A decade ago, most people started off with enough equity in their homes to make foreclosure irrational from a financial standpoint. Consumers with significant equity in their homes were reluctant to walk away form their mortgage obligation.

But over the past few years, lenders and the mortgage-backed securities investors who bought the mortgage paper weren’t demanding substantial down payments. In fact, in response to market demands, these lenders were content with 5% or even nothing down.

Essentially, mortgage-bond investors, seemingly unwittingly, sold homebuyers a put option, without properly pricing it, and now homeowners are exercising that option. (more…)

search for : mortgage-backed securities investors, mortgage paper

The decision to buy a second home can be a daunting task when one considers the financial and logistical tasks. In addition to taking on a mortgage, vacation-home owners face a second set of utility, maintenance and tax bills.

Combine that with the stress of managing the home as a rental property, and some would-be second-home shoppers might be wiser and happier sticking with renting.

But with proper planning, a little common sense and some friends spreading the good word, renting out a vacation home can be a positive experience. (more…)

Beautiful Wilkes County NC Timber Frame Home and Mountain Property.

MLS Number: 51166, List Price: $898,500

2 Bedrooms, 2 Baths, 2 half baths, 2 car attached garage, full basement, and a barn on 5 acres of land.

These terms are used to describe thousands of homes and yet some things just can’t be described, they have to be experienced. This is one of those homes that really has to be seen to be appreciated.

This majestic Timber Frame home of the Bob Timberlake genre is not just another house, it provides a feeling of home that is not about walls and floors and windows and doors. It creates a feeling of the flow between your outdoor and your indoor environment that is seamless. Everywhere you look there is a view. Everything you touch feels natural and beautiful in a way that cannot be described, only owned.

Contact Elizabeth Carter, 336.973.5594 or Greg Stikeleather, Broker, 704.880.5247 or email eacarter@charter.net

click here for more information

Recent actions (or maybe inactions) may help solve the current “mortgage meltdown” crisis. But as we enter into a new year, there are other real estate issues confronting consumers. Here are some New Year’s resolutions recommended for legislators, lenders, appraisers, title companies, and consumers.

If you are in the market to buy a house (whether it is a single-family, condominium or cooperative), it’s imperative that you shop around for your mortgage. Many new-home builders will offer you a cash discount if you use the lender’s “preferred lender” and its “preferred title company.” Sometimes these discounts are worthwhile, but sometimes the extra charges imposed by that lender and the title company exceed the amount of the discount.

Make sure that you carefully inspect the house. If the current owner is reluctant to give you this opportunity, move on to another property.

You also have to have a complete title search done before you go to closing — even if you plan to pay all cash. Distressed properties can carry a lot of problems — such as tax liens, unpaid assessments, or judgments against the current owners. (more…)

search for : preferred lender, title company, title search, Distressed properties

Even for the smallest of remodeling budgets, improved energy efficiency can have a variety of benefits. Environmental gains will appear through drastic decreases in water consumption and electricity use. These include lower energy costs, qualification for tax breaks and rebates and the ability to market a property to buyers or tenants as being environmentally friendly.

Energy efficiency projects come in all shapes and sizes, ranging from as simple as changing light bulbs to as complex as performing a complete remodel. One fine source for detailed renovation ideas is the book shown on this page — Green Remodeling: Changing the World One Room at a Time, written by David Johnston and Kim Master in 2004.

The easiest and least expensive solutions involve lighting, showerheads and thermostats. Regular incandescent light bulbs use technology that has been obsolete for some time; they lose most of their energy as heat instead of light. Compact fluorescent light bulbs (CFLs) use about 75 percent less energy to produce the same amount of light, and will last up to 10 times longer. (more…)

search for : energy efficiency, lower energy costs, Green Remodeling

Jack M. Guttentag, Professor of Finance Emeritus at the Wharton School of the University of Pennsylvania has composed an excellent series of articles on the Mortgage 101 website

Entitles “New mortgage underwriting rules will be tough to enforce”, Guttentag discusses the problems that regulators will have when trying to make sure that lenders comply with the intent of the Federal Reserve Board.

In writing, the Professor examines board proposals to curb lax underwriting rules, unfair practices by mortgage brokers, and abusive practices by loan servicing agents in respect to this salient statement

Underwriting requirements set by private markets tend to become increasingly liberal when house prices are rising. Rising prices convert bad loans into good ones — good, at least, from a lender perspective. If the borrower can’t make the payments, having equity in the property allows the borrower to refinance into a mortgage with lower payments, or to sell.

It is our opinion that this one series will do well to educate current and prospective mortgage holders as to the problems facing themselves and the mortgage industry.

search for : mortgage underwriting rules, lax underwriting rule, unfair practices by mortgage brokers, abusive practices by loan servicing agents

If you are thinking of selling then one hassle you don’t need is a last-minute renovation. With the housing market continuing to weaken, many sellers are going beyond the usual cleaning, painting and “staging” with flowers and pillows, by taking on big-ticket projects.

Real estate pundits warn that sellers are unlikely to get their money back from extensive renovations. But owners often feel they have no choice if they want to sell, especially when builders of newly constructed homes are throwing in hardwood floors, finished basements and other free upgrades.

According to Remodeling magazine’s annual Cost Versus Value Survey, the overall return for remodeling projects is on the decline, falling to an average of 70% in 2007 from 86.7% at the market peak in 2005. (more…)

It used to be, years back, that there were two types of real-estate agents: Those who listed homes and those folks who took buyers around to look at homes represented by a listing service (MLS). Both were necessary at that time. Because the Internet and online real-estate listings didn’t exist, the agents who showed homes to buyers generally spent a lot of money on gas and earned every penny of their commission.

With changes in technology, a new kind of agent has emerged. These agents are called “exclusive buyer agent,” and are responsible to the buyer alone. Although a full service agent could be employed as a buyer’s agent, some don’t list homes at all.

Some real estate pundits recommend that buyers seek out such agents, as they’ll not only keep your confidence, they’ll also drive you around, give you valuable insight into market conditions and negotiate hard on your behalf, without any possibility of a conflict of interest. (more…)

search for : real-estate agent, MLS, buyer’s agent

In this overly litigious society in which we live, manufacturers feel the need to paste a warning label on every available square inch of just about every tool we use. Because we are so inundated and overwhelmed with the stickers, we often don’t give the warnings much deserved attention.

Safety warnings are there for a reason. Some are generic in nature, yet some are specific to that particular tool. And, while many may seem like simple common sense, to ignore basic safety procedures is stupid, and dangerous in the extreme. So take a moment to review some of these common power tool safety precautions. Keep them in mind the next time you’re working with power tools. (more…)