Archive for April, 2010

A Morning Cup of Inspiration (April 30, 2010)

morning cup of inspiration

Imagination is more important than knowledge.

Knowledge is limited.

Imagination encircles the world.

– Albert Einstein

Knowledge is the years of schooling you need to gain the credentials for a great career.
Imagination is the vision
of the dream job you’ve held tightly to since you
were a child. Imagination is having the goal of a perfect relationship, healthiest body,
and overflowing bank account. And knowledge and action are the tools that put you
through the paces in achieving those goals.

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The 7 Best Housing Recovery Bets

The national average home price over the next 2 years may not seem promising. But there are cities predicted to post gains.

According to CNN Money, below are the 7 top cities:

1. San Francisco:
The market there may come roaring back: Fiserv predicts a 14.3% gain between June 2010 and June 2011. Averaged out, that means a 4.8% gain over the next two years. One reason for the sharp comeback is that much of the area’s excess inventory will have been sold. It’s already dropped by nearly in half over the past year. More info…

2. Seattle:

Seattle has become a world-class city with a diverse, vibrant economy. As a home to manufacturers such as Boeing and software providers such as Microsoft, the job market has held up better than average, with a current unemployment rate of 8.8%.  After another modest price decline of 2.3% in the next eight months, the market should begin to turn up. Between June 2010 and June 2011, the city should see a gain of 6.2%. Averaged out, that means a 3.8% gain over the next two years.  More info…

3. Pittsburgh:
Pittsburgh’s main problem has been a brain drain. The metro area has been losing residents for years: Its population shrank 3% since the 2000 census, and the core city of Pittsburgh has lost almost half its population over the past 50 years. But that worked in Pittsburgh’s favor when it came to real estate. There was no shortage of housing during the boom years, which helped keep a heavy lid on housing prices. Homebuyers never had to resort to exotic mortgages just to buy a starter place.

Once the national recovery begins in earnest, the housing market should start to record moderate gains. Fiserv predicts a home price rise of 0.5% by June 2010 followed by a 1.7% increase in the following 12 months. Averaged out, that means a 2.2% gain over the next two years.  More info…

4. Rochester:

Rochester has had to reinvent itself. Old economy companies like Eastman Kodak and Xerox have lost much of their importance and reduced their workforces.  The slack has been picked up by such newer companies as Paychex, a successful payroll-service company headquartered there, as well as high-tech optical companies. The current unemployment rate of 8.1% is was well below the national average of 9.6%.  Rochester home prices never bubbled during the boom, but they have enjoyed slow, steady growth during the bust, gaining 5.2% over the past three years*. Since many of the area’s jobs pay reasonably well (the median household income is $63,000, which is above the national median), the relatively affordable housing market has been open to most of the population.

The prices also meant few homebuyers resorted to toxic mortgages, and New York’s strong consumer protection laws tended to discourage predatory lending. As a consequence, Rochester has been less burdened by foreclosures than most big markets. Only one property for every 276 had a foreclosure filing against it during the first six months of 2009, about a third the national rate.  More info…

5. Memphis:

The Memphis metro area boasts some of the most affordable housing in the country — and it grew considerably cheaper during the past few years, falling nearly 20%.  That downturn will continue for another year or so, with prices declining another 1.2% before rebounding 2.2% during 2011. Averaged out, that means a 1% gain over the next two years.

The metro area has been growing steadily in population since the 2000 census, up nearly 7%. The added demand for housing should support home prices, although land in the city’s far-flung exurbs can be purchased and developed quite reasonably. The competition from new home builders tends to keep a tight lid on the gains of existing home prices.  More info…

6. Oakland:

Looming over Oakland’s metro area is the exotic mortgage, such as option ARMs, which will start to reset to higher rates over the next few months. It’s feared that could fuel another severe wave of foreclosures.  Still, the foreclosure problem of Oakland pales in comparison with those of inland California cities.

With the prospect of continued job losses, it’s no surprise that Fiserv is predicting an 11.7% drop in home prices by June 2010. After that, however, Fiserv expects Oakland to take off again thanks to its strong and varied businesses, such as health insurer Kaiser Permanente, Clorox and retailer Dreyer’s.

Its position across the Bay from San Francisco and its great educational institutions, led by the University of California, provide a further base for the economy. Fiserv forecasts that home prices will return to double digit growth starting next June and produce gains of 13.7% in the following year. Averaging out the drop and the gain, Fiserv expects a 0.4% rise over the next two years.  More info…

7. Birmingham:
Alabama is filled with metro areas that recorded positive returns for home sellers during the past few years. Birmingham recorded a gain of 6% during past three years, but several other state cities recorded double digit gains, including Mobile, where prices grew 13.4%.

Birmingham, like most Southern metro areas, is marked by a “high elasticity of supply,” said Mark Fleming, chief economist for First American CoreLogic. Developers are relatively unrestrained in building, and these markets tend to be far less volatile than places like San Francisco or Portland, where development is restricted either by government policies, in Portland’s case, or geography, in San Francisco’s.  As a result, these cities seem to exhibit slow, steady growth rather than big peaks and valleys. Birmingham is no exception. Fiserv forecast a slight 12-month loss of 0.7% through June 30, 2010, and then a gain of 1.1% the subsequent 12 months. Averaged out, that means a 0.4% gain over the next two years.  More info…

Source:; Statistics – Fiserv: From June 30, 2009, through June 30, 2011.

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Hump Wednesday Funnies


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The Basics of Buying a Foreclosed House

buying a foreclosure

Purchasing a foreclosure home can be a great savings to a home buyer vs. a traditional resale transaction.

However, foreclosure sales will often come with their own set of rules, regulations and red tape. Knowing how to navigate the waters for a foreclosure sale is of great benefit to home buyers.

Finding Foreclosure
Find properties that interest you. This can be done most easily by hiring a real estate agent to utilize the multiple listing service (MLS) to narrow foreclosure properties in the areas and neighborhoods most desirable to you. You will be able to preview these properties online and decide which property might be of interest.

HUD Homes
HUD homes are foreclosed properties where the previous borrower defaulted on an FHA loan. With HUD homes, buyers can expect rock bottom prices but need to be prepared to bid over the asking price. The best benefit about HUD homes is that many of them will come with a $100 down program, making them the most affordable deal on the block.

VA Foreclosures
VA foreclosures are homes that have been repossessed by the Department of Veterans Affairs from a veteran with a default on their home mortgage payments. In these scenarios veterans can sometimes receive incentives to purchase the home under a new VA loan. However, a consumer does not need to be a veteran to purchase a VA foreclosure.

Many foreclosures have undergone damage, poor care and maintenance, and will require some work. It is very rare for anyone to find a “ready for move in” foreclosure home. Be prepared to do some major work with any foreclosure purchase.

Avoid Financing Pitfalls
Depending on the amount of damage done to a foreclosure home, all methods of financing might not be available to consumers. In some cases, homes are so badly damaged that the only way to complete a purchase is using cash.

The contract to purchase a foreclosure is identical to any other residential real estate purchase. The difference will be visible, however, in the bank required addendums that will be in addition to the purchase contract. For many foreclosures these addendums can be 10 or more pages in length.

Bottom Line
Foreclosures are a great value. The purchase process of a foreclosed home does not differ much from a typical real estate transaction other than financing concerns and additional paperwork.

Source: Shauna Zamarippa (ehow Contributor)

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How a Foreclosure or Bankrupty Impacts Your Credit Score

credit report clipboard

Recently, Fair Isaac, which developed FICO scores, pulled back the curtain a bit, revealing some estimates of point-score declines following mortgage delinquency problems.

Here are the average hit your credit will take:

  • 30 days late: 40 – 110 points
  • 90 days late: 70 – 135 points
  • Foreclosure, short sale or deed-in-lieu: 85 – 160
  • Bankruptcy: 130 – 240

“The lending industry tends to regard an account differently when it has become 90 or more days late,” said Craig Watts, a spokesman for Fair Isaac. “The likelihood that consumers will resume paying their overdue obligations drops off significantly after the delinquencies have reached 90 days.”

One reason credit companies were so closed-mouthed is that they often can’t definitively state how much each delinquencies will affect scores because there are too many variables.

Some borrowers will fall much more steeply than others for the same payment problem, according to Maxine Sweet, vice president for public education at Experian, one of the nation’s main credit bureaus.

“If you picture someone who has just one mortgage and one other credit account versus a mature credit user like me with 15 accounts, if they miss one payment that would impact their scores a lot more,” she said. “For me, one missed payment would just be a blip.”

Source: Les Christie,

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A Morning Cup of Inspiration (April 23, 2010)

morning cup of inspiration

Try not to become a person of success but a person of value.

– Albert Einstein

leaders on mount rushmore

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4 Important Tips on Home Inspections when Buying a Home

home inspection

A professional home inspection can not only provide a great education about the home’s systems, but also be a crucial tool in negotiating the most equitable price on the home, according to HouseMaster, one of the first and largest home inspection franchisors in North America.

“Our experience and research shows that approximately 40% of resale homes have at least one defect that can cost a home buyer a minimum of $500 to repair,” said Kathleen Kuhn, President of HouseMaster.“A home inspection by a professional and qualified home inspector is an excellent tool to encourage home sellers to make repairs or make further price adjustments as a result of conditions noted in the inspection report.”

According to HouseMaster, below are tips to ensure that home buyers make an educated decision when purchasing a home and get the best price possible:

1. Inspect the Inspector. Only hire a home inspector with an excellent reputation and credentials. Ask how long the company has been in business, ask about specific formal training and ongoing education the inspector has and verify the inspector carries professional liability insurance also known as “Errors & Omissions” (E&O). If the company doesn’t carry this insurance, it could indicate a poor track record or lack of experience.

2. Ask for a sample of a report. The credentials of the inspection company and the quality of the final inspection report will be important. A poorly prepared report without pictures or clear, concise details addressing all the various systems and accessible elements of the home is less likely to be taken seriously by a home seller.

3. Inspect ancillary systems. It’s hard for home buyers to know what they need, so be sure to ask what additional services the company offers. If the home you are considering has a septic system for example, a professional home inspection company may offer septic system inspections or can coordinate that service for you. Generally, the company will offer you a multiple services discount as well as the added convenience of only having to attend one inspection appointment. Other common services offered by home inspectors are termite inspections, mold screening, water testing and radon testing.

4. Go along on the inspection. Ask the inspection company if they encourage buyers to tag along on the inspection. If the inspector discourages you from going along and asking questions, find another inspector. A home inspection is not simply a laundry list of what is wrong with the home. In addition to documenting issues and needed repairs that may exist, a professional home inspector will also show the new buyer how to operate the various systems in the home and provide tips on improving energy efficiency and maintaining the home in general. And being present during the inspection will make the final written report that much more meaningful.

Source:  RISMedia and

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