Paying off an underwater mortgage and buying a better home could be the best tactic in this troubled market.
“If you are trading up, what better time than when interest rates are at record lows and the cost of the trade-up is much less than it used to be?” says Christopher J. Mayer, a Columbia Business School economist.
With 15-year fixed-rate mortgages at about 4.5 percent, it also makes sense to pay off the mortgage and keep the house. “At this point,” says Jay Brinkmann, chief economist of the Mortgage Bankers Association in Washington, D.C., “if they don’t have anything else that is bringing a tremendous return, then they are buying themselves an annuity by paying their house off sooner than they needed to.”
Source: The Wall Street Journal, M.P. McQueen
Ga Dream Rates are at a Historic Low!!!! This is great news for our first-time homebuyers, with 2 different down payments assistance programs available. I would be happy to tell you more about the standard Ga Dream program and the Rewards program, offering you $5-$7,500 in down payment funds!
Lenders continue to reject borrowers with otherwise good credit when they diverge from the standard approval checklist.
Would-be borrowers facing the most problems include the self-employed.
One reason bankers are so nervous are the standards held out by Fannie Mae and Freddie Mac. Not only are Fannie and Freddie demanding credit scores above 720, they are refusing to buy back defaults when the original mortgage application had small discrepancies from the norm. To avoid losses, lenders are being extra careful.
The result is that some borrowers are being rejected for problems that seem completely inconsequential.
Source: The Wall Street Journal, James R. Hagerty and Nick Timiraos (07/10/10)
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Atlanta, GA 30342
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The number of homes for sale declined 2.4 percent in November in the metropolitan areas covered by ZipRealty Inc. In the last 25 years, the decline in November has averaged 1.8 percent.
The data doesn’t include New York, but Miller Samuel Inc., an appraisal firm, reports that inventory was down 7.1 percent from the end of October and down 18 percent compared to November 2008.
October was the first month since January to show a rise in bank-owned homes. The number of bank-owned properties declined over the summer because of efforts to prevent foreclosures. As time runs out for many families, the number of foreclosures is increasing.
As of the end of October, banks and mortgage investors had 639,000 foreclosed homes for sale across the U.S., Barclays Capital estimates. “We expect a rebound in distressed inventory in the coming months,” says Glenn Boyd, a senior analyst at Barclays.
Source: The Wall Street Journal, James R. Hagerty (12/09/2009)