September 26, 2011 at 10:21 AM · Posted under Lisa Rossetto-Glowacki
NAR says that 13,780 houses sold yesterday and 13,780 houses will sell today (based on 2011 sales figures). So….houses are selling.
Interest rates are around 4%, meaning that borrowing $100,000 for a 30 year mortgage results in a monthly payment of roughly $478/month!
We know already that it’s a “no brainer” for a renter to check into home ownership. Of course, why pay your landlord to build equity when you can build your own (and still have a place to live)?
What about the so-called “move-up” buyer? Those hard working families with young children who bought their first house back about 5-7 years ago, with 20% down? Their families have grown in these years and they really need a larger house-now!
However, if they sell their house, they will only walk away with a few thousand dollars, at best, or perhaps have to pay a few thousand dollars because so much of their equity has eroded in this market. Where will the new 20% down payment come from?
Do not rule out a move! Speak to a lender right away. Loans are still being made with 3% and 5% down payments. See if that is possible. See if family members can contribute. Why? How about if you just wait for the market to get better?
There are a number of reasons why moving now is worthwhile. In the interest of keeping this blog short, I only want to mention cost. Your cost of a new home is the interest rate. They are the lowest they’ve been over the last 70 years or so.
Your realtor can show you examples of this and also give you other reasons why an attempt at a move today is a good idea.
The wild card in this market is the empty-nester. We realtors have many customers in this boat. They own large houses in the suburbs; they have lots of equity in those houses; perhaps even no mortgage. Most of the homes were built in the 80’s and 90’s during the “suburban sprawl era”. (Many of these houses have more oak wood on the inside than oak trees in the yard, much to the dismay of potential buyers)
They want to move into the city, into a condo, and enjoy all that the city has to offer. What a wonderful idea! They don’t care about interest rates at all because they will pay cash for their new condo. They don’t care if loan parameters change and 20% down is required on every house purchase; in fact, they like that idea a lot. We hear their song every day, “I will not give my house away…..”
So, okay, they’re waiting for the market to get better, too. Sometimes, we forget the most simple of concepts. If I, as a realtor, know a least 5 empty-nester customers who are waiting for the market to get better in order to sell, I can promise you that the other couple of thousand realtors in the state know 5 or more as well.
When the market improves, it will be flooded with these homes. So supply goes up; home prices come down.
And these empty nesters don’t care about interest rates or down payment requirements because they will pay cash. However, will the buyer of their house pay cash? Most likely no. Not only will that buyer in a number of years be paying a higher interest rate, but also the entire lending industry is undergoing change. Ask your realtor about QRM. Ask your realtor what the current ideas are about changes to Fannie Mae, Freddie Mac and FHA loans. In a nutshell, loans will be more difficult to come by in the future. So now we have more big, empty-nester houses on the market (supply) and we have fewer buyers who can actually afford to buy these homes (demand). Sometimes the most simple of concepts is the most important concept.
So…..”play the tape forward.” You may end up selling your house in a few years, in a better market just as you are hoping for, but for about the same price as today because other changes are coming down the pike. You may end up saying, “Gee, had we known that the market was going to get better, but that we couldn’t sell our house for more than we could back then, we would have moved sooner to enjoy our lives more.” It’s that old hind sight vision rule….
Is today’s real estate market really so bad after all?
Posted by: 
Lisa Rossetto
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August 16, 2010 at 07:00 PM · Posted under Pat Tasker
Are you having trouble making ends meet, and your mortgage is falling behind? Help is coming to town.
Thursday August 19th from 1-7:30pm at the Frontier Airline Center (formerly Midwest Airline Center) 400 W Wisconsin Avenue, Milwaukee 53203 parking available at 630 N 5th St - $6
BE PREPARED to make the most of this appointment! Here is a list of documents you should bring along to the workshop.
CHECKLIST
- Monthly mortgage statement
- Information about other mortgages on your home, if applicable
- Two most recent pay stubs, documentation of income you receive from other sources or most recent quarterly profit and loss statement if self-employed
- Two most recent bank statements
- Account balances and monthly payments for credit cards and other debts
- Estimates of other monthly expenditures (such as utilities, insurance and medical bills)
BEWARE, there are scams out there taking advantage of homeowners who are underwater with their mortgages. This workshop on Thursday is sponsored by the government and will have answers for you. When a homeowner is experiencing financial difficulties, including mortgage payments, there are several options available as relief. If you live in the suburbs of Greater Milwaukee, call me to discuss those options. If I don’t know the answer, I can help you find a trustworthy source of help!
Posted by: 
Pat Tasker
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July 02, 2010 at 07:17 AM · Posted under Colleen Kuchta
In response to the foreclosure surge since 2007, Fannie Mae has begun a ‘Loan Quality Initiative’. The new requirements are intended to reduce the number of bad loans. The new program shifts the responsibility of mortgage guideline compliance back to the individual banks responsible for making the loans.
The basic steps for obtaining a mortgage are:
1) Apply for the mortgage
2) Bank runs a credit check
3) The application goes through the underwriting and approval process (this is the step where an appraisal of the property takes place)
4) Credit is checked again (this is a new step in the process)
5) The loan is funded
With the new Loan Quality Initiative lenders are required to verify that the applicants credit profile has not changed since the original credit check was run. Some things to avoid while waiting for your loan to be approved and funded are: Applying for a new credit card (this includes department store cards or buying new furniture on credit), running up the balance on existing credit cards and/or financing an automobile or other major purchase.
Here are the 3 things the underwriter is checking during this 2nd credit check:
1) Recalculate your debt-to-income ratios using your minimum payment figures. If the debt-to-income ratios exceed Fannie Mae’s threshold, your loan will be denied! * don’t run up credit cards prior to closing
2) Re-check your credit score. The score will be used to asses loan-level pricing adjustments. It can also lead to a denial if your score falls below Fannie Mae’s minimum requirements! * pay your bills on time - including utility bills
3) View the Credit Inquiry section of your credit report to find ‘non-disclosed’ debts. If items are found you will need to provide documentation regarding the debt & this will be used to re-underwrite your mortgage. Many times changing your interest rate & monthly payment. * DO NOT apply for new credit until AFTER your loan is funded!
This may seem like consumers are being targeted, and it will be nearly impossible to get a loan. In the end, these are things that should have been monitored all along. If these new standards had been upheld from the beginning, we would not find ourselves in the mess we are in right now. Property values would not be declining because of an surge in foreclosures. So remember, 
don’t use your existing credit cards, don’t apply for new credit and pay all of your bills on time! If you would like more help understanding the mortgage approval process, or are looking for help in finding a home or financing a loan, please give us a call, visit http://www.thekuchtas.shorewest.com or send us an email! The Kuchta’s, Kelly & Colleen
Posted by: 
Colleen Kuchta
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May 07, 2010 at 10:01 AM
As most people are aware, the $8,000 tax credit ended at midnight on April 30th. Early in the year, it seemed like it would be doom and gloom for months after that. By the end of March, beginning of April, the mood seemed to be improving, in regards to life after the tax credit!
During open houses in April, I started hearing buyers say, “yes, we’d love the tax credit, but we aren’t going to make a quick decision just to get it!” That was refreshing to hear. While I know some buyers may have bought, just to “get it done” in time, many were smart and shopped with cool heads.
WHY WOULD YOU BUY NOW, IF YOU MISSED THE TAX CREDIT? I can give you several reasons.
• Low interest rates, even though they were predicted to go up quickly and dramatically, so far they have been very good.
• Great inventory is still out there
• Lower prices than we’ve seen in years
• WHEDA is back, and FHA is as busy as ever! MORTGAGE MONEY IS AVAILABLE!
• A HOUSE IS MORE THAN AN INVESTMENT! It is a place you bring your new baby home to, entertain friends at a backyard BBQ, celebrate the holidays, and go home to at the end of a long work day! It is a safe, warm welcoming place you call HOME
Our first 4 months of this year have produced some interesting numbers. New inventory is up 20%, and sales are up 40%! That shows that the inventory is starting to head towards a balanced market. So if you are a buyer, it is good to buy now, before the rates go up and the market swings out of buyers favor.
For a list of homes in the City or Suburbs of Greater Milwaukee, call or email Pat Tasker at ptasker@shorewest.com You too can make a good buy if you act now. The stock market proved yesterday it is not for the faint of heart. But real estate over the long haul has proven that it is a good investment.
Posted by: Pat Tasker
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