Austin - A GREAT place for Real Estate Investors!

Austin has been in the national news quite a bit recently. We now top Forbes list as the Best Housing Market for Investors. “Austin looks like a great buy right now with a projection population growth of 16% and three-year home price forecast of 5%.” To read the entire article - http://www.forbes.com/fdc/welcome_mjx.shtml

Here is another great article from Forbes.com talking about both residential and commercial Real Estate Investing. \http://blogs.forbes.com/francescalevy/2010/09/13/real-estate-investing-housing-reit-foreclosures-distresse/?partner=contextstory

If you have considered adding property to your portfolio, please contact me to discuss various options. I am here to help with any of your mortgage needs or questions.

Effects of Mortgagee Letter 2010-28

The recently released HUD Mortgagee Letter 2010-28 has generated not only quite a buzz in the industry, but also a good deal of confusion over the actual stipulations. Here is a basic recap of the Letter to help you navigate the change.

The Facts

The new law allows HUD to increase the amount of the annual Mortgage Insurance Premium (“MIP”) from 0.5 percent to 1.5 percent for loans at 95% or less LTV. The allowable premium changes from 0.55 percent to 1.55 percent for loans over 95% LTV.

However, HUD is not increasing premiums up to these allowed amounts at this time. Their letter states that, effective for all case numbers assigned on October 4 and later will be charged .85 percent or .90 percent, depending upon the LTV.

On the flip side, FHA will greatly lower the Upfront Mortgage Insurance Premium (“UFMIP”) on October 4 from 2.25 percent to 1.0 percent for purchase and refinance transactions.

Annual premiums for Home Equity Conversion Mortgages (“HECMs”) are increasing to 1.25 percent while the upfront premium is unchanged; cancellation policies for MIP are also unchanged.

What Does It All Mean?

The simple fact is that closing costs for FHA loans assigned on or after October 4 will be dramatically reduced by the new, lower UFMIP.

The upfront savings will be somewhat offset by the higher annual premium paid monthly. However, those borrowers who want to roll the UFMIP into their loan amount will enjoy having more equity in their homes now than if they had purchased prior to the change.

FHA loans are still a great deal, especially with the upcoming change to the UFMIP which should help to alleviate client resistance to FHA financing. If you or your buyers have any questions about FHA financing, please do not hesitate to ask me.

Can't decide if you are ready to buy OR if you should refinance?

Can't decide whether or not to buy? On the fence?
Read this article from Time magazine....it couldn't be more accurate! : http://www.time.com/time/magazine/article/0,9171,976602,00.html
The surprise? It was written 18 years ago! History often repeats itself. It is human nature to get stuck thinking what's happening now will never happen again, however it is important to remember that things go up and go down, we WILL get through this. The housing market will recover long term. The best investors buy during the most pessimistic times.

Can't decide whether or not to refinance?
Rates right now are the BEST they have ever been. It couldn't be a better time to buy or refinance. This current bond 'bubble' will burst, there is no doubt about it. If you are contemplating a refinance, now is the time to take action. You don't want to look back and wish you had. Instead, take action and take advantage of the best rates EVER available!
As always, please let me know if you have questions or if I may assist in any way.

ATTENTION REALTORS

It isn't new news to say that purchases have slowed down.

I would like to take this opportunity to partner with you NOW, to help build business in the months to come!

I would be happy to sit with you at any time to make outbound calls to anyone that is sitting on the fence. I can qualify your prospective clients and explain that affordability is great now and probably will never be better. I am also happy to track anyone that might not be ready today. I've always said "never say no, always say here's how". Every buyer deserves a loan, some just aren't ready yet. I'm here to help you get them ready.

I'm more than happy to be in your office, helping you find business solutions. Tough times require tough actions. As we all know, the next 6 months won't be easy. All indications are that sales are slowing, unemployment is not improving and though consumer confidence was up slightly today, it is still at very low levels.

Today I can be part of the solution; I plan to focus on the things that will build your business for the future. Today, as a team we can ensure that when the market does come roaring back, it will be YOU that the competition will be chasing.

Let me know how I can help!

Market Commentary

The unemployment numbers never cease to amaze. It is such a toss up between expectations and reality. Today's nonfarm payroll number was -54K when the consensus was -105K. And, if that was not enough, last month's number was revised to -54K from -131K. The employment rate went up by .1% this month to 9.6%. The private sector has had positive job growth every month this year. As a result, MBS prices are off this morning and the 30 year fixed FNMA required net yield (60 Day) is now at 3.85%Next week is very light on data. We will have the biweekly Treasury sales scattered throughout the week and the market holiday on Monday.