How Congress Is Providing Tax Relief To Foreclosed Homeowners

December 21, 2007

After Thursday’s passage of the Mortgage Forgiveness Debt Relief Act of 2007, foreclosed homeowners have one less worry: taxes. When a homeowner defaults on a home loan, a mortgage lender will sometimes “forgive” the debt owed. One example is when a foreclosed home sells for less money than is owed on it.  The mortgage lender […]

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For Some Homeowners, PMI Is Tax-Deductible Through 2010

December 20, 2007

The resurgence of private mortgage insurance continues — if only because it’s aided by Congress. For eligible homeowners, lawmakers voted to extend the tax-deductibility of PMI through 2010.  The law was previously scheduled to expire at the end of 2007. For all loans originated prior to December 31, 2010, and within those years, private mortgage […]

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You’ve Been Pre-Approved — Now Get RE-Approved

December 19, 2007

Even if you’ve been recently pre-qualified (or pre-approved) for a mortgage, it may be prudent to get “re-approved”. The mortgage industry is changing quickly; being prepared beats the alternative. Recently, mortgage lenders have made adjustments in what they will lend, and to whom.  This shrinks the pool of eligible mortgage borrowers. Some of these guideline […]

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How To Squeeze Extra Tax Deductions From Your Mortgage In 2007

December 18, 2007

For most Americans (but not all), mortgage interest is tax-deductible in the year in which it was paid. With some advance planning, therefore, a homeowner can increase his 2007 tax deductions by paying additional mortgage interest while the calendar still reads 2007. The key is to make the mortgage payment due January 2008 a few […]

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The Week In Review (December 17, 2007) : What To Watch For

December 17, 2007

Last week proved once again: The Fed does not control mortgage rates. On Tuesday, after the Federal Open Market Committee lowered the Fed Funds Rate by 0.250%, mortgage rates began an ascent that carried all the way through Friday’s close. As a result, mortgage rates are dramatically higher today than just one week ago. Other […]

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Why Recession Is Not A Guarantee In 2008

December 14, 2007

In its biggest month-over-month jump since 1973, the Producer Price Index rose 3.2 percent in November. PPI is like a “cost of living” measurement for consumer, except that it applies to business. PPI measures how expensive it is to produce goods on a day-to-day basis. PPI spiking in November is an important development for all […]

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Mortgage Rates Are Going Up — But Not For The Reason You’d Expect

December 13, 2007

Conforming mortgages are getting more expensive — but not because of mortgage rates. To protect against further weakness in the housing sector, Fannie Mae and Freddie Mac are instituting “delivery fees” on all conforming mortgages, effective March 2008. Fannie Mae’s Adverse Market Delivery Charge and Freddie Mac’s Market Condition Delivery Fee will add a one-time, quarter-percent […]

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Making English Out Of Fed-Speak (December 2007 Edition)

December 12, 2007

The Fed lowered the Fed Funds Rate by 0.250%.  The rate decrease was not well-received, though, as many investors were calling for a deeper cut of a half-percent. In response, dollars moved from stock markets to bond markets and, therefore, mortgage rates fell. Because it is tied to the Fed Funds Rate, Prime Rate fell by […]

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Why Credit Card Holders May Benefit From The Fed’s Actions Today

December 11, 2007

The Federal Open Market Committee meets today and will release a public statement at 2:15 P.M. ET. It is widely expected that the FOMC will lower the Fed Funds Rate by at least 0.250%. When the FOMC lowers the Fed Funds Rate, it is trying to “loosen” credit for American businesses and consumers.  When credit […]

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The Week In Review (December 10, 2007) : What To Watch For

December 10, 2007

Among lingering doubts about housing and credit markets, and a general uncertainty about the U.S. economy, the mortgage bond market tanked towards the latter part of last week. As investors moved away from mortgage bonds, mortgage rates forcefully bounced off their two-year lows. A major factor behind last week’s run-up in rates is the market […]

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Mortgage Rate Relief Plan: Who Qualifies For Help?

December 7, 2007

Thursday, the White House revealed its HOPE NOW program, aiming to help sub-prime borrowers freeze their initial “teaser” rates for a period of five years. The program is receiving a lot of ink in the newspaper dailies but sometimes it’s unclear exactly what the program offers, and to whom. Let’s look at the details and […]

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Your Credit Score Doesn’t Cost You Today, But In Three Months It Could Cost You Plenty

December 6, 2007

Credit scores are the best predictor of how a homeowner will pay on a mortgage, so it’s no surprise that credit scores will play a bigger role in mortgage financing in 2008. Actually “that date” is more clearly defined.  It’s March 1, 2008. For loans closing on or after March 1, 2008, Fannie Mae and Freddie […]

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What Does It Mean To “Escrow” Taxes And Insurance?

December 5, 2007

As a homeowner, your financial obligations extend beyond your monthly mortgage payment.  Periodically, you are also required to pay real estate taxes and homeowner’s insurance premiums. Each month, you pay your mortgage payment to a company called a “mortgage servicer” (because they “service” your mortgage each month). In addition to the risk of not getting […]

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Why New Home Sales Data Doesn’t Tell Us Much About The Real Estate Market

December 4, 2007

October’s New Homes Sales report showed a modest month-over-month improvement from September. Before we interpret that to mean that the housing market is rebounding, though, let’s consider the fallibility of the New Home Sales report. On the Census Bureau’s Web site, there is a disclaimer about the validity of the data.  Paraphrased, it reads: A […]

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The Week In Review (December 3, 2007) : What To Watch For

December 3, 2007

If you enjoy roller coaster rides, last week’s mortgage markets were a delight.  Up and down mortgage rates went, trying to find a balance between inflation and recession (or maybe neither). A major cue for markets last week came from a high-ranking Fed official who raised expectations for future cuts to the Fed Funds Rate.  […]

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What If The Energy Company Paid YOU Each Month?

November 30, 2007

This 30-second video posted to YouTube and shows a home’s electric meter running backwards after installing solar panels. The meter runs backwards because the home is putting more power into the electric grid than it is taking out for itself. With energy costs expected to rise sharply this winter and the costs of “going green” coming […]

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Buyers, You Will Pay More For A Home Than The Agreed-Upon Purchase Price

November 29, 2007

In real estate, the true cost of buying a home is always higher than the home’s purchase price itself. This is because of service charges from governments, lenders, and title/escrow companies. Because there is no such thing as “typical” closing costs because each home purchase is different, home buyers should remember that the actual cost […]

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Why You Should Remain In “Ready Position” For Your Mortgage Rate

November 28, 2007

Easy come, easy go. There was a strong rally Monday afternoon in the mortgage bond market.  It was sudden and furious, mostly coming on in the last 60 minutes of trading. When markets closed, mortgage rates for conforming home loans were grazing their lowest levels in nearly two years. It lasted overnight and into the […]

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It’s A Good Time To Buy — But Not For The Reasons You May Think

November 27, 2007

Since November 1, the following banks have written-down at least $1 billion in their respective loan portfolios: Bank of America Barclays Bear Stearns Citigroup HSBC Morgan Stanley Wachovia Wells Fargo This is a big deal to people in the market for a home loan because when banks repeatedly take mortgage-related losses, it can lead to […]

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The Week In Review (November 26, 2007) : What To Watch For

November 26, 2007

In a holiday-shortened trading week, mortgage rates finished the week slightly improved. But, because many traders had left early for Thanksgiving, matching buyers and sellers at any given price proved to be an exercise.  Mortgage rates bounced wildly as a result. Between now and the New Year, expect the same volatility.  Fewer market players means […]

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