Brian Leavitt, REALTOR®

OK, It's real estate..

When one of my clients called the other day with a real estate question, I was surprised when she prefaced the question with “I know your main business is mortgage but...” I was delighted to help her with her question and found it interesting that the image I had cultivated is that mortgage is my primary business. One of the things this tells me is I need to do a better job educating my clients, so here goes.

Real estate is my primary business. In pursuit of my goal of delivering excellent service in real
estate I found that a consistent weakness in transactions was the mortgage component. This led me to the conclusion that the only way to make sure my clients were adequately served was to become
an expert in mortgage as well as real estate. I began serving my clients with their mortgage needs more than 18 years ago. The objective of the mortgage company has, from our first day in business, been threefold:

1. To serve my real estate clients by thoroughly educating them about their financing options so that they can select the best mortgage product for their needs.

2. To deliver competitive interest rates and low fees.

3. To maintain the highest level of integrity putting client needs first always.

Because of this we weathered the mortgage industry meltdown in a market that most of our
competitors did not survive.

As stated previously, real estate is my primary business but a large part of my success is the unique
ability to merge both the real estate and mortgage component taking service to a higher level. Even in the event that my client uses another source for their mortgage financing, the same level of
service and heart of the teacher are there.

In closing I would like to take a moment and say thank you to my many, many loyal clients who helped me during this very difficult time by referring friends and family for both their
real estate and mortgage needs. I can never thank you enough for your loyalty and support. I am blessed because of you.

Brian

Congressional action raises interest rates..

If you are thinking of a refinance or for that matter a home purchase, now is the time.

Conforming prices will increase based on recent Congressional action. Freddie Mac and Fannie Mae are increasing their guarantee fee effective with April settlements which will
worsen pricing. In order for a loan to meet the April settlement requirement it must fund prior to February 29th 2012.

The guarantee fee increase will worsen prices up to 80 basis points (8/10 of 1%) depending upon the note rate. Some lenders are staggering the increase based upon when the loan is locked in an effort to offer lower rates to consumers in the market for as long as possible.

If you are considering a refinance or purchase do it now if you can . Although interest rates remain at record lows there's no telling how long they will remain low and with this announcement we know that the cost of obtaining financing will increase.

Please note that the guarantee fee increase does not impact government loans.
For more details on this and any other financing options please call Brian Leavitt at Northstone Mortgage.

Why you should pay off your mortgage before you retire

More Americans are quitting the workforce without retiring their mortgages. The most recent Federal Reserve survey shows that 32 percent of households headed by someone age 65 to 74 were carrying home-mortgage debt.

That could be a mistake. Consider this scenario. Two retired couples have income of $16,000 from Social Security and $24,000 from individual retirement accounts.

The couple without a mortgage would be taxed on their IRA withdrawals, but with the standard deductions, they would owe only about $600 a year in taxes, leaving them with $39,400 in after-tax income.

The second couple took out a $200,000 30-year mortgage at age 50 that costs $955 per month until age 80. The interest deduction doesn't help because by the 16th year of their mortgage, just $5,047 goes to interest. Added to other deductions, they will have little more than the $11,600 standard deduction taken by the first couple.

To match the first couple's standard of living, they have to make large taxable withdrawals from their IRA. The withdrawals would drive up their total income, triggering taxes on Social Security. They would need total pretax income of more than $58,000 to have the same standard of living as the first couple, and they would pay more than $4,300 in federal taxes.

To pay off a $200,000 30-year fixed-rate mortgage at 4 percent with a $955 payment: Add $100 a month to pay off the loan in 26 years. Add $200 a month to pay off the mortgage in 22 years. Add $500 a month to pay it off in 16 years.

 To calculate your own time frame and payments to see what you could do go to http://www.northstonemortgage.com/MortgagePayoffCalc.  If your rate is higher than 4% call me about the possible benefits of a refinance.

 

Lowest interest rates on record

This is an excellent time to refinance.  Northstone Mortgage rates are significantly lower than the national average.  Check them out at northstonemortgage.com

 

Freddie Mac (OTC: FMCC) today released the results of its Primary Mortgage Market Survey® (PMMS®), coming on the heels of the Federal Reserve's recent announcements. The conventional 30-year fixed averaged an all-time record low at 4.01 percent; likewise the 15-year fixed averaged an all-time record low at 3.28 percent for the week. Of the five regions surveyed in Freddie Mac's survey, the West region recorded the lowest average rate for the 30-year fixed dipping below 4.00 percent to 3.95 percent.

30-year fixed-rate mortgage (FRM) averaged 4.01 percent with an average 0.7 point for the week ending September 29, 2011, down from last week when it averaged 4.09 percent. Last year at this time, the 30-year FRM averaged 4.32 percent.

15-year FRM this week averaged 3.28 percent with an average 0.7 point, down from last week when it averaged 3.29 percent. A year ago at this time, the 15-year FRM averaged 3.75 percent.

5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 3.02 percent this week, with an average 0.6 point, matching last week when it also averaged 3.02 percent. A year ago, the 5-year ARM averaged 3.52 percent.

1-year Treasury-indexed ARM averaged 2.83 percent this week with an average 0.6 point, up from last week when it averaged 2.82 percent. At this time last year, the 1-year ARM averaged 3.48 percent.

Frank Nothaft, vice president and chief economist at Freddie Mac, reports, "Fixed mortgage rates fell to all-time record lows this week following the Federal Reserve's announcement of its Maturity Extension Program and additional purchases of mortgage-backed securities. Interest rates for ARMs, however, were nearly unchanged as the Federal Reserve plans to sell $400 billion in short-term Treasury securities, which serve as benchmarks for many ARMs."

"Meanwhile, the spring and summer home-buying season gave a boost to a number of house price indexes. The Federal Housing Finance Agency reported that its National index (not seasonally adjusted) rose for the fourth consecutive month in July. Similarly, the S&P/Case-Shiller® 20-City composite index, which has a broader scope of properties, rose 0.9 percent between June and July with 17 of the cities experiencing positive monthly growth. Finally, CoreLogic® reported that its index, excluding distressed sales, increased at a 1.7 percent monthly rate for the same month."

Bye Bye Bank of America Wholesale Lending

 

Bank of America announced today that it plans to exit the wholesale mortgage lending business.  They state that as part of their “customer driven” business model they have decided to focus on opportunities to “deepen our relationships with existing Bank of America customers" and to offer responsible and competitive mortgage products to new customers.  “By responsibly exiting our relatively low market share" (22%) “in the highly diversified wholesale mortgage market.  We can redirect critical operational resources to enhance capabilities for consumers to purchase or refinance homes” 

So let me get this straight, they think that by limiting distribution of their mortgage products they can somehow help consumers?  It seems to me that by limiting access to product they are directly opposing what is in the best interest of consumers. 

We have seen this before.  In Washington Mutual's “glory days", that is the years before the whole mortgage meltdown, we watched Washington Mutual move in and out of wholesale lending time and time again.  Interestingly enough their most profitable years coincided with the years that the majority of the loans they originated were through their wholesale lending relationships.  We certainly wish Bank of America best success in this endeavor, after all it is a free country so why not put the squeeze on consumers if you can.  Brokers, do not worry, they will be back.  In the meantime, Bank of America is not the only game town

This blog was written by Brian Leavitt, Designated Broker of Northstone Real Estate Inc, and Northstone Mortgage.

Brian serves clients within the Northwest Multiple Listing Service. And specializes in residential re sale homes, condo’s and land, and is uniquely qualified as a short sale negotiator holding both real estate and mortgage licenses.

You can contact Brian directly by phone at 800-806-3145 or by email at brian@northstone.net.  Click here to view his client newsletter.

Brian is licensed with the Washington State Department of Licensing and the Washington State Department of Financial Institutions License number MLO-114864 and is a member of the Seattle King County Association of Realtors and Northwest Multiple Listing Service.

Purchase and rehab your home with FHA 203k Streamline home loan

FHA Streamlined 203(k) Overview

The Streamlined FHA 203(k) program is intended to facilitate uncomplicated rehabilitation

and/or improvements to a home for which plans, consultants, engineers, and/or architects are not required. Due to the rehabilitation amount limitation of $35,000, eligible improvements are limited and can not include any major rehabilitation or remodeling, new construction such as room addition, repairs to structural damage, or site amenity improvements. (Repairs of this nature would be considered under the Standard FHA 203(k) Program which is not offered at this time.)

Eligible Improvements: Examples of eligible improvements are listed below (this is not an
all-inclusive list):

• Repair/replacement of roofs, gutters and downspouts.
• Repair/replacement/upgrade of existing heating, ventilation & air conditioning
• systems.
• Repair/replacement of plumbing and electrical systems.
• Repair/replacement of flooring.
• Minor remodeling that does not involve structural repairs, such as kitchens
• Exterior and interior painting.
• Weatherization, including storm windows and doors, insulation, weather stripping,
• etc.
• Purchase and installation of appliances, including free-standing ranges,
• refrigerators, washers and dryers, dishwashers and microwaves.
• Improvements for accessibility for persons with disabilities.
• Lead-based paint stabilization or abatement of lead-based paint hazards.
• Repair/replacement/addition of exterior decks, patios, porches.
• Basement waterproofing.
• Replacement of window and doors.

Most improvements are eligible provided they add value and are permanently affixed to the foundation. Improvements to detached structures and luxury items are not allowed:

• Luxury items include: Swimming pools, hot tubs, tennis courts, gazebos, barbecue pits, etc. Repair work to these items is also not allowed.
• Properties that require the following work items are not eligible for financing:
• Major rehabilitation or major remodeling, such as the relocation of a load-bearing wall;
• New construction (including room additions);
• Repair of structural damage;
• Repairs requiring detailed drawings or architectural exhibits;
• Landscaping or similar site amenity improvements;
• Any repair or improvement requiring a work schedule longer than six (6) months;

or

• Rehabilitation activities that require more than two (2) payments per specialized contractor.

The Streamlined 203(k) program may not be used to finance any required repairs arising from the appraisal that do not appear on the list of Streamlined 203(k) Eligible Work Items or that would:

• Necessitate a "consultant" to develop a "Specification of Repairs/Work Write-Up"
• Require plans or architectural exhibits;
• Require a plan reviewer;
• Require more than six months to complete;
• Result in work not starting within 30 days after loan closing; or
• Cause the borrower to be displaced from the property for more than 30 days during the time the rehabilitation work is being conducted. (FHA anticipates that in a typical case, the borrower would be able to occupy the property after mortgage loan closing).

Reinspection: If the cost of the renovation is over $15,000 then a second inspection by the original appraiser is required. 

More Info:

• FHA Streamlined 203K Overview
• FHA Streamlined 203K Frequently Asked Questions