west of Westlake Hills and east of Bee Cave, offers country style living just a short drive from downtown. With traffic, the commute is about 10 minutes.

For prospective home buyers looking in the Barton Creek area, you’ll find the majority of real estate is single family homes, with a few condos and upscale apartment complexes spread throughout. Home prices begin around $500,000, with the more luxurious homes starting at $1 million. Many offer spacious floor plans, with a median size of 5,000 square feet.

The community is also known for its green initiatives, as it’s nestled in an environmentally sensitive area of Texas Hill Country. Homeowners are encouraged to use native landscaping and minimize the use of chemical pesticides and fertilizers in their lawn.

The Barton Creek district is an ideal place to raise a family, as it’s home to several highly ranked schools. Oak Hill Elementary, O Henry Middle School, and Austin High School are all a part of the Austin Independent School District and are located here. There are also four private schools within the neighborhood, or just a short drive away.

There are four golf courses in the neighborhood, all of which were designed by professional golfers. These challenging courses, including Fazio Foothills, Fazio Canyons, Parmer Lakeside, and Crenshaw Cliffside, boast perfectly manicured courses and are ranked as one of the “Top 50 Courses in Texas,” by Dallas News.

The award-winning Barton Creek Resort and Spa offers luxurious spa treatments, a well-equipped fitness center, and indoor and outdoor pools. A membership to the spa will also give you access to 11 lighted tennis courts and an 18-hole miniature golf course.

For those who love to shop, the Barton Creek Square Mall is the largest shopping area in the neighborhood. As you stroll through the mall, you’ll find large stores like Macy’s and Dillard’s alongside smaller specialty stores such as Armani Exchange and Express.

And, when it’s time for a bite to eat, there are several options available. Hill Country Dining, located in the Barton Creek Resort, is known for its extensive wine list and sophisticated dishes. There are also several restaurants along Highway 360 that serve cuisines ranging from Thai to authentic Italian.

For a quaint and relaxing atmosphere just a short drive from downtown, be sure to check out the Barton Creek Neighborhood.

This article was provided by Brian Talley of Regent Property Group LLC, an expert of our Austin Realtors providing information about Austin luxury homes for sale and about homes for sale in Barton Creek located in west Austin Texas.

What do you, the average investor, think is going to be the next big revenue boom? “People who see jobs evaporating in other companies and other industries tend to ratchet back their own spending, economists say-an understandable response, but one that could drive down the local economy even further,” according to previous reporting by Seattle Times.

“Not only do consumers feel overall economic conditions have grown more dire,” as stated earlier this year by Lynn Franco, Director of The Conference Board’s Consumer Research Center, “but just as disconcerting, they anticipate no improvement in conditions over the next six months.”

In response, consumers are seeking new ways to boost and safeguard their retirement portfolios. Twenty-year low property rates have novice and seasoned investors rethinking traditional investment strategies.

Companies are springing up by the dozens, vying for new and seasoned investors’ Real Estate dollars. Many companies are also focused gaining long-term investors so they can manage these accounts and accrue extensive commissions from these clients.

But why pay hefty commissions? Why extend more money to the open and often jilted hands on Wall Street? Why give more of your hard-earned money to others who do not produce extra-special results? Sadly, many people still think they cannot invest themselves or they simply do not know they are paying these exorbitant fees.

But guess what? You do not have to anymore. You can keep earning real interest on your investments and not have to worry about paying commissions to those who have not earned them. Invest your IRA in Real Estate.

Real Estate provides a lucrative income via rental income while adding a long-term strategic asset to your portfolio that is not subject to the savage up-and-down roller coaster of the stock market.
It is always important to remember, Real Estate investing is not a get-rich-quick scheme or a fast way to retirement, but with the deepest discounted Real Estate in decades, retirement is much closer with a cash-flowing and appreciating asset anchoring your retirement portfolio.

And investing your IRA in Real Estate provides a great way to utilize already taxed or tax-deferred investments to buy the property without having to come up with a cash down payment.

So what is the answer to the next big revenue boom? It is self-directed IRA invested Real Estate, appreciation, cash flowing, and retirement building, all in one significantly safer investment than the stock market. Be on the lookout for the cheapest Real Estate in our generation and an opportunity for you too to invest your IRA in Real Estate!

Paul R. Whitacre is a managing partner at WealthyIRA.com.
The passion of WealthyIRA is to teach everyone to invest their IRAs and 401(k)s in the deepest discounted Real Estate in decades. Check out how to invest your IRA or 401k in Real Estate at WealthyIRA.com Blog.. Follow us on Twitter at WealthyIRA. Email Paul here.

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