Kim & Terra's Blog

If you have not already heard, the HOME BUYER TAX CREDIT EXTENSION CLOSING DATE WAS NOT GRANTED THROUGH THE HOUSE, TO GET THE TAX CREDIT, YOU MUST CLOSE BY THE 30TH OF JUNE 2010. Just wanted to let everyone know since I mentioned last week that the Senate passed it, but since then, the House denied it. Sorry!

And a friend of mine, Terry Wagnon from Stewart Title in Edmond just passed this information along… “Lawrence Yun, the chief economist for the National Association of Realtors predicted that 25 to 30 percent of the buyers who made the deadline for signing a contract won’t be able to close by June 30. That means about 180,000 home purchases could fall through. Most of the deals that will take longer than 60 days to close are those involving short sales or foreclosures, but with such a backlog of mortgage applications even others could be impacted.”

In a slow week for economic news, ‘worry’ is still with us as new and existing home sales numbers came in lower than expected. While this scared some, it is the inevitable aftermath of the home buyer stimulus and this effect will be with us through June. On a positive note, core durable goods orders showed continued, slow improvement, underscoring the fact that the overall economy is still moving forward. We are improving, but in a world of rapid responses and quick solutions, it’s hard to be patient. Remember, some economic indicators lag behind the recovery, which is why unemployment remains high and inflation remains low…and with LOW inflation comes LOW RATES.

BUT you are a buyer and are sitting on the fence because there is no more incentive. And YOU think the $8,000 is gone. WRONG! If a borrower bought in April, their rate would have been approximately 5.125%. The payment on their $200,000 house is the SAME payment they would make TODAY on a $208,000 house at 4.625% (1/2% lower). The lower rate gives them the same benefit as the tax credit, it’s just in the form of more house vs. a tax refund. And, least your buyers think home prices will drop, existing home inventory is slowly coming down, and that bodes well for pricing.

This week rates ranged between 4.5% and 4.75% depending on program, credit and points.

Ted Clay
Sr. Loan Officer
NMLSR # 217991
OK License # MLO01963

Office: 405-341-8644
Cell: 405-826-1320
e-Fax: 1-866-208-5309

tclay@wrstarkey.com

www.TedClay.com

You want your space to be comfortable and have a little bit of personality. Here are a couple tips from cosmo life that can help you do this the cheap way.

Make It Smell Great- This is an obvious one but candles are so perfect for creating a relaxing atmosphere. Lots of candles now come in pretty jars or the new thing is a scensy candle. You just cant skip something so simple that adds so much.

Pick Up Knicknacks- A few well placed funky knickknacks can add so much character to a room. Anything that catches your eye… like some cool vases, can add some more personality to your space.

Add a Punch of Color- Cosmo says the quickest way to add some color to a room is simply a rug. Go for bright colors that will make more of a statement instead of going with a neutral color rug.

Show Off Chic Lighting- Frame your bed with a pair of sconces will not only be functional but also pull your room together. Try to match these sconces to something else in your room.

Hang Mirrors Instead of Art- Mirrors can make your room look even larger and also they are sometimes cheaper than art work. Look for neat decorative mirrors and hang them where they reflect open space to open up your room.

Get Major Drama with Curtains- Buy long curtains that can hang from the top of the window and puddle at the floor. Pull each panel to the side for a more dramatic effect.

Oklahoma real estate is still GOOD. Living and working in Edmond daily confirms that we should not worry. Overall, compared to last year all sales are up and as a Realtor it is looking pretty smooth.

Pricing trends for the South for a median existing single-family home was $148,200 in the first quarter, up 1.1 percent from the first quarter of 2009. On the other hand, existing-home sales in fell 14.6 percent in the first quarter to an annual rate of 1.89 million. Although these existing-home sales are 10.7 percent higher than a year ago which is wonderful. We all need to keep thinking positive though and continue to read to see why.

In May, pending home sales in the South jumped 12.7 percent, which is 28.3 percent higher than March of 2009. This tells us that the tax credit clearly help stabilize the market. Do not be sad though if you are a first time home buyer and missed the tax credit. These all time low interest rates enable a buyer to afford more now than in April, before the tax credit was over. Or just have a smaller payment which is better overall in the future. If you bought a $350,000 house with a $280,000 mortgage in April your payment would be around $1560 with an interest rate of 5.34% on a 30 year conventional loan. Today with the same scenario, but a rate of 4.625% your payment would be $1440. That would be an annual savings of $1467 and right at $44,000 over the 30 year note. WOW! Hopefully, the public will continue to think positively and want to keep moving from here to there especially while the interest rates are where they are now- about 4.5%.

On a different note, 11% of Realtors reported contracts being canceled because of appraisals coming in low, so as Realtors we have to stay on top of pricing homes and the price our clients are paying/offering for homes. This is something the public does not think of which makes having a licensed Realtor assist you in the sell of your home well worth it!

Lastly, there is more availability for jumbo loans and second home mortgages, so call us today if you have any real estate needs. Have a good week!

Sources: NAR, Realtormag, and Informa Research Services

This past week we saw inflation still in hibernation mode as the producer price index and the consumer price index both came in lower than last month. But don’t be fooled, our economy is moving forward, albeit slowly. Year over year inflation as measured by the consumer price index is 2% above last year with the core number (stripping out food and energy) at approximately 1% above last year. In addition, consumer sentiment numbers came out positive and that shows a hopeful outlook is still out there. Europe still overhangs the markets, and so with no inflation on the horizon and worries in Europe still making ‘fear’ drive money into bonds, rates remained at all time lows.

I’ll quote Barry Habib, one of my favorite analysts. “There is no fundamental reason why interest rates – and more importantly to us, mortgage rates – should be this low. The confluence of factors all coming together at the same time have made for an incredible low interest rate opportunity, but it won’t last long, and can change very quickly. Borrowers have temporarily been given this gift of historically low rates. It’s our job to help them see and capitalize on this opportunity, before it is gone.” Mr. Habib was commenting on Alan Greenspan’s speech this week where Mr. Greenspan said, “Long-term rate increases can emerge with unexpected suddenness.”

So, it seems that ‘making hay while the sun shines’ would apply to both the season and the rate environment. Hope you are enjoying your summer.

Oklahoma State Bond Authority still has the money available with a rate of 5.25% and 3.5% Down Payment Assistance.

This week rates ranged between 4.625% to 4.875% depending on program, credit and points.

HOPE YOU ALL HAD A WONDERFUL FATHERS DAY!!

Ted Clay
Sr. Loan Officer
NMLSR # 217991
OK License # MLO01963

Office: 405-341-8644
Cell: 405-826-1320
e-Fax: 1-866-208-5309
tclay@wrstarkey.com
www.TedClay.com

705 Smiling Hill Blvd Edmond, Ok 73013

Listed for $178,777. 4 bed, 2 bath, 1 living, 2 dining, and 2309 sqft/mol.

Large kitchen with lots of cabinet space and walk in pantry.

Perfect living room with fireplace and built in bookshelves open to formal dining.

Huge fenced in backyard with covered patio, landscaping and a storage shed plus an enormous side yard! Call us to see it today!

I got an email this morning from Ted Clay with WR Starkey mortgage letting me know the tax credit for existing contracts suppose to close on or before June 30 has been extended until September 30,2010. See below for more information. This is exciting for those who were pressed for time. I know others just wish they would extend the whole tax credit!

WASHINGTON June 16 (Reuters) – The U.S. Senate voted on Wednesday to give home buyers another three months to settle on their contracts and take advantage of a popular tax credit that sparked a rush of activity in the housing market.

The Senate, with a vote of 60-37, accepted an amendment by Democratic Leader Harry Reid that extends the closing deadline to Sept. 30 for buyers who met the April 30 deadline to have a signed contract.

The current deadline requires buyers to close by June 30 to get the $8,000 tax credit for first-time home buyers. Existing homeowners buying a new primary residence are eligible for a $6,500 credit.

Reid offered the measure as an amendment to a bill that would extend some popular business tax breaks and extend unemployment insurance benefits for jobless workers.

Coming off of last Friday’s employment numbers, investor fears kept rates low early in the week. But that fear lessened a bit mid-week, money flowed back into stocks and out of bonds, and this caused rates to tick up a bit. I know I’ve said it before, but for those who are new, as money moves into bonds, (mortgages are bonds) investors don’t have to pay as much in interest to attract the money and rates fall. As money flows out of bonds, investors have to raise rates to entice the money to stay. But today, retail sales came out negative, putting fear back into the market. Low and behold money flowed back into bonds helping us recapture some of yesterday’s losses and keep rates low.

Economic facts impact how investors, and consumers, feel about their world. But it’s those feelings or emotions that that move people to action. So while job numbers and retail sales have disappointed lately, the longer we continue without falling off an ‘economic cliff’, the more fears will subside. And, like the turtle, we will again stick our necks our and move forward….but as I’ve said, it’s going to take most of 2010 to get there.

In the mean time, Carpe Diem! Folks, it DOESN’T GET ANY BETTER! (and even if it did, winning the lottery for 10 million is just as good as winning the lottery for 11 million!). EVERYONE NEEDS TO TAKE ADVANTAGE OF THESE RATES!!! – Call me if you want to refinance too!

State Bond Money still has a rate of 5.25% with 3.5% Down Payment Assistance. There is over $10,900,000 still available so if you have that first time home buyer that need some help with down payment then this is a GREAT option. The buyer does not have to be a first time home buyer if buying in a targeted area!!!

This week rates ranged between 4.625% to 4.875% depending on program, credit and points.

Ted Clay
Sr. Loan Officer
NMLSR # 217991
OK License # MLO01963

Office: 405-341-8644
Cell: 405-826-1320
e-Fax: 1-866-208-5309

tclay@wrstarkey.com

www.TedClay.com

We continue to slog through this economic ‘slow down’ and many might ask the question, “Why is it taking so long?” Nerves. As Europe continues to unravel, no one really knows what impact it will have on the US. This week Spain was downgraded, Hungary announced that they were in trouble, and the Greek woes continue. So, unless the US economy can CONSISTENTLY show improving strength, nerves remain on edge. If the US were to show consistent improvement, nerves would calm because we are a big enough economic engine when we’re healthy to weather storms from around the world…but when we are weak, no one is too sure. This week the jobs report came in much weaker than anticipated, so while we had good economic news last month, it was not followed up on this month, and the consistent, sustainable improvement is still not there.

The result is that no one is hiring unless they have to. Consumers and business aren’t buying unless they need to. Global money is not investing like it used to. Money stays predominately in bonds. And this means WE STILL HAVE GREAT RATES!!! Remember, when money flows into the bond market (which includes mortgages) the bond makers (for us this would be Fannie and Freddie) don’t have to pay as much in interest to attract the money….so rates can stay low. But don’t worry, by year end our economic engine will be speeding up. Unfortunately, that will force rates up too.

This past week rates ranged between 4.625% to 4.875% depending on program, credit and points.

Ted Clay
Sr. Loan Consultant

Office: 405-341-8644
Cell: 405-826-1320

tclay@wrstarkey.com

www.TedClay.com

With the first-time home buyer tax credit deadline having come and gone, you may be asking yourself, “What now?” Fortunately, the door is now open to a new wave of savings: distressed properties.

For many buyers, the term foreclosure brings up images of run-down homes with no heat and rotting wood. While this is still the case for some homes, it’s no longer the standard. In fact, first time buyers are snatching up distressed deals in decent condition for great prices.

According to a November 2009 Keller Williams Research Buying Distressed Properties Survey, 40 percent of all buyers for bank-owned foreclosures (REOs) were first-time buyers in 2009. 50 percent of all short sale buyers were first-time buyers.

By definition, a distressed property is one that was purchased with a loan and the homeowner is no longer able to make their mortgage payment resulting in foreclosure – or if they’re lucky a short sale – meaning they owe more on the home than it’s currently worth. With a 20 percent increase in foreclosures from 2009, distressed properties still remain a large portion of home sales and are going to continue well into 2010 as homeowners continue to feel the effects of an economy on the mend.

If you’re in the market for a home and are prepared for a unique(more timely) transaction, a distressed property can be a great option. Here’s why:

Prices are low – Buying a foreclosed property is an excellent way to get a home for less(if it is in “ok” condition and you are getting a deal). Research shows you can save 10-40 percent over the price of similar properties in a traditional sale.

Mortgage costs are low(all across the board now) – With rates hovering near historic lows, financing costs to are favorable. Keep in mind, rates are always changing. It’s important to begin the pre-approval process so that you know how much you can realistically afford.

You have options – The number of homes in some stage of the foreclosure process still remains high. RealtyTrac, a site dedicated to tracking foreclosures across the country, estimates that there are approximately 2.1 million homes in some stage of foreclosure in the United States.

Sellers and lenders are motivated – According to data from RealtyTrac, in April, one in every 387 households in the country has received a foreclosure filing. The bottom line is that many sellers are still feeling the pain of a down economy and are anxious to out get from under a home that is putting stress on their current financial frustrations. While it is still an emotional transaction, these sellers are willing to come down on price or even consider concessions such as helping out on closing costs. Banks holding on to large portfolios of Real Estate Owned (REO) properties want to unload quickly – and price these home to sell.

Your best ally when purchasing a distressed property is an expert. Always have a professional REALTOR®, Kim or Terra, by your side to help you make informative decisions.