By JoAnn Rooney

There is a Chinese proverb that says, “May you live in interesting times.”

Well these are very interesting times in real estate. Cash is king in Florida and sales of homes in Tampa Bay prove it. We have seen a surge in sales the first quarter of 2011 and the more it snowed up North the busier we got. We are seeing pricing that the Tampa Bay area has not seen for 10 years and interest rates are still holding steady. It’s looking like the homes that are priced right will be selling this next quarter. The sooner we get though the glut of homes the sooner we will see a return of equity in our homes.

We are seeing buyers that are using funds from retirement accounts and the stock market because they are banking on getting a better return on a home by renting it out for the next five to ten years. As these sales rise median prices are falling. This is a great opportunity for the second home buyer, the investor and the first time homebuyer. In some areas we are seeing multiple bids on homes. I have a client who drove through her Mother’s neighborhood and for years there was a home that she could only dream of owning… today she’s living there because that home sold for thirty percent less than what the previous owner paid for it; her patience paid off.

A lot of the homes that are short sales (you owe more than the house is worth and your lender agrees to take less than what you owe on the property to release you from the lien) have been renovated back in 2005 and 2006 when money was flowing. I had a young buyer today that commented on how updated the homes were that she was looking at.

Unfortunately all those homes that were foreclosed on and these same short sales leave behind displaced homeowners. If you had your property foreclosed on you may have to wait seven years before you can apply for a mortgage and three years with a short sale. Where are these homeowners going to live in the meantime? They are going to be renters and the rental market is heating up.  These are tough times we are living through and the housing crisis has affected someone that we all know; a sister, brother, cousin, neighbor, parents and friends. Jobs have been lost across all sectors and bad things have happened to good people.

What happens three years from now and seven years when these same renters want to buy again? We don’t have much new building going on in Tampa Bay so the demand for homes will be high and this will bring back equity in our homes since no one wants to be paying the mortgage for the landlord. This is exactly what investors and foreign buyers are banking on. They will either fix them up to produce cash flow for the next five to ten years or sell them to other buyers for a quick profit.

In January and February of 2011 Tampa Bay recorded 2,619 foreclosure sales compared to 2,532 conventional sales. One year ago in 2010 for the same months, foreclosure sales numbered 1,154 compared with 3,089 conventional sales. Our best months; spring and summer, for buying homes are here, and the best advice I can give a client is to get approved for a loan before you contact a real estate agent, have a larger down payment and make sure you know what your credit profile is so you can compete with the cash buyers.

Lending is tougher then ever and you need a trusted advisor to help you navigate through the maze of paperwork and tougher underwriting standards that lenders are imposing on buyers these days. I just closed a self-employed buyer because the bank he went to turned him down because they couldn’t properly read a business tax return! Good grief that’s mortgage 101! There are plenty of extremely knowledgeable loan officers out there; make sure you are working with one. I am licensed, tested, my credit report is pulled and I have passed an FBI screening; ask your lender if they can say the same.

If you need a referral to a real estate agent call me and I can recommend someone who can help you negotiate the purchase of a home. A real estate agent works harder than ever and can work with a buyer for up to six months on a short sale and if the home does not close they spent six months working for free. Why should they drive you around when gas is $4.00 a gallon if you are not approved for a loan?

Experts believe we have seen the worst of the housing slump and the increase in sales is welcome news for all of us. So when that short sale or foreclosed home in your neighborhood sells–go introduce yourself to your new neighbors and thank them for helping us all get closer to our homes increasing in value.

Need us?  Call us!  At Your Mortgage Source, Inc., your priorities are our priorities!  Call us today at 717-787-2299.  We’re here to help.

Finding the Right Mortgage, Like Finding the Perfect Shoes (or Shoe Store!)…Requires a Great Fit

By JoAnn Rooney

Good question – right?

I had a potential client (Beth) ask me the other day, “Why should I use a mortgage broker for my home purchase?” I then said to her “Why wouldn’t you use a mortgage broker?”

I was all set to explain my logic to her when I noticed she was wearing a killer pair of red pumps. I asked her where she bought them and it turns out we shop at same shoe store at International Mall.  So, I asked her why she goes to that particular store and she said “I go to that store because I’m offered a wide variety to choose from, the salesperson knows my name and knows my style and  I receive that ‘personal touch’ that I appreciate.  Sometimes when I’m standing there I am overwhelmed by all the beautiful shoes to pick from.  I grab a seat, get comfortable, and my salesperson brings out the shoes I want to see, in addition to others that I never noticed but are also my style.  It’s always a pleasant experience for me and I always walk out with a smile on my face. I feel like I make educated decisions based on the many options presented and the personal attention and care I am given.”

“Beth” I said, “you just answered your own question for me.”

As a mortgage broker I work with more than ten local and national lenders, and my job is to help find the right fit for you. There are no more “one size fits all” products in this market and new rules and regulations are changing the landscape every day. The average consumer, busy with his or her own job, family, finances, etc., does not have the time or expertise to navigate this environment.  FHA, VA, USDA, conventional and jumbo mortgages, short sales, foreclosures, sink holes, flood and wind insurance, judgments and bankruptcies, investments properties, second homes and self-employed borrowers – - all these are things I address daily with customers.  I had a closing last month for a client that didn’t qualify because their credit was so bad a year ago. I gave him a road map to clean up his credit and last month he moved into his new home!

At Your Mortgage Source we negotiate for our borrowers with national lenders for better terms and quicker processing, often with the same institution you may have gone to anyway. Mortgage brokers are free agents which drive competition resulting in better pricing and service to you, the consumer.

Standards in the mortgage industry have tightened up immensely. We must be licensed, pass rigorous background checks, be fingerprinted, nationally registered, have our personal credit report examined, pass yearly state and national tests, and attend continual education classes year round.

As a trusted mortgage advisor for the past 14 years, I have been helping families buy or refinance their homes.  Purchasing a home is one of the biggest investments of your life. We help manage our client’s expectations up front and take the emotion out of a home purchase. IT PAYS TO SHOP AROUND!

If you’ve got questions – we’ve got answers.  Call us today at 727-787-2299 or visit us online at www.urmortgagesource.com.

Buyer beware though – before you consider MOVING UP…take a look at these six common move up market mistakes! 

1.  Not Putting first things first: One of the trickiest things in moving up is knowing in which order to take each step in the process. Do you list first? When do you look for a new house? What about possession of the current home? An experienced agent will guide you through these twists and turns with ease and help ensure that you have everything moving in the right direction at the right time.

2.  Failing to evaluate your finances: Buying and selling homes are major decisions and  should be thought through thoroughly. Unfortunately, many consumers leap before they look which can be a recipe for disappointment. Dig deep and look at, not only how much you’re bringing in pay- check-wise but also, how much is going out. Loan to debt ratio is one of the largest factors consumers face when attempting a favorable mortgage loan. Things like making large purchases or applying for new credit before hand can have a negative impact on your buying power.

3,  Choosing the wrong (or no) real estate agent: In terms of getting the most from your current home and negotiating the best deal on the new house, don’t leave your investment options to chance. An experienced agent can negotiate on your behalf and use all the tools and programs the industry has to offer to work for you.

4.  Overestimating your home’s value: Many homeowners make the mistaken impressions that they can price their home high and “come down” later when that strategy couldn’t be more detrimental to getting the most for their home in the shortest time. I can walk you through the wide spectrum of reasons why pricing right is your best chance at a fast sale.

5.  Not knowing your liabilities: Most know what their mortgage payment is but not necessarily their mortgage payoff or what liens may be associated with their loan. It pays to have your ducks in a row when considering both selling and buying a home,
Not doing the math: People get overwhelmed thinking about how much less they might get for their home but forget to look at the flip side: how much less they’ll pay for their next. For example, if your home is worth $200,000 and you want to buy a $600,000 house, the difference in value is seemingly $400,000. However with home prices decreasing roughly 10% on average in today’s market, your current home’s value would be $180,000 and the home you want to move up to would be worth $540,000. So while your home value has decreased only $20,000, the home you want is now $60,000 less!

If you’d like to learn more about how much home you qualify for or what financing options may be available to you, give us a call today at 727-787-2299.  We can help!

HARP is the Homeowner Affordability Refinance Program being offered for those homeowners who do not otherwise qualify to refinance their current home loan.

If your current loan is owned by either Fannie Mae or Freddie Mac you may be eligible to refinance your home with HARP funds, take advantage of the new low interest rates, and reduce your monthly pay­ment. We have several lenders offering this program NOW.

How do I find out if I have a Fannie or Freddie mortgage?

Visit the webpages below and complete the short form online.

www.fanniemae.com/loanlookup

www.freddiemac.com/corporate

You will know immediately if Fannie or Fred­die owns your loan. Only your first mortgage can be refinanced (if you have a first and sec­ond mortgage, the second mortgage remains as is). We can finance up to 105% of the current value of your home. In some cases HARP loans are available up to 125%.

How do I know if I am eligible?

1. You owe more than the house is worth OR you have lost significant equity.
2. You have a fixed mortgage rate higher than current interest rates.
3. You have an adjustable rate mortgage (ARM) that has reset or will soon reset.
4. You are current on your mortgage and have not been 30 days late making a pay­ment in the last 12 months.

Can I get cash out to pay other debts?

No. Unfortunately, the Home Affordable Re­finance Program (HARP) will not allow cash back to the borrower in excess of $250. The goal of this loan is to reduce your current monthly payments.

What about closing costs and mortgage insurance?

All closing costs can be included the mort­gage, so except for a credit report fee and ap­praisal fee (if required), HARP loans do not require cash at closing. The credit report and appraisal fees typically run $300 or less. This expenditure will be offset by your reduced mortgage payments savings in a matter of a few months.

Typically you would be required to pay mortgage insurance, making the re­finance transaction not worth paying the closing costs. Mortgage Insurance is not re­quired for HARP loans.

Here is an example of a HARP refinance that I did for clients Jack and Kate:

Jack and Kate have steady jobs. They pay their bills on time including their monthly mortgage payment. Like many homeowners in Florida, Jack and Kate felt they were unable to refinance to a lower in­terest rate because the value of their home has declined. They met the following re­quirements; They own a one- to- four unit home with a $310K balance on their first mortgage and an appraised value of $300K. Their Adjustable Rate Mortgage currently at 6.25% was owned by Fannie Mae and was scheduled to reset in June 2011. They are up-to-date on their mortgage payments and have not been more than 30 days late in the past 12 months.

With my assistance, Jack and Kate were able to secure a 4.75%* 30-year fixed rate loan through the HARP program. Their payment went down by $368 a month, great­ly reducing their stress over other bills each month and freeing up funds for other cash needs. Their credit score will not be affected and they now have peace of mind knowing their payment is fixed and they can remain in their home indefinitely. *4.637% APR

Loan to Value Ratio (LTV) can be used to estimate the amount of equity you have in a property. Example: $300,000 (loan balance) divided by $286,000 (market value) = 105% LTV

The HARP program is not just for folks “upside down” on their mortgag­es. If your LTV is anywhere from 80% to 125%, you may be eligible.  Call me 727-787-2299. ext 1 to see if you qualify for a refinance under the HARP program!

by JoAnn Rooney

Eight months ago, Sarah, a recently divorced mother of two, walked into my office and saidshe wanted to purchase a home on her own for the first time. After reviewing her situation and checking her FICO score*, I realized we had some credit obstacles to overcome.   Sarah had a credit score of 620 – high enough for a mortgage – but low enough to invoke a higher interest rate. I explained if we could improve her credit score we could reduce her interest rate, which in turn would save her thousands of dollars over the life of her loan as well as reduce her monthly payment. We talked about why her credit score was low and what she would need to do to increase the score. We mapped out a plan for Sarah to follow involving some basic steps that could be taken quickly and easily.

They are:

Credit Dos:

1. Pay your bills on time. Delinquent payments and collections can have a major negative impact on your FICO* score. If you have missed payments, get current and stay current. The longer you pay your bills on time, the better your FICO score.

2. Pay down your debt rather than move it around. Keep balances below 30% of total credit line on credit cards and other revolving credit. It is OK to request and check your own credit report, as long as you order your credit report directly from the credit-reporting agency or through an organization authorized to provide consumer credit reports.

3. Have credit cards, but manage them responsibly. In general, having credit cards and installment loans (and making timely payments) may improve your FICO score. Someone with no credit cards tends to be a higher risk than someone who has managed credit cards responsibly. 4. Do your rate shopping for a loan within a focused period of time. FICO scores distinguish between a search for a mortgage or auto loan (where it is customary to shop for a best rate), and a search for many new credit lines.

Credit Don’ts

1. Don’t shop for a mortgage while also shopping for big-ticket items that will be paid for on your credit card. Delay large purchases such as furniture, electronics, or cars until after your real estate closing.

2. Don’t close unused credit cards as a short-term strategy to raise your FICO score. Closing an account will not remove it from your credit report and may not improve your score.

3. Don’t open a number of new credit cards that you don’t need just to increase your available credit. This approach could backfire and actually lower your score. New accounts will lower your average account age, which will have a greater effect on your FICO score if you don’t have a lot of other established credit information. Paying off collection accounts or other derogatory items will not remove them from your credit. The fact that this event occurred is predictive, in addition to any dollar amount associated with the past due. There is no mystery about how consumers can improve their FICO scores. FICO scores reflect the long-term patterns of credit use and repayment history over time. FICO scores automatically improve, as your overall credit picture gets better. That means showing a historical pattern of paying your bills on time and using credit conservatively. Scores are weighted according to the following criteria (example below can vary per reporting agency).

• 35% – Major and minor delinquencies including late payments, collections, judgments and bankruptcies.
• 30% – Amount of outstanding debt and balance to high credit ratios.
• 15% – Length of credit history (how long accounts have been open)
• 10% – Inquiries or applications for new credit (promotional inquires do not affect the score) 10% – Type of credit – real estate and revolving vs. installment.

*A FICO score is a credit score developed by Fair Isaac & Co. Credit scoring is a method of determining the likelihood that credit users will pay their bills. A credit score attempts to condense a borrower’s credit history into a single number. Fico scores range from 300 to 850. The higher the score, the lower the predicted credit risk for lenders.

Sarah paid her credit cards off every month in full, used them the next month and paid them off again; she corrected some errors on her credit report and was diligent about paying her debts on time. Having a plan and taking the steps I mapped out for Sarah increased her credit scores. Sarah and her daughters are now living in their new home!  If you’d like to learn how you can take these steps for your family, call me for your free credit consultation map at 727-787-2299, extension  1.

Do you currently have a FHA mortgage? If so, ask me about the FHA Streamline Refinance where no appraisal or income verification is needed! To take advantage of historically low interest rates, call me today!

Follow these steps to lower the risk of having your personal information stolen. 

By Cameron Huddleston, Kiplinger.com

Using your smart phone to check your bank account balance or deposit a check is convenient. But is it safe?

Hackers are getting better at finding ways to tap into smart phones and capture people’s account numbers and other personal information. However, there are ways to lower your risk of becoming a victim, says Michael Gregg, a cyber security expert and founder of Superior Solutions. Here are his tips:

Don’t use public Wi-Fi to access accounts online. Use your phone provider’s network, instead, because it’s more difficult for hackers to tap into it. Public Wi-Fi connections, on the other hand, are easily compromised not just by savvy cybercriminals but by anyone who downloads a free program, which allows users to see what others are doing online and log onto their accounts as them.

Watch out for smishing (fake text messages). If you get a text message supposedly from your financial institution warning you that there may be a problem with your account, don’t click on any links or call a number in the message. The link could take you to a phony site with malicious software that will give criminals access to your phone. And the number could connect you with scammers who are trying to collect your account information. Go directly to your bank’s Web site to check your account or to get a customer service number. And if you get a text message asking you to download a security update for your phone, don’t be fooled. Smart phone makers don’t send out security updates by text message, Gregg says.

Be careful where you browse. Go to sites you know to conduct financial transactions. And before downloading any banking applications, check your financial institution’s site to make sure it offers one. Apple puts all apps for the iPhone through serious scrutiny, but other smart phone makers do not. A year ago, more than 50 fraudulent mobile banking apps appeared in the Android marketplace and were removed once they were discovered — after many had bought and downloaded the apps.

Don’t jailbreak your iPhone. You’ll lose your security mechanisms, Gregg says, if you tamper with your iPhone so it can run on another service provider’s network or download additional apps.

Reprinted with permission. All Content ©2011 The Kiplinger Washington Editors. www.kiplinger.com.