Every month we know there are tons of new reports out there talking about the number of foreclosures, along with the number of homes sold, homes listed, and homes that were sold in a short sale. With all the numbers being calculated it might be interesting to see how many home sales are pending. The number of home sales pending more than likely grows each holiday season, and especially this year.
Sales fell when the tax credit expired, but with the rate of joblessness remaining so high it makes everyone wonder how much sales will decrease, or for that matter how they could possibly increase. Home sales will probably stay about the same in the coming year unless there are some dramatic changes, but the number of pending sales probably did shoot up over the course of November. As Thanksgiving approaches, then with Christmas following people are not motivated to pack and move, nor do they want to spend more, so many will wait until after the holidays to start spending money on appraisals and inspections leaving tons of pending sales out there.
When it comes to short sales, those sales could take quite some time, but only time will tell overall how home sales will move in 2011.
-Mayer Dallal
Friday, December 31, 2010
Thursday, December 30, 2010
Credit Recommendations for 2011
In the coming year, we all have some changes we would like to make whether personal or professional. Credit is a big issue for all, and many of us are setting goals, cutting up credit cards, and living more frugally in order to make it happen. So, in the coming year, for those who aren’t sure where to start I have a few simple ideas for you to jumpstart your new outlook for 2011.
If you are in credit card debt up to your eyeballs, the only way to get out of it is to stop using them. Cut them up, and pay more than the minimum due if you can. If you are struggling due to unemployment or minimal cash-flow and you are under the seamless pile of debt, call the credit card companies and tell them your situation. Some of them will be more willing to work with you than others, but the best way to handle this is to get ahead of the problem.
The next step is to pay more than you can every chance you can get. While jobs are few and far between, some places are willing to hire for part-time work. Still, these jobs are really hard to get, and it may come down to you parting with items you love in order to raise the funds to get the debt down and out of your life. A friend of mine who is an avid reader has sold several of her books on eBay. She read them, but because they were shelved they were in good shape and completely capable of being sold. Now, this may not apply to everyone, but we all have something we collect and we could probably stand to get a head start on our spring cleaning.
All in all, do what you can. I know that not everyone will have this advantage, but you have to start somewhere. You never know what is around the corner but with much determination and working together with others you can make it happen.
-Mayer Dallal
If you are in credit card debt up to your eyeballs, the only way to get out of it is to stop using them. Cut them up, and pay more than the minimum due if you can. If you are struggling due to unemployment or minimal cash-flow and you are under the seamless pile of debt, call the credit card companies and tell them your situation. Some of them will be more willing to work with you than others, but the best way to handle this is to get ahead of the problem.
The next step is to pay more than you can every chance you can get. While jobs are few and far between, some places are willing to hire for part-time work. Still, these jobs are really hard to get, and it may come down to you parting with items you love in order to raise the funds to get the debt down and out of your life. A friend of mine who is an avid reader has sold several of her books on eBay. She read them, but because they were shelved they were in good shape and completely capable of being sold. Now, this may not apply to everyone, but we all have something we collect and we could probably stand to get a head start on our spring cleaning.
All in all, do what you can. I know that not everyone will have this advantage, but you have to start somewhere. You never know what is around the corner but with much determination and working together with others you can make it happen.
-Mayer Dallal
Resolving For a Better Year in 2011
In light of what happens, and all the changes that have occurred I resolve for a prosperous year in 2011. I am driven by family, and the desire to help others; this is all in addition of being thankful for my wonderful friends, family members, colleagues and awesome clients. I am thankful for all those I have been able to help, those I have been able to counsel, and those that I will be able to help in the future once they come out stronger on the other side.
When challenges come you have to keep pressing on toward the mark. Setting goals, short term and long term are so important for all of us. I encourage you all to decide what goals or resolutions you might have. I say goals first, simply because resolutions are something that we talk about, but goals are something that we write down. Once you write something down you are held to a higher standard. You look at it every day and you are reminded of what is ahead, and you hold yourself accountable to what you have now decided upon for your future.
Your future is in every thought for every day ahead of you that you are planning. Don’t think that the future is that far off, because every morning when you wake up…is hopefully a day you planned for. Live on purpose, speak on purpose and do- ON PURPOSE. My wish for each and every one of you no matter what your relationship is to me is nothing but sheer joy, prosperity, success and peace amidst the storm.
-Mayer Dallal
When challenges come you have to keep pressing on toward the mark. Setting goals, short term and long term are so important for all of us. I encourage you all to decide what goals or resolutions you might have. I say goals first, simply because resolutions are something that we talk about, but goals are something that we write down. Once you write something down you are held to a higher standard. You look at it every day and you are reminded of what is ahead, and you hold yourself accountable to what you have now decided upon for your future.
Your future is in every thought for every day ahead of you that you are planning. Don’t think that the future is that far off, because every morning when you wake up…is hopefully a day you planned for. Live on purpose, speak on purpose and do- ON PURPOSE. My wish for each and every one of you no matter what your relationship is to me is nothing but sheer joy, prosperity, success and peace amidst the storm.
-Mayer Dallal
What We May See Next Year
With the New Year approaching, we aren’t sure what we are going to see in the coming year. This year we continued to be riddled with fear, and bad media reports were plentiful with little chance that any of it was accurate. While things are far from business as usual, we still can’t rely on all the media statistics being true to what is really happening. There are plenty of predictions to go around, and I am sure that mine are no different.
1). I don’t see jobs picking up all that much, meaning the housing market won’t pick up much either. How do I know this? It’s simple; without job certainty there is no desire to purchase a home. Who knows if they can even pay their rent? This is just a common sense assessment.
2). Foreclosures may follow suit according to how the job market goes, but we will see. I have interviewed several people that believe their jobs are in danger and have lived so frugally in order to pay down every single bill they have. They are so afraid of being unemployed, they will nearly starve now, so that they don’t have to completely starve later. Preparation is everything, and stockpiling canned goods that won’t go bad or having water on hand ahead of time is a safe bet. If not in case of bad weather, make sure you plan ahead for all things.
3). Commercial Real Estate may not pick up anytime soon, and in 2011 those who want to start businesses may have their pick of properties. I can’t guarantee anything, but what I can tell you is that unless there is a windfall of venture capitalists that are willing to throw money at start-ups it may not grow much in 2011.
It’s really hard to tell either way, but these are three of the things I don’t see changing much. I of all people remain hopeful, but realistically speaking and based on what I see has happened this year this may be the case.
-Mayer Dallal
1). I don’t see jobs picking up all that much, meaning the housing market won’t pick up much either. How do I know this? It’s simple; without job certainty there is no desire to purchase a home. Who knows if they can even pay their rent? This is just a common sense assessment.
2). Foreclosures may follow suit according to how the job market goes, but we will see. I have interviewed several people that believe their jobs are in danger and have lived so frugally in order to pay down every single bill they have. They are so afraid of being unemployed, they will nearly starve now, so that they don’t have to completely starve later. Preparation is everything, and stockpiling canned goods that won’t go bad or having water on hand ahead of time is a safe bet. If not in case of bad weather, make sure you plan ahead for all things.
3). Commercial Real Estate may not pick up anytime soon, and in 2011 those who want to start businesses may have their pick of properties. I can’t guarantee anything, but what I can tell you is that unless there is a windfall of venture capitalists that are willing to throw money at start-ups it may not grow much in 2011.
It’s really hard to tell either way, but these are three of the things I don’t see changing much. I of all people remain hopeful, but realistically speaking and based on what I see has happened this year this may be the case.
-Mayer Dallal
Freezing Credit Lines Due to Low Values
Real estate appraisals were out of control there is no doubt, and changes were made to prevent estimates from being put into unrealistic ranges. There is no doubt that home values are in danger, and with prices falling it’s hurting more than just the seller’s pocketbook. Computerized home appraisals are making waves in that several models are contributing to the information that comes back. In some cases it may be true that the values of homes run through these systems may be rendered undervalue.
So, while some homeowners think this is ideal in that they feel they would get lower taxes, the challenge is greater for those who have equity lines of credit attached to their homes. When loan companies offer these lines of credit, it is possible that they could in fact put a freeze on that line of credit. The real issue? Not only is freezing that line of a credit frustrating for the borrower, but what if you already have estimates and have put down a deposit on home repairs using this line of credit? You have workers coming to work on your home and you have already written the first installment from that line of credit on your repairs. Also, when getting estimates double check with the contractor, but in most cases deposits or partial payments are non-refundable.
The best thing to do is to ask if you are in the middle of a big job, or if you speculate that there might be an issue. Writing a check that won’t be honored and one you didn’t know about can be embarrassing, but can cause huge problems along with more fees that you weren’t prepared to paid. After all that is why you took out the line of credit; you wanted to let the equity you thought you had in your home work for you.
-Mayer Dallal
So, while some homeowners think this is ideal in that they feel they would get lower taxes, the challenge is greater for those who have equity lines of credit attached to their homes. When loan companies offer these lines of credit, it is possible that they could in fact put a freeze on that line of credit. The real issue? Not only is freezing that line of a credit frustrating for the borrower, but what if you already have estimates and have put down a deposit on home repairs using this line of credit? You have workers coming to work on your home and you have already written the first installment from that line of credit on your repairs. Also, when getting estimates double check with the contractor, but in most cases deposits or partial payments are non-refundable.
The best thing to do is to ask if you are in the middle of a big job, or if you speculate that there might be an issue. Writing a check that won’t be honored and one you didn’t know about can be embarrassing, but can cause huge problems along with more fees that you weren’t prepared to paid. After all that is why you took out the line of credit; you wanted to let the equity you thought you had in your home work for you.
-Mayer Dallal
The Reverse Mortgage Dilemma
A little birdie told me that reverse mortgages might be in trouble, but I am not sure exactly what this means. Reverse mortgages weren’t following in the same footsteps as other mortgage loans, and I certainly wouldn’t begin to group them together. While I don’t do them, I know what they are, and I guess I don’t really see them as “harmful”.
A reverse mortgage essentially pays someone to have a mortgage, acting as “income” for the borrower. The catch? The property would be relinquished to the bank upon the death of the homeowner or sale of the home. These loans are aimed at senior citizens, and aren’t really designed to set someone up for default. There are specific stipulations that must be met in order for a reverse mortgage to be done, and the guidelines are anything but the “standard”.
Reverse mortgages were meant for good, not for bad; while they do have that “catch”, I would have to say that most senior citizens across America aren’t in a stable financial position. Sure, many I know have homes that are paid in full, and don’t have all this credit card debt that younger generations have; well some of them anyhow.
Seniors tend to have higher medical bills, and more medications as they age, so this is where the reverse mortgage comes in. This was designed to generate additional income out of the equity they had established in their home. It sounds ideal, but is it? I guess that is what everyone is asking these days, and while I don’t have all the details, I would hate to see a life boat taken out from under a senior citizen. I guess there is no perfect solution to any of this, but just when healthcare is getting ready to change, taking away one of the very few life lines seniors have could be detrimental.
-Mayer Dallal
A reverse mortgage essentially pays someone to have a mortgage, acting as “income” for the borrower. The catch? The property would be relinquished to the bank upon the death of the homeowner or sale of the home. These loans are aimed at senior citizens, and aren’t really designed to set someone up for default. There are specific stipulations that must be met in order for a reverse mortgage to be done, and the guidelines are anything but the “standard”.
Reverse mortgages were meant for good, not for bad; while they do have that “catch”, I would have to say that most senior citizens across America aren’t in a stable financial position. Sure, many I know have homes that are paid in full, and don’t have all this credit card debt that younger generations have; well some of them anyhow.
Seniors tend to have higher medical bills, and more medications as they age, so this is where the reverse mortgage comes in. This was designed to generate additional income out of the equity they had established in their home. It sounds ideal, but is it? I guess that is what everyone is asking these days, and while I don’t have all the details, I would hate to see a life boat taken out from under a senior citizen. I guess there is no perfect solution to any of this, but just when healthcare is getting ready to change, taking away one of the very few life lines seniors have could be detrimental.
-Mayer Dallal
Wednesday, December 29, 2010
Privatizing Freddie and Fannie?
Republicans were planning to privatize Fannie Mae and Freddie Mac, but it may be a different story now that they are going to be in control of the House. Representative Scott Garrett made mention of the fact that some things can be done overnight, but others can’t be. Garrett is the gentleman that was appointed to oversee what changes with Freddie and Fannie. Garrett believes that with the market being in a delicate position, it could be damaging to privatize the mortgage giants so quickly.
To clear up what Fannie and Freddie really do, they buy mortgages from lenders and package them as securities. The securities are sold to investors, but with the losses that these agencies experienced in 2008 it had to be placed under the view of the government. Tax payers are fed up with the constant bail outs and are watching their tax dollars go down the drain because if the bailouts. The financial industry seems to have not corrected itself just yet, and with billions being thrown at it to save it without a turnaround, it makes you wonder how much more will be thrown at it before things change.
-Mayer Dallal
To clear up what Fannie and Freddie really do, they buy mortgages from lenders and package them as securities. The securities are sold to investors, but with the losses that these agencies experienced in 2008 it had to be placed under the view of the government. Tax payers are fed up with the constant bail outs and are watching their tax dollars go down the drain because if the bailouts. The financial industry seems to have not corrected itself just yet, and with billions being thrown at it to save it without a turnaround, it makes you wonder how much more will be thrown at it before things change.
-Mayer Dallal
Buying From the Divorced
Buying a home is stressful enough, and no transaction is exempt from its challenges, but buying from a couple that is divorcing certainly can present challenges. While these homes tend to get listed quickly and are looking to sell quickly, emotions are high, and things are said in the process that is hurtful between the husband and wife. Unfortunately, that carries over into the sale of the home, and can make things harder on the buyer.
When tension is high, there can be miscommunication between the agent and the couple. This can be frustrating for the agent in that they have a certain timeline they need to follow as well. No one gets paid until the loan closes, so everyone is waiting on pins and needles while trying to ensure that it has been a smooth transaction. The transaction can only go as smooth as what the sellers allow, and when miscommunication is a problem, everything else can go awry as well.
None of us are exempt from getting a divorce, and none of us are perfect, this is merely a warning to those who are looking to buy. There can be challenges with any purchase transaction when buying a home, and it all comes down to being prepared to wait if necessary, or being prepared to move quickly if given the chance. Remember that it is important to be considerate of the seller’s emotions as well, and by doing your part it can make as the buyer it will make things smoother for everyone involved.
-Mayer Dallal
When tension is high, there can be miscommunication between the agent and the couple. This can be frustrating for the agent in that they have a certain timeline they need to follow as well. No one gets paid until the loan closes, so everyone is waiting on pins and needles while trying to ensure that it has been a smooth transaction. The transaction can only go as smooth as what the sellers allow, and when miscommunication is a problem, everything else can go awry as well.
None of us are exempt from getting a divorce, and none of us are perfect, this is merely a warning to those who are looking to buy. There can be challenges with any purchase transaction when buying a home, and it all comes down to being prepared to wait if necessary, or being prepared to move quickly if given the chance. Remember that it is important to be considerate of the seller’s emotions as well, and by doing your part it can make as the buyer it will make things smoother for everyone involved.
-Mayer Dallal
Tuesday, December 28, 2010
2010's Double Dip in Housing Failures?
At the end of 2009, everyone had figured that the housing market had reached the worst level ever, and that it couldn’t possibly get worse. I don’t know that any of us really anticipated it would be this bad, but we didn’t expect it to recover quickly either.
Some warned us of a double dip in the housing market, while others predicted we would experience a self-sustained recovery. Oddly, we had neither! However, we can all see that the housing recovery will move slowly, that is no surprise. The homebuyer tax credit gave us a small jumpstart and gave us a little bit of confidence, and when that tax credit was taken away there was little incentive for folks to buy. So, with that being taken away it makes us all wonder if there is still a reason to buy.
Naturally, my answer is yes; there is a huge inventory of homes to choose from, and the tax bill affecting tax deductions was extended for another year. This is always helpful, simply because we want to have some incentive for one of the largest purchases we will ever make.
In some sense, we did bottom out twice, meaning our sales picked up with the tax credit, and then slowed down again, but I wouldn’t call this a “double dip” as some refer to the recession. While gains may have seemed artificial, let’s take it one day at a time, and let each of us do our part to make things better. Pay your bills, and when you can’t call ahead and begin making arrangements. Don’t wait until it’s too late to let someone know you need help.
-Mayer Dallal
Some warned us of a double dip in the housing market, while others predicted we would experience a self-sustained recovery. Oddly, we had neither! However, we can all see that the housing recovery will move slowly, that is no surprise. The homebuyer tax credit gave us a small jumpstart and gave us a little bit of confidence, and when that tax credit was taken away there was little incentive for folks to buy. So, with that being taken away it makes us all wonder if there is still a reason to buy.
Naturally, my answer is yes; there is a huge inventory of homes to choose from, and the tax bill affecting tax deductions was extended for another year. This is always helpful, simply because we want to have some incentive for one of the largest purchases we will ever make.
In some sense, we did bottom out twice, meaning our sales picked up with the tax credit, and then slowed down again, but I wouldn’t call this a “double dip” as some refer to the recession. While gains may have seemed artificial, let’s take it one day at a time, and let each of us do our part to make things better. Pay your bills, and when you can’t call ahead and begin making arrangements. Don’t wait until it’s too late to let someone know you need help.
-Mayer Dallal
Wednesday, December 22, 2010
Did You Know?
Did you know that this recession is definitely nowhere near being as bad as the first one? Although we might see it as a catastrophe, it certainly isn’t. History does repeat itself, but the truth is we are still doing okay for the time being. Unemployment right now is teetering around 9 to 10% which isn’t great, but during the Great Depression unemployment reached 25%. Did you know that industrial production dropped 46%? This is not even the worst of it; let’s just say that what we view as a Depression isn’t really a Depression.
I look around and see people shopping for the holidays; at that time only the very wealthy could afford to shop. There were plenty of families that knew what it was like to be hungry, and I can’t say that I have been there. Sure, we have all been concerned about what is happening and how it will affect us. This is what I call a national disaster, but in the end we are much further along in our comforts than people were back then.
So, with what is going on now, what would you say that the Great Depression was linked to then? How did this all happen so long ago? According to an article I read entitled, “Seeds of Financial Disaster”, there was corruption in the banking system at that time. So, it really isn’t much different in terms of how this happened. Commercial and investment banking industries were crossing each other’s lines then, so it seems that it history does in fact repeat itself.
During the 70’s, Asset Securitization was born, and this is how the selling of mortgages began. In essence, this plan was designed to make housing more affordable, but did it? Looking at where we are now, surely there is a better plan.
-Mayer Dallal
I look around and see people shopping for the holidays; at that time only the very wealthy could afford to shop. There were plenty of families that knew what it was like to be hungry, and I can’t say that I have been there. Sure, we have all been concerned about what is happening and how it will affect us. This is what I call a national disaster, but in the end we are much further along in our comforts than people were back then.
So, with what is going on now, what would you say that the Great Depression was linked to then? How did this all happen so long ago? According to an article I read entitled, “Seeds of Financial Disaster”, there was corruption in the banking system at that time. So, it really isn’t much different in terms of how this happened. Commercial and investment banking industries were crossing each other’s lines then, so it seems that it history does in fact repeat itself.
During the 70’s, Asset Securitization was born, and this is how the selling of mortgages began. In essence, this plan was designed to make housing more affordable, but did it? Looking at where we are now, surely there is a better plan.
-Mayer Dallal
Tuesday, December 21, 2010
Federal Reserve to Provide Guidance on LO Compensation
It’s not really clear what changes are coming on LO compensation, but we always knew that somehow changes would be made. Closing loans is a lot of work, let alone getting the applications and getting someone to be approved, but I certainly understand why there is concern over how loan officers are being compensated.
I even saw this years ago when I first started in the business, because loan officers were less apt to focus on the borrowers best interest when they knew how much they could make. It’s really sad, but there were so many people who would sit and figure out the maximum amount of money they could charge to know on each loan so they would know exactly how commission they could walk away with. There is nothing wrong with wanting to make a decent living, but don’t do it at someone else’s expense. In every loan there should always be a benefit to the borrower, and if there isn’t then the loan shouldn’t be done. The whole point of what we do is to progress home ownership not make this situation worse than it already is.
People are looking for hope, not a commission driven loan officer who is looking to make a quick buck. This job takes work, and those who don’t want to put time into it shouldn’t be in this field.
-Mayer Dallal
I even saw this years ago when I first started in the business, because loan officers were less apt to focus on the borrowers best interest when they knew how much they could make. It’s really sad, but there were so many people who would sit and figure out the maximum amount of money they could charge to know on each loan so they would know exactly how commission they could walk away with. There is nothing wrong with wanting to make a decent living, but don’t do it at someone else’s expense. In every loan there should always be a benefit to the borrower, and if there isn’t then the loan shouldn’t be done. The whole point of what we do is to progress home ownership not make this situation worse than it already is.
People are looking for hope, not a commission driven loan officer who is looking to make a quick buck. This job takes work, and those who don’t want to put time into it shouldn’t be in this field.
-Mayer Dallal
Eyes on FHA
All eyes are on FHA right now, only for the simple fact that no matter what is going on around them, they are still doing very well. The main goal of FHA is to provide home ownership to qualifying borrowers, and to keep them in those homes. It’s always the organizations that do well that get scrutinized, but because it’s a government organization they are being examined closely just to ensure that they continue to do things the right way.
There have been many changes with FHA this year, but again that is simply attributed to the fact that they are under scrutiny as a government organization. FHA is trying to make sure that every policy they implement has the homeowner’s best interest in mind. It is not always the easiest job, and of course you can’t make everyone happy. The goal though is to continue to promote home ownership, but there is only so much you can do. FHA made changes based upon the market, what they forecast is coming, and what is based on research.
There are more changes coming, which will be introduced in January 2011, but as far as all the details I don’t have them. I can tell you that the main goal for 2011 is to create balance, and to ensure that going forward everything is done with decency and professionalism to benefit all who are involved.
As always I can provide you with up to date information on FHA, and the lowest rates around. So, call me today at 310-498-2700, or you can visit my website to get started at www.fhaloansnow.net.
-Mayer Dallal
There have been many changes with FHA this year, but again that is simply attributed to the fact that they are under scrutiny as a government organization. FHA is trying to make sure that every policy they implement has the homeowner’s best interest in mind. It is not always the easiest job, and of course you can’t make everyone happy. The goal though is to continue to promote home ownership, but there is only so much you can do. FHA made changes based upon the market, what they forecast is coming, and what is based on research.
There are more changes coming, which will be introduced in January 2011, but as far as all the details I don’t have them. I can tell you that the main goal for 2011 is to create balance, and to ensure that going forward everything is done with decency and professionalism to benefit all who are involved.
As always I can provide you with up to date information on FHA, and the lowest rates around. So, call me today at 310-498-2700, or you can visit my website to get started at www.fhaloansnow.net.
-Mayer Dallal
Sunday, December 19, 2010
Rates Are on the Rise
Anytime rates are on the rise, it means that something is spurring underneath with the economy. This is good, and although we aren’t there yet it will just take a little time. Clearly, with rates going up, I have had a lot of phone calls from families on whether or not to buy or whether or not they should be refinancing. The answer is a resounding YES!
You don’t want to be going into another year in which rates could potentially drive up very high, we just don’t know for sure. With rates being so low in more than 50 years, it makes it a great time to refinance or buy a home if you have been on the fence. Making a move could mean the difference between paying $20 more than you are paying now per month, or paying $100 more per month. We just don’t know how all of this will impact us, but I would certainly urge you to call me today before this happens. Why more than you have to; I certainly wouldn’t.
-Mayer Dallal
Foreclosures Drop in November
It’s great news that foreclosures have been dropping over the past few months. In the month of November, Realty Trac released their survey results stating that foreclosures had dropped more than 20% from October which is great. They were down 14% from what we had going on in November of 2009. This is good news to too, because we don’t really want to see numbers right now superseding what occurred last year.
What this means in terms of more real numbers is that this is the lowest this number has been since February of last year, because that is when things seem to get worse. Whether or not it was linked to families choosing to spend money on holiday credit card bills over paying the mortgage I am really not sure. It is tough when families are choosing between paying the mortgage or feeding their kids. I am thankful I am not in that position. What I will tell you is that I am on a mission simply to help others, and it goes day by day because you never know who you will come into contact with.
This is why I was so driven to become multifaceted in my business, so that I could be empowered with knowledge to help those in good and bad situations, and to be able to answer questions that would at least point people in the right direction.
-Mayer Dallal
What this means in terms of more real numbers is that this is the lowest this number has been since February of last year, because that is when things seem to get worse. Whether or not it was linked to families choosing to spend money on holiday credit card bills over paying the mortgage I am really not sure. It is tough when families are choosing between paying the mortgage or feeding their kids. I am thankful I am not in that position. What I will tell you is that I am on a mission simply to help others, and it goes day by day because you never know who you will come into contact with.
This is why I was so driven to become multifaceted in my business, so that I could be empowered with knowledge to help those in good and bad situations, and to be able to answer questions that would at least point people in the right direction.
-Mayer Dallal
Tuesday, December 7, 2010
Is Roubini Always Right?
Nouriel Roubini has made some hefty predictions in the past, but they have all come true. Many call him “Dr. Doom”, but he is simply giving his vision based upon research and statistics. He is an economist, so he does have data to back up what he has predicted, and right now his biggest concern is what is going on in America with our real estate debacle. It isn’t pretty right now, but according to Roubini it’s going to get worse.
He basically takes the stance that America doesn’t really take it all that serious, and that right now would be a good time to do so. He believes that America looks at the situation and says we can’t change it so why work on making an effort to do anything different? Roubini isn’t a fan of taking a back seat to something so critical, and he is probably right, but what is happening is so overwhelming that I don’t think anyone can wrap their mind around it for now.
Roubini says that despite what is happening in other countries, our circumstances are much worse, and that other countries will just need to worry about themselves without our help. We need a leg to stand on and no one is really paying attention in his opinion. I think many have this opinion because for so long American has taken care of others before we have taken care of ourselves and that can be dangerous even though we have good intentions of helping those in our alliance.
-Mayer Dallal
He basically takes the stance that America doesn’t really take it all that serious, and that right now would be a good time to do so. He believes that America looks at the situation and says we can’t change it so why work on making an effort to do anything different? Roubini isn’t a fan of taking a back seat to something so critical, and he is probably right, but what is happening is so overwhelming that I don’t think anyone can wrap their mind around it for now.
Roubini says that despite what is happening in other countries, our circumstances are much worse, and that other countries will just need to worry about themselves without our help. We need a leg to stand on and no one is really paying attention in his opinion. I think many have this opinion because for so long American has taken care of others before we have taken care of ourselves and that can be dangerous even though we have good intentions of helping those in our alliance.
-Mayer Dallal
Saturday, December 4, 2010
Will the Commercial Markets Grow Stable?
Commercial real estate has taken a big hit this year. With businesses going under, and empty spaces for sale and for rent, there is a low turnover rate as opposed to what it used to be. Commercial realtors have taken significant cuts to commission as a result, and for many it has taken longer than normal for deals to come to fruition. Commercial sales were never quick, but now they are moving slower than ever.
The National Association of Realtors (NAR) seems to think that there is some modest comeback for commercial real estate in 2011, but only time will tell. There is no certainty with anything, but right now more than ever than are questions being asked. Leasing will probably be where it’s at with so many business owners being reluctant to buy, and leases have been more than negotiable.
When new businesses open, that means commercial real estate will change for the better, but how soon this will happen we aren’t sure. More businesses opening means more jobs, and with more jobs comes a more stable environment. We are all looking for a change, and we just hope that it’s coming soon.
-Mayer Dallal
The National Association of Realtors (NAR) seems to think that there is some modest comeback for commercial real estate in 2011, but only time will tell. There is no certainty with anything, but right now more than ever than are questions being asked. Leasing will probably be where it’s at with so many business owners being reluctant to buy, and leases have been more than negotiable.
When new businesses open, that means commercial real estate will change for the better, but how soon this will happen we aren’t sure. More businesses opening means more jobs, and with more jobs comes a more stable environment. We are all looking for a change, and we just hope that it’s coming soon.
-Mayer Dallal
Do Americans Trust Mortgage Lenders?
Overall, I think the honest answer to this question is know. I have been a lender myself, or bank rather. I have had my hands in many areas of this industry, and I think what did people in was actually something that stemmed from years ago. When what we call the “housing boom” occurred, many were dealing with loan officers that were more like “Salespeople”. As much as I had my own techniques in dealing with people, I never wanted to come off like a car salesman. It used to be the running joke, that those who didn’t make it as car salesman became mortgage brokers, and brokers who couldn’t make it became car salesmen.
The one bonus that I do think came as a result of our housing crisis, is the group of people that are still standing and are working in the business today. These people are the ones you want to deal with, because they won’t get out of the business no matter what. Sure, that isn’t to say that anyone who moved on wasn’t honest or worth dealing with, but a majority of people who left the business really shouldn’t have been in the business in the first place.
I think that streamlining the process, and keeping bankers and brokers educated is the key, and putting processes into place to make sure that things are being done correctly is so important. Checking and double-checking is a lost art, and there is no doubt about it that many didn’t take this crisis seriously. Those who are dealing with your money and emotions should know better, and most of all we need to get back to the basics and be accountable for our actions.
-Mayer Dallal
Wiki Leaks and Bank Documents
Wiki Leaks has been an ongoing controversy for quite some time. It is no wonder that our country is at such unrest right now. We have people leaking classified information onto the internet where many can see it, and in the process the other countries look on and just laugh at us. It is truly a sad situation, but it makes you wonder what is really going on.
In the process of uncovering government documents and statements, the next move for Assange is apparently bank documents. Keep in mind that this pertaining to U.S. bank documents. Everyone is interested in our bank documents because they are trying to understand what happened to the super power. Or, are we really all that powerful?
Assange defined the documents as not being as big as Iraq, but could be tens of thousands of documents. Very interesting I think, and I guess doing what I do today I am looking forward to what occurs as a result. Assange already pointed out that these documents will expose the truth about what is happening, but do we even really know what that truth is? Maybe we will just have to wait and find out when that time comes.
-Mayer Dallal
In the process of uncovering government documents and statements, the next move for Assange is apparently bank documents. Keep in mind that this pertaining to U.S. bank documents. Everyone is interested in our bank documents because they are trying to understand what happened to the super power. Or, are we really all that powerful?
Assange defined the documents as not being as big as Iraq, but could be tens of thousands of documents. Very interesting I think, and I guess doing what I do today I am looking forward to what occurs as a result. Assange already pointed out that these documents will expose the truth about what is happening, but do we even really know what that truth is? Maybe we will just have to wait and find out when that time comes.
-Mayer Dallal
Considering Litton Loan
Traditionally in the past, Litton Loan Servicing has not been viewed as a superior servicer of mortgages. Goldman Sachs owns Litton Loan Servicing, and analysts say that selling this loan servicing company could end a lot of problems for the bank. Litton Loan isn’t at the core of the service they provide, meaning Litton has nothing to do with investment banking, which is the direction that they wish to go. So, in their opinion it would be unwise to hold onto a company that has little to do with their ultimate goal.
Although there has been much talk around Goldman Sachs and everything that is going on in the industry of finance, I would have to say that letting go of Litton should be the least of anyone’s worries. In the past potential borrowers that had loans serviced by Litton were always having problems. They would report payments late when they were not, and forbearances would show up when no forbearance had ever been initiated on the loan payments.
The problems this can cause are insurmountable for many, as they now have to go back and try to correct everything that shows up incorrectly which can be really trying to the mind, the nerves and the emotions. Trying to overcome a loan servicer is very difficult, and a lot of information can get lost in translation going from the lender to the servicer, and never touching the ears of the borrower. Servicers definitely need work.
-Mayer Dallal
Friday, December 3, 2010
Are Jobs Really Up?
Since the beginning of this year we have watched the job ticker go up and down, up and down. We have watched the unemployment filings vacillate to the point where we aren’t really sure what to believe. Unemployment went down when so many were hired to do work for the census, but as soon as those people were out of work then the numbers changed. There are many different variables that go into accounting for the proper numbers on unemployment.
There are those that were just recently hired, or those that were recently fired. Then, we have seasonal workers, and once they are out of work the numbers will change again. Then we have those who were also told that they could not extend their unemployment benefits. Huh? That’s right, in several states, especially in Ohio there were many that were told they could not get their unemployment extended after a bill was signed that would allow them to do so.
Here is the problem; those that were told they could not re-apply or didn’t qualify for whatever reason, are now in limbo. They are no longer getting unemployment, but they are still out of a job. So, how are they being counted?
-Mayer Dallal
There are those that were just recently hired, or those that were recently fired. Then, we have seasonal workers, and once they are out of work the numbers will change again. Then we have those who were also told that they could not extend their unemployment benefits. Huh? That’s right, in several states, especially in Ohio there were many that were told they could not get their unemployment extended after a bill was signed that would allow them to do so.
Here is the problem; those that were told they could not re-apply or didn’t qualify for whatever reason, are now in limbo. They are no longer getting unemployment, but they are still out of a job. So, how are they being counted?
-Mayer Dallal
Thursday, December 2, 2010
The Holiday Gift of Suspending Evictions
Freddie Mac announced again that they would not evict people from their homes during the holiday season, which is something that they have been putting into practice for three years in a row. Freddie Mac isn’t the only one that is halting its evictions though, because Fannie Mae is jumping right in as well.
I think that this was one of the best things they could do, because times are hard enough and the holidays have made many people feel worse. Depending upon what holiday you will celebrating, you may be having a hard time with the holiday season. Perhaps it isn’t even a material thing and you lost a loved one, and that is plenty hard enough. Let’s look at the reality at what is happening right now too, and put a spin on this situation. Let’s say you just lost your spouse, and your mortgage payments are behind and you have already gotten your foreclosure notice. Not only are you in a bad place in life, but now you have been given more bad news which makes things harder. You now have to either find another place to live or sleep on the street. This is hard stuff, the stuff that right now I don’t have to worry about. No matter how bad I think I have it, I am still better off than many others in this country right now.
Many times, we also pass by someone without giving much thought to what might be going on in their world. I am here to tell you that I can’t stop thinking about the bum on the street with no place to go. Maybe he lost his job, and his wife left him and his home went into foreclosure and now he is on the street. This when I say “thanks be to God”. Freddie Mac can’t save the world, but it’s time than many more organizations follow their example in 2010 and the years to come.
-Mayer Dallal
Wednesday, December 1, 2010
Rent or Buy?
Those who are currently renting may want to stay a renter in this economy. Naturally, I promote homeownership, and there are so many benefits to owning a home, but in these tough economic times it may be hard to convince someone to buy over renting. Many are taking a look around and feeling comfortable right where they are.
On one side, when you own your home you will have more privacy, it’s yours, and dealing with neighbors is a little different. When you live in an apartment they are right next to you, but when living in a house they are a little further away. Renting a house is not so bad, but you are still putting up money every month for something that you will never own. There are some property owners that offer rent to own agreements with offering the money you pay into the rental as down payment towards the purchase of the home. However, just be careful that you read the fine print. These agreements can have huge loopholes and ultimately don’t put as much toward the down payment as you think.
Owning a home is still the American dream, but the challenge now is that the dream seems like it’s harder to achieve. The second half to this issue is that rents are getting higher, and making mortgage payments look cheaper. With home prices falling, there is no doubt that you can get more house for the money, but do make sure that in the bigger picture with maintenance and utilities that it will still work with your budget.
-Mayer Dallal
On one side, when you own your home you will have more privacy, it’s yours, and dealing with neighbors is a little different. When you live in an apartment they are right next to you, but when living in a house they are a little further away. Renting a house is not so bad, but you are still putting up money every month for something that you will never own. There are some property owners that offer rent to own agreements with offering the money you pay into the rental as down payment towards the purchase of the home. However, just be careful that you read the fine print. These agreements can have huge loopholes and ultimately don’t put as much toward the down payment as you think.
Owning a home is still the American dream, but the challenge now is that the dream seems like it’s harder to achieve. The second half to this issue is that rents are getting higher, and making mortgage payments look cheaper. With home prices falling, there is no doubt that you can get more house for the money, but do make sure that in the bigger picture with maintenance and utilities that it will still work with your budget.
-Mayer Dallal
Monday, November 29, 2010
The Federal Reserve is at it Again
I wonder if the folks that work for the Federal Reserve are getting tired. They are in the throes of the economy every day, constantly looking at the bigger picture and trying to find ways to change things and improve on what is happening. However, the phrase “enough is enough” is a good one for the Federal Reserve regarding many different aspects of what they do.
They have been constantly scrutinizing banks, revamping policies, and having to look at interest rates and other financial figures so that they can issue forecasts on the economy along with news to the citizens are really curious as to what is happening.
Most recently in the news, the Federal Reserve made mention of its interest in scrutinizing the 19 largest bank holding companies….again. These banks are required to submit their plans for the coming year, and whether or not they can be stable under the mandate of the central bank. This isn’t going to be an easy task because they are going to be required to show how they can withstand the economic battle regarding real estate and how it affects their business, as well as overall affects from the economy as a whole.
The Fed’s are claiming that this is simply one way of showing that they are trying to elevate the level of responsibility and accountability of the banks. Let’s just hope that is the truth and that everything sticks.
-Mayer Dallal
They have been constantly scrutinizing banks, revamping policies, and having to look at interest rates and other financial figures so that they can issue forecasts on the economy along with news to the citizens are really curious as to what is happening.
Most recently in the news, the Federal Reserve made mention of its interest in scrutinizing the 19 largest bank holding companies….again. These banks are required to submit their plans for the coming year, and whether or not they can be stable under the mandate of the central bank. This isn’t going to be an easy task because they are going to be required to show how they can withstand the economic battle regarding real estate and how it affects their business, as well as overall affects from the economy as a whole.
The Fed’s are claiming that this is simply one way of showing that they are trying to elevate the level of responsibility and accountability of the banks. Let’s just hope that is the truth and that everything sticks.
-Mayer Dallal
Foreclosures Are Back In Motion
Banks began to examine their foreclosure documents a little closer when some mistakes were being made, then a foreclosure moratorium was issued. Now banks are back in motion filing their foreclosures and getting things done when it comes to evicting their borrowers. It didn’t take very long for the filings to begin again.
JP Morgan Chase amongst others have spent time training people in their departments to ensure that things are being done correctly. Too many foreclosures were not even being reviewed and were being passed through rather quickly. The banks have to be careful, ensuring that all legal issues have been squared away before they file these documents. Robo-signing may not be a thing of the past yet for all lenders, but cleaning up this mess we have our hands is definitely going to continue for awhile.
The question many consumers have is to whether or not they are going to be able to enforce their legal rights when a bank does them wrong. It seems that the banks are the ones that control almost everything, and doesn’t give the consumer a chance to ask the questions that really plague them until it’s too late. Bankers will always say that when it comes to foreclosure that the borrowers who get the notices are the ones who should be getting them; no questions asked.
Even if someone is behind on their payments, and they don’t qualify for a modification, the truth is that people need to be treated with dignity and respect. People should educate themselves and know their legal rights, just as the bank has their legal rights. No one is better than anyone else, and it still seems that no one is really focusing on making a team effort.
-Mayer Dallal
JP Morgan Chase amongst others have spent time training people in their departments to ensure that things are being done correctly. Too many foreclosures were not even being reviewed and were being passed through rather quickly. The banks have to be careful, ensuring that all legal issues have been squared away before they file these documents. Robo-signing may not be a thing of the past yet for all lenders, but cleaning up this mess we have our hands is definitely going to continue for awhile.
The question many consumers have is to whether or not they are going to be able to enforce their legal rights when a bank does them wrong. It seems that the banks are the ones that control almost everything, and doesn’t give the consumer a chance to ask the questions that really plague them until it’s too late. Bankers will always say that when it comes to foreclosure that the borrowers who get the notices are the ones who should be getting them; no questions asked.
Even if someone is behind on their payments, and they don’t qualify for a modification, the truth is that people need to be treated with dignity and respect. People should educate themselves and know their legal rights, just as the bank has their legal rights. No one is better than anyone else, and it still seems that no one is really focusing on making a team effort.
-Mayer Dallal
Monday, November 22, 2010
Refinancing Before the Holidays
If you have a lot of debt now and you want to get things in order, then go ahead and consolidate. The challenge in the past has been that families would refinance to pay off debt, then turn around and run up their credit cards again rather than paying cash. This is absurd, and yes it doesn’t benefit you if you know that your spending habits are hard to curtail. However, at a time like this in a rough economy it is best to downsize and begin setting aside more money in case you do have an emergency. Working off a cash basis will help you stop using these credit cards, and will get you to a place where you can break away from the spending and really think about what you are doing. If you don’t have the money on hand, don’t use a credit card to get it. While refinancing your home to consolidate and pay off debt is helpful, keep in mind that the less you have to consolidate the better off you are. You want to build equity in your home, and in a market where housing prices have fallen it doesn’t help to use it all up. If you have to do it then do it, but if you can pay off some other things on your own then do it that way.
I am here to help you every step of the way, and I will also be honest and tell you that refinancing may not be the answer for you. Not everyone will be in a position to refinance, but refinancing through FHA will give you the lowest rates on the market today, and FHA guidelines focus on commonsense underwriting, so they look at the bigger picture. FHA will look at your income, credit, investments, cash reserves, and how you pay other bills outside of your mortgage.
For more information you can go to www.fhaloansnow.net, or you can call me directly at 310-498-2700.
-Mayer Dallal
I am here to help you every step of the way, and I will also be honest and tell you that refinancing may not be the answer for you. Not everyone will be in a position to refinance, but refinancing through FHA will give you the lowest rates on the market today, and FHA guidelines focus on commonsense underwriting, so they look at the bigger picture. FHA will look at your income, credit, investments, cash reserves, and how you pay other bills outside of your mortgage.
For more information you can go to www.fhaloansnow.net, or you can call me directly at 310-498-2700.
-Mayer Dallal
Sunday, October 31, 2010
The Consumer Financial Protection Bureau
The Treasury and the Feds are putting their heads together to see what they can do to move this organization right along. They are trying to write some tough rules, and the sole purpose of the rules is to make things better and prevent another financial crisis from happening; like the one we have now. The bigger question is, who is going to write the rules? Apparently, word has it that the Federal Reserve may be the one to have the final say on it all.
If the Consumer Protection Bureau does give some headship to the Federal Reserve then they will be just fine in doing what they set out to do. So many critics have questioned the bureau’s rule making ability, and with all the problems in our economy it is no surprise that anyone would question it. In the long run, everyone wants to know what type of experience these people are required to have in order to be in a leadership position.
-Mayer Dallal
If the Consumer Protection Bureau does give some headship to the Federal Reserve then they will be just fine in doing what they set out to do. So many critics have questioned the bureau’s rule making ability, and with all the problems in our economy it is no surprise that anyone would question it. In the long run, everyone wants to know what type of experience these people are required to have in order to be in a leadership position.
-Mayer Dallal
A New Credit Score?
There is a new credit score available to you and it’s custom made just for your mortgage. That is right! The new FICO 8 is on the horizon, and it only pertains to how you pay your mortgage loan.
FICO is the leader is credit management technology, and services hundreds of thousands of companies. The three main credit agencies use it, and it’s available to anyone. What does this do? The reason for this is to allow banks to get a view that is geared to the real estate market, and will enable us to get some stability as a country in our markets. Overall, this is very beneficial and will reduce the risk for everyone.
The idea behind the score was also to help lenders predict how a mortgage would perform, and to help them fine tune their credit decisions based on what they can see, which will give them a good idea of what they think will happen. All lenders and services will have access to it, so there should be no surprises.
-Mayer Dallal
FICO is the leader is credit management technology, and services hundreds of thousands of companies. The three main credit agencies use it, and it’s available to anyone. What does this do? The reason for this is to allow banks to get a view that is geared to the real estate market, and will enable us to get some stability as a country in our markets. Overall, this is very beneficial and will reduce the risk for everyone.
The idea behind the score was also to help lenders predict how a mortgage would perform, and to help them fine tune their credit decisions based on what they can see, which will give them a good idea of what they think will happen. All lenders and services will have access to it, so there should be no surprises.
-Mayer Dallal
Does the Government Pay to Prevent a Foreclosure?
In the midst of all the foreclosures there have been nearly half a million loan modifications done. The success is right around 40%, which is good although we would really like to see it get higher. The only way it would get higher is if banks aggressively solicited modifications instead of waiting for borrowers to get to them. It seems that the families are having to make the first move these days, no matter how deep in they are in the loan.
It has been said that the average cost per modification is a little over $50k. Where does this figure come from? The figure is simply a part of what goes into doing a mortgage modification, and includes everything from the people hired to do the job, to the filing of paperwork, the fees that the bank would eat and some other miscellaneous costs. It sounds like a lot per loan, but let’s face it, we can’t have families put out on the street. The families should have gotten help extended to them in the first place, but there was no real solution in place. Ever see the movie “It’s a Wonderful Life”? That says it all.
-Mayer Dallal
It has been said that the average cost per modification is a little over $50k. Where does this figure come from? The figure is simply a part of what goes into doing a mortgage modification, and includes everything from the people hired to do the job, to the filing of paperwork, the fees that the bank would eat and some other miscellaneous costs. It sounds like a lot per loan, but let’s face it, we can’t have families put out on the street. The families should have gotten help extended to them in the first place, but there was no real solution in place. Ever see the movie “It’s a Wonderful Life”? That says it all.
-Mayer Dallal
What's The Risk?
Is it just me, or does anyone else not see potential issue with having a robot sign foreclosure documents? I think that all the banks and lenders need to be taking a closer look at their process and who is overseeing these things. While it is hard to manage everyone in a large organization, it is imperative that a large organization knows how to make it run like a well-oiled machine.
Having the proper supervisory people in place makes the world go round and having employees that contribute make it all worthwhile and a lot easier to endure. I will say that most companies have it all wrong, and want to get the best around for the least amount of money. When banks and lenders hire these people, they should most certainly get their view on money, and how it works, along with how they wish to see other people become more successful financially. If they don’t share that vision, they have no business working in finance.
Once investors begin to lose confidence, business is down which makes matters worse and properties get sold for a lot less money and less frequently. There is no great mystery behind what is going on, but the only mystery is regarding who will take a stand for what is right? The financial industry has suffered some staggering losses and will continue to do so if no one takes a stand.
-Mayer Dallal
Having the proper supervisory people in place makes the world go round and having employees that contribute make it all worthwhile and a lot easier to endure. I will say that most companies have it all wrong, and want to get the best around for the least amount of money. When banks and lenders hire these people, they should most certainly get their view on money, and how it works, along with how they wish to see other people become more successful financially. If they don’t share that vision, they have no business working in finance.
Once investors begin to lose confidence, business is down which makes matters worse and properties get sold for a lot less money and less frequently. There is no great mystery behind what is going on, but the only mystery is regarding who will take a stand for what is right? The financial industry has suffered some staggering losses and will continue to do so if no one takes a stand.
-Mayer Dallal
Is All Well That Ends With Wells Fargo?
Wells Fargo decided it might be best to take a closer look at its foreclosure process which was a smart move. Banks are being examined closely in the wake of a time when no one is able to make ends meet, or is struggling too. Banks are also just filing papers quickly without much review. So, with all the review Wells Fargo thought it was a good idea to go ahead and analyze their processes a little bit further.
Affidavits must be signed and finalized by someone before the foreclosure becomes official. Many large companies pay someone a nice salary to do this job and review the papers before they are signed. With this being said, Wells Fargo states that they have the proper processes in place to make sure that the right papers are signed by the right people and that no stones goes unturned.
This process can only be run from the company’s data, meaning the figures on the mortgages and the database showing who is on the list to be processed etc. This is simply a part of quality control, and is done to ensure the accuracy of all paperwork. The story of a man getting his home foreclosed on when he didn’t owe the bank anything is down- right hideous. Think about it; no matter how much you were being paid to sign off on foreclosure documents, would you not review those things to make sure they are correct? Would you want to be out on the street?
-Mayer Dallal
Affidavits must be signed and finalized by someone before the foreclosure becomes official. Many large companies pay someone a nice salary to do this job and review the papers before they are signed. With this being said, Wells Fargo states that they have the proper processes in place to make sure that the right papers are signed by the right people and that no stones goes unturned.
This process can only be run from the company’s data, meaning the figures on the mortgages and the database showing who is on the list to be processed etc. This is simply a part of quality control, and is done to ensure the accuracy of all paperwork. The story of a man getting his home foreclosed on when he didn’t owe the bank anything is down- right hideous. Think about it; no matter how much you were being paid to sign off on foreclosure documents, would you not review those things to make sure they are correct? Would you want to be out on the street?
-Mayer Dallal
The Thirty Year Rises Slightly
Freddie Mac does surveys that follow the trends in the increases in the 15 year and the 30 year mortgage rates. It is always interesting to see what is happening in the markets, and if you have struggled to keep up with it, don’t worry because I keep up to date on everything that is happening. This is what I do, and the only way I can be good at it, is to stay on top of market trends so I can help families understand what is good for them and why.
The latest survey though was about the 30 year fixed rate mortgage and how it increased slightly again. It rose for the second time in six weeks, and ended up at a whopping 4.23%. This was a slight increase from the previous week when it was 4.21%. Doesn’t sound like a lot, but any increase in rates will always tell you what is happening in the market, just like rates going down will show you what is happening in the markets today.
The 15 year did go up slightly, and it currently sits at 3.66%. The week prior it was sitting at 3.64%. Again, it doesn’t sound like a whole lot, but any increase will always tell you what is happening. Things are from over, and they certainly aren’t perfect, but increases in rates mean that there is a very slight improvement.
-Mayer Dallal
The latest survey though was about the 30 year fixed rate mortgage and how it increased slightly again. It rose for the second time in six weeks, and ended up at a whopping 4.23%. This was a slight increase from the previous week when it was 4.21%. Doesn’t sound like a lot, but any increase in rates will always tell you what is happening in the market, just like rates going down will show you what is happening in the markets today.
The 15 year did go up slightly, and it currently sits at 3.66%. The week prior it was sitting at 3.64%. Again, it doesn’t sound like a whole lot, but any increase will always tell you what is happening. Things are from over, and they certainly aren’t perfect, but increases in rates mean that there is a very slight improvement.
-Mayer Dallal
What is the Main Cause of Foreclosures?
I don’t know that the reason for our foreclosure crisis is really a secret, but I do believe that there are multiple reasons. However, if you take a look at the most recent statistics dealing with financial reports, you will clearly see that joblessness is at an all time high, even though rates are at an all time low. It doesn’t balance out, and it doesn’t seem fair.
Rick Sharge, the Senior Vice President for RealtyTrac Inc. spoke with Lisa Murphy on Bloomberg not too long ago and gives us some insight into what is happening. I whole heartedly believe that unemployment is a major if not the main contributing factor for the foreclosures. How can anyone pay their bills when they have no income? They simply can’t, and the funny part is that when you lose your job, your unemployment isn’t instant, yet every credit under the sun expects payment from you. Usually, once you do lose your job you are looking at getting one last paycheck, but even so, it should only be an additional two weeks before you get your first unemployment check.
The point is that with joblessness this high, there is no way that people are going to be able to hold up a mortgage payment, or at least it may not be feasible with very little no savings, and depending on how large that payment is, time could run out very quickly for your family.
-Mayer Dallal
Rick Sharge, the Senior Vice President for RealtyTrac Inc. spoke with Lisa Murphy on Bloomberg not too long ago and gives us some insight into what is happening. I whole heartedly believe that unemployment is a major if not the main contributing factor for the foreclosures. How can anyone pay their bills when they have no income? They simply can’t, and the funny part is that when you lose your job, your unemployment isn’t instant, yet every credit under the sun expects payment from you. Usually, once you do lose your job you are looking at getting one last paycheck, but even so, it should only be an additional two weeks before you get your first unemployment check.
The point is that with joblessness this high, there is no way that people are going to be able to hold up a mortgage payment, or at least it may not be feasible with very little no savings, and depending on how large that payment is, time could run out very quickly for your family.
-Mayer Dallal
FHA's Help for Negative Equity
In August the FHA released a Mortagee Letter offering a refinance program for those who are underwater on their mortgage. So, how are the benefits actually determined in this case? The true success of a plan like this will only be measured by its outcome, and at this point the companies that hold these liens need to be willing to sacrifice a certain percentage of the balance on the loan. This program is not applicable to everyone unfortunately; it will only apply to those who were issued a case number as of September 7, 2010 and get their loans closed by December 31, 2012.
However, as with anything it is best to know the details before you get too excited and carried away. I wouldn’t necessarily describe it as a catch, but there are some things you will want to keep in mind. First of all, the loan you are in cannot be an FHA loan, and your payments must be on time. That’s right; don’t think that because you got frustrated that you could quit making payments and all is forgiven just because you thought the banks were greedy. I can understand your aggravation, but remember you signed the papers with the understanding that you were responsible for paying the loan back.
The maximum amount of money that they can loan you will only be 97.75%, with a maximum combined loan to value of 115%. One would think that this would have been ousted, but keep in mind that there are many who had taken out second mortgages, and had purchased homes with a second broken down into 20%, with the first mortgage being at 80%. This was to ensure that the borrower wouldn’t have to pay PMI. Also, keep in mind that the company that holds your second mortgage must allow the first to remain as the first mortgage. This is what loan officers refer to as a “subordination”.
Once a loan is accepted or approved by the lender, no income or credit verification needs to be done. Here is where things get tricky; isn’t this where the problems started before? You may not agree, but I have found that to be true only on a case by case basis. While I don’t agree with everything banks have done, I have to say that those who have stronger credit up front typically don’t default. Those who make an investment up front on their purchase usually don’t default, while those who aren’t current usually revert back to a very low credit score and so forth. There is always a trend that we can see, and that is what we need to be looking for.
-Mayer Dallal
However, as with anything it is best to know the details before you get too excited and carried away. I wouldn’t necessarily describe it as a catch, but there are some things you will want to keep in mind. First of all, the loan you are in cannot be an FHA loan, and your payments must be on time. That’s right; don’t think that because you got frustrated that you could quit making payments and all is forgiven just because you thought the banks were greedy. I can understand your aggravation, but remember you signed the papers with the understanding that you were responsible for paying the loan back.
The maximum amount of money that they can loan you will only be 97.75%, with a maximum combined loan to value of 115%. One would think that this would have been ousted, but keep in mind that there are many who had taken out second mortgages, and had purchased homes with a second broken down into 20%, with the first mortgage being at 80%. This was to ensure that the borrower wouldn’t have to pay PMI. Also, keep in mind that the company that holds your second mortgage must allow the first to remain as the first mortgage. This is what loan officers refer to as a “subordination”.
Once a loan is accepted or approved by the lender, no income or credit verification needs to be done. Here is where things get tricky; isn’t this where the problems started before? You may not agree, but I have found that to be true only on a case by case basis. While I don’t agree with everything banks have done, I have to say that those who have stronger credit up front typically don’t default. Those who make an investment up front on their purchase usually don’t default, while those who aren’t current usually revert back to a very low credit score and so forth. There is always a trend that we can see, and that is what we need to be looking for.
-Mayer Dallal
Saturday, October 30, 2010
The Foreclosure Moratorium Mess
The moratorium on foreclosures is a horrible idea and for many reasons. Look, I don’t have all the answers, but I can tell you what I do know from experience and you can decide for yourselves.
For starters, it doesn’t really resolve the real issue which is related to many things. Many homes went into foreclosures simply because they were underwater on their mortgages. However, joblessness is a huge contributing factor. Much of what is happening could be corrected with jobs abounding and mortgages being modified to truly put a borrower in a better position. The idea behind the modification is to get the borrower’s payments within a reasonable percentage of their income along with their other debts. Many families still won’t qualify, but there is no way to know for sure unless we try it.
The other big issue here is that the reports, facts and figures aren’t going to be true and genuine. They will only make things worse by not giving the facts on what is really happening. Those cases that have been filed won’t go up for modifications, and can’t be listed for short sales until everything has been reviewed. The only real good that could come from this is that the homeowner gets a little more time in their home until they figure out where they can go. This moratorium prevents the supply and demand, so where do we go from here?
-Mayer Dallal
For starters, it doesn’t really resolve the real issue which is related to many things. Many homes went into foreclosures simply because they were underwater on their mortgages. However, joblessness is a huge contributing factor. Much of what is happening could be corrected with jobs abounding and mortgages being modified to truly put a borrower in a better position. The idea behind the modification is to get the borrower’s payments within a reasonable percentage of their income along with their other debts. Many families still won’t qualify, but there is no way to know for sure unless we try it.
The other big issue here is that the reports, facts and figures aren’t going to be true and genuine. They will only make things worse by not giving the facts on what is really happening. Those cases that have been filed won’t go up for modifications, and can’t be listed for short sales until everything has been reviewed. The only real good that could come from this is that the homeowner gets a little more time in their home until they figure out where they can go. This moratorium prevents the supply and demand, so where do we go from here?
-Mayer Dallal
The Skinny on Countrywide's CEO
If you aren’t familiar with the story on the CEO of Countrywide, it’s okay, but interesting stuff. In addition to all of the other excitement going on in our housing market, Mozilo was slapped with charges for insider trading and civil fraud. Did he do it? I wasn’t there so I have no idea, but I can tell you that he did settle along with two other executives to shell out $67.5 billion dollars to the SEC.
His fine is now the largest ever paid out by a public company in regards to a SEC settlement. The total of $67.5 million will be returned to those who were harmed by the actions. This sort of makes it sound like he is guilty and admitting to something. The insider trading issue has always been about what happens behind the doors in the executive suite. Countrywide was like most lenders in that it was struggling under the weight of bad mortgage investments, and in the heat of the moment many executives cracked. It’s a high pressure industry, from which none of us are exempt. People deserve for their financial planners, investors and mortgage brokers to be honest with them, and under financial pressure it is never easy for anyone.
The best way to conduct business is openly and honestly. Believe me, I have made plenty of mistakes in this life, and I am not here to criticize Mozilo. None of us are exempt from being human, but the difference is when we choose right or wrong, and if we choose to make a change. Then, and only then have we really done our job.
-Mayer Dallal
His fine is now the largest ever paid out by a public company in regards to a SEC settlement. The total of $67.5 million will be returned to those who were harmed by the actions. This sort of makes it sound like he is guilty and admitting to something. The insider trading issue has always been about what happens behind the doors in the executive suite. Countrywide was like most lenders in that it was struggling under the weight of bad mortgage investments, and in the heat of the moment many executives cracked. It’s a high pressure industry, from which none of us are exempt. People deserve for their financial planners, investors and mortgage brokers to be honest with them, and under financial pressure it is never easy for anyone.
The best way to conduct business is openly and honestly. Believe me, I have made plenty of mistakes in this life, and I am not here to criticize Mozilo. None of us are exempt from being human, but the difference is when we choose right or wrong, and if we choose to make a change. Then, and only then have we really done our job.
-Mayer Dallal
Low Rates Make Applications Go Up
For the week ending October 8th, the mortgage applications went up due to a dip in rates. While the dip wasn’t huge, it is still enough to trigger applications to go up. The Market Composite Index showed that applications increased 14.6 percent on a seasonally adjusted basis from the week prior. It seems like a tennis match as rates go up, then down. They just go back and forth and keep you guessing, never knowing what you are about to experience.
Those who were on the fence decided to jump off, and enjoy the fray of refinancing that was spurring underneath it all. It is no wonder that applications were up. People are always fearful of the unknown, and just need that little extra bit of confidence. Those in the business should never lose heart, and it’s all about understanding where the borrower is coming from. Just understand that they need to feel a certain way about things before they are going to make a major decision, so it is our job to educate them, every step of the way.
-Mayer Dallal
Those who were on the fence decided to jump off, and enjoy the fray of refinancing that was spurring underneath it all. It is no wonder that applications were up. People are always fearful of the unknown, and just need that little extra bit of confidence. Those in the business should never lose heart, and it’s all about understanding where the borrower is coming from. Just understand that they need to feel a certain way about things before they are going to make a major decision, so it is our job to educate them, every step of the way.
-Mayer Dallal
Friday, October 29, 2010
Is There Hope for Underwater Homeowners?
If you have never heard of the Value Gap Refinance, you probably will. The Value Gap Refinance program means that there is a guarantor making up the difference between the existing mortgage and the present value of the home. Sound like a dream come true? It will help those who are underwater but it certainly doesn’t change the economy….at least not at this moment.
The difference would need to be established by getting an appraisal of course, that way it is clear what the value is based on the current market. The homeowner would then obtain a new loan at 100 percent of the property’s value and at the current rates.
The homeowner is responsible for paying off the balance, but not the dollar figure that creates that gap. When the home is eventually resold to another buyer down the road, the government will pay the difference between the final selling price and the original loan balance. It’s a program that has been a long time coming, and helping people is what it’s all about.
-Mayer Dallal
The difference would need to be established by getting an appraisal of course, that way it is clear what the value is based on the current market. The homeowner would then obtain a new loan at 100 percent of the property’s value and at the current rates.
The homeowner is responsible for paying off the balance, but not the dollar figure that creates that gap. When the home is eventually resold to another buyer down the road, the government will pay the difference between the final selling price and the original loan balance. It’s a program that has been a long time coming, and helping people is what it’s all about.
-Mayer Dallal
More Home Sales in 2011 ?
Real estate experts seem to think that there will be more home sales next year, but the only way I see that happening is if we can get all foreclosures out, listed on the market. Whether they are purchased by an investor, first-time homebuyer or someone who is just looking to relocate, it doesn’t matter. The key is making sure that what needs to get filed is filed, and what needs to be listed is listed. Either way, I am hopeful that our sales will begin to increase now, but the foreclosure moratorium does tend to slow things down.
Commercial real estate lenders are looking for more sales next year as well, so long as plenty of jobs have been added. When that happens, getting more commercial sales should not be an issue. Everyone who has a rental property whether it is real property or commercial property will still need to ensure that they are able to cover the rent they have on their property.
Flipping no longer seems to be the way to go, and those who were looking to do so now appeared discourage. The fear is that when you buy a property, will you now be able to find someone to buy it after you sink money into it to fix it? It’s a tough call, and word has it that nearly $1.4 trillion in mortgages on malls and other commercial properties will be coming due.
-Mayer Dallal
Commercial real estate lenders are looking for more sales next year as well, so long as plenty of jobs have been added. When that happens, getting more commercial sales should not be an issue. Everyone who has a rental property whether it is real property or commercial property will still need to ensure that they are able to cover the rent they have on their property.
Flipping no longer seems to be the way to go, and those who were looking to do so now appeared discourage. The fear is that when you buy a property, will you now be able to find someone to buy it after you sink money into it to fix it? It’s a tough call, and word has it that nearly $1.4 trillion in mortgages on malls and other commercial properties will be coming due.
-Mayer Dallal
Wednesday, October 27, 2010
Is Real Estate Making a Comeback?
While things may look bleak to the consumer, I get a different view of what is happening everyday as I interact with borrowers on purchase loans and refinance deals. This is good, because it helps me keep things real with those I encounter daily. The media can be so negative, and naturally the more television we watch the worse things appear. There are some interesting things happening, and I will tell you about a few of them.
Foreclosures are slowly rolling in, which is good. I would rather see them go slowly over the hill than flood the banks paper reams. However, I don’t want to see any foreclosures because I don’t enjoy watching families lose their homes. One main benefit, and probably the only benefit is for those looking to buy a home that can now get more house for less money, and for less of a down payment upfront. FHA allows buyers to bring as little as 3.5% down on their new home purchase. This allows the buyer to make an investment, but not have to pull out all of their savings to do it.
Sales are up too, which is always good news. The buying seem to come to a halt after the tax credit expired, but in the end people realized that they can’t just sit on buying a home not knowing whether or not that tax credit would be implemented again. There is nothing worse than waiting, and while some people are good at it, most people hate it. This is still a great time to buy a home, or even refinance the one you are in. In regards to buying a home, there are so many homes out there for buyers to pick from. Whether this is your first time buying a home, or your second, there is still time to get a great deal on a house.
-Mayer Dallal
Foreclosures are slowly rolling in, which is good. I would rather see them go slowly over the hill than flood the banks paper reams. However, I don’t want to see any foreclosures because I don’t enjoy watching families lose their homes. One main benefit, and probably the only benefit is for those looking to buy a home that can now get more house for less money, and for less of a down payment upfront. FHA allows buyers to bring as little as 3.5% down on their new home purchase. This allows the buyer to make an investment, but not have to pull out all of their savings to do it.
Sales are up too, which is always good news. The buying seem to come to a halt after the tax credit expired, but in the end people realized that they can’t just sit on buying a home not knowing whether or not that tax credit would be implemented again. There is nothing worse than waiting, and while some people are good at it, most people hate it. This is still a great time to buy a home, or even refinance the one you are in. In regards to buying a home, there are so many homes out there for buyers to pick from. Whether this is your first time buying a home, or your second, there is still time to get a great deal on a house.
-Mayer Dallal
Monday, October 25, 2010
Unreasonable Requirements
In the past year FHA has made several changes, some of which borrowers thought were too strict. Lenders are now getting rules that are more strict as well, so it applies to everyone. You are probably wondering what makes or breaks a lender in the process of qualifying to do FHA loans, and so I will share a little bit of that information with you, and the reason why things are changing.
The FHA, or Federal Housing Administration doesn’t loan money, but they do insure loans for banks and lenders. Lenders and banks have always had to show that they have a strong and reasonable force behind them financially to do FHA loans. HUD is now asking lenders and banks to reimburse them for loans that were not done according to the agency’s guidelines. Sound odd? Not really, and it isn’t in force yet, but if an agency is insuring loans for that lender they should be doing things right. Insuring loans is risky, and means that if the borrower defaults on the loan then the FHA covers it. So, it makes sense that they would want to take every step possible to ensure that the loans are being done properly.
All in all, this may be part of the reason that the FHA took steps in January of this year to write new regulations and standards regarding their requirements, along with increases in mortgage insurance. The FHA simply needed to find a way to strengthen its insurance fund, and prepare to insure more loans. The FHA loan programs have been booming as a result of a bad economy, in which families were able to buy with less money down than they would have been required to come up with if doing a conventional loan. The major uncertainty was only in the fact that once someone bought a home could they maintain the payments and upkeep? This is the question that FHA is asking to ensure that lenders are calculating debt-to-income ratios properly meaning that families are able to afford the monthly payments after all other bills have been accounted for.
In the past, banks were letting families buy homes with a debt-to-income ratio of 50% or higher. This doesn’t even sound right when we already know that these families have hardly any disposable income left at all. When families have little left over, and they have to choose between feeding the children and paying the mortgage, then they are naturally going to feed the children. Tight monthly budgets have triggered defaults, and therefore this includes even FHA loans too. The FHA wants to make sure that the lenders are following their guidelines, and not just passing deals through to get them done. This will be a huge benefit to everyone.
To find out more about getting your FHA loan today, you can go to www.fhaloansnow.net. You are welcome to use my FHA calculator there to see what fits into your monthly budget before you spend.
-Mayer Dallal
The FHA, or Federal Housing Administration doesn’t loan money, but they do insure loans for banks and lenders. Lenders and banks have always had to show that they have a strong and reasonable force behind them financially to do FHA loans. HUD is now asking lenders and banks to reimburse them for loans that were not done according to the agency’s guidelines. Sound odd? Not really, and it isn’t in force yet, but if an agency is insuring loans for that lender they should be doing things right. Insuring loans is risky, and means that if the borrower defaults on the loan then the FHA covers it. So, it makes sense that they would want to take every step possible to ensure that the loans are being done properly.
All in all, this may be part of the reason that the FHA took steps in January of this year to write new regulations and standards regarding their requirements, along with increases in mortgage insurance. The FHA simply needed to find a way to strengthen its insurance fund, and prepare to insure more loans. The FHA loan programs have been booming as a result of a bad economy, in which families were able to buy with less money down than they would have been required to come up with if doing a conventional loan. The major uncertainty was only in the fact that once someone bought a home could they maintain the payments and upkeep? This is the question that FHA is asking to ensure that lenders are calculating debt-to-income ratios properly meaning that families are able to afford the monthly payments after all other bills have been accounted for.
In the past, banks were letting families buy homes with a debt-to-income ratio of 50% or higher. This doesn’t even sound right when we already know that these families have hardly any disposable income left at all. When families have little left over, and they have to choose between feeding the children and paying the mortgage, then they are naturally going to feed the children. Tight monthly budgets have triggered defaults, and therefore this includes even FHA loans too. The FHA wants to make sure that the lenders are following their guidelines, and not just passing deals through to get them done. This will be a huge benefit to everyone.
To find out more about getting your FHA loan today, you can go to www.fhaloansnow.net. You are welcome to use my FHA calculator there to see what fits into your monthly budget before you spend.
-Mayer Dallal
Saturday, August 28, 2010
So, MetLife Wants to do Warehouse Lending?
Just when we thought no one wanted to lend money, we got a surprise. MetLife has decided to try its hand at warehouse lending in addition to its securities, and financial planning that it offers. From insurance to mortgages, it has now truly broadened its horizons. MetLife in addition to many other insurance and financial planning firms have been looking for ways to expand their potential, and this was one way to do it.
The managing director the for the operation, Brian Lewand made the statement that it was a “good fit” for the firm. In order to launch the financing end properly, the company hired two executives from Sovereign Bank to head up the launch of their new product. Ultimately, it takes more than two to run an operation like this, so MetLife is currently in the process of looking to add staff, but a process like this takes careful time and selection. At the end of their third quarter, MetLife plans to release more information regarding the next steps and what is going to happen.
I hope that this operations is successful, as the nation has faced so much disappointment over the past few years. Our country just can’t take anymore. My hopes are that certainly, a company that focuses on financial planning and insurance, will take all the right steps to grow this endeavor to the best of its ability.
-Mayer Dallal
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