Wednesday, December 03, 2008

Reasons To Buy Palm Springs Area Real Estate Now

Top 10 Reasons to Buy in Today’s Palm Springs Area Market:

(1) Declining Prices = Improved Affordability,Over 50% affordability

(2) Bargains – Short Sales/REO’s & Motivated Sellers Priced to Sell

(3) Favorable rates for qualified Buyers: FHA, VA & Conventional

(4) Renters & First Time Homebuyers can now buy at approximately what they were paying for rent and receive tax advantages.

(5) Declining Inventory-Inventory has been declining mthly in 2008

(6) Investors coming into real estate instead of stocks for it’s tax advantages and stability.

(7) Higher loan limits for conforming mortgages at the lowest rates

(8) Housing still the American Dream with quality of life benefits that are not just economical. Long term investment in real estate has always created wealth and security for retirement.

(9) The valley’s environment, quality of life, weather and beauty will always be a desirable factor as a place to live, work and play.

(10) You can’t predict the bottom of the market. No BELL will ring!

Please contact us to discuss in detail: sclove@windermere.com

Sunday, October 26, 2008

Countrywide ARM Bailout

The following was published in Smart Money on October 24, 2008. It is a very informative article about the Countrywide bailout for homeowners with Adjustable Rate Mortgages. Please contact me for more information and/or if I can help with selling or buying (this is a great time to buy!) of real estate, including short sales. - Stephen Love (sclove@windermere.com)

Deals by Aleksandra Todorova (Author Archive)
What Countrywide's Bailout Plan Means for Homeowners
IT'S A NIGHTMARE for any homeowner: An interest-rate hike pushes your monthly mortgage payments into such costly territory that you fall behind, and soon the foreclosure notice arrives in the mailbox. Unfortunately, this scenario has already played out for hundreds of thousands of homeowners across the country and could become a harsh reality for many more Americans whose adjustable-rate loans are about to reset in the upcoming months.
Making matters even worse: Home values continue to slide and lending standards remain tight. Those factors have made the one logical solution for homeowners that face ballooning mortgage payments — refinancing their mortgage to a loan with a lower rate — nearly impossible, especially for those with subprime loans.
So when Countrywide Financial, the U.S.'s largest mortgage lender, announced on Tuesday that it was launching a program aimed at helping cash-strapped homeowners by canceling rate resets or modifying their loans, you could almost hear a collective sigh of relief.
After all, lenders are facing a glut of foreclosures, so it's no surprise that they're warming up to the idea of helping delinquent borrowers by, for example, restructuring a mortgage so the homeowner can catch up on missed payments. However, the actual act of a lender like Countrywide reaching out to people who have yet to miss a payment — but are likely to do so because of a pending rate reset — is something new.
"This is the first broad-reaching plan we're aware of that addresses borrowers who are not yet late," says Tracy Morgan, a spokeswoman for the Homeownership Preservation Foundation, a nonprofit organization dedicated to helping consumers prevent foreclosures. A quarter of the 60,000 homeowners the organization has counseled so far this year were actually current on their mortgages, according to Morgan. Until now, she notes, most lenders wouldn't even talk to them about working out some solution to keep payments reasonable. "But that's changing," she says. "Countrywide's announcement is a positive sign and hopefully we'll see other lenders offering similar workouts."
Lenders have an interest in introducing such programs, so it's quite likely that others will follow Countrywide's example. "Lending is not an altruistic business," says Keith Gumbinger, a vice president at HSH Associates, a Pompton Plains, N.J., mortgage information firm. True, lowering borrowers' interest rates means the lenders will make less money than originally projected, but hey, less money is better than nothing if those loans were to go into foreclosure.
All of that is great news — at least for some people. Countrywide estimates it will call or send letters offering help to 80,000 of its customers. (For details on the program, see the sidebar.) But if your mortgage is with another lender, you may have to negotiate a solution yourself. Here's what you need to do.
1. Know your mortgageDo you know your mortgage? When does your interest rate reset? What would your new payment be when it does? Those are the first questions any borrower who doesn't have a 30-year fixed-rate loan should ask, says Dania Perez, a housing counselor at the Tampa Bay Community Development Corporation in Tampa Bay, Fla., which helps troubled homeowners avoid foreclosure. "A lot of people who come into my office don't know what type of mortgage they have," she says.
If you have an ARM — any type of ARM — be sure to call your lender immediately and ask them when your interest rate will reset — and how often it will change afterwards. You should be particularly cautious with the so-called 3/27 or 2/28 ARMs, which carry a fixed rate for the first three or two years, respectively. These are subprime loans that carry high rates to begin with, but also tend to reset every three or six months (sometimes even monthly) once the fixed-rate period is over, Gumbinger says. The more traditional 3/1, 5/1 and 7/1 ARMs, meanwhile, are typically prime loans that carry lower rates and adjust only once a year after the fixed-rate period of three, five or seven years.
2. Prepare a budgetOnce you know when your rate adjusts, it's time to take stock of your spending. Figure out just how much your loan will increase, says Maria Enomoto, a credit and housing counselor with the Consumer Credit Counseling Service of Ventura County, Calif. (Ask your lender for an estimate of your new payment or, at the very least, what your new interest rate will be. Plug the new rate into our Mortgage Calculator to get a rough estimate of your new payment.)
If you find the new payment is beyond your means, look for ways to cut back your spending or increase your income. "We have families here who take part-time jobs just so they're not late with payments and can refinance to a better loan in the future," Enomoto says. A spending plan, mind you, will come in handy if you call your lender to discuss loan modification: Lenders want to see that you're in control of your budget and can afford future payments.
3. Talk to your lenderDon't wait to fall behind on your mortgage. Rather, call your lender as soon as things start getting rough, Perez says. While the lender might not be able to immediately help — that is, unless they launch a program similar to Countrywide's — they will put a note in your file and may be more willing to help if you do become delinquent. Meanwhile, if you're already in trouble, don't dodge the lender's calls. "It's like telling them you don't care," Perez says. "You have to show them this is important to you."
4. Get help — but watch out for rip-offsFinding the best solution can be complicated. Some lenders are more likely to negotiate than others and some loans are more easily negotiated (those that the lender hasn't sliced and diced and sold to investors in the form of mortgage-backed securities, for example). The good news is you don't have to navigate the maze on your own.
Many credit-counseling agencies, which traditionally help consumers with debt management and budgeting issues, now have special departments staffed with housing counselors to help you, free of charge. Some will guide you through the process and help you line up the paperwork before you call your lenders, others will go a step further and negotiate on your behalf. But be sure to stick with an agency that has been approved to do so by the Department of Housing and Urban Development (HUD). (Find a list here.) You can also call the Homeownership Preservation Foundation (888-995-HOPE), a network of five HUD-approved credit-counseling agencies that offers help nationwide.
Fair warning: Don't fall for companies that charge fees. Even if they're legitimate, you're likely to alienate the lender, Perez warns. They'll wonder why you're paying a third party (for something you can do free of charge), when you should be using the money to pay them back.
5. Some other alternativesEven with lenders warming up to mortgage restructuring, some homeowners simply won't be able to keep their homes. Typically, lenders won't even work with you if you can't afford your house payments, say, because you bought too much house in the first place. "If this is a just a short-term solution, they're not going to do it," says Todd Mark, director of consumer relations for Consumer Credit Counseling Service of Greater Atlanta. "There's no sense in giving someone a Band-Aid when they have a terminal illness."
As difficult as it will be, your only choice at this point might be to let the house go, says Kate Williams, a vice president for financial literacy for Money Management International, a credit-counseling service. (You won't be alone in doing this. Click here for more on homeowners who walk away from their homes.) One of your options: If you haven't been able to sell your house so far but think you'll find a buyer if you lower the price substantially, ask your lender if they'll agree to a short sale. With a short sale, the lender accepts a lump-sum payment that's lower than the amount of the mortgage and considers it paid off. Another option for homeowners who have no equity in their home is a "deed in lieu of foreclosure," where you basically hand over the deed to your house to the lender in exchange for forgiveness of the loan. A deed in lieu of foreclosure can ruin your credit. But if that's the cost of getting back on your feet, it's worth consideration.

Tuesday, September 23, 2008

PALM SPRINGS HOME SALES ON UPLIFT

September 3, 2008
Existing Home Sales Up 41.6 Percent In July, Says Desert REALTOR John Hussar/PRNewsWorks Reader Submitted
PALM DESERT (Calif.) — Coachella Valley existing home sales jumped significantly in July with a 41.6 percent increase over July 2007 sales, although the median price dropped homes declined 36.7 percent over July 2007, the California Desert Association of REALTORS reported today.
"When sales rise faster than prices fall, it could indicate that buyers are taking advantage of this market window with urgency, and that window could be narrowing more quickly than earlier projections," said Greg Berkemer, executive vice president of the California Desert Association of REALTORS. "In terms of sales, which have been increasing since the second quarter of this year, if you were waiting for the bottom of the market you may have missed it," he said. "The August inventory is the lowest since September 2006," Berkemer said. By comparison, the January sales rate and inventory yielded 20.2 months of unsold inventory while the August sales and inventory stands at 12.7 months of unsold inventory. Berkemer said desert buyers continue to take advantage of lower prices and reasonable interest rates, such that for July single family homes sold were on the market for a median of 97 days. "So when is the best time to buy? The answer hasn't changed. It's five years ago. True, five years ago. It's true today and will probably be true five years from now. The sales pace would seem to indicate that serious buyers agree," he said. The median price of an existing desert area home in July was $239,360, down 36.7 percent from $378,310 in July 2007. According to the Desert Area Multiple Listing Service, the real estate industry standard for existing and some new home sales throughout the Coachella Valley, the typical median priced home for sale now is a three-bedroom, two-bath, 1,760 square-feet listed at $314,945 and has been on the market for 97 days. Throughout California, existing home sales rose 43.4 percent in July compared to July 2007 although the median price fell 40.3 percent to $350,760, according to the California Association of REALTORS, the statewide organization. The California Desert Association of REALTORS, The Voice for Real Estate for the Coachella Valley, represents more than 4,000 real estate professionals from Palm Springs to Coachella. For more information, please call (760) 346-5637 or visit online at www.CalDesertRealtors.com