A POSITIVE COMMENT FROM THE MEDIA

The March 31, 2008 NEWSWEEK contains an article regarding the economy entitled "COOLER HEADS PREVAIL".

The final paragraph states "With all of Washington standing by to protect the economic system, you can bet on eventual recovery, even if there's a recession to get through. So use tough times to shop for a house, a cheaper mortgage, a good stock. When the cycle turns back up, you'll be sitting on top of the world."

Wow, pretty succinct. Meantime, the word on the financial street is that we may well be at the end of the bad news from the banking world. We did lose 250 mortgage companies but I suspect they did it to themselves by taking to much risk. Meanwhile, the loan applications based on "stated income" are slowly getting phased out, a common investor vehicle for buying property.

On the other side, FHA has gone through some major changes - they are the loan of the moment for accepting lower FICO scores, lower down payments, good interet rates, and a new maximum for the Phoenix area of $386,000.

Let FHA Loans Help You

Act while the good opportunities are in front of you.

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MORTGAGE HELP STALLED IN CONGRESS

Me thinks we need to clean out the Congress and put in some folks who do things:

Bills on Capitol Hill

Aside from delaying aide to those who need it, our economy could use a little medical attention right now!

Rising Housing Sales

A good news, tempered with not so good news, from Realty Times:

Rising Housing Sales Should Be No Surprise

The stock market reacted favorably to the sales improvement in February so maybe we will see some form of turning point soon.

ALMOST GOOD NEWS?

The Cheif Economist for the Conference Board offers a glimmer of hope in this Realty Times articel:

AN OPTIMIST AMONG THE MEDIA?

I for one certainly hope she is right. I must confess, it't beginning to get on my nerves!

And for those facing the potential of the foreclosure process, please, please, get in touch with your lender and/or some of the organizations in earlier blogs on here. Do not, under any circumstances, allow yourself to get caught up in the "helper scams" that individuals are perpertrating on less knowledgeable homeowners. If in doubt, call me!

STABLE EXISTING-HOME SALES EXPECTED IN EARLY 2008

An article from REBAC's HOTSHEET suggests that the recent increase in pending sales projects improvements in 2008:


STABLE EXISTING-HOME SALES EXPECTED IN EARLY 2008


Again, let's hope they are right. Sure tired of the "downer" news coming from most new media sources.

LENDERS OFFER BROADER MORTGAGE HELP...

Click on the title above. This article from USA Today highlights the several programs available to assist those facing foreclosure. The latest plan will allow seriously overdue homeowners to suspend foreclosures for 30 days while lenders try to work out more affordable loan terms.

As an aside, Phoenix is number 22 on the list of cities with the most foreclosures.

Housing Hangover Leaves Consumers Confused

This article from Realty Times says that 56% of those in foreclosure still don't know there are people that can help out there. Make sure you send this to anyone who you know is in a potential financial burden:

THE WORD IS NOT GETTING OUT!

The news media tend to emphasis the bad and fail to communicate the possible help that is available. Do your friends a favor!

SOME GREAT INDUSTRY & VALLEY NEWS

Through the courtesy of First American Title, we bring you a Newsletter of great value.

Today's articles include:

-New Home Sales fell by record amount in 2007
-Number of homeowners who can't afford payments escalates
-Mortgage industry fears foreclosure moratorium
-It's a Renter's Market in the SE Valley
-Permits may fall, but rebound on horizon
-Stimulus plan also sparks housing market
-Lower credit scores mean higher rate for borrowers
-Number of foreclosures soared in 2007
-Economists rate chance of recession as a "coin flip"

THE NEWSLETTER


Some facts of interest in concert with the Newsletter:

FACT: 97% of home owners in the United States are CURRENT on their mortgage!

WOW, listening to the general media, that number would be voted on the opposite side of current.

FACT: 99% of all homeowners are NOT IN FORECLOSURE.

Not as bad as you thought unless you are part of the other %. The Newsletter and this blog offer several suggestions for help!

MORTGAGE MARKET CURE HALF DONE? HELP?

Some recent articles quoted the Chief Excutive Officer of JP Morgan Chase as stating that "there was a housing bubble in the U.S.", it burst and subprime suffered as the first affected. His remarks at a gathering in Switzerland continued, "That will cure itself, and in my opinion it is half done already"

He also commented on the U.S. monetary policy favorably, highlighting that Central banks were doing a great job to mitigate the downturn effects.

An article in Realtor summarizes the help available to all borrowers during the current unrest in the market. The article follows.

HELP TROUBLED BORROWERS

It is an excellent summary and worth the read.

ECONOMIC STUMULUS PACKAGE

The Economic Stimulus Package. What's in it? What's been left out? When do we start cashing our rebate checks?

This article from Realty Times sheds some light on progress:

Washington Report: Economic Stimulus Package for Housing

"One economist in Washington estimates this change alone -- even if it's in place for just 12 months -- could stimulate over a quarter of a million home purchases, plus help thousands of financially-stressed owners facing payment resets on jumbo mortgages to refinance into saner, safer fixed rate alternatives."

I, for one, hope he is correct.

Subprime Borrowers Get Hope Now

If you are a homeowner with a subprime mortgage, chances are, you could use a little hope, right about now. The following from Realty Times:

HOPENOW

If you are able to re-finance, and there are a few that can, on an 85% of appraised value, the interest rate on 30 year fixed is now 5.75%.

Do call HOPENOW, they do appear to be helping folks.

MORTGAGE RELIEF UPDATE & TAX CHANGES

The following is provided courtesy of Bob Martin, Artisan Mortgage:

Update # 1 - Mortgage Relief Passed by Congress & Signed Into Law by the President!

On Thursday, December 20th, President Bush signed into law a bill passed by Congress: HR 3648 –Mortgage Forgiveness Debt Relief Act of 2007. The three major points are:

· Elimination of the “phantom tax” on foreclosures, short sales or other discharges of debt on a primary residence. Consider this scenario: A property is worth $250,000, and the mortgage balance is $300,000. Under the old rules, if a lender forgave the $50k difference as part of a foreclosure, short sale, refinance or loan modification, the borrower had to claim the $50k as income and pay federal income taxes on that amount. The new law eliminates this “phantom tax”, and the forgiven debt is no longer treated as taxable income to the borrower, as long as certain requirements are met, such as the discharged mortgage balance must be on the taxpayer’s principal residence (no investors or 2nd homes).

· The tax deduction for mortgage insurance premiums is now extended until December 31, 2010 instead of expiring at the end of 2007. The same rules apply as before in terms of the income limitations, etc. If you have questions about these rules please contact Artisan Mortgage for more information.

· The capital gains exclusion is now $500,000 instead of $250,000 for an unmarried individual who sells their primary residence within 2 years of the time their spouse has died. This new guideline applies to sales after December 31, 2007, and provides relief for widows and widowers by giving them a 2 year window from the time their spouse has died to sell their home and receive the $500,000 exclusion. Of course, the same rules apply as before, where the individual(s) need to have lived in the home as their primary residence for 2 out of the last 5 years.

Update # 2 – AMT (Alternative Minimum Tax) Relief Passed by Congress

Congress passed AMT relief on Wednesday, December 19. The President has indicated a strong willingness to sign this bill into law, and it is currently awaiting his signature. Under this one year patch, approx. 20 million taxpayers have escaped the clutches of the AMT. However, approx. 3.5 million taxpayers are still expected to be subject to the AMT.

Bob Martin
Artisan Mortgage
Certified Mortgage Planning Specialist
(623) 518-4401
bmartin@artisanloans.com

FREDDIE MAC - INTEREST RATE DOWN

MORTGAGE RATES AT 2005 LEVELS

A recent Real Estate seminar we attended noted that with 100,000 net annual increase in Maricopa County's population, with more and more National weather anomalies and our constant warm climate, with pending sales up the last 2 months in Maricopa County, with Builders still building, with prices down AND interest rates down, while there is bond money available to help 1st time homebuyers with a FREE 3+% grant (no repay), with more young people leaving Ohio than staying, with our access to skiing, lakes, Mexico, Vegas, and FHA reforming to a more viable option, why is the media so negative.

Partly because they report Nationally, and because bad news makes headlines, not good news. One Broker reported a 0.1% per month drop in Tucson prices - a recent Tucson headline, "Home Prices Plunge!".

Maricopa County home grown investors, not the Californian's that caused the 2005 run-up with O% down, 100%, interest only loans, are jumping in with both feet. They know when most Buyers sitting on the sidelines jump in there could be a frenzy mentality! Beat the "Christmas Rush" type phenomena if you're serious about buying!

INTEREST RATE UPDATE

The message is - get'em while they're hot!


Interest Rate Update

FHA Loan Program: Model of Success?

With FHA, a lot of the risk associated with the new loan formats is eliminated. For instance, there are no prepayment penalties with FHA financing. The article from Realty Times identifies several other advantages:

FHA Loan Program

Of particular interest, "FHA has just come out with a new loan designed specifically for troubled ARM borrowers who face foreclosure. Called "FHASecure," the new program is available even to homeowners who have missed six or more monthly payments."

Perhaps the help you are seeking is close at hand.

TAX IMPACT ON FORECLOSURES & SHORT SALES

The Internal Revenue Service has provided guidance in a publication dealing with Foreclosures and Short Sales:


IRS PUBLICATION

Having read the article, I suggest you contact a competent CPA to review your personal circumstances. The issue of insolvency appears to be the key to whether you will face tax consequences.