MortgageJaw.com

Here is a summary of the NEW RESPA Rule going into place January 1st, 2010.

On January 1, 2010, HUD will require that lenders and mortgage brokers provide consumers with a standard Good Faith Estimate (GFE) that clearly discloses key loan terms and closing costs. Closing agents will also be required to provide borrowers a new HUD-1 Settlement Statement that clearly compares consumers’ final and estimated costs. The new RESPA rule became effective on January 16, 2009, but provided a one-year transition period for the mortgage industry to incorporate these changes. HUD will continue to work with the mortgage industry during this period, including providing a comprehensive set of frequently asked questions (FAQs) on its website.

***Now below is the actual letter release from HUD***

WASHINGTON – The U.S. Department of Housing and Urban Development (HUD) today announced that for the first four months of 2010, the staff of the Mortgagee Review Board (MRB) will exercise restraint in enforcing new regulatory requirements under the Real Estate Settlement Procedures Act (RESPA), due to take full effect on January 1. The MRB instructed its staff to exercise such restraint in considering an action against FHA-approved lenders who have demonstrated that they are making a good faith effort to comply with RESPA’s new requirements.Hope this helps

In addition, HUD is asking other federal and relevant state enforcement agencies to exercise the same 120-day restraint in enforcement for non-FHA originators and other settlement service providers who demonstrate the good faith effort to implement RESPA’s new rules. In determining whether a mortgagee has made a good faith effort, MRB staff will consider whether the mortgagee has relied on the new RESPA rule and other written guidance issued by the Department, and the extent to which the mortgagee has made sufficient investment and commitment in technology, training, and quality control designed to comply with the new rule.

“We will work with those who are making an honest effort to work with us as we implement these important new consumer protections,” said HUD Secretary Shaun Donovan. “While we will not delay implementation of RESPA’s new requirements, we are sensitive to the concerns of the industry as it integrates these new rules into their day-to-day business practices.”

On January 1, 2010, HUD will require that lenders and mortgage brokers provide consumers with a standard Good Faith Estimate (GFE) that clearly discloses key loan terms and closing costs. Closing agents will also be required to provide borrowers a new HUD-1 Settlement Statement that clearly compares consumers’ final and estimated costs. The new RESPA rule became effective on January 16, 2009, but provided a one-year transition period for the mortgage industry to incorporate these changes. HUD will continue to work with the mortgage industry during this period, including providing a comprehensive set of frequently asked questions (FAQs) on its website.

By improving the disclosures borrowers receive when applying for a mortgage, and by promoting comparison shopping, HUD believes its new RESPA regulation will save consumers an average of nearly $700 in mortgage costs.

I couldn’t believe it my self until I found this article from CNBC.com, then saw this was going on in Barrington, Illinois. Here is the full article below for your reading pleasure.

Published: Wednesday, 11 Nov 2009 | 12:26 PM ET

Here’s a sweet real-estate deal: One well-heeled Chicago suburb is selling three homes in its downtown area for just $1 each.

Source: Village of Barrington Hey, honey—Can you come out and help me unload the trunk? This hair salon I bought today is a little heavy! I’d also love your input on where to put it. By the fireplace?

But, wait, don’t answer yet: They’ll also give you $10,000 to buy one of them.

That’s right. They’re paying YOU to buy a house.

So why aren’t there any takers?

Well, there’s one teensy catch: You have to physically move the house to another location and that costs a lot more than $10,000 — more like $20,000.

The town of Barrington, which had to reduce its staff by 10 percent last year amid the recession, wants that land to build new restaurants, shops and office space as part of a downtown-revitalization project.

A first round of bidding generated a lot of buzz but no buyers.

The town says it’s because the auction wasn’t long enough.

“We only had the bidding process open for a few weeks and that didn’t give the public enough time to assemble and get all the different players together — house mover, utilities, etc.,” said Brooke Jones, a development planner for Barrington.

It also had a lot to do with money.

By the time you add up the costs of buying a new lot, building a new foundation and then rewiring these turn-of-the-century homes for modern times, “it probably ends up costing per square foot similar to building a new home,” said Marty O’Donnell, who runs a B&B in town with his wife, Mary, and is chairman of the local architecture-review commission.

To put it simply: You get a fixer-upper-MOVER for the same cost as a new, move-in ready home.

And then there’s the fact that you have to figure out how to actually MOVE the house.

I mean, if you said, here’s a new refrigerator, all you have to do is find a place to put it, I could probably find a truck to move it — and a place to put it. But a house? That just sounds like something beyond the scope of my capability.

“It’s really a labor of love,” O’Donnell said — you’ve got to love the house and love preserving little pieces of history.

O’Donnell, who lives in a historic home in downtown Barrington and also volunteers to preserve the town’s architectural history, obviously has the love: “It’s kind of a cute story,” he said. “You can buy a home for a negative $10,000 — all you have to do is find a place to put it!”

If you’ve got $1 — and the love — contact Brooke Jones from the village of Barrington at (847) 304-3400. The next round of bidding will start in November and run through March.

http://www.cnbc.com/id/33838028

Hope you enjoyed this.

If you were able to see my previous post about budgets then you would have seen this first step of setting up a budget or as I like calling it by the true name “Spending Plan”. I wanted to go into this step a little bit deeper so hope you enjoy.

Step 1:

What are your goals? If you don’t know what you want to accomplish, it will be hard to make any accomplishments and know when you are successful of them. Also I like to use this analogy, “If you get into a car, you usually know where you are going to end up. If you don’t, well……either you are stuck in park or going to run out of gas.”

This step is truly the most important because when you are building a house, you definitely need a good solid foundation. With out a solid foundation, your house will crumble or will not be sturdy enough to build on. Need to make your financial house sturdy to build on so we start with goals. Going back to the car analogy, if you didn’t have a goal of where you were headed…..then you would be driving around and might run out of gas. With a goal or set destination, even if you get off your path, at least you know that destination you want to arrive at and might have to find a different path. You might ask, “Why do I need this, I am doing a spending plan?” Good question and glad you asked. Start by setting those goals that you are truly passionate about; saving money to {input what ever you are wanting to do with money}; traveling; stop working at age 55; putting my kid through college. These are just some examples, but YOU are the only person to know what is a truly passionate goal for YOU.

Here are some examples of goals and what to do:

Examples of goals categories: Life, Job, Spiritual, Health, Family, Financial, Education….etc.

Now, under each goal catagory make sure to set what the long term goal will be and several short term goals it will take in order to get there. Reason for this is if you wanted to retire by age 55……well that might be a long time away and you might lose sight of that goal. What you want to do is set up a few short term goals like having a certain amount of money put aside by a certain age. These will act like gas stations along the way of your journey to meet your end goal and a chance you can check your map and make sure you are going in the right direction.

WRITE YOUR GOALS DOWN ON PAPER, and if you are brave enough…….TELL SOMEONE about them. *WARNING* beware if you do this, you might actually accomplish your goals.

Why this works is because if you write it down the goals will be staring back at you from that piece of paper. If you tell someone, well, every time you see that person they will ask you how you are coming along on your goal. Most people want to show progress so either they will have done something towards their goal……….or they will run away from that person they told.

Hope this helps

Looks like a new mortgagee letter from FHA, mortgagee letter 2009-46b is out with the new condo approval process for FHA loans. Saying it simpler, if you are buying a condo these are the guidelines lenders will be looking at for all FHA loans. You still have guidelines from Fannie Mae and Freddie Mac, then beyond that it is up to each individual lender and their interpretation of the guidelines and how much risk they want to take on. I originally talked about these changes in my earlier post HUD Delays Condo Changes notifying everyone of the delay until December 7th, 2009 for these changes to take place. The major change is the elimination of FHA’s Spot Loan Approval process for condo projects. So this means that all projects will be required to be approved through FHA with two approval options:

*HUD Review and Approval Process (HRAP)

* Direct Endorsement Lender Review and Approval Process (DELRAP) — The preferred method for approval, as it is typically faster.

DELRAP is available only through lenders who have unconditional Direct Endorsement authority as well as staff who are experienced in reviewing and approving condo projects. So this means for any one looking for financing on condos it is very important now what lender you choose and knows what they are doing!

Here is a link to the actual Mortgagee Letter 2009-46b for your reading pleasure. Any questions please feel free to ask and as always……Hope this helps

Yes, got this wonderful information for everyone directly from the IRS.gov site so you will have none of the he said, she said going on. Also have a couple of key website links for your information so make sure to click on them as you read. Hope this helps

From IRS.gov

Updated Nov. 6, 2009, to reflect new legislation — more to be added soon

New Legislation

New legislation, the Worker, Homeownership and Business Assistance Act of 2009, which was signed into law on Nov. 6, 2009, extends and expands the first-time homebuyer credit allowed by previous Acts. The new law:

continue reading »

Well, after the process started looks like President Obama put the ink to the paper and has signed the extension on the unemployment bill which had an amendment attached to extend the home buyer tax credit. Not only did this extend the first time home buyer tax credit of $8,000 for those whole qualify, but added to it several other details I explain in my previous post

Tax Credit.

Looks like everything is the same from when it started added several things like allowing people who lived in their current residence for 5 yours to get a $6,500 credit if they buy a new primary residence. Also raised the income caps for people to qualify. Just remember this is a TAX CREDIT so make sure you do get all the details before you claim this on your taxes. Also be good to talk with a Tax professional.

Hope this helps

Could this be, well only heard it reported on CBS 2 news on Thursday November 5th here in Chicago that she might be setting up a studio in California. Don’t think that means she would be actually leaving Chicago, but might be doing shows in more then one place. Also CNBC.com reported by Julie Boorstin this article:

Is Oprah Ready to go on her own?

http://www.cnbc.com/id/33675696

Hope you enjoy

According to the CNBC report Obama will be signing the bill for the Unemployment and 1st time Home buyer tax credit extension. 

Obama To Sign Bill Friday Extending Homebuyers Credit
Congress took further steps to right the staggering economy by expanding a popular tax credit for home-buyers and extending unemployment checks for the growing legions of people running out of benefits with few job prospects.

http://www.cnbc.com/id/33673455/

Summary:

This extends the credit for first time home-buyers through JUNE as long as home-buyers have a signed contract by the end of APRIL. It also offers a $6,500 for those who lived in their current homes for at least 5 years to buy a new primary residence to live in. The income level has been raised to $125,000 for individuals but homes must cost less then $800,000.

Hope this helps.

I would consider this one of those items on the same shelves as losing weight. Here is why both of these topics have so many similarities:

1. Both are probably 20% technique and 80% the person.

2. There are a hundred ways to accomplish your end goals

3. There are some simple guidelines for accomplishing each.

Exercise the simple guidelines are: Eat less, exercise……..with many paths to get there.  Getting out of debt I think I have narrowed it down to only 3 simple guidelines which maybe could only be two: Earn more money, have less expenses and/or spend less, and sell items of value to increase income or have less expenses.  One way to get out of credit card debt would be the snow ball effect. If you have multiple debts, number one sell items of value or take out money in savings to pay down your most expensive debt with the least amount of balance. Lets use this example:

Credit card A has a balance of $2000 and interest rate of 10% Min. Monthly payment of $50

Credit card B has a balance of $2000 and interest rate of 7% Min. Monthly payment of $40

First you would do a spending plan and figure out how much month you can put towards paying down your debt. In this case lets say it is $200, so what you would do is pay the minimum payment on Credit card B of $40 and pay $160 towards Credit card A. Once you pay Credit card A off, then you will take that full $200 payment and apply it towards Credit card B. DON’T STOP HERE!!!……..Now you just freed up $200 a month for extra income…..please don’t go spend it! Instead, take that $200 a month and put it in savings or a retirement account.

Hope this helps

Stay tuned as I will have more money saving tips coming your way!

The FED will most likely announce today after their two day meeting they will leave the over night rate unchanged currently at 0 to .25%. The overnight rate is the going rate at which the FED charges banks for borrower money. So now looking back at any of the banks quarterly earnings, if they can borrower money at 0 to .25%…..lend it at 4.5 to 5.5%…….that is a pretty big profit. Further story at CNBC.com

All the eyes though on this announcement are more aimed towards the wording, is the FED planning to raise rates sooner or later? There has already been the announcement of the FED to stop Treasury buying (the United States debt) so that might be one impact on interest rates. They announced this would take place at the end of the 1st quarter (March). Depending on the direction they want to give, raising of the over night rate must come sooner or later. There is a lot going against the rates being this low…..dollar devaluation, but there is a lot going against raising them, JOBS, real estate, lending.

Hope this helps

Always interested in your comments, so feel free to contact me.