When I lived in Madison, WI I used to read The Onion every tme it came out - since it was distributed freely on the UW-Madison campus. It was the only way to live through the Clinton scandals - seriously. Some of the stuff they came up with during those years was truly classic.

Well now they have stuff online and even have videos and I go on their website from time to time to check things out. Here is one that was kind of thougth provoking for me. I guess the message of this is clear for business owners. Innovate or vegetate!

The Onion at its finest:

Historic 2018Blockbuster2019 Store Offers Glimpse Of How Movies Were Rented In The Past

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The East Vally Tribune reports that existing home sales increased compared to last year. According to the morning news, this is the first time since 2005 that the year over year (YOY) sales numbers have been positive. For Gilbert, there were 360 sales in April of 2008 compared to 330 in the same month last year, a 9% increase. The news is mixed though since median home prices have come down a bit over the same period.

Now, what I just said is just a paraphrase of what is being reported across newspapers and T.V. news. But in a Web 2.0 world, I’m also interested in what local real estate bloggers have to say with the same numbers. This is because most of the time local area agents have a better understanding of the market and can shed better light on these numbers than the so called “experts”. Below is a sampling of what I found in some prominent local real estate blogs discussing the good news.

The Phoenix Real Estate Guy (Jay Thompson) says:

Beginning of a recovery? One time blip? Who knows. One YOY data point does not a trend make. But sales seem to be picking up steam, foreclosures are creating affordability, and absorption rates are falling. All of this seems to indicate we may be bottoming.

AllPhoenixRealEstate.Com (Jonathan Dalton):

Lower prices can be expected since it is the bank owned home sector fueling the current real estate market. And as I’ve said at least a half-dozen times, that’s not necessarily a bad thing.

The biggest gem though comes from North Phoenix Agent (Heather Barr) who in the middle of April posted anecdotal evidence asking if the market was improving, some of her nuggets (which is being validated through improved numbers):

• I’ve also got 3 new buyers, money in hand, FICO score safely in the mid- to high-700’s, ready to buy this month
• My A/C guy is busier than he can keep up with, with new work based on home inspection findings
• His friend who does truss work for area builders, says he’s busy again after a 1-1/2 year lull
• A friend of mine who works for Pulte says their sales office is slammed; she’s working Saturdays again

So what does it all mean? It seems we’re getting our usual spring inventory increase. With an already bloated market full of too many under-improved and over-priced houses, this should be bad. But the good news it we seem to be selling it.

Way to go Heather. You nailed this one a month in advance.

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Tags: bloggers, phoenix, Real Estate
Categories: Bloggers, Phoenix, Real Estate
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With all the press FHA loans has garnered recently we have received quite a bit of inquiry on this government insured mortgage. We have been able to qualify most who have contacted us, however, we’ve had to disappoint a few. The crazy thing is the reason for denial wasn’t even something related to the borrower. It was entirely based on the property they were seeking to mortgage. While there are relatively few property related hurdles for single family homes, when it comes to condominiums and FHA it’s a different story entirely.

Basically, it boils down to the condo itself being FHA approved. So, if you are thinking of purchasing a condo or refinancing a mortgage on a condo, and would like to use the FHA loan program, the first thing you need to do is make sure it is FHA approved. The loan goes nowhere if the condo in question is not on the FHA approved list. To help you the HUD maintains a master list on its website, but to be double sure, I suggest contacting a FHA approved lender.

If you are curious about what qualifies a condo for FHA approval, the Mortgage Porter has written a fantastic post on this topic. Here are some of the requirements she highlights from the FHA guideline:

1. At least 51% of the total units in the project must be owner occupied.
2. At least 90% of the total units in the project have been sold.
3. No single entity owns more than 10% of the total units in the project.
4. The project, including common areas, is complete with no special assessments and no legal actions pending.
5. The owners association has a reserve plan and a reserve fund , separate from the operating account that is adequate to prevent deferred maintenance

Feel free to contact me if you have a particular property in mind and want to find out if it is FHA approved.

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Tags: Condo approved, FHA, Mortgages
Categories: FHA, Mortgages, Real Estate
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Regular readers of this blog know that even though this blog is focused on mortgages and home financing like a laser beam, I’ve had Jennifer Furrier contribute a few times. Jennifer is a professional organizer, and a very good one at that. The feedback from her customers is always amazing and her work ethic is legendary. That is why I’ve always thought she’d be a great addition to the blogging community.

Well, now it looks like she’s taken the plunge. Last week she e-mailed and and told me she’s set up a blog on professional organizing and I was elated to hear that. Her blog is called “Overcome the Overwhelm” and already has some really good nuggets on getting organized, improving productivity and living a stress-less life. I already know this is going to be an awesome blog, and that is because I know that Jen is an awesome professional organizer!

The only thing I can say at this point is “watch out”, to the other bloggers who focus on professional organizing. You guys now have some pretty tough competition coming your way. However, as a blogger I know it’s not all about competition, but also about building community and interaction and relationships. So, on that front Jennifer is going to make a great addition to the already mushrooming professional organizing blogosphere.

Head on over to Jennifer’s blog and leave a note!

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Tags: Jennifer Furrier, professional organizer
Categories: Bloggers, Blogging, Phoenix
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Warning: it’s kind of cheesy, but it’s different and novel. That’s what I like about it. It was featured on Fox News last night!

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Tags: listing, phoenix, Real Estate
Categories: Arizona, Phoenix, Real Estate
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Zillow published some stunning numbers yesterday regarding the US housing market. According to their analysis they believe “one out of two homeowners who purchased during the national market peak in 2006 are currently “underwater” on their mortgage”. This is a lot of people, and it does not appear to let up too much in 2007 either, because they claim “45% of homeowners who purchased last year (2007) are already underwater on their mortgages”.

This is not good news. However, is this a reason to walk away from your home, like so many are doing? In my opinion - NO! In order to put things in perspective I ran a hypothetical scenario to see how long it would take to recoup the equity. If you bought in 2006 with no down on a mortgage of $200,000 and experienced a 25% decline since. Then your home would be valued at $150,000 today. Now at the historically average appreciate rate of 6%, it would take you five years (from today) to be back at 2006 home price levels. (Side note: I sincerely believe we’ve hit bottom.)

Certainly not something you may have hoped for, but it’s not as dire as you may think. Five years isn’t too long of a time, it goes by pretty fast. Even if you purchased on a five year ARM - you’re almost covered. Also, remember ARM’s can reset lower too - if the index is falling. Even if rates go up when it adjusts, I’ve run situations for clients where the saving they received against a 30-year mortgage pretty much covers the increased payment for about a year or so (assuming its a five year ARM of course). More importantly you have five years to figure something out -maybe you make extra payment so increase your equity? Maybe you save some more. What ever the case you have five years to make a plan. The situation is completely different of course if you are in any kind of negative equity loan program.

Now, that I may have assured you a bit, let me share the rest of the bad news. Phoenix is cited in Zillow’s report as one of the hardest hit markets. I share with you some of the charts they have for Phoenix. To read the full report head on over to the ZillowBlog.

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Tags: market analysis, phoenix, zillow report
Categories: Arizona, Phoenix, Real Estate
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This is pretty funny. She does a good job explaining things to everyone:

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Tags: funny, gnooze, humor
Categories: Humor and Fun
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FHA here, FHA there, wherever you look it’s FHA these days. With the increase in loan limits, competitive loan rates and very low down payment requirements often times its the only loan program that makes sense in todays credit crunch. And it appears the Federal government is looking to expand the reach of this program and try to help borrowers in distressed situations.

Last week,a key committee in the House passed H.R. 5830, otherwise known as the FHA “Short Pay” Loans Bill. The main provision in this bill would allow FHA to insure loans for troubled borrowers. This bill seeks to insurance upto $300 billion in home mortgages. According to MortgageNewsDaily:

…the FHA will guarantee a new loan to a troubled borrower if the existing lender will agree to accept a short payment (i.e. less than the outstanding balance of the loan) in full payment of the old loan. The new loan would be limited to no more than 90 percent of the property’s value and must have terms that the borrower can reasonably be expected to pay. When the borrower sells or refinances the home the borrower will pay from any profits either an exit fee equal to 3 percent of the original loan amount or a declining percentage of any net proceeds attributable to home appreciation (from 100 percent in year one to 50 percent in years four and beyond,) whichever is larger. The government, therefore, would only be at risk if the borrower defaults on the new loan in which case he would lose the house.

Other than helping the homeowner stay in their house I don’t see what else it gives them. Their credit will still tank - since they did a short sale refinance. Which means higher interest rates on anything else they ever decide to use credit for - such as a car or credit card. However, being able to keep your home is a huge boost.

Sounds good right? Well not exactly is my answer. Citigroup Global Markets research released a report last Friday stating that this move by the government could go either way:

The analysts — weighing the benefits of insurance premiums and interest cost paid against re-default rates and estimated losses on foreclosed homes — calculated the government could earn as much as $31 billion or lose up to $20 billion.

Keep in mind Congressional leaders estimate the program to cost between $3 billion and $6 billion. Wow. Does anybody even understand the scale of these expenses anymore? As Senator Everett Dirksen once said “a billion here and a billion there, and soon you’re talking about real money.”

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Tags: FHA, H.R. 5830, Refinances
Categories: Congress and Government, FHA, Mortgages
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Dear Readers,

The FHA Mortgage Center is running a blog contest and I’ve entered the contest. If you believe The Arizona Mortgage Guru has consistently provided you with quality content then please consider voting for this blog. All you have to do is click on the thumbs up button in the side bar under “Vote for AMG”. —to side bar—>>

I do not run this blog to win online beauty pageants or, to be known and heard about in the blogosphere. The focus of my efforts is to provide you the ready with valuable content as you navigate the complex real estate financing market.The quality of e-mails I receive from you is a testament to that endeavor and is sufficient reward for me and my business.

But, if you should so feel inclined please vote for me.

Thanks,

Shailesh

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Tags: Blog, Contest, FHA Mortgage Center
Categories: Bloggers, Blogging, Humor and Fun
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The downpayment assistance program, which we participate in, the Home in Five Program (only for Maricopa county) had been running out of funds recently. Actually to be more precise funds for non targeted areas had been running out, there was always plenty of money for targeted and priority areas. Late last week the program announced that it would be reallocating funds to non-targeted areas. For those not familiar with the distinction, let me clarify the definitions:

Non-targeted areas: All areas outside of the targeted and priority areas within Maricopa county. There are income limits determined by household size and loan size limits based on the property type. The main rule is that you need to be a first time home buyer in order to purchase a home in this area (using the funds from the Home in Five program).

Targeted Areas: This encompasses areas designated in Maricopa county by the program and is determined by census track numbers. The income limit and purchase size limit is higher than for non-targeted areas. Additionally purchasing in this area entitles you to a better interest rate. You do not need to be a first time home buyer to take advantage of the down payment assistance if you are purchasing in this area.

Priority Areas: These are areas within the targeted areas which are being given additional preference. Hence, the income and loan size limits are even higher and the interest rates are even better than for targeted areas.

The process of determining whether or not a property is in a targeted or priority area is in fact rather cumbersome. Contact me or Aimee with an address and we can look it up for you. Just a reminder, the funds are disbursed on a first come first serve basis and the program makes no guarantees on availability.

Further reading on the Home in Five Downpayment Assistance Program is available here.

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Tags: assistance, down payment, maricopa county
Categories: FHA, Mortgages
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