Sonatta Camara, Distressed Property Expert

30-Year Rate Inches Up, Five-Year Drops to New Low

Fri, 20 Apr 2012 09:13:18 GMT

Freddie Mac’s weekly average for the 30-year rate came in two basis points higher at 3.9%, while the average for the five-year Treasury-indexed hybrid ARM dropped seven basis points to a new low at 2.78%.

Like the 30-year fixed rate mortgage, the 15-year FRM was up two basis points at 3.13%. The average weekly primary market rate for the one-year ARM was up just a basis point at 2.81%.

Mixed economic indicators in the U.S. and financial developments in Europe continue to drive rate activity. Uncertainties related to these have pushed rate-indicative bond yields more frequently below 2% at various points during the period covered in Freddie’s most recent rate survey, which encompasses the week ending April 19.

The long-term, rate-indicative 10-year Treasury yield as of Thursday afternoon was at 1.96% following a less-than-expected drop in U.S. jobless claims. The Collingwood Group said in a report Thursday that economic indicators in the U.S. are vacillating, in part, due to insufficient job creation, which continues to hold back housing. In turn, constraints on the housing market are restraining job creation, the firm said.

When asked how rates play into this, Collingwood Group partner Tim Rood told this publication, “There is no doubt that affordability is certainly a factor” in consumer decisions that support the housing market, but it tends to be overshadowed by other factors such as employment.

Affordability remains strong from a historic perspective. Rates are still below where they were last year, according to Freddie Mac. A year ago, the 30-year averaged 4.8%, the 15-year averaged 4.02%, the five-year Treasury hybrid averaged 3.61% and the one-year Treasury ARM averaged 3.16%.

Average points in the latest week were highest for 30-year FRMs at 0.8 of a point, followed by 0.7 of a point for 15-year FRMs and five-year Treasury hybrids. One-year Treasury ARMs required borrowers pay an average of 0.6 of a point

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Sonatta Camara, CDPE®,CRS®,GRI®,MBA
Broker
Camara & Co. - The Real Estate Group
9500 Arena Drive, Suite 480, Largo, MD 20774
301-333-4444 Office
301-333-2013 Fax
http://www.SonattaCamara.com

To FSBO or not to FSBO: It Could Be Better Not To

Thu, 19 Apr 2012 09:41:21 GMT

There's this story which recently appeared in the Wall Street Journal regarding Colby Sambrotto, the founder and former CEO of forsalebyowner.com. It seems the founding father and lifelong evangelist of the concept of selling your home without a real estate agent was forced to hire a broker to sell his home after failing at what he preaches others should do.

After failing to sell his NYC apartment on his own as a For Sale By Owner (FSBO), Sambrotto hired a broker and paid a 6% commission in order to get the job done. His personal experience helps refute some of the myths Sambrotto has been espousing for over a decade. Let’s look at two of those myths:

Myth #1 – You Will Pocket More Money Selling on Your Own

Most FSBO sites say you can save the commission by selling on your own. What happened in Sambrotto’s sale?

From the WSJ article:

“The broker, Jesse Buckler, said he told Mr. Sambrotto the apartment in the Lion’s Head building on West 19th Street near Sixth Avenue was priced too low and wasn’t drawing the right buyers.

By May, it went into contract, he said, after attracting multiple offers. It closed in the last few days for $150,000 more than the original asking price.”

Myth #2 – The Internet Alone Can Sell Your Home

Many have said that, with the introduction of home search on the internet, hiring an agent is no longer a necessity. What happened to the FSBO guru when he attempted to only depend on the internet?

From the WSJ article:

“Looking to move his family to the suburbs, [Mr. Sambrotto] said he carefully staged his apartment for sale himself, and put it on the market. But after using a mix of websites to publicize his apartment, he said he had only ‘middling success’ and switched to a broker because many buyers were so reliant on brokers.”

In Conclusion

There is a reason the real estate industry has been around for centuries: it performs a valuable service.

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Sonatta Camara, CDPE®,CRS®,GRI®,MBA
Broker
Camara & Co. - The Real Estate Group
9500 Arena Drive, Suite 480, Largo, MD 20774
301-333-4444 Office
301-333-2013 Fax
http://www.SonattaCamara.com

New Foreclosure Wave: What Will Be the Impact?

Wed, 18 Apr 2012 09:25:44 GMT

This increase in distressed properties will have a much different impact on the housing market than previous increases for three reasons.

1. Demand Will Absorb Much of the Increase in Supply

The last wave of foreclosures entered the market as both consumer confidence and demand for housing was on the decline. That created an overhang of discounted properties that pushed down the prices on non-distressed homes. This new increase in foreclosures is hitting a different type of real estate market. Consumer confidence is stabilizing and the demand for housing is increasing. The impact on prices will be much less dramatic in most markets than it has been in the past.

2. Many Banks Are Doing Necessary Repairs and Renovations

Historically, the typical foreclosure has sold at a discount of 25-30% compared to non-distressed properties. The banks are finally realizing that they may soon own one or more of homes in any neighborhood. For that reason, we are beginning to see banks do the necessary repairs and renovations in order to garner a price closer to the value of non-distressed properties in the marketplace thereby lessening the impact on the value of surrounding homes.

3. Different Regions Will Bear the Brunt

Originally, many thought that the foreclosure fiasco was confined to the four ‘sand’ states (CA, AZ, NV and FL). We now realize that cities like Chicago and Atlanta, along with many others, have also faced the burden of falling prices because of an increase in distressed properties.

This next ‘flood of foreclosures’ will have the largest impact in the judicial states that impeded the foreclosure process over the last few years such as New York, New Jersey and Connecticut. California, Nevada and Arizona will be impacted in a much less dramatic way than in the past.

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Sonatta Camara, CDPE®,CRS®,GRI®,MBA
Broker
Camara & Co. - The Real Estate Group
9500 Arena Drive, Suite 480, Largo, MD 20774
301-333-4444 Office
301-333-2013 Fax
http://www.SonattaCamara.com

3 Questions You Must Answer When Buying a Home

Tue, 17 Apr 2012 09:11:52 GMT

If you are thinking about purchasing a home right now, you are surely getting a lot of advice. And some of that advice is probably negative. Why buy now with prices still falling? Don’t you realize real estate is no longer a good investment? Don’t you know that people who bought six years ago lost their shirt? We understand the concern your friends and family have. However, let’s look at whether or not now is actually the perfect time to buy a home.

There are three questions you should ask before purchasing in today’s market:

1. What are the experts recommending?

In the last 120 days, many experts have said that buying now makes sense. This list includes: John Talbott, Christopher Thornberg and Warren Buffett.

2. When will I begin to see appreciation if I buy now?

This is a great question. Macro Markets, LLC is a company that studies housing prices. They started their Home Price Expectation Survey in 2010. They ask 100+ housing industry experts to project housing prices through 2016. The most current survey shows that the experts are predicting prices to remain relatively flat in 2012. The experts then project prices to rise reaching a cumulative appreciation of over 10% by 2016.

Purchasing a home today makes great sense from a financial standpoint. Think of the old axiom: you want to buy low and sell high. This decision should not only be a financial one however.

That leads us to our third and final question:

3. Why am I buying a home in the first place?

This truly is the most important question to answer. Forget the finances for a minute. Why did you even begin to consider purchasing a home? For most, the reason has nothing to do with finances. The Fannie Mae National Housing Survey shows that the four major reasons people buy a home have nothing to do with money:

A good place to raise children and for them to get a good education
A place where you and your family feel safe
More space for you and your family
Control of the space

What non-financial benefits will you and your family derive from owning a home? The answer to that question should be the reason you decide to purchase or not.

In Conclusion

Don’t allow money to get in the way of you making the right decision for you and your family. In the long run, the finances will work in your favor anyway.

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Sonatta Camara, CDPE®,CRS®,GRI®,MBA
Broker
Camara & Co. - The Real Estate Group
9500 Arena Drive, Suite 480, Largo, MD 20774
301-333-4444 Office
301-333-2013 Fax
http://www.SonattaCamara.com

10 Ways to Turn Off a Homebuyer

Mon, 16 Apr 2012 11:02:50 GMT

What a difference a couple of years makes.

Back in 2007, homebuyers would beg to purchase your house. They would even bid more than the asking price for the privilege to do so.

Today ... well, not so much. Once the real estate bubble burst and foreclosures poisoned the housing pool, buyers suddenly regained the upper hand. But instead of buying, they're waiting, convinced that housing prices will continue to drop.

What's a smart seller to do in this environment?

We assembled a coast-to-coast SWAT team to address the crisis: Chad Goldwasser of Goldwasser Real Estate in Austin, Texas; Terry Cannon, a buyer's agent and broker with Oregon Exclusive Buyers Realty in Salem, Ore.; and Julie Dana, the New York-based "home stylist" and co-author of "The Complete Idiot's Guide to Staging Your Home to Sell."

They suggest 10 buyer turnoffs that sellers should avoid at all costs.

"If you do all the staging correctly and have a good agent, the house will hopefully only be on the market a few weeks," Dana says. "Then you can go back to living your life."

1. Dirt

Hands down, our panel agrees: Nothing turns off a buyer quicker than a dirty house.

"The No. 1 biggest mistake is not getting the home in the best possible condition. That's huge," says Goldwasser. "I won't even represent sellers at this point unless they are fully aware of how important it is to get their home in the absolute best condition that they've ever had it in."

Goldwasser recommends that sellers go the extra mile, from steam-cleaning tile and grout to replacing carpets.

"If the carpets are old and smelly, you should put in new," he says. "If they're relatively new, you should at least have them shampooed."

Cannon agrees that grime can derail any showing.

"The home should be neat and clean and free of all debris," Cannon says. "If it reeks of cats or the kitchen sinks and counters are so filthy that it almost looks like the food is moving, I won't even want to come in."

2. Odors

Buyers, it's said, buy with their noses. Make sure your home smells fresh and inviting.

"Odors are a big one, especially kitchen odors," says Dana. "I advise my clients not to cook fried food, fish or greasy food while the house is on the market."

Some pet owners mistakenly believe pet smells to which they've become accustomed help make their abode homey. Nothing could be further from the truth.

"If you're a dog person, you tend to think everyone else is a dog person," says Goldwasser. "But the truth is, 50 percent of the population hates dogs and doesn't want to be near them. "Pets in the home? You have to deal with that."

Dana advises her clients to eliminate all traces of pets, not just pet odors. It's important to get rid of pet paraphernalia and have a "pet plan" to make sure the animals are not around when the house is shown.

"A lot of times, people will leave pet items out -- dog dishes, cat litter boxes, etc.," Dana says. "That immediately turns off a buyer because they wonder, 'What has that animal done in the house?' Also, some people really don't like dogs. The minute they walk in and see this big, old dog bowl, they immediately won't like the house."

The same rules hold true for smokers: Remove all ashtrays, clean all curtains and upholstery, and consider smoking outdoors while your home is on the market.

"Interestingly, next to the kitchen, the smelliest room in the house is actually the living room," Dana says. "That's typically the room that has the most fabric, so that is where odors get absorbed."

3. Old fixtures

Want buyers to roll their eyes? Leave old fixtures on your doors and cabinets.

"You need to change out old fixtures in your house," Goldwasser says. "New cabinet hardware and doorknobs will probably cost all of $400 or $500, but it makes a huge difference."

The same holds true for dated ceiling fans, light fixtures and kitchen appliances.

"Homes that have old fans, lights, ovens, microwaves, ranges and dishwashers can really turn a buyer off," says Goldwasser. "Sellers will say, 'Oh, the buyers can take care of that.' Well, yes they can, but it's going to impede you from getting the highest price possible for your home."

4. Wallpaper

Your grandmother may have had it in every bedroom. Your mom may have loved it as a room accent. But today's buyer wants no part of wallpaper.

"Wallpaper is a definite no-no," Dana says.

Wallpaper is a pain to remove and simply adds another chore to a buyer's to-do list, Dana says.

"Wallpaper is extremely personalized. You've spent hours looking over books to pick out the wallpaper you want," she says. "What are the odds that the person walking in the door will also like that wallpaper that you picked out?"

5. Popcorn acoustic ceilings

Times change, and with them home decor styles. Acoustic popcorn ceilings, once the must-have for fashionable homes in the '60s and '70s, now badly date your space.

If you can't stomach the cost or the mess to remove the overhead popcorn, be prepared to credit a buyer in certain markets in order to close a sale.

"The popcorn acoustic ceiling is a major, major turnoff to buyers these days," says Goldwasser.

6. Too many personal items

Psychologically, when buyers tour a home, they're trying it on to see how it fits, just as they would a skirt or a pair of pants. If your house is cluttered with too many personal items, it's like the buyer is trying on those clothes with you still in them. A fit is unlikely.

"Anything that makes your house scream 'you' is what you don't want," Dana says. "I tell all my clients that how we decorate to live and how we decorate to sell are different, and right now, we're decorating to sell."

Sellers should try to eliminate personal items, including family photos, personal effects and even unique colors, she says.

"As soon as you have family photos, buyers get very distracted. 'Oh, did I go to school with him? What do their children look like?'" she says. "Suddenly, you're selling your family, and you're not selling the home."

If you really want to hook a buyer, Dana offers a tip: "I try to place a mirror strategically so that people can actually see themselves in the home, so they can actually picture themselves living there."

7. Snoopy sellers

Realtors and buyers alike generally bristle when the seller greets them at the door for a showing.

"It's so annoying," Goldwasser says. "They will want to walk around with the potential buyer and put in their two cents' worth. It's not good. Normally, there are one out of 10 sellers where it's OK to have them there, and that's because they know what is up with the property and how everything works."

Goldwasser makes a point to shoo his sellers away from showings when he's the listing agent.

"They like to think they know what they're doing, and that's fine," he says. "But when you've sold thousands of homes and you have a system, you know how to get people the maximum value for their home. That's why they hire you, right?"

8. Misrepresenting your home

Misrepresenting your house online in the multiple listing service is a sure way to really upset buyers and their Realtors.

One of Cannon's buyers loved a home she saw online. When he drove by to take a look, he was surprised to find acres of ramshackle mobile homes across the street.

"Sellers are going to paint the best picture they can," he says. "Some listings I've looked at and wondered how in the world they got that gorgeous photo without showing all the junk that's around it. When you get there, you wonder why didn't they just be upfront?"

9. Poor curb appeal

Much is made of curb appeal, and for good reason: It's your home's handshake, the critical first impression that lasts with most buyers.

"You have to totally trim and edge your yard to get it into the most immaculate condition you can," Goldwasser says. "It's a big mistake to not freshly mulch the beds and trim the trees. Every little detail counts.

"To not power-wash the exterior or leave mud dauber and wasp and bird's nests in your eaves and above your doors? You've got to be a fool to do that."

10. Clutter

Whether inside or out, less is more when it comes to clutter.

"I usually start in the closets," Dana says. "Your closets should be half-full with nothing on the floor. Why? Because most people looking for a house have outgrown their previous house. Showing them that you've still got room to grow gives them a reason to buy."

Kitchens and built-in bookshelves should showcase spaciousness by following the rule of three. For kitchens, there should be no more than three countertop appliances. Meanwhile, bookshelves should be divided into thirds: one-third books, one-third vases and pictures, and one-third empty.

The home office should be very generic so any type of professional can imagine living there, Dana says.

"Otherwise, it can be a distraction: 'What does he do for a living? How much money does he make?'" she says.

Dana's tip for toddler parents is to pack away extraneous "kiddie litter" and keep a laundry basket handy.

"When you get that phone call one hour before a showing, toss everything in that basket and take it to the car with you and your kids, and you're all set," she says.

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Sonatta Camara, CDPE®,CRS®,GRI®,MBA
Broker
Camara & Co. - The Real Estate Group
9500 Arena Drive, Suite 480, Largo, MD 20774
301-333-4444 Office
301-333-2013 Fax
http://www.SonattaCamara.com

6 Don’ts After You Apply For A Mortgage

Fri, 13 Apr 2012 09:27:47 GMT

6 Don’ts After You Apply For A Mortgage

I learned a long time ago that “common sense is NOT common practice“. This is especially the case during the emotional time that surrounds buying a home, when people tend to do some non-commonsensical things. Here are a few that I’ve seen over the years that have delayed (and even killed) deals:

Don’t deposit cash into your bank accounts. Lenders need to source your money and cash is not really traceable. Small, explainable deposits are fine, but getting $10,000 from your parents as a gift in cash is not. Discuss the proper way to track your assets with your loan officer.
Don’t make any large purchases like a new car or a bunch of new furniture. New debt comes with it, including new monthly obligations. New obligations create new qualifications. People with new debt have higher ratios…higher ratios make for riskier loans…and sometimes qualified borrowers are no longer qualifying.
Don’t co-sign other loans for anyone. When you co-sign, you are obligated. With that obligation comes higher ratios, as well. Even if you swear you won’t be making the payments, the lender will be counting the payment against you.
Don’t change bank accounts. Remember, lenders need to source and track assets. That task is significantly easier when there is a consistency of accounts. Frankly, before you even transfer money between accounts, talk to your loan officer.
Don’t apply for new credit. It doesn’t matter whether it’s a new credit card or a new car, when you have your credit report run by organizations in multiple financial channels (mortgage, credit card, auto, etc.), your FICO score will be affected. Lower credit scores can determine your interest rate and maybe even your eligibility for approval.
Don’t close any credit accounts. Many clients have erroneously believed that having less available credit makes them less risky and more approvable. Wrong. A major component of your score is your length and depth credit history (as opposed to just your payment history) and your total usage of credit as a percentage of available credit. Closing accounts has a negative impact on both those determinants of your score.

The best advice is to fully disclose and discuss your plans with your loan officer before you do anything financial in nature. Any blip in income, assets, or credit should be reviewed and executed in a way to keep your application in the most positive light.

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Sonatta Camara, CDPE®,CRS®,GRI®,MBA
Broker
Camara & Co. - The Real Estate Group
9500 Arena Drive, Suite 480, Largo, MD 20774
301-333-4444 Office
301-333-2013 Fax
http://www.SonattaCamara.com

The Second Largest Settlement in History: How it save you from foreclosure!

Thu, 12 Apr 2012 10:16:35 GMT

The news has been abuzz in the past few weeks about the historic Robo-Signing Settlement reached between the government and five major lenders. The settlement raises lots of questions, but for homeowners who are in danger of losing their home there is only one:

Can this settlement help me stay in my home?

The answer: Possibly! But regardless of whether you meet the specific eligibility requirements for this settlement, it is important to remember one thing:

YOU HAVE OPTIONS!

As a Certified Distressed Property Expert (CDPE) I am uniquely qualified to help determine your eligibility and answer any questions you may have about the settlement. Call me or email me and set up your free, confidential consultation. Let me help you figure out the best foreclosure alternative option for you.

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Sonatta Camara, CDPE®,CRS®,GRI®,MBA
Broker
Camara & Co. - The Real Estate Group
9500 Arena Drive, Suite 480, Largo, MD 20774
301-333-4444 Office
301-333-2013 Fax
http://www.SonattaCamara.com

Bank of America Short Sale Process Change, April 13th. | BofA Short Sale Forms

Thu, 12 Apr 2012 09:10:58 GMT

On April 13th 2012 Bank of America is rolling out a new short sale process (and new documents/ forms) with the goal to reduce the approval process to 20 days.

The bank’s new short sale process will enable all parties involved in the short sale process to complete their tasks simultaneously.The goal is for the timeline from offer and (uploading to Equator) to closing to be reduced. Bank of America says it will now be able to provide a decision on a short sale offer in 20 days reduced from 45 days+.

As reported on RealEstateInsiderNews.com many Senators and regulators have been pushing for shorter offer response time from the banks. Bank of America is ahead of the curve with the introduction of their new process.

Be aware that the Equator platform will be down for 10-12 hours during the overnight hours starting Friday, April 13 as the new system is launched.

Bank of America has been warning agents of this upcoming change:

“If you’ve submitted a short sale with Bank of America, be aware that before April 13 you must complete the following tasks or risk having your file declined: Submit Short Sale Offer, Upload Offer Documents and Upload Supporting Documents in Equator.”

Other changes…some not so helpful…

New timeframes. Currently, salespersons have 14 days to submit a counteroffer in Equator. On April 14, that will be reduced to five days. What’s more, Bank of America is limiting prospective buyers to two counteroffers. Responses will be given within three days.

As sometimes happens, should the buyer walk away, Bank of America is giving agents five days to submit a backup offer. Previously agents had 14 days. Once again, buyers are limited to ONLY two counteroffers. BofA promises a response from the lender within three days.

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Sonatta Camara, CDPE®,CRS®,GRI®,MBA
Broker
Camara & Co. - The Real Estate Group
9500 Arena Drive, Suite 480, Largo, MD 20774
301-333-4444 Office
301-333-2013 Fax
http://www.SonattaCamara.com

Loan Quality May Be Peaking

Wed, 11 Apr 2012 09:18:51 GMT

Loan quality has been historically strong since the downturn, but it could be peaking.

There are anecdotal signs that loan quality has been loosening slightly. Some say that since it has been so historically tight, that may not be a bad thing, but it could indicate the peak is nearing.

“The loosening is certainly not extreme,” said Rob Withers, vice president, product development, at product and pricing engine LoanSifter, in an interview. Specifically, credit score requirements, he said, are “starting to drop a little bit.

“Investors have been incredibly cautious, maybe rightfully so, and imposed stricter requirements on borrowers,” he said, noting that in that context, “It's not that dangerous to [loosen standards] to a point.

“I don't think we're all that far off from striking the right balance,” he said, noting that since the downturn a combination of data accuracy, operational measures that ensure completeness of loan data and improved risk management, as well as a desire to lend only to the most pristine borrowers, have all been improving credit quality.

These may continue offset a slight loosening in other areas.

Withers said a Lender Processing Services report earlier this year that indicates 2010 and 2011 were optimal years for loan quality suggests that the conditions required to produce it needed some time to develop since the bust that all but shut the market down in the wake of the 2005-2007 boom.

“The LPS report didn't surprise me at all,” he said. “It takes awhile for an industry to react to something like that.”

Dan Cutaia, president of capital markets and risk management at Fairway Independent Mortgage, said in an interview that the pendulum to an extent “swung the other way” after too-loose underwriting caused the downturn.

He agrees that credit scores have seen a relative rise but said subprime is still out of the question.

Cutaia said his company is still keeping a close eye on the other elements of “layered” risk that caused problems in 2005-2007 originations as well, such as overall borrower debt-loads outside of mortgage debt, house flipping that could be an indication of fraud, and appraisal quality.

Then, of course, there is what some see as the recent surfeit of regulation and is still increasing.

Withers said he believes the “general guidance” for this “has had a positive influence on both lenders and technology vendors,” although he hesitantly adds that there may also be within it some situations where “good intentions misfired.”

Lenders are still routinely griping about continuing mixed signals from government efforts.

They are encouraged to lift credit standards, for example, to meet the terms of the so-called 2.0 version of the Home Affordable Refinance Program to “rescue” troubled borrowers who got loans during the problematic boom years, while being discouraged from taking on more risk by other regulations.

As a result, lenders are still adding “overlays” to programs like the 2.0 version of the Home Affordable Refinance Program or Federal Housing Administration lending, and not originating loans to the extent they allow, although with the 2.0 version of HARP the government-sponsored enterprises have said they will limit liability for lenders.

Gus Altuzarra, chief executive officer of distressed loan buyer Vertical Capital Markets Group, said the state of the secondary market has had some bearing on this trend and will play a role in whether it continues.

“In today's environment, we don't have a secondary market like we had.

“So if a loan is going to be FHA insured or sold to the [government sponsored enterprises] and at the time of the sale it doesn't pan out, there aren't too many places to go other than a group like ours [that will buy it at a discount] as a result of the secondary market being as limited as it is today,” he said.

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Sonatta Camara, CDPE®,CRS®,GRI®,MBA
Broker
Camara & Co. - The Real Estate Group
9500 Arena Drive, Suite 480, Largo, MD 20774
301-333-4444 Office
301-333-2013 Fax
http://www.SonattaCamara.com

Study: Hispanics Poised to Be 'Mega-Force' in Housing

Tue, 10 Apr 2012 09:30:28 GMT

Still saddled with a huge overhang of distressed properties and lackluster demand, it seems the housing market could really use a knight in shining armor to slay the metaphorical dragons choking its growth.

According to a study released this month, that white knight could come in the form of Latino homebuyers who are expected to provide a deep well of housing interest over the next decade, propelling demand for condos, starter homes, and trade-up homes.

"The demographic trends all line up for Hispanics to be a prime demographic for homeownership," says Gary Acosta, co-founder and acting executive director of the National Association of Hispanic Real Estate Professionals. "We're seeing very strong indicators that Hispanics are going to be 40 to 50 percent of all new homebuyers for the foreseeable future."

There are a few factors that make Acosta and other industry experts think that. For starters, Hispanics have been a huge engine of population growth over the past decade, and over the next decade they're expected to account for 40 percent of the estimated 12 million net new U.S. households, a huge predictor of future housing demand.

[Read Housing Slump Hits Hispanics Hard.]

Hispanics also have the highest labor force participation rate in the nation, according to the report, with nearly two thirds of all working-age Latinos employed.

Even considering the scourge of subprime lending and foreclosure crisis, which disproportionately hurt Hispanics especially in states such as California, heightened housing demand among Latinos is already starting to materialize, Acosta says.

"It was sort of surprising to us. The resilience within the Latino community for homeownership seems as strong or stronger than ever," Acosta says. "They view homeownership as a vehicle for stabilization to create a better living environment for their family and not as much as an investment. Because of that, the enthusiasm for homeownership hasn't waned a whole lot."

During the third quarter of 2011, the Hispanic homeownership rate rose to almost 48 percent, accounting for more than half of the total growth in homeownership over that period. Drilling down to the raw numbers, Hispanics bought almost 300,000 housing units in the third quarter of 2011, compared with 190,000 units bought by African-Americans, 66,000 by Asians, and just 18,000 by non-Hispanic white households.

[Read Why Mitt Romney May Suffer if SCOTUS Rules Against Mandate.]

Still, many obstacles confront would-be Hispanic buyers, not least of all difficulty getting a mortgage.

"I would say the desire [for homeownership] is there, but if there are any limitations around demand it's really due to, in our view, the lack of affordable mortgage credit," Acosta says. "The pendulum, quite frankly, has swung a little too far the other way."

And it could make the difference between a housing market that continues to limp along and one that starts seeing more signs of life.

"FHA is really the only game in town when it comes to anybody who has less than 20 percent to put down on a mortgage, and that has made it much more difficult for folks that we believe have not only the desire but the capacity to be successful homeowners," Acosta says. That's especially true when it comes to Hispanics, who as a whole are relatively light consumers of credit. "It's not that these folks necessarily have bad credit, they just have little credit."

Hispanics also tend to be concentrated in areas particularly hard hit by the housing crash—California, Nevada, Arizona—which means a good chunk of the housing stock on the market is distressed properties. That's set up an environment of competition between prospective buyers and cash investors, Acosta says, and it's usually the cash investors who win out with banks in the end.

"Banks, servicers, [and] GSEs have shown a pretty strong bias toward cash buyers even if [the average buyer] is willing to pay more than a cash investor," Acosta says. "The lenders are taking those cash deals [because] there's much less risk for fallout and they'll probably get a faster close on the transaction."

"It's a challenging environment in those states right now for that reason," he adds.

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Sonatta Camara, CDPE®,CRS®,GRI®,MBA
Broker
Camara & Co. - The Real Estate Group
9500 Arena Drive, Suite 480, Largo, MD 20774
301-333-4444 Office
301-333-2013 Fax
http://www.SonattaCamara.com

10 home maintenance tips for spring

Mon, 09 Apr 2012 09:32:55 GMT

The sun is peeking out and the plants are starting to blossom, so it must be about time for spring chores again. Here's my annual spring checklist of important issues to tend to around the house.

1. Roofing repairs: If you suspect winter storms may have damaged your roof, it needs to be inspected. (If you're not comfortable with the height or steepness of your roof, hire a licensed roofing contractor for the inspection.) Look for missing or loose shingles, including ridge-cap shingles.

Examine the condition of the flashings around chimneys, flue pipes, vent caps, and anyplace where the roof and walls intersect. Look for overhanging trees that could damage the roof in a wind storm, as well as buildups of leaves and other debris.

If you have roof damage in a number of areas, or if older shingles makes patching impractical, consider having the entire roof redone. Also, remember that if the shingles have been damaged by wind or by impact from falling tree limbs, the damage may be covered by your homeowners insurance.

The sun is peeking out and the plants are starting to blossom, so it must be about time for spring chores again. Here's my annual spring checklist of important issues to tend to around the house.

2. Check gutters and downspouts: Look for areas where the fasteners may have pulled loose, and for any sags in the gutter run. Also, check for water stains that may indicate joints that have worked loose and are leaking. Clean leaves and debris to be ready for spring and summer rains.

3. Fences and gates: Fence posts are especially susceptible to groundwater saturation, and will loosen up and tilt if the soil around them gets soaked too deeply. Check fence posts in various areas by wiggling them to see how solidly embedded they are.

If any are loose, wait until the surrounding soil has dried out, then excavate around the bottom of the posts and pour additional concrete to stabilize them. Replace any posts that have rotted.

4. Clear yard debris: Inspect landscaping for damage, especially trees. If you see any cracked, leaning or otherwise dangerous conditions with any of your trees, have a licensed, insured tree company inspect and trim or remove them as needed.

Clean up leaves, needles, small limbs and other material that has accumulated. Do any spring pruning that's necessary. Remove and dispose of all dead plant material so it won't become a fire hazard as it dries.

5. Fans and air conditioners: Clean and check the operation of cooling fans, air conditioners and whole-house fans. Shut the power to the fan, remove the cover and wash with mild soapy water, then clean out dust from inside the fan with a shop vacuum -- do not operate the fan with the cover removed.

Check outdoor central air conditioning units for damage or debris buildup, and clean or replace any filters. Check the roof or wall caps where the fan ducts terminate to make sure they are undamaged and well sealed. Check dampers for smooth operation.

6. Check and adjust sprinklers: Run each set of in-ground sprinklers through a cycle, and watch how and where the water is hitting. Adjust or replace any sprinklers that are hitting your siding, washing out loose soil areas, spraying over foundation vents, or in any other way wetting areas on and around your house that shouldn't be getting wet.

7. Check vent blocks and faucet covers: As soon as you're comfortable that the danger of winter freezing is over, remove foundation vent blocks or open vent covers to allow air circulation in the crawl space.

While removing the vent covers, check the grade level around the foundation vents. Winter weather can move soil and create buildups or grade problems that will allow groundwater to drain through the vents into the crawl space, so regrade as necessary. Remove outdoor faucet covers. Turn on the water supply to outdoor faucets if it's been shut off.

8. Prepare yard tools: Replace broken or damaged handles, and clean and condition metal parts. Tighten fittings and fasteners, sharpen cutting tools and mower blades, and service engines and belts in lawn mowers and other power equipment.

9. Change furnace filters: Now is the time to replace furnace filters that have become choked with dust from the winter heating season. This is especially important if you have central air conditioning, or if you utilize your heating system's fan to circulate air during the summer.

10. Check smoke detectors: Daylight Savings Time snuck up early again this year, and that's usually the semi-annual reminder to check your smoke alarms. So if you haven't already done it, now's the time. Replace the batteries, clean the covers, and test the detector's operation before it's too late.

If you have gas-fired appliances in the house, add a carbon monoxide detector as well (or check the operation of your existing one). CO2 detectors are inexpensive and easy to install, and are available at most home centers and other retailers of electrical parts and supplies.

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Sonatta Camara, CDPE®,CRS®,GRI®,MBA
Broker
Camara & Co. - The Real Estate Group
9500 Arena Drive, Suite 480, Largo, MD 20774
301-333-4444 Office
301-333-2013 Fax
http://www.SonattaCamara.com

Bank of America Agent REO Update | How To List REOs, BPOs

Fri, 06 Apr 2012 09:14:29 GMT

1. Use of Alternative Disposition Channels to Increase; Online FAQ Has More Information

Bank of America will increase the use of our alternative disposition channels as a complement to our overall direct marketing strategies. As we ramp up the use of our alternative space, you should expect to see properties (including occupied properties) selected for these campaigns in all phases of the REO cycle.

Alternative disposition channels include, but are not limited to:

Bulk Sales: Bulk pool of assets marketed to vetted investors and sold through Bank of America’s Alternative Disposition Program.

REO Auctions: Single assets sold through ballroom or online auctions open to the public and marketed through an auction vendor.

The listing agent will be notified by the Alternative Disposition Team via Equator messaging when a property has been identified for an Alternative Disposition Program in advance of the final pull date.

Before the final pull date: The agent must send an Equator message to the asset manager to exchange contact information and continue to handle the property normally.

After the final pull date: The listing agent will no longer have access to the property via Equator.

Bank of America values your work and expertise and requests your continued involvement with the property through the alternative disposition process. If this property is in a Marketing status, please continue to market it as usual and do not disconnect utilities, remove your lockbox or cancel current maintenance.

Please note:

You will be notified by our Alternative Disposition vendor of the successful sale with closing procedures, escrow information, HUD-1s and additional information.

You will be notified via Equator messaging if the asset is not disposed through the program.

Bulk Sales: Will be returned to you so that you can continue to market.

Auction: The bank will select another marketing strategy and we appreciate your continued services.

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2. Payments on the Final HUD-1

Bank of America would like to remind you that no repairs are to be paid on the final HUD-1 at the closing table. You must follow the business-as-usual processes determined by the REO Broker/Agent Guidelines (login required).

Fees approved to be paid on the final HUD-1 above and beyond the normal and customary fees could be but are not limited to the following:

Pest Inspection Report
Natural Hazard Disclosure
Home Warranty

Any fee above and beyond the normal and customary fees must be paid outside closing unless proper approval is received and noted in Equator.

All fees requested to be paid on the HUD-1 must have invoices to support the payment being requested.

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Sonatta Camara, CDPE®,CRS®,GRI®,MBA
Broker
Camara & Co. - The Real Estate Group
9500 Arena Drive, Suite 480, Largo, MD 20774
301-333-4444 Office
301-333-2013 Fax
http://www.SonattaCamara.com

Universal Mortgage Principal Reduction: Who’s Going to Pay for This?

Thu, 05 Apr 2012 09:04:25 GMT

There is a desire to find that one size fits all, “get us out of the housing recession” program that is a win-win for everyone. Several supporters argue that universal mortgage principal reduction is that fix. By “universal”, I mean to identify proposals offering all (or most) borrowers in negative equity (even if they are not in default) forgiveness of all (or most) of their negative equity. Such plans should be distinguished from the way principal reduction is used today as one of many possible remedial options for borrowers who are in default (albeit an option that is not widely utilized).

As an example of such calls, take Martin Feldstein’s recent proposal in the New York Times proposing that banks and the government split the cost of writing all mortgages down to 110% of the value of the home. There’s also the Win-Win proposal being put forth by an independent coalition of community groups that proposes that banks write down the entirety of the negative equity debt themselves.

Negative equity is and will continue to be a major factor determining housing dynamics in the next several years (and not in a good way) so I understand the impulse to just make it go away. Thus, I greet each new proposal dealing with negative equity with a hopeful eye but, invariably, I find them each unable to overcome some very thorny issues once examined.

First, there’s an issue of efficiency. Zillow estimates that about 15 million single-family homeowners are underwater on their mortgages and the total amount of negative equity is greater than $750 billion. But the vast majority of these homeowners are not going to default on their mortgages. Negative equity makes foreclosure more likely if there’s a disruption in income, but most of these borrowers will not experience such an event. So most of the money spent on universal principal reduction ends up with people who weren’t ever going to default on their mortgages. It’s another policy along the lines of the federal home buyer tax credits that paid up to $8,000 to buyers who, for the most part, were going to buy a home in the near-term even without the tax credit.

Second, there’s the issue of who pays for this policy. If we are to pay off $750 billion in mortgage debt for Americans, who precisely should pick up the tab? Taxpayers? The debt super committee can’t agree on how to come up with $1.5 trillion in spending cuts or new revenue but we’re willing to increase the size of the task by fifty percent? How about the investors holding the securities behind these mortgages? This option sounds great when you picture such investors as Wall Street fat cats but less attractive when you consider the reality that these investors are retirement and pension funds (or, again, taxpayers). Through securitization, these investors provided money to borrowers to buy homes and now homeowners are telling investors that their willingness to pay them back was contingent on home prices never falling?

Third, there’s the issue of picking asset classes to favor. According to Zillow, home values are down roughly 23% from their peak in 2007 (excluding foreclosure sales). But the stocks that make up the S&P 500 are still down 21% from their peak in 2007. Both the fall in home values and stock or retirement portfolios have wealth effects, meaning that the diminished value of a household’s cumulative wealth makes them feel poorer and, as a consequence, save more of their income in order to compensate. If we’re going to compensate for home value declines, should we also compensate households for their losses in the stock market? And keep in mind also that housing already receives substantial government support in the form of the mortgage interest deduction, the subsidization of long-term mortgages via Fannie and Freddie, and recent federal home buyer tax credits that totaled almost $30 billion, just to name a few of the policy supports for housing.

Fourth, there’s the issue of basic fairness among borrowers. Are we really prepared, as a nation, to write down the debt of somebody who paid 5% down and suffered a 15% decline in home value versus somebody who put down 20% and suffered the same loss in home value?

Don’t get me wrong. There are plenty of things that we can be doing to help housing, some of which I outlined in an earlier piece. As much as I try though, I just can’t see how universal principal reduction is one of them.

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Sonatta Camara, CDPE®,CRS®,GRI®,MBA
Broker
Camara & Co. - The Real Estate Group
9500 Arena Drive, Suite 480, Largo, MD 20774
301-333-4444 Office
301-333-2013 Fax
http://www.SonattaCamara.com

National Housing Survey 2012

Wed, 04 Apr 2012 08:59:42 GMT

Each quarter, Fannie Mae releases their National Housing Survey. They survey the American public on a multitude of questions concerning today’s housing market. We like to pull out some of the findings we deem most interesting each time it is released. Here they are for the most recent report:

84% of the general population believes that owning a home makes more sense than renting.

The Most Important Reasons to Buy a Home

When we talk about homeownership today, it seems that the financial aspects always jump to the front of the discussion. However, the study shows that the four major reasons a person buys a home have nothing to do with money. The top four reasons, in order, are:

It means having a good place to raise children and provide them with a good education
You have a physical structure where you and your family feel safe
It allows you to have more space for your family
It gives you control of what you do with your living space (renovations and updates)

The Home as an Investment

Though most people purchase a home for non-financial reasons, everyone realizes there is a money component to homeownership. Here is what they said on this issue:

63% of the general population believes that homeownership is a ‘safe’ investment.
53% believe that homeownership has more potential as an investment than any other traditional asset class.

Rent vs. Buy

We are always interested in the difference people see in renting vs. owning.

64% of renters have aspirations to someday own their own home
70% of renters think that owning is superior to renting

Bottom Line

Our belief in the value of homeownership grows each time this survey is released.

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Sonatta Camara, CDPE®,CRS®,GRI®,MBA
Broker
Camara & Co. - The Real Estate Group
9500 Arena Drive, Suite 480, Largo, MD 20774
301-333-4444 Office
301-333-2013 Fax
http://www.SonattaCamara.com

Real Estate: Sales Increasing. Prices – Not Yet.

Tue, 03 Apr 2012 09:28:04 GMT

We've been hearing about news of Home sales beginning to increase. Today, we want to make sure that you realize that it will still take time for prices to begin to appreciate. Pricing is about supply and demand. Though demand is increasing, there is still a large supply of homes for sale in many markets and the National Mortgage Settlement will probably mean over a million distressed properties (foreclosures and short sales) will enter the market this year. Two major surveys spoke to this point in the past week.

The Home Price Expectation Survey asked 104 leading industry experts where they thought prices would be at the end of 2012. The average of those opinions showed that the experts believe prices will depreciation by about one percent (.72%).

The Urban Land Institute released results from their survey also. In their report, 38 leading real estate economists/analysts, representing major real estate investment and research firms, felt that prices would remain flat throughout the year.

Demand will increase dramatically this year. However, it won’t drive prices upward because of the supply of inventory for sale in most markets.

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Sonatta Camara, CDPE®,CRS®,GRI®,MBA
Broker
Camara & Co. - The Real Estate Group
9500 Arena Drive, Suite 480, Largo, MD 20774
301-333-4444 Office
301-333-2013 Fax
http://www.SonattaCamara.com

Survey: 68% of house hunters contact real estate pros after mobile search

Mon, 02 Apr 2012 09:03:50 GMT

More than two-thirds of prospective buyers who use a mobile device in their home search reported contacting a real estate professional for a showing as a result of their mobile search, according to a survey from property search site The Real Estate Book.

The site conducted the survey between Jan. 26, 2012 and Feb. 3, 2012. Consumers who had shopped for either a home or an apartment in the last 90 days on any of more than 55 real estate-related websites were sent invitations to participate in the survey via email; The Real Estate Book received 4,051 responses.

Over half of the respondents, 52 percent, reported using a mobile device to hunt for a home, while the remaining 48 percent said they had not. Of the latter group, 85 percent said they would consider using a mobile device to search for a home in the future.

Of the respondents who did use a mobile device to shop, 46 percent considered the device an "essential" tool in their search and 52 percent considered it "helpful."

Most, 68 percent, of those respondents said they had contacted a real estate professional to view a home based on their mobile search, the site said.

"Our research supports that homebuyers are turning to their smartphones and tablets in their search and taking action to reach real estate professionals," said Scott Dixon, president of the real estate division for Network Communications Inc. (NCI), The Real Estate Book's parent company, in a statement.

Image via watcharakun/Shutterstock

Of the respondents who did use a mobile device to shop, 46 percent considered the device an "essential" tool in their search and 52 percent considered it "helpful."

Most, 68 percent, of those respondents said they had contacted a real estate professional to view a home based on their mobile search, the site said.

Other frequent activities for mobile house hunters included viewing photos and videos of homes (reported by 78 percent), asking for more information about a listing (66 percent), finding listing details, including contact information (60 percent), locating a listing via GPS (57 percent), searching for listings by city (55 percent), downloading a for-sale property search application (42 percent), and sharing listing information with family and friends (30 percent).

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Sonatta Camara, CDPE®,CRS®,GRI®,MBA
Broker
Camara & Co. - The Real Estate Group
9500 Arena Drive, Suite 480, Largo, MD 20774
301-333-4444 Office
301-333-2013 Fax
http://www.SonattaCamara.com

How Does a Lender Evaluate Your Borrowing Ability?

Fri, 30 Mar 2012 09:12:34 GMT

If you are thinking about buying a home, one of the first things you should do is go to a lender to get pre-approved. This will determine how much money you can borrow on a mortgage. This will also help you filter your home search by sale price, which will narrow your choices within your financing range.

So how does a lender evaluate — called underwriting — and determine how much you can borrow? It involves the three C’s: Credit, capacity and collateral!

Credit or FICO Score

The first item a lender will review is your credit profile, also known as your credit score or FICO score. This can range from 350 – 850. This is where all the decisions you’ve made in the past regarding will be reflected, such as:

How much debt you have outstanding
How much debt you have outstanding as a percentage of open credit accounts
How much debt you have in the different types of credit accounts (credit cards, car loans, school loans, etc.)
How well you’ve paid your bills over the years

Lenders used to allow much lower credit scores for borrowing purposes, but they’ve gone up the past few years. You need, in general, at least a 640 FICO score to borrow on a loan. The optimal score is 740-760 or above. The lower your score, the higher your interest rate and points on your mortgage loan.

[Related: Estimate your credit score]

Capacity or Income

If you pass the FICO score test and the lender says you are creditworthy, the next item you will be evaluated for is your “capacity.” Capacity means that based on the lender’s allowed maximum percentage debt to your gross income, less all of your other debt payments, how much do you have available for a housing payment? It also has to be stable income, such as $65,000 per year for two years in a row.

Per the chart, you can generally have your total mortgage payment, less other debt payments, be up to about 35% to 40% of your gross income. In the chart the bank took 35% of this borrower’s $6,000 gross monthly income and subtracted out other debt payments to get a maximum allowed housing payment of $1,750. And that $1,750 equates to about a $225,000 house with a $200,000 mortgage (this means you will need to put down a downpayment of $25,000 to buy the $225,000 house) per the bottom of the chart.

[Related: Get a free loan quote]

Collateral or the Property

If you’ve got the credit, and the capacity, you only need one more piece and that’s the collateral. This is the easiest part. You will pay the bank and they will order an independent appraiser to determine a market value of the property. And the lender will lend you up to a certain percentage of that value (or purchase price whichever is lower) like 80% loan to value (LTV) or maybe 90% LTV or maybe up to 96.5% LTV. This depends on the bank and the loan program in which you qualify. So even if your income qualifies you for a higher loan amount, the MOST any one bank will lend you on any particular property is up to their maximum allowed loan to value percentage on that property.

That’s it! If you’ve got credit, and capacity, go out and find the collateral!

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Sonatta Camara, CDPE®,CRS®,GRI®,MBA
Broker
Camara & Co. - The Real Estate Group
9500 Arena Drive, Suite 480, Largo, MD 20774
301-333-4444 Office
301-333-2013 Fax
http://www.SonattaCamara.com

Smart Advice About Your Credit

Thu, 29 Mar 2012 09:23:11 GMT

A tip for you:

Be aware that companies you do business with may sell your credit information. Now, many of the people buying the names and addresses of people who have given their credit information are legitimate marketing companies who are searching for a particular target audience. But lately, there is a rise of not-so-legitimate people who are buying your credit information to actually steal your credit profile.

We’ve all heard about identity theft, but how does it happen? Historically, it has usually been a case of the bad guys either rummaging through your garbage for old bank and credit card statements; or hacking a website where you entered info (like a credit card); or there have even been cases where bank databases where compromised. But, the sale of your information seems to be the most scary of them all. For between $40 and $80, would be thieves can really mess up your credit and life.

True, most identity theft can be fixed, but it can take months – even when you hire an expert. Especially when you are looking to buy a home or even refinance it, months can be fatal.

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Sonatta Camara, CDPE®,CRS®,GRI®,MBA
Broker
Camara & Co. - The Real Estate Group
9500 Arena Drive, Suite 480, Largo, MD 20774
301-333-4444 Office
301-333-2013 Fax
http://www.SonattaCamara.com

More Affordable To Buy in 98% of Major Metros

Wed, 28 Mar 2012 09:11:57 GMT

Last week, Trulia released their Winter 2012 Rent vs. Buy Index. In the index, they report that:

“After years of home price declines and tightening rental markets, home ownership is now more affordable than renting in all but two of the 100 largest metros – even in expensive real estate markets such as New York, Los Angeles and Boston.”

The two metros where renting was more affordable were Honolulu and San Francisco. However, Trulia explains that, even in these markets, buying a home:

“…might make sense for people who plan to stay in their next home for at least five years and can benefit from the mortgage-interest tax deduction.”

This rent/buy ratio favors buying more so then at almost any time in history. In a recent article, Forbes Magazine quotes Jed Kolko, Trulia’s chief economist:

“Certainly prices have continued to fall nationally, but rents have been rising so this would be the lowest price-to-rent ratio that we’ve seen.”

In Conclusion

It might be time to talk to a local real estate professional about the possibility that buying a home makes sense for you and family.

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Sonatta Camara, CDPE®,CRS®,GRI®,MBA
Broker
Camara & Co. - The Real Estate Group
9500 Arena Drive, Suite 480, Largo, MD 20774
301-333-4444 Office
301-333-2013 Fax
http://www.SonattaCamara.com

National Association of Realtors Pending Home Sales Report

Tue, 27 Mar 2012 09:16:17 GMT

The number of U.S. home buyers who signed contracts to purchase previously owned homes fell slightly in February, a reminder that the housing market’s recovery remains uneven.

The National Association of Realtors’ seasonally adjusted index for pending sales of existing homes decreased 0.5% on a monthly basis to 96.5. The results were 9.2% above the same month a year earlier.

Despite the small decrease for February, the Realtors’ top economist said the market is showing new signs of life.

“The spring home buying season looks bright because of an elevated level of contract offers so far this year,” said Lawrence Yun, the Realtors’ chief economist. “If activity is sustained near present levels, existing-home sales will see their best performance in five years.”

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Sonatta Camara, CDPE®,CRS®,GRI®,MBA
Broker
Camara & Co. - The Real Estate Group
9500 Arena Drive, Suite 480, Largo, MD 20774
301-333-4444 Office
301-333-2013 Fax
http://www.SonattaCamara.com

Kitchens Sell a House

Mon, 26 Mar 2012 16:15:35 GMT

It's a tool used by house flippers all across the nation. Stagers know its power. Real estate agents push its importance. What is this not-so-well-kept secret of real estate? A kitchen can sell a house.

A kitchen is the heart of a home. This is true all across the globe. The old saying that the "stomach is the way to the heart" carries a lot of truth. Kitchens are where we spend much of our time and most of that is with our families. It's the room where we nourish our bodies and our spirits.

Kitchens are integral to entertaining and in today's age of open floor plans, they're a focal piece of many family rooms. It's because of this that kitchens play such an important role in the buying and selling process.

This one room is the showpiece of the house. You'll see it every day and your guests will see it during most visits. This means buyers want homes with up-to-date kitchens.

Kitchens, however, can be one of the most expensive rooms to renovate. These projects can also be the most labor and time intensive of all home renovations. It's not just a new layer of paint.

Instead you find a complicated array of flooring, tiling, cabinets, and counters. This means buyers may want a home with an up-to-date kitchen but they aren't willing to tackle this problem themselves. Most buyers want a kitchen that is ready to use the day they move in.

What do buyers look for in up-to-date kitchens? A lot of this depends on what price range your home is in.

The main thing to remember as a seller is to not price yourself out of your market. If homes in your neighborhood are selling for $100,000 with tidy, but not luxury kitchens, then this is no time to upgrade to granite, travertine, and marble at the price tag of $40,000+. You simply won't find a buyer.

Scope out the competition. Use open houses in your area or MLS listings to find out what your competitions' kitchens look like.

Do area homes have new solid wood cabinets and granite counters in today's designer colors? You'll be wise to consider making the same move. Are they including new stainless steel appliances and add-ons like dishwashers, wine-coolers, and trash compactors?

Are you in a higher-end neighborhood? It's time to think high-end. Your older home may have a highly functional kitchen, but a buyer will take one look at your formica counters and white appliances and become lost in the stress of how much money and time it would take to remodel. If you don't want to put in the time yourself to make upgrades then you'll have to make concessions in the price.

Don't become overwhelmed, though. Sometimes a kitchen update can mean doing just a few minor changes. Change the paint color to a warm, neutral tone. Get rid of any clutter. Update your appliances, paint your cabinets, change the pulls, or get a high-end looking counter for a fraction of the cost (faux-granite or lower end granite). You might even save a bundle by doing much of the work yourself.

The bottom line is a kitchen can sell a home. Do a little research and find out what your kitchen needs to make it competitive with area listings.

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Sonatta Camara, CDPE®,CRS®,GRI®,MBA
Broker
Camara & Co. - The Real Estate Group
9500 Arena Drive, Suite 480, Largo, MD 20774
301-333-4444 Office
301-333-2013 Fax
http://www.SonattaCamara.com

GSEs Complete Nearly 1.1M Mods but Number of Mods Still Declining

Fri, 23 Mar 2012 09:12:27 GMT

Since the September 2008 conservatorship, Fannie Mae and Freddie Mac have completed nearly 1.1 million loan modifications, according to the FHFA’s fourth quarter 2011 Foreclosure Prevention and Refinance report. Overall, the GSEs have completed more than 2.1 million foreclosure prevention actions since the same time period.

“Data from the Office of the Comptroller of the Currency show that in the two years ending in the third quarter of 2011, modifications on Fannie Mae and Freddie Mac loans accounted for 40 percent of all loan modifications,” said General Counsel for the FHFA Alfred M. Pollard in a written testimony before congressmen Monday.

For just the 2011 fourth quarter, about 71,100 loan modifications were completed, compared to about 83,500 in the third quarter.

Pollard said a contributing factor to the decline in modifications seen may be that the initial backlog of eligible borrowers in 2009 has been addressed to some extent, and added the GSEs offer substantial incentive payments to servicers to encourage them to meet timelines for modifications.

Also, in terms of delinquency, Pollard said the GSEs own or guarantee about 60 percent of all mortgages, but account for roughly 29 percent of the seriously delinquent loans.

Foreclosure prevention numbers

-About half of all borrowers who received a modification in the fourth quarter saw their monthly payments reduced by over 30 percent.

-About one-third of modified loans also included principal forbearance.

-A higher percentage of loans modified through HAMP stayed current compared to non-HAMP modifications. For Fannie Mae HAMP mods during the third quarter, 86 percent stayed current compared to 80 percent of non-HAMP mods three months after getting modified. After 6 months in the second quarter, 81 percent of Fannie Mae HAMP mods stayed current compared to 71 percent of non-HAMP mods. After 9 months in the first quarter, 77 percent of HAMP mods stayed current compared to 68 percent of non-HAMP mods.

-For Freddie Mac modifications, 87 percent of HAMP mods stayed current after 3 months compared to 79 percent of non-HAMP mods. After 6 months, 84 percent of HAMP mods stayed current compared to 71 of non-HAMP mods. After 9 months, 80 percent of HAMP mods stayed current compared to 66 percent of non-HAMP mods.

-HARP refinances increased 10 percent in the fourth quarter.

-The total number of home retention actions (repayment and forbearance plans and mods) for the GSEs during the fourth quarter was 120,698, a decrease compared to the third quarter when there were 140,258 actions. For the year 2011, there were 540,352 actions, compared to 832,309 for 2010.

-Short sales and deeds-in-lieu of foreclosure increased 13 percent to 34,895 in the fourth quarter. For the entire year of 2011, there were 125,468 short sales and deeds-in-lieu, compared to 113,996 in 2010.

-Third-party and foreclosure sales saw a slight increase while foreclosure starts decreased in the fourth quarter.

-REO inventory declined for the fifth consecutive quarter as more properties were disposed of than acquired in the fourth quarter.

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Sonatta Camara, CDPE®,CRS®,GRI®,MBA
Broker
Camara & Co. - The Real Estate Group
9500 Arena Drive, Suite 480, Largo, MD 20774
301-333-4444 Office
301-333-2013 Fax
http://www.SonattaCamara.com

Rate of Properties Entering Shadows = Rate of Properties Finding Light

Thu, 22 Mar 2012 09:02:20 GMT

The current rate at which mortgage borrowers are falling into serious delinquency closely matches the rate of distressed sales – short sales and REO sales- according to CoreLogic’s latest report released Wednesday.

While distressed sales are keeping the shadow inventory from growing, the quantity on record is not yet decreasing. In fact, today’s shadow inventory mirrors that recorded in January 2009, though there have been 3 million distressed sales since that date.

The total 1.6 million properties CoreLogic considers to be part of the shadow inventory makes for a six-month supply of homes for the market.

The total is lower than the 1.8 million CoreLogic counted in January 2011.

However, CoreLogic estimates the current shadow inventory is about half the current visible inventory.

Furthermore, “Almost half of the shadow inventory is not yet in the foreclosure process,” said Mark Fleming, chief economist for CoreLogic.

The total shadow inventory includes 400,000 REOs, 410,000 properties already in foreclosure, and 800,000 seriously delinquent loans.

A few hard-hit states are home to a disproportionate percentage of the industry’s shadow inventory. More than one-third of the shadow inventory is in California, Florida, and Illinois. Add to this the shadows lurking in New York, Texas, and New Jersey, and you have half of the total shadow inventory plaguing the market.

However, “In some hard-hit markets the demand for REO and distressed property is now outstripping supply, said Anand Nallathambi, CoreLogic’s president and CEO. “As we move into what is traditionally the peak selling season for real estate, servicers will certainly be watching closely to see if now is the time to move more inventory out of the shadows.”

CoreLogic reported that loans between $100,000 and $125,000 make up the highest concentration of the shadow inventory, but loans less than $75,000 are starting to make up an increasing portion of the shadow. In fact the amount of loans in this category that have dimmed into the shadows increased 3 percent from last year.

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Sonatta Camara, CDPE®,CRS®,GRI®,MBA
Broker
Camara & Co. - The Real Estate Group
9500 Arena Drive, Suite 480, Largo, MD 20774
301-333-4444 Office
301-333-2013 Fax
http://www.SonattaCamara.com

Short Sale Success: Key is to Change Our Mindset!

Wed, 21 Mar 2012 09:04:38 GMT

In any business discipline, having the proper mindset is the key to a successful business venture. This holds true in the Real Estate industry. Now more than ever, having the proper “Short Sale Mindset” is a key ingredient to a successful short sale transaction. In order to have the proper” Short Sale Mindset” we need to ask ourselves:

What are the parties involved thinking?

During our nationwide educational seminars regarding the short sale process, we have found the following mindsets to permeate the industry:

Listing Agents - The short sale process is too lengthy. It is impossible to deal with the short selling banks.
Buyers – The short sale process takes too long. We want an answer from the short selling bank ASAP. Why should I wait to purchase a short sale when I can purchase a non- distressed asset?
Sellers - What is the point? I am just going to let the bank foreclose.
Banks – Their mindset changes all the time!

The Key to Success

The following comments, though general in nature, are the keys to changing these mindsets.

1.) Listing Agents – Though the short sale process does take longer than the traditional non distressed property sale, the short sale process on average is taking 72 days from start to finish. If the agents are properly positioned to negotiate with the bank, preferably through a law firm who has experience in the short sale process, their mindset will change. Taking the negotiation burden off the agent will allow them to properly market the property and help the distressed seller.

2.) Buyers - Understandably the short sale process is lengthy and not every buyer is a “short sale buyer” depending on their individual circumstances. However, according to the Realty Trac Foreclosure Report dated 8/23/2011, a buyer who engages in the purchase of a short sale will typically purchase the property at a 21% reduction to the current market value. That means INSTANT EQUITY for the potential buyer. In most cases this will change the mindset of the buyer.

3.) Sellers – In nearly every instance, a short sale is more advantageous to the seller than a foreclosure. We will cover this in detail in a later post.

4.) Banks – It is apparent the bank’s mindset changes on a day to day basis. However, through successfully negotiating over 1000 short sale transactions, we have found one common thread to be true. Banks are becoming more and more open to a discussion regarding short selling a property. We will again reference the RealtyTrac Foreclosure Report to explain our point. If a bank approves a short sale, on average, they will be approving a sales price that is at 79% of current market value. The other most common loss mitigation option is for the bank to foreclose on the property. When sold, the bank will sell the REO asset for 60% of current market value. Their mindsets are changing!

We certainly understand that a short sale transaction is not one without its complexities. That being said, if we change our mindset when dealing with them, we will be truly doing a service to our communities and the entire Real Estate market.

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Sonatta Camara, CDPE®,CRS®,GRI®,MBA
Broker
Camara & Co. - The Real Estate Group
9500 Arena Drive, Suite 480, Largo, MD 20774
301-333-4444 Office
301-333-2013 Fax
http://www.SonattaCamara.com

Short Sale vs. Foreclosure: A Short Sale Always Wins

Tue, 20 Mar 2012 09:40:20 GMT

Today’s ever changing real estate industry has brought upon some very challenging questions from our clients. We as counselors, want to put forth the best, non-emotional advice that we can, in hopes that we can help our clients and their families navigate the rough waters of the short sale process.

The most prevalent question and one that continues to permeate the industry is:

“Why should a seller go through the short sale process rather than letting their house be foreclosed upon?”

While we cannot speak to every client circumstance, we can say one thing with complete conviction. In almost all instances in which a potential seller is contemplating whether they should short sell their house or let it go through the foreclosure process, a short sale is the better option. The following are examples to consider:

Example A- Short Sale

Mr. Smith owns a home in which he has a mortgage balance of $220,000 and a current market value of $150,000. Mr. Smith has elected to short sell his property. His Realtor successfully obtains a buyer who puts forth an offer price of $120,000 (80% current market value according to Realty Trac Foreclosure Report 5/26/2011). After reviewing the buyers offer and the financial hardship information from Mr. Smith, Mr Smith’s bank agrees to accept the short payoff of $120,000 which would leave a deficiency balance of $100,000.

The transaction closes and is final. Mr. Smith then pulls his credit report 30 days after the transaction takes place. On the report he notices that the mortgage trade line states “Mortgage debt was settled for less than full” and the balance on the mortgage is $0. Mr. Smith is now on the road to financial recovery.

Example B- Foreclosure

For the ease of illustration we will use the same value and mortgage debt amounts as in Example A. However, Mr. Smith has elected to forgo the short sale process and let the bank foreclose on the property. The bank holding his mortgage facilitates the proper legal procedures to foreclose on the property, all of which are costly. Mr. Smith is notified and his property foreclosed upon of which is taken back by the bank to sell as an REO.

Six months later, the bank finally sells Mr. Smith’s home only they sell it for $90,000 (60% of current market value according to Realty Trac Foreclosure report dated 5/26/2011). Remember, as a short sale, the home would have sold for $120,000 keeping the deficiency to $100,000. In addition to the deficiency now being $130,000, the bank has elected to add on legal costs of $15,000 and asset preservation costs of another $5000 for a total deficiency liability of $150,000. Mr. Smith pulls his credit report 30 days after being notified that the bank has sold his property and of his liability.

On the report he notices that the mortgage trade line states “Foreclosure” and the balance is $150,000. Because of Mr Smith’s choice to choose foreclosure vs. short sale his road to financial recovery has taken a major detour. He not only has a foreclosure on his credit report but now has a much larger deficiency balance in which the bank, in most cases, will report on his credit report as a balance owed.

The Best Option is Clear

While the financial and credit advantages are clear when choosing a short sale over a foreclosure, other advantages are sometimes overlooked. The most important of all of them is maintaining the seller’s dignity and peace of mind. We have heard too many stories of families having to leave their homes because of a Sheriff’s order or some other type of legal action. The short sale process alleviates this negative social impact. The process puts the control back in the seller’s hands so that they can get back on the road to financial recovery and start providing for their families. In the battle of the two evils, a short sale always wins!!!

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Sonatta Camara, CDPE®,CRS®,GRI®,MBA
Broker
Camara & Co. - The Real Estate Group
9500 Arena Drive, Suite 480, Largo, MD 20774
301-333-4444 Office
301-333-2013 Fax
http://www.SonattaCamara.com