Today in the Star Tribune (MN biggest newspaper) break some good news!! “Mortgage fraud scheme architect gets 13 years in prison” by James Walsh breaks the news of that the people behind the Parrish Marketing are going to jail.
What is Parrish Marketing? This company was a multi-million dollar company that built real estate and sold it. The only problem is, they were crooks. They used straw buyers; other peoples credit reports, to purchase the homes. They also worked with a fraudulent loan officer at US Bank who made up income documents and pleaded guilty to mortgage fraud.
It’s not only the mortgage fraud that really pisses me off, but rather all of the innocent people he screwed over. I have a friend who did all of the lawn work for this company. He never got paid for any of his work!! I also feel bad for the neighbors next to these homes, because they all lost money on equity. Instead of neighbors these people now get discounted foreclosed homes.
The main man of Parrish Marketing, Michael Parrish got 13 years. I wish that with jail time, they could find out a way to pay back all of those poor people who worked hard, but got screwed.
Thursday, July 31, 2008
Wednesday, July 30, 2008
Housing Bill 2008- UPDATE
Okay, so the President passed the new housing bill today. Aloha, new laws and regulations.
“Devils in the details” by Eva Rosenberg, posted on marketwatch.com 7/29/2008 examines the new laws.
In a previous post I thought that First-Time Home Buyers will be able to get some free money, but I was wrong. It looks like it’s a short-term, zero interest loan.
It’s an informative read and I suggest doing so. If you have any questions regarding the new tax laws, please call your CPA or tax preparer. As always, if you have any questions regarding real estate, you know where to go!!
“Devils in the details” by Eva Rosenberg, posted on marketwatch.com 7/29/2008 examines the new laws.
In a previous post I thought that First-Time Home Buyers will be able to get some free money, but I was wrong. It looks like it’s a short-term, zero interest loan.
First, we have a $7,500 credit for new homeowners that is not really a credit,
it's a loan. Those who qualify to receive this credit will receive 10% of the
purchase price of their home -- up to $7,500, in the first year. Then, they will
repay the loan over a 15-year period, starting in the second year after the
taxable year in which the house is purchased.
It’s an informative read and I suggest doing so. If you have any questions regarding the new tax laws, please call your CPA or tax preparer. As always, if you have any questions regarding real estate, you know where to go!!
A what-if story....
I first read this article “Life in a Bubble”, by Carol Lloyd on sfgate.com in the 2004. At that time you have to remember that we were just starting to see the real estate bubble come to fruition.
The summary of this article is that Lloyd looks at three different scenarios of people thinking about buying real estate. She does the math and forecasts three "what if’s" for these people. All are unique and it really points out that its different strokes for different folks.
The moral of this post is, don’t always listen to the national headlines, but rather find out what works for you. Personal preference is a strong factor when it comes to purchasing real estate. Make sure you have a true, solid professional helping you out, who is not just out to make a bigger paycheck!!
The summary of this article is that Lloyd looks at three different scenarios of people thinking about buying real estate. She does the math and forecasts three "what if’s" for these people. All are unique and it really points out that its different strokes for different folks.
The moral of this post is, don’t always listen to the national headlines, but rather find out what works for you. Personal preference is a strong factor when it comes to purchasing real estate. Make sure you have a true, solid professional helping you out, who is not just out to make a bigger paycheck!!
What is a FICO™ (credit score)?
A FICO score is a credit scoring system that is commonly used by financial lenders to evaluate the borrower. Here's a list of different factors that impact your credit score and their approximate percent of impact.
Types of Credit in Use: 10%--Considers the number of credit accounts and the mix of credit types: credit cards, installment loans, mortgages, and is most important if you don't have a very lengthy credit history.
Payment History: 35%--Takes into account (1) many different types of payments, including mortgages, major credit cards, department store credit cards, car loans, other installment loans such as for furniture, etc., (2) information from public records such as bankruptcies, liens, lawsuits, foreclosures, judgments, and wage garnishments, (3) details of any missed or late payments, such as the amount, how long ago it occurred, and how late it was.
Amounts Owed: 30%--Looks at (1) the total of all the amounts you owe for all accounts, (2) the mix of amounts owed (credit cards versus installment loans, for example), (3) the number of accounts that have balances, (4) how much of your total credit available on credit cards and installment loans you're using (the closer you are to maxing out your available credit, the more negative the impact on your score), and (5) how much of the original balance borrowed you still owe on installment loans, like your car loan.
Length of Credit History: 15%--As long as you don't have negative information in your file, the longer your credit history, the higher your score.
New Credit: 10%--Considers (1) how many new credit accounts you've opened recently, (2) how long it's been since you opened a new credit account, (3) how many requests you've made for credit recently, (4) how long it has been since lenders have requested credit information on you, and (5) how good your recent credit history has been.
Types of Credit in Use: 10%--Considers the number of credit accounts and the mix of credit types: credit cards, installment loans, mortgages, and is most important if you don't have a very lengthy credit history.
Payment History: 35%--Takes into account (1) many different types of payments, including mortgages, major credit cards, department store credit cards, car loans, other installment loans such as for furniture, etc., (2) information from public records such as bankruptcies, liens, lawsuits, foreclosures, judgments, and wage garnishments, (3) details of any missed or late payments, such as the amount, how long ago it occurred, and how late it was.
Amounts Owed: 30%--Looks at (1) the total of all the amounts you owe for all accounts, (2) the mix of amounts owed (credit cards versus installment loans, for example), (3) the number of accounts that have balances, (4) how much of your total credit available on credit cards and installment loans you're using (the closer you are to maxing out your available credit, the more negative the impact on your score), and (5) how much of the original balance borrowed you still owe on installment loans, like your car loan.
Length of Credit History: 15%--As long as you don't have negative information in your file, the longer your credit history, the higher your score.
New Credit: 10%--Considers (1) how many new credit accounts you've opened recently, (2) how long it's been since you opened a new credit account, (3) how many requests you've made for credit recently, (4) how long it has been since lenders have requested credit information on you, and (5) how good your recent credit history has been.
Tuesday, July 29, 2008
How far will it dip…
The Standard & Poor's/Case-Shiller 20-city index dropped by 15.8 percent in
May compared with a year ago, a record decline since its inception in 2000. The
10-city index plunged 16.9 percent, its biggest decline in its 21-year history.
Source
Will this ever end? I’m not sure, but I do know that this is good for people looking to buy. Homes are getting cheaper and cheaper by the day.
At the same point, this is a national figure. Not all areas are in a decline. Since this stat is Real Estate, it's location specific. I have heard reports of people selling their homes in some areas of the country in less than two weeks, while others have been waiting a year or more! It is all about location, price and demand.
The new mortgage bill….
The headlines around the nation have been dominated by a new mortgage bill that has already passed the senate and on the way to W’s desk to get signed.
The bill provides government money to help the housing industry. I’m not so sure about all of the FHA stuff in the bill. It’s a little hard to understand because I’m not sure if it’s between the lenders and their current customers, or if customers can refinance into a new FHA mortgage loan with a different lender?
One part of the plan is called "FHA rescue" which is supposed to help people get out of toxic mortgages. Sounds more like a way to help people stop foreclosing and to help ease the housing market crash. I will post more information on this topic when I gather more knowledge.
The highlight of this bill is for First-Time Home Buyers (FTHB). The numerous articles I have read state that there will be a tax credit issued to First-Time Home Buyers. On a bankrate.com mortgage blog, they are saying that FTHB will receive as much as $7,500 in tax rebates if they buy a home.
With this new tax incentive, next year might be the best time ever in the history of the United States of America to be a FTHB. Not only are there tons of great deals on the market today, FTHB will get a $7,500 dollar incentive to purchase a new home!! Basically, you can buy a new construction for a discount or buy a fixer-upper for a discount...You can’t go wrong!!
If you are interested in learning more about what you qualify for, or want to start looking at homes, please Contact Us. We have the answers for you.
The bill provides government money to help the housing industry. I’m not so sure about all of the FHA stuff in the bill. It’s a little hard to understand because I’m not sure if it’s between the lenders and their current customers, or if customers can refinance into a new FHA mortgage loan with a different lender?
One part of the plan is called "FHA rescue" which is supposed to help people get out of toxic mortgages. Sounds more like a way to help people stop foreclosing and to help ease the housing market crash. I will post more information on this topic when I gather more knowledge.
The highlight of this bill is for First-Time Home Buyers (FTHB). The numerous articles I have read state that there will be a tax credit issued to First-Time Home Buyers. On a bankrate.com mortgage blog, they are saying that FTHB will receive as much as $7,500 in tax rebates if they buy a home.
With this new tax incentive, next year might be the best time ever in the history of the United States of America to be a FTHB. Not only are there tons of great deals on the market today, FTHB will get a $7,500 dollar incentive to purchase a new home!! Basically, you can buy a new construction for a discount or buy a fixer-upper for a discount...You can’t go wrong!!
If you are interested in learning more about what you qualify for, or want to start looking at homes, please Contact Us. We have the answers for you.
A new tool for the mortgage market
The people that lend all the money in America have decided that they are going to start to use covered bonds as a way to finance mortgages. The top four banks think that these bonds will help to revitalize the mortgage market, especially in the secondary market.
Here is a link to the covered bonds definition on Wikipedia. The gist of these bonds is that they remain on the bank's balance sheet and are backed by the bank's cash flow/assets. They have a good credit rating and are almost fail-proof.
What does this mean for the housing market?
I’m not exactly sure, but I do know that at this point in the housing cycle, anything can help. Any money put in the housing sector is a good thing in my book. These bonds are also very popular in Germany where they have had some great success.
To read the full article, click here
Here is a link to the covered bonds definition on Wikipedia. The gist of these bonds is that they remain on the bank's balance sheet and are backed by the bank's cash flow/assets. They have a good credit rating and are almost fail-proof.
What does this mean for the housing market?
I’m not exactly sure, but I do know that at this point in the housing cycle, anything can help. Any money put in the housing sector is a good thing in my book. These bonds are also very popular in Germany where they have had some great success.
To read the full article, click here
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