Here Comes the Fed

Via Origination Pro:

-Get Ready For New FHA Reverse Mortgage

-Confused Over New Compensation Rules?
-Freddie Paints Bleak Picture
-Government Weighs in on Fannie/Freddie Future
-Commercial Market Rebounding

-One CEO: No Real Estate Double Dip

It used to be that a meeting of the Federal Reserve Board was accompanied by great anticipation and trepidation. This is no longer the case. As a matter of fact, there have been no previous time periods in the past forty years when the Fed has been so inactive when it comes to changing short-term rates. It has been just about two years since the last significant adjustment. Not that the Fed has been idle. They have been very busy purchasing bonds and mortgage securities. And more of these activities may follow, though the recent reports on retail sales and employment, while not strong, may keep the Fed inactive in this regard for right now. Even the members of the Fed don't seem to agree on the correct course of action. From a recent blurb in The Wall Street Journal: Federal Reserve officials differ on the question of how weak the economic outlook should get before they move to take major steps to boost growth.
Don't get us wrong, the markets will still be anticipating the Fed meeting this week. However, the focus is more likely to be on the wording of the announcement at the conclusion of the meeting. The Fed has nowhere to go with regard to rates. The markets would love to see some statement that is positive. More than likely, the Fed will play down the chances of a double dip while acknowledging that the present state of the economy, especially real estate, is slower than anticipated. This is old news. So the question is, will the wording contain some sort of surprise in this regard? Any surprises could definitely increase volatility in the markets.

Rates were stable at historic lows again in the past week. Freddie Mac announced that for the week ending September 16, 30-year fixed rates averaged 4.37%, up slightly from 4.35% the previous week. The average for 15-year fixed fell slightly to 3.82%. Adjustables were also down slightly with the average for one-year adjustables easing to 3.40% and five-year adjustables falling slightly to 3.55%. A year ago 30-year fixed rates were at 5.04%. Attributed to Frank Nothaft, vice president and chief economist, Freddie Mac, "Rates on 30-year fixed loans have remained below 5 percent for the last 19 weeks giving people ample opportunity to refi their existing loans. As a result, homeowners reduced their financial obligations relative to disposable personal income during the second quarter of 2010 to the lowest share in almost eight years, according to the Federal Reserve. Currently, four out of five applications for home loans are for refinancing existing loans, based on figures released by the Mortgage Bankers Association of America." Rates indicated do not include fees and points and are provided for evidence of trends only. They should not be used for comparison purposes.

Current Indices For Adjustable Rate Mortgages
Updated September 17, 2010

Index	September 16	August
6-month Treasury Security	0.20%	0.19%
1-year Treasury Security	0.25%	0.26%
3-year Treasury Security	0.77%	0.78%
5-year Treasury Security	1.48%	1.47%
10-year Treasury Security	2.77%	2.70%
12-month LIBOR		0.949% Aug
12-month MTA		0.353% Aug
11th District Cost of Funds		1.753% July
Prime Rate		3.250%

 

Report: Right to Rent Legislation Would Slow Growing Rate of Foreclosure

Via RISMedia:
As the number of homes around the country entering the foreclosure process continues to steadily rise, a recent report from the Center for Economic and Policy Research (CEPR) suggests that giving homeowners the right to rent their house at a fair market price may be one of the best ways to address the nation’s foreclosure crisis.

“With roughly one-in four mortgages underwater, the loan modification plans put forth so far have done little to help homeowners facing foreclosure,” said Dean Baker, Co-Director of CEPR and an author of the report. “Right to Rent, on the other hand, would benefit millions, provide families with real housing security, and could go into effect immediately.”

The report, “The Gains from Right to Rent in 2010,” analyzes the costs of renting versus owning a house in several major cities and finds that the Fair Market Rents in these metropolitan areas is often much lower than the cost of ownership.

“Ordinarily, the gap between owning and renting is not that large.” continued Baker, “Due to the enormous run-up in house prices over the housing bubble years, however, ownership costs now vastly exceed rental costs in many of the bubble markets and homeowners in these markets have much to gain from having the opportunity to remain in a home as a renter following a foreclosure."

The report documents the costs of renting and owning before and after taxes in 16 metropolitan statistical areas (MSAs) and details substantial savings gained from renting across all scenarios depicted. The various scenarios consider the costs of mortgage payments, property taxes, insurance and maintenance costs, and mortgage deductions. An appendix is included that compares ownership and rental costs across 100 MSAs as well.

Under Right to Rent legislation, such as HR 5028, sponsored by representatives Grijalva (NM) and Kaptur (OH), Congress would temporarily alter foreclosure laws to let foreclosed homeowners remain in their homes as renters for a substantial period of time. This would save families from being kicked out of their homes and would go far to stop the blight of foreclosures affecting many of our communities. This plan requires no taxpayer dollars and no new bureaucracy to implement.

Taste of the Beach

More than 20 Pensacola Beach restaurants are expected to prepare their signature dishes for public sampling Saturday and Sunday at this year's Taste of the Beach event.  The two-day event will take place from 11 a.m. to 4 p.m. at the Gulfside Pavilion on Casino Beach.

All menu items will be priced for $5 or less.

Additional activities will include free musical entertainment, a Corvette show, children's games and contests, and crab races. Beer, wine, soft drinks and water will be sold by the Pensacola Beach Chamber of Commerce.

Details: Visit www.PensacolaBeach Chamber.com, or call 932-1500.

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Lowe's, REbuildUSA Launch Program to Support FHA Streamlined 203(k) Loan

Via RISMedia:
Program simplifies the loan-fulfillment process, creates opportunities for homeowners, home buyers, real estate and approved mortgage professionals

In today’s housing market, many homes for sale are in need of repairs and renovations. The FHA Streamlined 203(k) program helps add money into a mortgage for repairs and renovations. Lowe’s and REbuildUSA are partnering to bring a national in-store program offering customers a one-stop destination for all of their repairs, renovation products and services needs. 

“Homes needing renovation are typically the very best buys available; however, most prospective buyers have no idea how to finance both the purchase of the home and the renovation work required,” says Dennis Walsh, CEO of REbuildUSA. "The FHA Streamlined 203(k) offers a competitive solution. At the same time, millions of current homeowners could also benefit from this program that offers excellent rates and the ability to make improvements to their homes. We're excited to partner with Lowe’s to make use of the Streamlined 203(k) much easier than ever before."

The FHA Streamlined 203(k) renovation loan program provides funds for both the purchase and renovation of eligible homes packaged into one mortgage loan. Once the purchase of the home is closed, renovation funds are held in escrow to pay for pre-determined renovation work done by approved renovation contractors. There were approximately 21,000 FHA 203(k) loans in 2009, including Streamlines. 

To that end, most recently, Lowe’s added preferred lending partner Bank of America, which will help coordinate financing options for both renovations and home purchase with renovations through the Streamlined 203k loan, increasing the Lowe’s stores footprint with Bank of America’s locations. 

“Lowe’s is working with REbuild USA to be the home improvement solution for products and services required by a Streamlined 203(k) loan,” says Mark Malone, vice president of consumer marketing for Lowe’s. “We can help facilitate the needs of home buyers acquiring distressed properties and facilitate the process of getting their projects done.”

And for the industry’s top leaders, they believe this announcement is coming at just the right time. 

"Every real estate professional needs to know about this great opportunity in today's market," says Dave Liniger, chairman and co-founder of RE/MAX LLC. In fact, Liniger recently presented the REbuildUSA program to RE/MAX agents during a live broadcast via RE/MAX University. 

"[This program] is nothing less than the future of real estate." explains Ed Krafchow, president and CEO, Prudential CA/NV Realty. "If you're serious about success in this business, you've got to get involved in this ground-breaking program."

Specially trained Lowe’s associates in stores across the country, except in Texas, can help the customer plan the project and select products and Lowe’s independent subcontracted installers can handle the installation. The program allows Streamlined 203(k)-qualified customers to have a huge selection of products and services under one roof, and it gives customers the ability to immediately improve their homes by adding equity with the repairs and renovations.

Concludes Alex Perriello, president and CEO of Realogy Franchise Corp.: "REbuildUSA is a concept whose time has come and will have a positive impact on the real estate industry and homeownership in America." 

ABOUT LOWE’S
With fiscal year 2009 sales of $47.2 billion, Lowe’s Companies, Inc. is a FORTUNE® 50 company that serves approximately 15 million customers a week at more than 1,700 home improvement stores in the United States, Canada and Mexico. Founded in 1946 and based in Mooresville, N.C., Lowe’s is the second-largest home improvement retailer in the world. For more information, please visitLowes.com.

ABOUT REbuildUSA
REbuildUSA™ is dedicated to "rebuilding America one dream at a time." Its industry leading 203(k) Specialist designation training, membership support, lead generation, marketing solutions and exclusive online Project Portal™ fulfillment platform help consumers, lenders and real estate professionals leverage the power of the U.S. Government FHA 203(k) Home Purchase and Renovation Loan program. The parent company, Dennis Walsh & Associates, Inc., has delivered cutting-edge education and sales and marketing solutions to more than 80,000 associates of the world’s leading real estate organizations since 1988. REbuildUSA™ is proud to work with Lowe’s as its home improvement partner, Pillar To Post as its home inspection partner and a who's who of the nation’s most successful real estate organizations and leading mortgage lenders. As members of REbuildUSA™, these industry leaders are able to more effectively open up many more home ownership opportunities and stimulate the economy while improving homes and communities across America. For more information, please visitwww.rebuildusa.com.

13 Unique Ways to Sell a Home

Via Paige Tepping from RISMedia:

In today’s market, it takes more than painting and trimming the bushes to get noticed, to stand out, to make your home memorable. While home sellers across the country are resorting to dropping the price in order to make their home more attractive, it leads to one crucial question: what can I do differently to make my home stand out?

Larry Nusbaum, Resolution Assistance Contractor for the FDIC, offers the following tips for home sellers looking to differentiate their homes from the numerous homes that are on the market today.

1. Get lighted signage that’s illuminated even after dark. This will give prospective buyers extra time to see your home as they don’t have to depend on sunlight. 

2. If you or your agent are hosting an open house, be sure to serve light snacks and hand out something that attendees will remember. You want something that will be a positive reminder of your home—seasonal gifts are the perfect way to stay top of mind. Be sure to at least have pens and key chains with your agent's name and contact information on them.

3. Create an informational flyer with all the local conveniences you can find: shopping, schools, universities, hospitals, malls, restaurants, gas stations and attractions in the area, in addition to local police and fire stations, even school bus pick up locations. Assume your open house attendees don’t know the neighborhood.

4. Hand out information pertaining to your home as well as information on the other listed properties in the area showing that your house is the best value.

5. Do some staging to make sure your home looks its best. 

6. Be sure to offer incentives. Some examples include a Lowe's gift card, paying for a year’s worth of yard care or a free session with a landscape architect, offering a $1,000 landscape allowance, paying for a years worth of homeowners fees, offering $1,000 for new appliances or any home improvement, offering a new carpet allowance or paying for lawn service for a year—the possibilities are endless. 

7. Paint the garage floor (concrete paint). Making the garage look fresh and clean will make the whole house feel newer.

8. Send letters to all the neighbors inviting them to “pick their neighbor,”and be sure to include information about your home and the open house. Give them an incentive to talk about your home with other individuals in their sphere of influence. (i.e. a $200 gift card if they find your buyer).

9. Put up signs in your front yard and be sure to hang up as many directional signs as the neighborhood allows.

10. Put out flyers in surrounding shopping areas.

11. Have your agent create a video of your home and put the virtual tour on the Web.

12. Have your agent post ads on Craigslist and on any other free online listing sites you can find.

13. E-mail HR departments at local companies as many employees prefer to live close to their jobs but don’t make time for the house hunting process. This will make it easy for employees to find your home.

Engineering and Planning Resources Joins Pensacola's Chamber Incubator

Via the Pensacola Bay Area Chamber of Commerce:
PENSACOLA, Fla. - Sept. 14, 2010 - Bonita Player, principal of Engineering and Planning Resources (EPR), is the newest tenant of the Gulf Coast Center for Innovation & Entrepreneurship (CIE).
 
CIE is a partnership between the chamber and Pensacola State College, located at the school's downtown campus on Garden Street. The CIE supports technology-based entrepreneurs who create jobs and can sustain long-term economic growth for the area. Tenants have access to office space and equipment, a conference room and resources from the "Friends of CIE," comprising accountants, attorneys and business consultants to help meet the needs of their start-up businesses. 
 
"Bonita's potential to grow her company's revenues from projects located outside of the Pensacola Bay Area was a critical component to the company's selection as a client of the CIE," said Charles Wood, senior vice president of economic development for the Pensacola Bay Area Chamber of Commerce. 
 
EPR offers specialty transportation engineering and planning, environmental planning, public involvement and civil engineering services. EPR is certified as a Disadvantaged Business Enterprise (DBE) and Minority Business Enterprise (MBE) in Florida and Virginia. 
 
"Pensacola is a great area because it's a booming market, it's growing rapidly and it gives you the opportunity to work with different people in different areas," said Player. "People here are very giving of their time and resources."

Player was one of 12 graduates of the chamber's Excellence in Entrepreneurship course last winter. The 12-session course, which will be offered again this fall, provides one-on-one consultations and real-world examples to assist entrepreneurs in the completion of a business plan. 

"The CIE is continuing to seek out new companies that will grow the region's knowledge and employment base," said Jim Donatelli, CIE chairman and city president for Regions Financial Corp. "EPR is a welcome addition to the CIE's client base and has significant growth potential for the Pensacola region."

For more information on the services of the CIE, call Bridgette Price at (850) 438-4081, e-mailavpecondev@pensacolachamber.com or visit www.gulfcoastinnovation.com.

Chamber and County are Courting "Project Everest"

Via the Pensacola Bay Area Chamber of Commerce:
PENSACOLA, Fla. - Sept. 14, 2010 - The Escambia County Board of Commissioners is scheduled to vote on economic development incentives Sept 16. for Project Everest, the code-name for a significant project that would generate new jobs for the area.

If the vote passes, Project Everest could have a capital investment of $56 million and would create 102 jobs at averages annual salaries of more than $55,000.

"We are competing with at least two other states to bring Project Everest to the Pensacola Bay Area," said Jim Hizer, CEO at the Pensacola Bay Area Chamber of Commerce. "However, we are optimistic that with support from the county and state, we will be successful."

Project Everest and the Pensacola Chamber are asking the county to support an economic development tax abatement and local match requirements for incentives from the state.

"I anticipate the commission will continue its stance in supporting job creation and economic development with this project, especially with the salaries 150 percent higher than the countywide average," said Grover Robinson, chairman of the Escambia County Board of Commissioners.  
"If we're successful with this project, it will be the third largest capital investment project we have landed in the last four years, following Pall Corporation and Navy Federal Credit Union," added Collier Merrill, chair-elect of the Pensacola Bay Area Chamber of Commerce.
 
Chamber officials could not specify the type of company, only indicating the project is engaged in advanced manufacturing.