New FHA Rules-What will they mean for you?
Monday, March 08, 2010 finds the weather in Bellingham, WA sunny, cool and crisp!
FHA is establishing some new rules which may make it harder for working households to secure safe and affordable home financing. Their policy changes are designed to shore up the FHA's capital reserves and help the agency do a better job of managing risk.
"Striking the right balance between managing the FHA's risk, continuing to provide access to underserved communities, and supporting the nation's economic recovery is critically important," FHA Commissioner David Stevens said in a statement.
John Anderson, a 30-year real estate veteran who chairs the National Association of Realtors®, states that these changes, while serious, are reasonable."I think the FHA is doing the right thing."
Anderson acknowledges that many households will be adversely affected. Buyers will have to either spend more to secure financing or scale down what they buy.
Proposed changes are:
- FHA is raising its upfront mortgage insurance premium to 2.25 percent from 1.75 percent
- Boosting the minimum down payment to 10 percent for borrowers with a credit score of 580 and below (it stays at 3.5 percent for everyone else)
- Reducing permissible Seller concessions from 6 percent to 3 percent
- The FHA is also seeking legislation to raise the annual mortgage insurance premium to a level above the current cap of .55 percent. Authority has already been given to institute the other changes.
Anderson, says the impact of the changes will be subtle in his market area where the median home price is under $200,000. For many first-time buyers, including younger households that haven't had a chance to develop much of a credit history, the credit-score floor will be a hurdle because the minimum 10 percent down payment will simply be out of reach unless they can get help from elsewhere, like family.
The reduced seller concessions will hurt, too, because these funds typically help buyers take care of closing costs like title insurance and the mortgage origination fee. "With that now limited to 3 percent, buyers might have to come up with another 1 percent of the mortgage amount," Anderson says.
Higher up-front mortgage insurance premiums won't affect the amount of cash buyers will need to raise, as that can be financed. But it will affect how much house they can afford, and could increase their monthly payments by $50 to $100. "That extra cost can have a big impact," he says.
Since the FHA commands about 40 percent of the mortgage market nationally and far more that that in regions like the Midwest (with a strong tradition of using FHA-insured loans), Anderson thinks these hurdles are a reasonable price to pay to ensure a healthier FHA.*
*REALTOR, March 2010, Real Life News-Trends-Tools: A Price Worth Paying-Buyers will be pinched by FHA's new rules, by Robert Freedman
Helpful Hints from Bellingham Police Dept.!
It’s a sunny Wednesday, March 03, 2010 in Bellingham, WA. Let’s hope tomorrow is the same.
Did you KNOW…that back-in angle parking is prohibited? 11.33.035 - no person shall back a vehicle, other than a motorcycle, into a space signed or marked for angle parking. This restriction shall not apply to commercial vehicles during actual loading and unloading or to construction vehicles during the loading or unloading of tools and/or building materials.
Copying down this information tor identifying your items helps in two ways:
- It increases your chances of recovering some of your stolen items
- Police may be able to charge the people with the found items with “Possession of Stolen Property.”
- Race
- Hair length and color
- Height, body type (small, average, heavy) facial hair
- Piercings, tattoos
- Shoes, logos and/or brand names printed on the clothing
- Smells on the person are helpful such as tobacco or alcohol. If you hear them speak, anything unusual such as accent, slurred speech due to alcohol consumption etc.
- Direction of travel and mode of transportation (i.e. on foot, bikes, car, etc.)*
*Bellingham Police Block Watcher, City of Bellingham, March 2010
Tips for Sellers and Buyers!
Tuesday, March 2, 2010 finds Fairhaven Realty in Bellingham, WA bustling with activity. Our morning meeting was topped off with an agent tour of new listings. Some are busy finalizing sales, others are working to complete listings, closings are happening and the list goes on….
Ericka Pizzillo Cohen, a writer for The Bellingham Herald, has compiled a list of tips gathered from local real estate agents and inspectors and included them in her July 23, 2009 article, Dealing in Details. These tips will prove valuable for buyers who want to look beyond the surface of a home and for sellers who want the best sales price.
TIPS FOR BUYERS:
- Don’t be embarrassed to bring binoculars, since you won’t be able to bring a ladder and get up on a roof during a home showing. Or, bring a digital camera, take pictures at a good angle and blow them up on your computer at home to get a view of the shingles.
- Walk down or across the street to get a good view of the roof shingles. Look for curling, uneven or missing roof tiles as well as the number of roof layers. A roof should have no more than two layers.
- If the shingles look new, but the flashings are still rusted and bent, the work might not have been professionally done.
- Look for roof vents. Typically you should see one vent for every 300 square feet of roof surface.
TIPS FOR SELLERS:
- Remove all moss from the roof. Roofs are designed to remove water, but moss acts as a sponge, keeping water on the roof all the time.
- If there is a problem with a newer roof, check if the roof’s warranty will save the cost of repair.
- Use a stiff broom or chemical product to remove moss.
- Remove and replace cupping or curling shingles.
- If you can’t afford to replace a roof before a sale, get an estimate and consider a deal with the buyer to pay for the roof after sale. It’s usually in your interest to get your own estimates for a new roof.
“The most important parts of a house are the roof and the foundation,” said Dennis Louthan, owner of WIN Home Inspection in Lynden.
“Most homeowners will use black tar at the drop of a hat,” said Aaron Long, owner of Aaron Long Roofing in Maple Falls. “Tar around penetrations is usually a good indication of previous leaking and future problems.”
Q & A 1031 Tax Exchanges
Monday, March 01, 2010 finds the weather a bit cool in Bellingham, WA. Our area has certainly experienced a very mild winter. Trees are blossoming, daffodils are blooming, grass is growing and spring is just around the corner!
Boot is any property received by the taxpayer in the exchange which is not like-kind to the relinquished property. Boot is characterized as either “cash” boot or “mortgage” boot. Realized gain is recognized to the extent of net boot received.
*Information gathered/quoted from the National Association of REALTORS® online library-1031 Exchange-FEA (Federation of Exchange Accommodations)
...and the WINNER IS?...
When her victory was announced and her trainer, Gabriel Rangel, was being congratulated by a swarm of people, Sadie got up on her hind legs and wagged her tail furiously as if to say, "Hey, what about me?"
Sadie came to the show with a rather 'comical' history. Two years previously, she got spooked at Madison Square Garden. Her handler's new shoes were too squeaky, the wooden boards covering the ice hockey rink thumped too loudly and a stray TV monitor threw her, too. Then last February, she had a potty accident on the green carpet while coming out to take her place in the final ring. So, Sadie is now the TOP DOG and has definitely redeemed herself! **
*Information gathered/quoted from NYDailyNews.com by Erica Pearson and Leo Standora & The Bellingham Herald, Tuesday, February 16, 2010, Scottie looks to be top dog.
Like to read? Public Library Book Sale Now!
'Friends' of the Bellingham Public Library are putting on a major book sale to benefit the Library. The support group raised about $80,000 for the Bellingham library last year through its internet, community and 'nearly new' sales.
Four major sales are held each year. The first this year will be February 24-27, beginning with the 1-6 p.m. preview sale today, Wednesday, Feb. 24th. Books are double the marked price. Books are regular price on Thursday, half-price Friday and $3 a bag on Saturday. With a 10 a.m. start those three days.
