True story: FRAUD! “Real Estate transactions”

I would like to share the experience one of my clients had with someone working in real estate and may be you could use this experience to protect yourself from FRAUD.

I came to know this client, whom we’ll call “Juan,” through a referral. He was interested in selling his home because his business was not doing so well and he needed to move to a smaller home. I contacted him and showed him my business and marketing plan to sell his home. He was happy with what I had to offer BUT his brother in law’s cousin also worked in Real Estate and wanted to give him a try. After all, family is family……right!!???

He signed the listing and it took a little over a month for this family member to upload the correct information to the MLS, and a couple more weeks to upload a picture of the house itself to the profile in the MLS. Nevertheless, the property was on the MLS with picture and description.

Seven months later he received one visit, no open house and one offer. You might say, well, the market has turned and the seller should not expect much; I’ll tell you, the market was still great when he first put his house on the market. The one visit they had was from some friends of the listing agent acting as prospective buyers. The open houses, the agent offer to do never happened and the one offer they got, never materialized because they buyers were not qualified for a loan. If you ask me, they were just some make believe buyers the agent brought in to show “Juan” he was working hard to sell the home.

At the end of the contract the listing agent threaten Juan to sell the house “in a second” to anyone he pleased if he did not renew the contract and to take him to court if he did not sign another contract to pay him back some money the agent had lend Juan to make his mortgage payments. Juan refused to sign any contract and at the end of this horrible experience, Juan decided to contact me after his contract expired to sell his home with me.

After reading this article, I just want to advice anyone looking to sell or buy a home to look into the agents credentials. This year, because there had been many people acting as real estate agents without a license, the California Department of Real Estate ordered agents to provide their real estate license number on their business cards. By the agents providing their real estate license on their business cards, the consumer can easily verify if this “agent” is in fact a real estate licensed agent.

Even if the agent you are dealing with has a licensed but is breaking the law or defrauding you, you can contact the California Department of Real Estate to help you.

April 28th, 2006 · Filed Under Real Estate & Mortgage FRAUD

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Mortgage watch 4/28/2006

Provided by Mortgage Track
Mercury News
Average Rates

April 28th, 2006 · Filed Under Keeping an Eye on the Market

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Long-Term mortgage rates rise for fifth straight week!

This week, Freddie Mac’s Primary Mortgage Market Survey showed that the 30-year fixed-rate mortgage (FRM) averaged 6.58% (with an average of 0.5 points) for the week ending April 27, 2006. This average is UP from last week; which was at 6.53%.

Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 6.21% for the same week (with an average of 0.6 points). This average is UP from last week when it averaged 6.16%.

One-year Treasury-indexed ARMs averaged 5.68% for the same week (with an average of 0.7 points). This average went HIGHER from last week when the average was at 5.63%.

Frank Nothaft, Freddie Mac vice president and chief economist, explained “Indications of a stronger economy gave rise to an increase in mortgage rates this week” “Consumer confidence and existing home sales unexpectedly rose. Much of this strength is attributed to a health labor market, which translates into greater consumer spending. This should support an active housing market over the next few months” “We expect mortgage rates to gradually rise throughout the year. A stronger labor market, coupled with moderation in house price growth, means our outlook for overall housing conditions remains upbeat”

My advise to everyone with an interest only, option arm or a short term hybrid arm is to get rid of those loans and refinance for a fixed rate mortgage or a long term hybrid arm and take advantage of the slow rise on interest rates.

April 28th, 2006 · Filed Under Keeping an Eye on the Market

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HELOC = Home Equity Line of Credit

Do you own a home and now you are thinking about making some home improvements or want to go on a vacation, or want to pay off your credit cards but cant afford to do it?

Someone mentions to you about a HELOC, and recommend you to take out a second loan on your home since you have built so much “equity.” After you obtain the loan, you have the home improvements done, you go on a vacation and pay off all your credit card debt, what now??

Interest rates are increasing and will continue to go up for the remaining of this year, how does this affect you? Well, a HELOC’s interest rates will also fluctuate when the prime rate fluctuates. Now you are stuck with two loans on your home and with the increasing monthly payment you could end up loosing your home.

Always think twice about the purpose and necessity of taking a second loan on your home as it is not always beneficial to obtain a HELOC, specially now that interest rates are constantly going up.

A HELOC’s rate is based on the prime rate. Most consumers will pay 1% over this prime rate. The prime rate is normally 3%+ over the Federal Funds rate. If you have been paying attention, you will know that the Fed has been raising these rates and most likely will continue to do it for the rest of the year. Therefore if the Federal Funds rate was to be at 5% a HELOC rate could end up being at 9% (5% Fed + 3% Prime + 1% = 9%).

(This week the Fed Funds rate was at 4.75)

A better choice for you would be a second loan with a fixed rate or refinancing your first loan for a bigger amount (only on certain situations). I suggest that you do not jump to the first offer you find, always try to find a mortgage broker who is willing to give you options and explain to you the benefits of each option.

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April 17th, 2006 · Filed Under Mortgage - Loan Information

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Mortgage Rates keep RISING!

This week, Freddie Mac’s Primary Mortgage Market Survey showed that the 30-year fixed-rate mortgage (FRM) averaged 6.49% (with an average of 0.6 points) for the week ending April 13, 2006. This average is HIGHER from last week; which was at 6.43%.

Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 6.13% for the same week (with an average of 0.7 points). This average is HIGHER from last week when it averaged 6.11%.

One-year Treasury-indexed ARMs averaged 5.61% for the same week (with an average of 0.8 points). This average is HIGHER from last week when the average was at 5.57%.

Frank Nothaft, Freddie Mac vice president and chief economist, explained “Mortgage rates continued to creep up following the unexpected drop in March’s unemployment rate. That drop indicated there may be some upward pressure on wages in the near future, which could lead to a rise in inflation,” “And the threat of a higher rate of inflation, as we all know, invariably leads to higher mortgage rates,” ”With all that said, Freddie Mac’s outlook for 30-year mortgage rates for 2006 continues to expect that rates will fluctuate somewhere between 6.25% and 6.75% over the course of the year.”

Get rid of those interest only or negative amortization loans NOW and refinance for a better loan and rate.

April 17th, 2006 · Filed Under Keeping an Eye on the Market

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Mortgage watch 4/14/2006

Provided by Mortgage Track
Mercury News
Average Rates

April 17th, 2006 · Filed Under Keeping an Eye on the Market

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Mortgage Rates went UP this week

This week, Freddie Mac’s Primary Mortgage Market Survey showed that the 30-year fixed-rate mortgage (FRM) averaged 6.35% (with an average of 0.5 points) for the week ending March 30, 2006. This average is HIGHER from last week; which was at 6.32%.

Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 6.02% for the week ending March 30, 2006 (with an average of 0.6 points). This average is HIGHER from last week when it averaged 5.96%.

One-year Treasury-indexed ARMs averaged 5.51% this week (with an average of 0.8 points). This average is HIGHER from last week when the average was at 5.41%.

Frank Nothaft, Freddie Mac vice president and chief economist, explained “The Fed raised rates this week, as was expected, but the market was a little surprised at the Committee’s coments, which implied more tightening in the future” “That raised the expectation that inflation may be more of a threat that was previously thought, and that kind of thinking promotes upward pressure on mortgage rates like we saw across the board this week.”

My advice is that if you have an interest-only loan or an option arm, you should think about refinancing NOW and try to fix your rate.

April 1st, 2006 · Filed Under Keeping an Eye on the Market

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Long-Term rates go LOWER for 2nd consecutive week

This week, Freddie Mac’s Primary Mortgage Market Survey showed that the 30-year fixed-rate mortgage (FRM) averaged 6.32% (with an average of 0.6 points) for the week ending March 23, 2006. This average is LOWER from last week; which was at 6.34%.

Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 5.96% for the week ending March 23, 2006 (with an average of 0.7 points). This average is HIGHER from last week when it averaged 5.93%.

One-year Treasury-indexed ARMs averaged 5.41% this week (with an average of 0.7 points). This average is HIGHER from last week when the average was at 5.37%.

Frank Nothaft, Freddie Mac vice president and chief economist, explained “The most recent economic indicators released this week showed that inflation is, indeed, being held in check” “That news allowed long-term mortgage rates to drift a little lower for the second week in a row. Shorter-term rates, however, rose in reaction to a recent speech by Chairman Bernanke, of the Federal Reserve Board, that hinted at even further rate hikes this year” “Meanwhile, existing sales for February were unexpectedly high, but experts think that this may be due to an unseasonably warm January when those contract were closed. Nonetheless, the housing industry remains fundamentally fit as we move into the spring buying season.”

Do you have an interest-only loan or an option arm, you should think about refinancing NOW and try to fix your rate.

April 1st, 2006 · Filed Under Keeping an Eye on the Market

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