Should You Pass On The Fixed Rate Mortgage?

The answer to the question raised above is, it depends.  While fixed rate loans give you comfort in knowing your loan payment will never change, does it make sense to borrower long term if you plan on being in the home for, say, 5 hears?  Decidedly not and the ARM, the adjustable rate mortgage, may be the loan for you.

Here's an article from  Realty Times that discusses the big pro of borrowing with an ARM for home ownership.

Should You Pass On The Fixed Rate Mortgage?

For your next commercial real estate transaction, house purchase, mortgage refinance, reverse mortgage, or home equity loan, contact us. We can help. Located in Fairfield, NJ, we are the title insurance agent that does it all for you.

For your next title order or

if you have questions about what you see here, contact

Stephen M. Flatow, Esq.

Vested Land Services LLC

165 Passaic Avenue, Suite 101

Fairfield, NJ 07004

Tel 973-808-6130 - Fax 973-227-0645

E-mail sflatow AT vested.com

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NJ town to condemn mortgages?

The mortgage debacle in New Jersey is not over. Irvington, located next to Newark in Essex County, is considering the condemnation of mortgages on under-water properties in an effort to help restore value to the community.  Lots of luck.

Says Wayne Smith and the ACLU,

When the housing bubble burst in 2008, it sank the fortunes of millions of Americans who invested their money by purchasing a home when the real estate market was hot.

An estimated 1,775 homes in Irvington have been foreclosed upon since the burst in 2008, leading the township to spend precious revenue on maintaining and policing vacant and abandoned properties.

According to a report by New Jersey Communities United, “Irvington Home­wrecker,” home­own­ers lost nearly $300 million in wealth tied to their properties. It’s not surprising that Irvington has been hard hit by the foreclosure crisis. Communities of color across the country were targeted by unscrupulous banks peddling subprime mortgages.

The number of foreclosures in communities of color is 17 per 1,000 households, while predominantly white communities have seen 10 foreclosures per 1,000 households.

So how should Irvington and other towns respond to this crisis and protect residents from further community destabilization brought on by the toxic mortgages? Our answer: eminent domain.

Underlying this scheme would be the payment of "fair market value" for the mortgage, then the municipality would lower the balance and, therefore, payments of the property owner in an attempt to restore the community.

As posted in the blog below, homeowners would have to

owe more than their homes are worth and who meet a few other criteria. Using money from private investors, the township would pay the holders of those mortgages fair market value and renegotiate a new mortgage based on much lower principal amounts, reflecting the new depressed values of the homes.

 Lots of luck Mr. Mayor.  Read the full post here Irvington aims to tackle Wall Street's mess: Opinion | NJ.com and the news report here.

For your next commercial real estate transaction, house purchase, mortgage refinance, reverse mortgage, or home equity loan, contact us. We can help. Located in Fairfield, NJ, we are the title insurance agent that does it all for you.

For your next title order or

if you have questions about what you see here, contact

Stephen M. Flatow, Esq.

Vested Land Services LLC

165 Passaic Avenue, Suite 101

Fairfield, NJ 07004

Tel 973-808-6130 - Fax 973-227-0645

E-mail sflatow AT vested.com

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JPMorgan paying $5.1 billion to Fannie, Freddie over mortgages - Oct. 25, 2013

OK, I'm not too sure I understand, but it goes like this-
bank buys failing lender to protect country against fallout from the 2008 implosion, lender had made bad loans, purchaser is responsible for said loans going bad, really bad.

That is the scenario as I understand it and JPMorgan Chase* is paying the price to Fannie Mae and Freddie Mac which bought those loans.  True, the loans were badly written but what was JPMorgan Chase to do?

Will someone please explain this to me as if I was a six-year old?  Read the full report from CNN.

JPMorgan paying $5.1 billion

For your next commercial real estate transaction, house purchase, mortgage refinance, reverse mortgage, or home equity loan, contact us. We can help. Located in Fairfield, NJ, we are the title insurance agent that does it all for you.

For your next title order or

if you have questions about what you see here, contact

Stephen M. Flatow, Esq.

Vested Land Services LLC

165 Passaic Avenue, Suite 101

Fairfield, NJ 07004

Tel 973-808-6130 - Fax 973-227-0645

E-mail sflatow AT vested.com

 

 

*Disclosure - I hold a small investment in JPMorgan Chase (but I'd be taking the same position if the article was about Bank of America.

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Thinking of selling your home? Here's a checklist.

 

What You Should Do Before You List Your Home by Lillian Montalto on Realty Times.

You've decided to sell your home. Congratulations! Here’s a checklist of things you need to do right now, before you list your home for sale.    

1)      Establish a master plan. Are you moving into a new property? Now is the time to think about what you are looking for so that you can set out on your search immediately and be prepared to buy a new home as soon as your current house sells. Look into neighborhoods you are interested in and find out how much inventory is available. Assess your finances and determine what you can afford. Then shop around and find a lender who will provide financing. Finally, get pre-approved for a loan (not just pre-qualified). This can take a while these days, so be prepared to wait. [Consider having a contract for the sale of your home in place before you sign for the purchase of your new home.]

2)      Find a real estate agent. You’re in the driver’s seat here, so unless you have worked with someone you liked before, do your research and interview several agents before making a choice. Make your decision based upon the individual agent’s record of sales in the past 6-12 months.  Do not base it on the number of properties the company has sold, as many larger companies have 80-100 agents, but the individual agents do an average of only 4-6 sales/year.  Many agents are part-time.  This is a business decision and is usually the largest financial transaction you will make in a lifetime.  Make sure you hire the top agent in your area.  Someone that is going to guide you through the process, may have staging services available, and most importantly, an agent that will tell you “what you need to hear, not what you want to hear”.    The best advice I can give you is NOT to hire a friend as I have seen too many friendships end on a sour note, and your friend will be hesitant to tell you what you need to hear in order to not hurt your feelings.  Get some recommendations from family or friends about specialists in your area or neighborhood. Have each do a walk-through of your home and ask for a general impression of your property as well as local comps. Discuss a marketing plan and listing price, and assess general knowledge of the market in your area. Most importantly, make sure that you and the agent you choose “click” and will be able to work well together.  [We can recommend agents in your neighborhood, just give us a call and we'll be glad to help.]

3)      Whip your home into shape. Check your water heater, furnace, roof, and chimney to make sure everything is in good condition. If necessary, hire a licensed home inspector to do this for you. If replacements are needed, get estimates from different companies about how much the work will cost. You should also make any small repairs and touch up paint. Assess your curb appeal and work on cleaning up your yard and making the exterior of the house look inviting to prospective buyers. De-clutter the interior: store keepsakes, toss anything no one could ever use, and donate the rest of your unused or unneeded belongings. Keep the bare minimum – it’s liberating! Finally, clean everything in your house, including the inside and outside of windows, blinds, carpets, oven, refrigerator, and anything else that hasn’t seen a good cleaning in a long time. Sounds daunting? You don’t have to do it all yourself. Hire a cleaning service! [Can not over-emphasize the need to declutter.  Give stuff to your children and let them throw it away if they do not want it!]

4)      Locate your paperwork. Get all of your home documentation together in a folder for the buyer to see. Include any notes on paint colors, manuals for appliances, and receipts for work you’ve recently done. If your utility bills might be lower than a buyer’s, have them handy to offer as additional incentive to buy. [Do not forget to look for a copy of your Title Insurance Policy and survey.]

5)      Finally, be prepared. Do you have a plan in place in case you are asked to close quickly? Most people don’t expect an immediate offer, but depending on the market and the buyer, it can happen. Better to be prepared to move out than to refuse an offer that comes your way.  [Couldn't agree more.  Avoid the aggravation of losing a buyer who must be in the house by a certain date.]

 

Now it’s time to list your home! Call up your agent, decide on a listing price, and get ready to make that sale!

For your next commercial real estate transaction, house purchase, mortgage refinance, reverse mortgage, or home equity loan, contact us. We can help. Located in Fairfield, NJ, we are the title insurance agent that does it all for you.

For your next title order or

if you have questions about what you see here, contact

Stephen M. Flatow, Esq.

Vested Land Services LLC

165 Passaic Avenue, Suite 101

Fairfield, NJ 07004

Tel 973-808-6130 - Fax 973-227-0645

E-mail sflatow AT vested.com

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Borrowers to face another hurdle in a few months.

As a result of the fall-out from the mortgage implosion, Congress saw fit to step into the fray through the Dodd-Frank Act.  One of its progeny is the creation of a class of mortgage called “qualified mortgage.”  These are loans deemed safe by the government regulators for borrowers.

According to a report in the New York Times,

The mortgage industry is bracing for the coming of “Q.M.,” the new federal rules defining a “qualified mortgage” — or one underwritten to standards deemed safe for consumers. The implementation of Q.M. poses a compliance headache for lenders, though the average borrower is unlikely to notice any difference when the rules take effect in January. The most immediate differences will be felt by borrowers at the higher and lower ends of the income scale.

Among the basic criteria: A Q.M. loan must be fully amortizing with a term no longer than 30 years, and the points and fees paid by the borrower cannot exceed 3 percent of the total loan amount.

Lenders must also document the borrower’s ability to repay the loan, and confirm a debt-to-income ratio of no more than 43 percent.

So, what does this mean for Mr. and Mrs. Borrower?  In our opinion, tighter controls on borrowers as to income, etc.  In other words, lenders will be afraid to lend money to folks looking to move into their first home that doesn't qualify for some sort of first-time homeowner program, or folks trying to move up in home size.

What we find puzzling is that the Federal government offices overseeing mortgage and bank lending are just getting bigger and bigger, and less people are able to borrow.

Read the full story.

For your next commercial real estate transaction, house purchase, mortgage refinance, reverse mortgage, or home equity loan, contact us. We can help. Located in Fairfield, NJ, we are the title insurance agent that does it all for you.

For your next title order or

if you have questions about what you see here, contact

Stephen M. Flatow, Esq.

Vested Land Services LLC

165 Passaic Avenue, Suite 101

Fairfield, NJ 07004

Tel 973-808-6130 - Fax 973-227-0645

E-mail sflatow AT vested.com

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