Can You Afford A New Home

Buying a new home can be the most exciting thing you've ever done and it can also be the scariest! You need to think things through and look at the big picture. Write things down, weight out everything so that you don't become just another statistic. Here are some tips to deciding if you can afford to buy a new home.

1. How much can you afford? You should talk to a lender to help you with this question. They will talk to you about your income and your debts and together you can decide how much you can afford and how much they will lend you.

2. Get pre-approved for a loan. Once you have talked to a lender about your finances and your credit worthiness they will give you a pre-approval letter. A pre-approval letter will give you the upper hand once you find a home that you want to purchase.

3. It is a good idea to keep your monthly costs under 28% of your monthly pre-tax income. This should include what your mortgage payment will be. Don't forget to include the real estate taxes and insurance if they are not going to be included in your monthly mortgage payment.

4. If you have any long term debts like a student loan, car payments etc, then you should keep your monthly costs under 36% of your pre-tax income. This includes your monthly housing expenses.

5. Decide what type of loan you will be applying for such as Conventional, VA or FHA loan.

6. Decide what type of mortgage you will be using. Are you going to use a fixed rate mortgage or an adjustable rate mortgage (ARM)? If you decide to use an adjustable rate mortgage you must think ahead and plan for when the rates go up, because your mortgage payment will go up when the rates go up, depending on the terms of your agreement.

7. Consider homes in various price ranges.

8. Think about your future plans, perhaps you should purchase a home at the top of your price range. This will give you more time to outgrow your home and will save you money in the long run.

9. Make a budget. Write down every little expense you have - it all matters.

10. Look at your expenses. What do you really need? What can you do away with?

11. Plan for emergencies. Do you have savings? What will you do if an emergency arises? Be prepared, you don't want to lose that beautiful home you saved so long for.

12. Don't over extend yourself.

Ok, now you have thoroughly thought everything through and it's time to make a decision. Go ahead; make the decision one way or another. If you are not ready to buy, decide what it is you need to do to get to where you need to be. Either way, start talking to your realtor today!

Whatever it is start handling it now. The sooner you take care of business, the sooner you will be in your new home. If you are ready to buy don't procrastinate, because you never know when the rates will go up or when you will lose out on your perfect home.

Buying A Second Home

Buying a second home - should you or shouldn't you - that is the question. Well, buying a second home could very well be the absolute best thing you have ever done but you have to do it for the right reasons. Let's talk about a few of the things you need to consider before making any quick decisions.

First you must ask yourself why you want to purchase a second home. Is it to invest in your future? Is it to use for a vacation home? Are you doing it for an additional income? The answer to these questions is critical so let's look at all of the facts.

If you are buying a second home as rental property to use as part of your retirement plan then you have made the right decision. Buying a home forces you to make regular savings in the form of a mortgage payment each month and that is money in the bank when it comes to a retirement fund.

You must make sure,however, that you have enough money to cover the mortgage payments plus any additional expenses such as repairs, yearly taxes and insurance, if they are not a part of your mortgage payment, and anything else that may arise. The good news is if you buy the right house at the right price, your rental property should always stay rented.

Another reason a second home as part of your retirement plan is a good idea is due to the fact that your investment money is subject to less income tax and the interest and taxes may be deductible. So planning ahead could pay off in a big way.

Housing, for the most part, appreciates over time. There are definitely ups and downs in the housing market but buying a home is a long term investment that can ride those tides very well. A home is an inflation proof investment.

The experts have predicted that both fixed rate and adjustable rate mortgages will probably remain in the single digits for the foreseeable future. Therefore, financing a home with a nominal down payment should remain achievable for quite some time.

Buying a home is very exciting and can be a very profitable experience but your decision cannot be made lightly. It is wise to give a lot of thought to why you want a second home, then make a financial plan and stick to it.

If you have some disposable income, then purchasing a vacation home may be just what you need to add a little spice to your life. Then by all means, go ahead and find the perfect house, buy it and enjoy.

Whatever the reason you want or need a second home, please think about your reasons, make a plan and follow through. It is also advisable to talk to a real estate agent about all of your options before diving in. A real estate agent can help you make the best decisions and could potentially save you thousands of dollars in the long run.

Improving Your Purchase Power And Credit

You examine your budget and determine that you cannot afford the home of your dreams because your credit and financial situation isn’t stellar. What’s your next step? Should you keep looking for a lender willing to work with your credit or should you begin to improve your financial picture?

The majority of people want it now. Why do so many individuals seek a mortgage program that will work with their credit situation instead of simply improving the overall picture? While it may be tempting to find a mortgage program that will work with your current financial situation you should stop and think if this is a temporary problem you’re having or if you cannot control you’re spending. If you’re having issues now it’s not likely to change when you become a homeowner.

With a few changes and little extra effort you could be in a completely different state of affairs within a year.

First, you need to analyze your spending habits. Where does your money go on a monthly basis? Consider the following;

1.Stop using credit cards. Credit cards always create financial hardship for most consumers. Often you will overspend with credit cards believing that you will pay for the difference next month. However, that rarely occurs. Additionally, credit card interest is high – too high – and can keep you in debt longer than you think. The best thing you can do is freeze your cards, pay off the debt and keep one for emergency. Go on a cash-only budget. Not only will this force you to live within your means, but you will appreciate your spending more when you are paying with cash.

2.How much car do you really need? Most of us possess a nice car but how often do you need to buy a new vehicle? Without even thinking about it as soon as it’s paid off, many of us run out and upgrade to a newer model. Who needs a new car payment – this will keep you in debt. If you want to save a ton of money monthly, keep up on your vehicle maintenance and keep your old car.

3.How much food do you eat – where and when? Buying out is a trap! How many of us pick up a quick breakfast on the way to work? And if you’re buying lunch every day, brown bag it. The more packaging and preparation that’s involved in making a meal, the more expensive it will be. Prepare a quick estimate of how much you spend each day on food and I’ll bet you can save a significant amount each month.

Your overall goal should be to save money, reduce debt and improve your credit. If you do all three things you will dramatically turn your financial situation around within the first 6 months. Not only will this be reflected within your credit score but your financial picture would be healthier and you’ll have more money for a down payment.

Upscale Downsizing For The Retiree

Today’s seniors are busier than ever with friends, family, part-time jobs and even weekend escapes. Who wants a house to clean, or snow to shovel? And those flower beds that seemed like a lovely idea years ago don’t seem like a good idea today. Yet, while many seniors want to scale down, no one wants to give up their upscale expectations.

The trick is to find retirement properties that offer downsizing with all the amenities you’ll love.

All retirement communities offer independent seniors the chance to live near neighbors of similar age and interests. Most are located close to medical facilities, shopping, and places of worship. Many offer club house activities, a pool, tennis courts and even shuttle bus or van service. So how do you find the retirement community that is all-inclusive and fits your expectations? With the help of a real estate agent you can find the community that fits your needs now and later.

Consider the location of any Active Retirement Community. What is most important to you and how close do you want to be to outside recreational activities? Many of the more upscale communities offer some or all of the following amenities on-site;

• clubhouses

• pools/saunas/spa facility

• exercise facilities

• craft and hobby shops

• libraries

• media rooms

• movie theaters

• hiking trails

How important are planned activities? Many active retirement communities employ full-time activity directors to plan events such as day trips, shopping excursions, special-interest groups, card clubs and book clubs. Additionally, many active retirement communities offer a wide variety of travel options, including day trips, member excursions and private travel agencies on site. Some will also recognize the importance of activities that are age-appropriate for visiting family and friends.

Retirement communities are also forward-thinkers that consider the issues relating to aging-in-place. Convalescent care, assisted living, and respite care are just a few of the concerns active retirement communities have considered. Proactive retirees looking for that all-in-one community can downsize to a home-like environment. Staffed by medical professionals, all health concerns are attended to, while remaining in the same community. There is no need to pack up and move to accommodate growing health concerns.

Preparing for such a transition can be daunting, however when you consider the array of activities and opportunities that are available when you downsize, it becomes easier to prepare for the next chapter in life.

Top 3 Foreclosure Myths That Keep Potential Homebuyers Away

Bad things can happen to good people and we’ve seen this many times, especially when it comes to owning real estate. Many people get themselves into situations beyond their means and the end result in real estate is often foreclosure. Yet, this opens the doors to incredible opportunities to purchase a home at a bargain.

Just about every consumer has heard about buying a foreclosure yet many shy away from these types of transactions because of misconceptions. Foreclosures are abundant in the marketplace and can save you anywhere from 20 to 40 percent off the selling price; sometimes more.

Are you hesitant to purchase a foreclosed property?

Myth #1 – Foreclosures are only found in the bad neighborhoods. This is certainly not true. Foreclosures can occur anywhere. People have mistakenly assumed that foreclosures are always the result of financial irresponsibility and this usually occurs in more crime ridden neighborhoods. Foreclosures have been caused by divorce, medical and health problems, predatory lending and death, just to name a few. Everything from estate homes and undisturbed lots to townhomes, condos and mobile homes have been foreclosed upon. Real estate agents have access to lists containing all the foreclosed properties available for sale.

Myth #2 – I must attend the auction to buy the property

Foreclosure notices are published for several weeks before the auction. This in-between period is referred to as the pre-foreclosure. Real estate agents can easily find homeowners in the early stages of foreclosure and work out a deal. Buying a pre-foreclosure does have its advantages. The homeowner is a bit more desperate to avoid the actual foreclosure. In addition, you are able to actually perform a walk-thru of the home and inspect before placing any contract.

Myth #3 – The only source of foreclosed properties is at courthouse auctions

Many potential homebuyers envision bidding on the courthouse steps to purchase a foreclosure. The fact is there are other opportunities to purchase a foreclosed property with less stress.

Lenders have an abundant inventory of foreclosed properties that never sold; these are referred to as REO properties. REO properties have several advantages;

• You can fully inspect these properties because in most cases the previous owners have already been evicted.

• You can bring a contractor with you to get a detailed list of what needs to be fixed and/or replaced and make an educated assessment of the property.

• Lenders are offering bargain-basement deals on these properties and since they are losing money on their inventory, they have an incentive to quickly sell.

No matter how hard you try when you’re buying any home there are risk involved. Taking on new challenges can be intimidating, yet buying a foreclosure isn’t so complicated that you should avoid this type of transaction. It only takes time and an experienced real estate agent.

Saving Money With Multi-Family FHA Loans

In the 1900s you would commonly find family generations living under one roof. For the last decade, extended families have begun to move farther apart. But again, this trend is changing.

Mostly for economic reasons, extended families have begun to live together once again. Thinking of ways to save and cut corners? Look into an FHA loan on a multi-family home.

A multi-family property is any home or residential building that has more than one unit. Most people purchase multifamily housing in order to invest in the property and use the rent from the tenants to pay the mortgage. The newest trend has been to purchase a multi-family home and move extended families under one roof.

FHA insured home loans can be used for a variety of properties, including purchasing the multi-family home for up to four families, or a condo or even a “manufactured home” on a permanent foundation.

FHA loans are an excellent choice for those with less than 720 Fico scores, and the FHA is still guaranteeing home loans.

• There is a minimum down payment of requirement for all FHA new home loans.

• Credit guidelines are more lenient with acceptable scores in the 600s.

• FHA does allow loan applicants to borrow money for a down payment, with restrictions

Some borrowers still have a difficult time coming up with the down payment and closing cost fees, however there are many programs available that “gift” these fees to the borrower.

Fannie Mae and Freddie Mac have no direct grant programs for down payment or closing cost assistance, so borrowers are not able to apply directly. Borrowers can inquire about these programs from their Mortgage broker or lender.

Many lenders participate with local, state and federal programs that provide down payment and closing costs assistance, i.e., all mortgage lenders and brokers are not created equal. This is why it can be vital to look around and ask your broker or lender which programs they take part in.

Living with parents just became the new trend

Many people looked down on the notion of “still” living with the parents, but today, mom and dad, siblings with husbands in tow and grandparents can be beneficial in many ways.

1. With several incomes, the monthly mortgage is more affordable

2. Child care fees are greatly diminished

3. When living with family, we tend to spend less on entertainment and enjoy more family time, which greatly benefits the younger generation

It may not be an ideal situation for everyone, but many families are making this FHA multi-family mortgage benefit them in many ways, especially with today’s tightened grip on our finances.

Speak with a real estate agent and lender to discuss your options.

Retiring For The Budget-Conscious

Being budget conscious does not necessarily mean that you have to deprive yourself of an enjoyable retirement. Of course the more money you have to retire with, the less you’ll have to worry and the best way to boost your retirement fund is to start saving early. Even those with limited retirement funds can benefit from some smart planning.

Re-Evaluate what you need

The first step is to create a retirement spending plan – where do you stand? The most important thing to consider when you create your retirement spending plan is whether or not the plan is reasonable. If it’s not, you probably won’t stick to it.

Mistake #1; the biggest mistake prospective retirees make is when they do not take a hard look at their overall retirement situation. Is your nest egg enough to generate retirement income for the next decade or more? Take a good look at your retirement situation because it could be time to downsize.

How much annual income will you need during retirement?

Financial planners suggest that you’ll need about 75 to 85 percent of your pre-retirement gross income to maintain your current standard of living. Of course, this can vary according to your lifestyle.

During retirement, you will pay less in taxes, save less, and you should have less of a mortgage burden than you did while working. While many expenses will decrease during retirement, many will increase.

Mistake #2; one in 10 Americans choose to downsize early, at the onset of retirement. Early planning to downsize to more affordable lifestyles can save you thousands every year. Only recently during our economic downfall have Americans began planning for retirement sooner than later. Why wait until you’re under water and barely surviving?

The practical alternative is smaller

Who said you would have to sacrifice the amenities when you downsize? The American dream was built around the idea of bigger is better but lifestyles have changed and the aging population are opting out of the “big” notions and choosing to keep it small. Retirees are turning to alternatives.

Whether it’s one-floor ranch styled homes, modular homes and manufactured homes or perhaps a home on wheels, retirees have a bevy of options to reduce living expenses.

Think about this – retirees require only the basics for living, sleeping, cooking and bathing. Do you really need several bedrooms, a family room, dining room, basement and more? This only translates into more electricity, more rooms to clean and more expenses.

Smart seniors realize that small can be advantageous, especially to the pockets.

Pricing A Home To Sell

Psychologically which price looks and feels better to you - $299 or $300? People generally feel like it’s more of a bargain with $299, although the difference is a mere dollar.

There’s a fair amount of psychology and strategy that goes into determining a home’s asking price and while you may have a price in mind, that doesn’t mean your home is priced to sell. It’s all about tapping into the mind of potential buyers and how they identify with your price.

The biggest hurdle is to determine a fair price for your home, sans any emotions. Ask any homeowner what their home is worth and the price will include all the memories that have gone into making a piece of property a home. Emotions have no place in this business practice.

It’s understood that sellers don’t want to simply give their homes away and everyone wants to sell for the maximum price, but buyers are seeking bargains and with an abundant inventory, sellers must be flexible.

The real estate agent will identify the approximate value of a property based on comparisons of similar properties sold in a neighborhood, the market conditions, competing surrounding properties, and the time of year. Once all of these elements are considered, the real estate agent will have a price range in mind.

Here are a few strategies for the seller to consider;

• Listen carefully to your agent’s pricing strategy – they are the experts. It’s their job to know what works and what doesn’t. And as with any strategy, be prepared to have an ongoing discussion about pricing with your real estate agent. If potential buyers are not biting, it may be time to re-think the asking price.

• By pricing your property on the average to the lower end of the price range, you will stimulate more interest among more than one buyer. Also, for those homeowners in a position to sell quickly, this would be a good option to get more offers. Sellers who list their homes too high miss out on a segment of buyers.

• Forget the creative pricing strategy - $488,888? Odd priced homes call attention to the price for no good reason. The goal is to showcase the property, and to appeal to as wide an audience as possible. Getting eccentric with your asking price counteracts the tried-and-true strategy of psychological pricing. Well thought out rounded figures work best - $299,000

A lot of factors can come into play when selling or buying a home, and not all of them can be anticipated. If you can be flexible and react quickly to changing market conditions you’re more likely to get the best price with the least aggravation.

South Bay Home Sales Rise

The local housing market enjoyed an increase in single-family home sales for October, even as prices fell.

South Bay cities - excluding the Palos Verdes Peninsula and Inglewood - saw 183 sales of single-family homes, up 8 percent from the same month a year ago.

In a statement released Wednesday, the South Bay Association of Realtors reported that the median price of those sold homes was $400,000, down 26 percent from a year earlier.

The median price is the middle figure where half of homes sold for more and half for less.

The improved sales with lower values represent real estate's uncertain future as monthly data give mixed signals about the industry's direction.

"Increased single-family sales suggest that buyers and sellers are coming together more effectively and new families can get into homes for which they are qualified to buy," association President Caren Greenwood said in a statement. "If this trend continues in the coming months and going into 2012, and appropriate financing is available to qualified buyers, then we hope that it signals the economic recovery gaining strength."

Sales of local condominiums and town homes were less promising, with 6 percent fewer transactions in October compare with a year earlier.

The median price in this segment was flat at $409,000.

Warren Snyder, co-owner of a mortgage brokerage and real estate company, said he has been an uptick in business in part because of low interest rates.

"We're doing a lot of refinances, and we're also doing a lot of sales right now through short sales," said Snyder, of Carriage Realty & American Broker Loans in Rolling Hills Estates.

While the housing market continues to look shaky, Snyder said that lower home values mean he has been able to help his clients lower their assessed property taxes.

Statewide, home sales also rose last month, according to the California Association of Realtors.

Resales of single-family homes across the Golden State reached 493,240 in October, up 8.5 percent from a year earlier, and a 0.9 percent rise from September of this year.

The statewide median price was $278,060, down 8.9 percent from a year earlier and 3.3 percent decline from a month earlier.

Note: Article written by Muhammed El-Hasan of the Daily Breeze.

Does Your House for Sale Advertisement Say "Buy Me Or Boring"?

It's no secret that human beings react to words, and any edge that a seller can gain - starting with the house ad - is vital.

While advertising your home is not an exact science, some words seem to give a listing more power than others. "Beautiful" rather than "move-in condition" translated on the average to three percent or more on the sale price - that works out to $9,000 on a $300,000 house.

Words that denoted "curb appeal" or general attractiveness - such as good neighborhood or excellent upkeep, for instance - helped property sell faster than those that described "value" and "price."

There is always something that can be said in an enticing influential way, which will force a buyer reading the ad to see opportunities. It is always important to help elaborate on the home's assets by providing descriptive details and giving the buyer a visual.

Placing a spin on the advertisement is the best opportunity to getting people in the door. You may chose to say, 'professionally designed,' 'Laura Ashley-inspired,' 'designer decor' or 'gourmet kitchen,' ".

It is also important to use proper terminology to enhance a feature. For example, heated floors in a master bathroom should be referred to as 'radiant heating' or a 'spa-like master bathroom.' If an owner claims there's nothing new, it can be referred to as, 'lovingly maintained’.

Many times sellers can make overstatements about the home. Your realtor will perform a walk-thru and ensure all the characteristics of the home have been considered; real estate agents create that visual romance that potential home buyers are looking for.

Is it Help or Hype?

Everything these days is about price and timing; potential buyers know a good deal is possible. Combine that with a properly worded advertisement, and you have the better chance than the next seller.

Buyers are attracted to verifiable amenities – the new roof, new carpeting, updated kitchen, beautiful landscaping, finished basement, golf course community, lakefront, or a gated community. If a property has a finished basement, it should be fully finished – not just one room in the basement.

Constructing your Ad

1.Start with a strong opening statement about the home

2.Mention the one or two key benefits that will attract buyers' attention and spark their interest

3.Include the significant facts about the property, such as the number of bedrooms and bathrooms

4.Use words that appeal to the emotions and senses

5.Be accurate. Prospective buyers are bound to feel disappointed or manipulated if the home doesn't match your description.

Lastly, always close with a statement that encourages prospective buyers’ – don’t leave a blank slate. "Call today" is a call-to-action statement that translates into ‘catch me now while the getting is good’.

Buying A home May Now Be Cheaper Than Renting That Apartment

In an ironic turn of events, many people are finding they cannot afford to pay rent and are turning to buying a new home.

Falling house prices and increasing rental demand have made it cheaper to buy a property than to rent. Individuals are quick to assume a rental would be much more peaceful on the pockets, but it turns out most rentals are priced, on average, approximately 25 percent higher than a monthly mortgage.

With home prices way down, low interest rates and sky high demand in the private rental sector, buying has never been a better option for those able to secure a mortgage. And with home owners reducing prices even further, in preparation for a quick sale during the holiday season, this has become one of the best times in history to purchase a home.

The statistics in every state show that the average rent is more than a monthly mortgage payment. When you add on the incentives to owning a home, it’s a strong argument to contact a real estate agent quickly.

Take a look at average rental prices in a few states;

Alabama $ 724

Arizona $ 815

California $ 1455

Colorado $ 1032

Florida $ 982

Georgia $ 819

Illinois $ 1098

Maryland $ 1283

Nevada $ 811

New Jersey $ 1468

New York $ 1672

Pennsylvania $ 1009

South Carolina $ 753

Tennessee $ 794

Texas $ 946

Virginia $ 1149

Average rates, based on 2 bedroom

Renters have failed to realize what an opportunity they have right now. There is an abundance of homes to choose from; and a larger selection of available homes versus rental units. Imagine shaving off $300 from your monthly rental payment? What about purchasing a new home, with all your required amenities, in the vicinity that’s central to everything, all at a lower monthly cost?

But the million-dollar question is whether prospective homeowners can get a loan.

After the mortgage meltdown, banks tightened credit standards including increasing down payments which shut out many potential homebuyers; however, there are many programs available to help get those homebuyers into a new home.

Many factors have created great deals in the housing market, but those same factors also might be too daunting for many individuals to overcome right now.

Everyone should know where they stand. At a minimum, meet with a mortgage broker and real estate agent to ascertain what home loan programs you may qualify for. This could very well be the best time in U.S. history to purchase property.

A Better Advantage With Credit Union Mortgage Loans

Amidst the topsy-turvy spiral of mortgage lending, most borrowers feel as though they need to hire a team of expert finance and legal consultants before pursuing a mortgage loan. Who can blame them? From the unintelligible disclosures to the twists, turns and requirements presented during processing, borrowers must approach the loan process with an eagle eye on the bottom line. Getting the most bang for the bucks.

After the wave of borrowers lost their homes in the fiery ashes of mortgage-gate, many prospective homeowners are hesitant about mortgage loans in general. Adding fuel to this fire are unattainable rates, poor servicing and being subjected to polices that serve the lender, but not the borrower's needs.

Credit unions are showing that there’s a better way to bank with several distinct mortgage loan advantages;

• More flexibility when locking in rates. Published mortgage rates can be locked for 45 to 60 days without a fee, when most banks quote 15 or 30 day rates.

• Credit union mortgage rates are better than those of other lenders because the company does not build a profit margin into its loans.

• Most credit unions do not have prepayment penalties on mortgage loans and do not charge origination points, unlike commercial lenders.

• Credit unions have more flexibility of approving loan applications.

• Credit unions can charge lower rates than conventional lenders because they are nonprofit institutions.

• Credit unions can save hundreds in closing costs by eliminating or decreasing many of the usual fees.

Service, low closing costs and mortgage rates are the differentiating factor among lenders, not to mention trust. Credit unions have a stable, reputable status and are not marred by the economic mess created by commercial lenders. A strong point when deciding whom you should submit an application.

These loans, which are available to anyone who meets a credit union’s membership terms, are not typically marketed, yet they have grown increasingly attractive during the last year.

Time to Compare Lenders

Many people will tell you they’re too busy to switch banks or comparison shop. Well, start with a quick call to your current financial institution and check to see if they are willing to decrease some fees and sweeten the deal for you. We are dealing in tough times and with the current economic demise, banks should be on the lookout to keeping customers happy. If they are unwilling to budge, it’s clearly time to shop around.

You can search for credit unions in your region at asmarterchoice.org, the website run by the industry’s trade association.

Buying a Budget Home

When it comes to real estate, it’s really hard to beat an inexpensive home. You may call it inexpensive while others refer to it as a cheap home – but they are very affordable and ideal for those on a budget.

These bare-bone types of homes represent a way to purchase property at a low price, build it up, and have instant equity. Making money with real estate is easy to do - no matter how you look at it.

Although you can find cheap homes throughout your state, some will obviously be better than others. Some are in great neighborhoods, giving you plenty to see and plenty to do all around you. On the other hand, most towns that offer the cheapest homes normally have a bad situation when it comes to the job market. They can be great to retire to or settle down in if you own a business, although they aren’t great if you need a job. Internet marketers and writers are finding these areas, and are flocking to them at a very fast pace.

The Best Way to Purchase Low

You can save quite a bit of money by buying a home that is practically unfinished, but still fits your needs. What this means, is buying a home in the inexpensive areas of your town, or buying a home that has not been completed yet. You shouldn’t be focused on one type of home or neighborhood, but instead look at your available options and compare prices.

Many builders have gone out of business, leaving plenty of unfinished properties. Let your real estate agent investigate how to purchase these almost finished properties. You’ll save a bundle and can have the home completed within months.

Keep in mind that buying cheap homes doesn’t necessarily mean buying a rundown place or buying your home in a bad part of town. You can get a cheap home in a great neighborhood, if you weigh your options accordingly. If you shop around and look at different areas, you might find yourself very surprised at just how many homes are available at cheap prices.

In some cases, you can end up paying the full price of a home and still end up spending less than someone else might spend. Although price has an impact, financing is also an area that can help to make a home more affordable. If you get a low interest rate, you’ll save a lot of money when you buy the home. There are several ways that you can save money through your finance options, which is why you should always research what’s available to you before you buy.

Contact a real estate agent and provide a list of what you’re looking for and how you want to save money. Finally, keep your options open because now is the best possible time to negotiate.

Three Reidential Improvements That Add Value

There are two ways to go about making home improvements. Either you splurge for things purely for the pleasure of having it or you take a pragmatic approach, making purchases that will increase your home's market value.

Exactly how much you'll recoup in costs depends on several factors, including the value of the homes in your neighborhood, when you plan to sell the home and the nature of the project itself.

But there are three improvements that will up your value no matter what!

1.Install a Standby Generator. Standby generators can add value to your home and while they are moderately expensive to install, they will safeguard your family by keeping power running in an emergency. Unlike a portable backup generator, which you store in the garage or shed and roll out during an emergency, a standby generator is permanently installed on a gravel bed or concrete pad next to your house. If the power goes out, an electronic switch automatically signals the unit to turn on, keeping essential household systems and appliances running

The cost of these units all depend upon your comfort level and what your expectations are. If you lose power, would you prefer the whole house remains running as if nothing ever happened or do you need just the basics to get through the rough time? Prices for standby generators can start as low as $1700, however, this does not include the price for an electrician to install and test the generator.

2.Create a Home Office. Many companies are looking for ways to reduce costs and minimize space to house employees; additionally, millions of Americans work from home and that number grows every year. This has made a home office more of a necessity than a luxury. Creating a dedicated work space not only adds value to your house, but it also makes your telecommute tax deductible. Converting an unused den, sunroom or extra bedroom is a great way to take care of business from the comfort of your home.

3.Infuse some Curb Appeal. If your house doesn't look appealing from the outside, chances are a potential buyer will never make it inside. Paving a driveway or walkway that is in disrepair is a must, because this is what leads people to your home -- you want it to be welcoming. Attractive, manicured front-yard landscaping will also add value to your home. Drought-tolerant plants are a great option if you don't have a green thumb. And don't forget about your backyard either. Outdoor living is very popular as more people wish to entertain. Raised garden beds and attractive lounging furniture will definitely appeal to future buyers. Who said you must spend a fortune? Curb appeal can be created for under $500.

Keep in mind that design tastes can shift significantly over time. A house that's priced higher than its neighboring homes could be perceived as overpriced even if it does have more value.

Turning Your Attic Into Living Space

An attic can yield up to hundreds of square feet of unused living space in your home. Do you have another child coming into the family? Are you starting a new business that requires more office space? Would you like to turn that attic into a guest room? All of these are viable ideas to create a room out of storage space that is rarely used! With a little sprucing up, maybe a fresh coat of paint and some windows added into the space, the attic could become one of the warmest rooms in the house! Use these tips to help you create your attic room!

Sometimes a fresh coat of paint is all it takes to add life to a room. Consider that most attics are unpainted and unfinished with low ceilings there are many painting techniques that we can use to make the ceilings appear higher, and make the room appear brighter. The lighter the color of the walls, the larger the room is going to appear. Take note of the walls, are they finished? Is the wood in good condition? Would it be beneficial to keep the history and paint the walls or would it be best to finish the walls with drywall and paint?

Take into account what the room will be used for. Often, attics are not insulated. If the room is going to be used for an office, den, living space or bedroom it is a good idea to insulate the walls before finishing the drywall. This will add warmth to the room, because no one is going to want to spend time in a freezing cold room. Make sure that it is insulated properly, contact the local professionals.

Attic floors can be customized to give the room character. Often, all they need is a good sanding, and a couple coats of wood varnish. The older the home, the more authentic that the attic floors are going to be. Add in a few area rugs here and there, and floors, and walls will be complete. These are two major parts of completing your attic room, and making it ready for your family or for guests, so these two tasks could have you on your way!

Next comes the ceiling, after the walls have been painted, it is time to look at the ceiling. How is the shape of the ceiling? Should it be replaced? If the ceiling needs to be replaced, it could be completed at the same time that the walls are finished with drywall. Be sure to use thin drywall, as attic rooms are small, and we need all the space that we can get.

After the main elements of the room have been completed it is time to think about décor. Finishing the room on a budget could mean visits to the local chain store, or thrift store to find cozy, chic furniture for less. This means, that you could spend more on fabrics, accessories and other elements to make the room feel more like home.

Improving Your Purchase Power And Credit

You examine your budget and determine that you cannot afford the home of your dreams because your credit and financial situation isn’t stellar. What’s your next step? Should you keep looking for a lender willing to work with your credit or should you begin to improve your financial picture?

The majority of people want it now. Why do so many individuals seek a mortgage program that will work with their credit situation instead of simply improving the overall picture? While it may be tempting to find a mortgage program that will work with your current financial situation you should stop and think if this is a temporary problem you’re having or if you cannot control you’re spending. If you’re having issues now it’s not likely to change when you become a homeowner.

With a few changes and little extra effort you could be in a completely different state of affairs within a year.

First, you need to analyze your spending habits. Where does your money go on a monthly basis? Consider the following;

1.Stop using credit cards. Credit cards always create financial hardship for most consumers. Often you will overspend with credit cards believing that you will pay for the difference next month. However, that rarely occurs. Additionally, credit card interest is high – too high – and can keep you in debt longer than you think. The best thing you can do is freeze your cards, pay off the debt and keep one for emergency. Go on a cash-only budget. Not only will this force you to live within your means, but you will appreciate your spending more when you are paying with cash.

2.How much car do you really need? Most of us possess a nice car but how often do you need to buy a new vehicle? Without even thinking about it as soon as it’s paid off, many of us run out and upgrade to a newer model. Who needs a new car payment – this will keep you in debt. If you want to save a ton of money monthly, keep up on your vehicle maintenance and keep your old car.

3.How much food do you eat – where and when? Buying out is a trap! How many of us pick up a quick breakfast on the way to work? And if you’re buying lunch every day, brown bag it. The more packaging and preparation that’s involved in making a meal, the more expensive it will be. Prepare a quick estimate of how much you spend each day on food and I’ll bet you can save a significant amount each month.

Your overall goal should be to save money, reduce debt and improve your credit. If you do all three things you will dramatically turn your financial situation around within the first 6 months. Not only will this be reflected within your credit score but your financial picture would be healthier and you’ll have more money for a down payment.

Financing Home Improvements With The FHA PowerSaver Program

Despite the slumping housing market and rising energy bills, the government might help you secure a long-term remodeling loan. Over the past several years the government has taken an interest in steering homeowners in a greener and more energy efficient direction when it comes to residential energy consumption.

The FHA (Federal Housing Administration) is offering the Power Saver Program, a mortgage insurance product to Homeowners desiring to make energy-saving improvements; you can secure up to a 20-year $25,000 loan to make improvements as outlined and approved by the FHA and the DOE (Department of Energy).

Who Qualifies for Mortgage Insurance?

The loan must be secured by an existing first loan. The homeowner's credit score must be a minimum of 660 points in order to be considered a reasonable credit risk. The debt to income ratio must be 45% or less.

It's important to know that the loans themselves are not provided by the government but are simply guaranteed by the FHA, which assumes 90% of any defaulting loan while the commercial lender backs the remaining 10%. The interest rates typically range between 5% and 8%. As of April 21, 2011 there were a total of 18 approved commercial lenders.

What Kind of Home Improvements are Covered?

Since the intent of the Power Saver program is to implement energy-conserving measures, the FDA recommends an energy audit to determine how best to invest the money. Specifically, HUD (Housing and Urban Development) recommends, the installation of insulation, duct sealing, replacement doors and windows, HVAC systems, water heaters, solar panels, and geothermal systems.

Items like insulation and replacement doors are relatively inexpensive investments, with the prices rising from there with energy-efficient replacement windows and geothermal systems getting into some serious money. The upside is that after installation, utility bills will be easier to control and some of these investments are eligible for federal energy tax credits.

Since this is a new program, job layoffs continuing to rise nationally, and the lending community is in such a guarded mode, the number of people that will take advantage of this program is difficult to estimate.

As with all capital-intensive renovation projects, it's critical to reevaluate the home's total replacement cost and update homeowners insurance policy after remodeling.

Defects You May Overlook When Buying A House

You love the house, but conventional wisdom will lead you to identifying defects that you do not want to overlook in your excitement about buying your house. Buying a house is one of the most important personal and financial decisions you'll make.

Your home and its location will help define you and your family and will be the focal point for most of the activities of your lives for years to come.

Here are five strategies to identify defects that could be overlooked in the purchase of a house:

1. First, review the Inspect America Engineering website:

[www.inspectamerica.com]

This site is a wealth of information for you to understand when buying a house. One of the best features of this website is their extensive checklist for home inspections. You can print off all the pages and place in a binder for you to identify house defects.

2. Rely upon the expertise of a qualified licensed professional engineer (P.E) home inspector.

There are businesses out there offering their services for home inspections, but you should hire one with the P.E. certification.

3. Attend the inspection so that you understand all aspects of what to watch for. This is more helpful than reading a report.

4. Be sure to get a full written report from the inspector telling you, in detail, what is wrong, why it's wrong, and what must be done to correct the identified defects. That checklist described in the #1 strategy is just to orient you. You will need an actual report, not a checklist when it comes to having real information to create that total picture of the house's condition.

5. That detailed report from the licensed professional engineer will establish a professional relationship with that engineer so that you can go back to the engineer with further questions, advice, and direction.

Buying a house that you carefully select and have inspected is the best proactive step any homebuyer can take. Identifying defects, especially the hidden ones, can eliminate much of the uncertainty of your future in that house.

In order to help you remain an informed home buyer here is a list of some of the house defects that can be overlooked:

a) structural additions and renovations - that were most likely installed by the previous home owner

b) defective furnace heat exchangers

c) extensive water damage or leaks that can lead to structural damage

d) electrical concerns that do not meet current standards

e) irregularities in the: roof framing, exterior wall framing, interior framing, cracks in the foundation wall

f) proper grading of land around the home - to divert water away from the home to prevent the water from entering the home

There is nothing like peace of mind when it comes to making big decisions about which house to buy.

Avoiding Mortgage Junk Fees

If you look down your long, long list of closing costs at your lender’s office, you probably won’t find one labeled “junk.”

That’s because lenders don’t like to admit that some of the charges they’re passing off as “necessary’ are really “junk”.

Actually, they aren’t junk to the lender because they represent an important stream of profit. But we certainly don’t need those added fees. Junk fees are a good place to negotiate with the lender for a better deal. But the time to negotiate is before you sign the loan application. Once you’ve signed, you’ve sealed your deal for better or worse.

The lender does have legitimate costs that are passed along to you, the borrower, in the form of closing costs and fees; however, by the time you see the fees they’ve been inflated. For example, if the lender has an electronic appraisal done on your property, it might cost him $25, but he’ll charge you $125.

Lenders are required to give you a good faith estimate of your closing costs when you first contact them, but it's not required to be completely accurate! So they often give a lower estimate to get your business, and then increase fees once you have committed. Thankfully, new mortgage legislation has limited the amount by which your fees can change once disclosed.

Inflated costs are just one example of junk fees and costs that get built into your loan without you knowing it. A more egregious example is the charges for made-up things, like “underwriting fees” or “document preparation.”

• A lender will tell you an underwriting fee is the cost that they incur to underwrite your loan. They need someone to go through your whole package to make sure it complies with secondary underwriting requirements.

But an underwriting fee is purely a junk fee because the whole point of applying for the loan is so that it gets underwritten. You’re being charged an extra fee on top of all the other fees to do exactly the same thing.

• Another common junk fee is the cost for document preparation. Basically, computer programs print all the necessary paperwork at the touch of a button. Someone will key in the necessary information. But again, underwriting the loan and preparing the paperwork is within the general scope of, well, getting the loan approved for you.

The problem with junk fees is that they all sound so legitimate. It’s difficult to tell what’s real and what isn’t. As the borrower, you’re entitled to an explanation of each and every charge in a way you can understand. If the lender throws some jargon your way, stop and ask for a detailed explanation.

To avoid the problem of bait and switch, talk to several lenders, and don't just compare interest rates -- compare fees.

Selling Your Home In A Buyers Market

Many experts have declared that any meaningful housing rebound will begin soon; and how long have we heard that? Home prices continue to decline fueled by tight lending standards and a rising supply of houses on the market.

In today’s market you have to be determined to sell and face the reality in many regions -- it's a buyers' market, and you will be competing with a growing supply of motivated sellers to get buyers interested in your house.

When trying to sell your home in a buyers' market, the three most important factors are price, condition and flexibility. Just because you may have paid too much for your home doesn't mean buyers think they should have to pay; pricing must be based on today’s market, no matter how difficult it may be for you to realize that.

Price It Right: Real estate pros say the key to selling a house is to "price it right." Set the price at what you can get, not what you think its worth. The fact is, it doesn't matter what you think your house is worth -- the only thing that matters is what a buyer is willing to pay. You don't want to over-price your house because buyers ignore it and your listing will lose its freshness and appeal, not to mention the uncompensated effort of keeping the home spotless during the showings. Also, the "original listing price" and "current asking price" are on your home's Multiple Listing Service (MLS) listing; if you do not show some decline from the original offering price, some buyers will see it as a sign you have unreasonable expectations of what you can fetch for your home.

Research Local Market: The best way to know if your home is priced fairly relative to comparable houses for sale is to compare your asking price to comparable homes in your community.

1. Get the listings of the houses in your area, and the price range. Look at the listing for every comparable home that is or was listed in your neighborhood over the past six months.

2. Compare similar properties; make adjustments for locations, age, upgrades and lot sizes and come up with a range of values.

3. Also, get a list of the recent sales prices and the original listing prices of comparable houses in the area. You can track this down on web sites such as www.zillow.com and www.realtor.com

Get a Pre-Sale Inspection: Sellers are strongly advised to consider getting a pre-sale home inspection, especially if their home is older or in need of repairs. They can either use a clean home inspection report as a selling advantage or take care of the repairs listed on the inspection report.

And lastly, be flexible. In this market, buyers will expect to pay less than the asking price. They will be armed with the original list prices and final sales prices of comparable homes and will know the price reductions other sellers are accepting.

Relying on Online Reviews – Consumer Decisions

Can you recall what it was like not having the web? When we picked up the phone to check out a business?

47% of consumers rely on online reviews about products or services on company websites before making a purchase decision. These results highlight the importance for organizations to have up-to-date reviews; but how trustworthy are those reviews?

“Mr. Handyman wasn’t very handy”, “I was impressed by how fast the HVAC Tech responded….”

You may think user reviews are posted by your typical shopper. But consumers beware because you can't believe everything you read.

It's not unusual for those rave user reviews to be written by people who work at the company or who are paid to write the recommendations. In fact, many companies are opting for paid reviews these days – you hire a blogger or content writer to highlight the positives about your business and even exaggerate a little.

However, this form of reviews isn’t legal; a chain of cosmetic surgery clinics was fined $300,000 because its employees published positive reviews and engaged in deceptive commercial practices.

It’s impossible to determine a service’s effectiveness by reading the sales page; along with positive reviews you also have plenty of unworthy negative reviews. How would you really know which one to rely upon?

Several popular consumer review sites have sprung up over the years, some better than others and some controversial for their practices;

1. Angie’s List

2. Yelp

3. Pissed Consumer

All of these websites provide the same basic services however they all have different guidelines in which consumers are able to place a review about the business.

What are some warning signs of suspect reviews and how do you distinguish the good from the bad?

• When there's no mention of personal experience with the item.

• When the reviewer only lists the pros and not the cons.

• What’s the language tone? Is it full of selling and hype? Too good to be true? If so, it’s probably not a good review.

• Is there any actual value in the review? Any meat and potatoes details about the product or service?

• Look for reviews that set out both advantages and disadvantages of the product or service.

Also be on the lookout for sponsorship disclosures. But they can be hard to spot, so look close at the bottom of the page.

Also, compare the reviews to other online reviews. Don’t rely upon one website before making your decision. And how about picking up a phone and asking the businesses a few questions of your own? We do still use telephones, you know?

The bottom line is to be skeptical. Before you buy, check lots of sources.

Qualifying For A Mortgage With Unconventional Income

Not everyone makes money the conventional way. Some people have sporadic sources of income but which sources of income will a lender use to qualify you for a mortgage?

Lenders will review all sources of income, but typically use only sources that are expected to continue on a steady basis.

They will distinguish between sporadic or occasional sources of income, and stable, regularly scheduled income. Borrowers can document supplemental sources of income by providing copies of bank statements showing deposits of amounts claimed, tax returns, and payroll/deposit stubs from employers.

There are special rules that apply to certain types of income, and these exceptions are reviewed case by case;

• Trust Income. If the trust is irrevocable and guarantees a payout for three years after closing, the income may be used. The borrower must provide a copy of the trust agreement and proof of two years of continuous payments.

• Social Security, disability and public assistance. This income must be verified as nontaxable. You’ll be required to provide documentation and tax returns. The borrower must also show proof that these payments are likely to continue.

• Unemployment income. Some lenders will allow this income to be used, if you can show you’re a seasonal worker. You’ll have to show that you have been receiving this type of income for the past two years. Proof is imperative, so you’ll have to show records of payments received.

• Notes receivable. If you hold a note and are collecting interest for a minimum of two years previous and will continue to collect this interest going forward, the interest may be added in as income. This doesn’t include a personal loan where your sister, for example, owes you $10,000 and pays you $100 per month.

• Rental income. You will have to show the lease that the tenant has signed as well as documented proof of the rental income, such as bank statements. Only 75% of rental income can be used towards qualifying a borrower for a mortgage.

The key factor for lenders to determine your income eligible for use in prequalifying you is continuity. Do you have continuous and reliable income that can be used to repay your mortgage? You can also include salary and/or wages from full and part time permanent jobs and employer paid bonuses that are paid on a predictable, periodic basis.

Those borrowers who are qualifying for a mortgage loan should pay special attention to the sources of income you use because it can help you understand how much you can really afford to pay for a home.

Going From Homeowner To Renter

During the past few years many well-intentioned homeowners have suffered the wrath of our housing crisis and unfortunately must become a renter. It’s probably been quite a while since you’ve searched for apartments, negotiated with landlords or signed a rental agreement. The single most dangerous mistake you can make is failing to get your rental terms on paper, before the move in.

The differences between a Lease and Rental Agreement

Both leases and rental agreements are legally enforceable and they establish the terms of your tenancy. Both cover basic issues such as the amount of rent, security deposits and who can live in the rental unit. But the primary difference between the two types of agreements is the length of tenancy.

• Rental agreements establish a tenancy for a short period of time, usually one month. A month-to-month rental agreement automatically renews each month unless you or your landlord gives the other the proper amount of notice [typically 30 days] to end the agreement.

A landlord can change the terms of a rental agreement, for example, increase the rent with proper written notice.

• Leases obligate both the tenant and the landlord for a set period of time, usually a year. Your landlord can’t raise the rent or change other terms until the lease ends. Your landlord also cannot force you to move out unless you breach an important term of the lease such as failing to pay the rent, nuisance or other property laws. At the end of the lease you or your landlord may decline to renew the lease or simply negotiate to sign a new lease with the same or different terms.

Oral agreements and un-written understandings…

While an oral agreement is legal and enforceable, it’s difficult to prove and unwise to rely upon. People’s memory become unreliable, leading to who said what and it just turns into misunderstandings.

Which is Better - Lease or Rental Agreement?

A lease provides the tenant with more security than a month to month agreement. A lease is usually the better option for tenants who plan to stay put for the foreseeable future. However a month to month gives you flexibility, especially if you are not intending on staying for a full year. Also, if you are in a bad situation, but are forced to rent a place you’re not all that happy with, a month to month will allow you some place to live while you search for something better.

Foreclosure Survival Ideas

The one word that strikes pain and fear in homeowners is Foreclosure. But today, being threatened with foreclosure or even receiving formal notices from the bank doesn’t mean you’ll lose your home. You still have some options.

Negotiating with the Lender

Your best approach is to start negotiating with your lender as quickly as you can.

• You may be able to get temporary relief from having to make monthly payments (forbearance).

• A plan to make up for missed payments, at the end of your mortgage

Of course, there are many stories I’m sure you’ve heard where lenders won’t return phone calls or simply refuse to negotiate; however, it is always wise to start with this option since later down the road, you can bring this up as a defense to show they wouldn’t cooperate early on. You can negotiate directly with the lender or work through a non-profit housing counseling agency.

Filing for Bankruptcy

Chapter 13 – with this type of filing you are able to develop a plan for making your regular monthly payments and paying off the arrears. If the bankruptcy court approves your plan, you’ll have between three and five years to make your payments. Chapter 13 also reduces or eliminates your total debt load, making your mortgage more affordable. In many situations, you can eliminate a second or third mortgage and reduce your first primary mortgage to the market value and probably reduce the interest rate to just above the prime rates.

Chapter 7 – with this type of filing you are able to wipe out your unsecured debt like credit cards, personal loans, medical debt, judgments, etc. This will free up more of your funds so you can place the money towards your mortgage. Chapter 7 may not be appropriate for you; because of the equity, if any, in your home, a Chapter 7 filing could trigger the sale of the home.

Fight the Foreclosure in Court

If you can show that the lender or mortgage servicing party violated your state or federal rights, you may be able to derail the foreclosure, at least temporarily. An increasing number of courts are siding with the borrower when it comes to presenting documented evidence of ownership. Because of the way mortgages have been sold and resold, the evidence is either lost or procedurally inadequate, meaning, your paperwork was not completed correctly.

Violations of federal lending rules and other federal and state laws regarding consumer transactions may provide protection against foreclosure.

It’s very important to contact a lawyer and if you cannot afford one, get in touch with legal aid to see if you are eligible for free legal representation.

Disclaimer: Do not construe this information to be legal advice; nothing in this article should be construed by you as a source of a legal relationship. This Legal Information is solely intended for general informational purposes only.

Firm's database helps keep Americans in homes

Consumers can't access MortgageKeeper Referral Services directly, but lenders and others can connect clients to its database for help on a variety of issues, including house payments and food assistance.

Last winter, Consumer Credit Counseling Service of San Francisco helped a Dayton, Ohio, housekeeper catch up on her mortgage payments and utility bills, find food assistance and get her property taxes lowered.

But how does a Northern California-based counseling agency know whom to call to get local help for a struggling homeowner living halfway across the country? By tapping into a national database of community resources operated by MortgageKeeper Referral Services Inc.

Created six years ago by a college professor and a housing policy wonk with extensive experience in foreclosure intervention strategies, MortgageKeeper's database is rich with 6,000 resources nationwide that can help financially strapped borrowers dig out from under their problems — if borrowers only knew about them.

The resources are out there for the asking, says MortgageKeeper President Rochelle Nawrocki Gorey, but for any number of reasons, people in need can't find them or don't try. Sometimes people are too afraid of losing their homes to con artists to seek help.

Enter MortgageKeeper, which connects distressed owners with reputable, fully qualified and totally vetted community services in all 50 states, but with a major focus on the 80 metro areas that account for roughly 90% of all foreclosures.

"Our database gets answers to homeowners fast, getting to the root cause of their loan delinquency," says Gorey, who has spent nearly two decades in housing policy research. "Hopefully, the end result is owners who have both their financial and personal needs met so they can stay in their homes."

In July alone, the Downers Grove, Ill., company made more than 75,000 referrals, its highest usage ever. That's about 2,500 people a day who were connected "directly and discreetly" to someone willing not just to listen to their stories but also to help them overcome their difficulties.

The only problem: Consumers can't reach MortgageKeeper directly. They have to go through the company that services their mortgage or a housing counseling agency.

Not all loan servicers or counseling agencies are affiliated with MortgageKeeper. But Gorey and her partner, Michael Collins, an assistant professor of consumer finance at the University of Wisconsin in Madison who has studied consumers in the marketplace for more than 10 years, recently signed Saxon Mortgage Services Inc. as a client.

Saxon, a top-25 mortgage servicer, according to National Mortgage News, joins a list of companies that also includes Ocwen Financial Corp., which claims to be the country's largest administrator of subprime mortgages.

Lenders' participation in MortgageKeeper isn't totally altruistic. After all, a typical foreclosure results in a $50,000 hit to a lender's bottom line. Borrowers who have help solving their issues are more likely to remain or become current on their house payments and avoid foreclosure altogether.

But if your servicer isn't a MortgageKeeper participant, you can still get through by contacting one of several counseling agencies.

Besides Consumer Credit Counseling Service of San Francisco, which, contrary to its name, is national in scope, company clients include Money Management International, CredAbility and the Homeownership Preservation Foundation's hot line at (888) 995-HOPE, each a law-abiding consumer counseling agency.

MortgageKeeper's up-to-date, real-time community resources are embedded into its clients' borrower-dedicated Web pages. Once you are there, you simply type in your ZIP Code and the service categories that interest you, and up pops a list of service descriptions and the relevant contact information.

MortgageKeeper has a list of up to 20 categories, everything from food assistance to job training to help with prescription drugs. Clients pick the ones they deem most pertinent based on their experience with borrower defaults. Saxon, for example, offers 12 categories.

In July, more folks who accessed the MortgageKeeper database asked for help with their utilities and with food than anything else. Employment, housing and credit counseling also were of big interest. And for the first time, help with rental housing was a top-five resource referral.

"There are a lot of nonprofits and government agencies that want to help with financial and personal challenges," Gorey says. "Many times, they are located right in their neighborhoods, but people are just not aware of them. Our database gets answers in seconds from a list of exhaustively researched, best-in-class agencies."

NOTE: Article written by Lew Sichelman

Does refinancing your home make financial sense?

A home mortgage refinance may sound like a good idea in theory, but it's not always possible or desirable.

For starters, lenders have tightened up the approval process, making it more difficult to get a loan.

"Homeowners today need to be triathletes to qualify for a loan, with great income, great credit and great value in their home," says Anthony Hsieh, founder and CEO of loanDepot.com, headquartered in Irvine, Calif.

In addition, a refinance may not make sense financially, particularly for borrowers who plan to sell their homes in the next few years.

Before taking the leap and opting to refinance, homeowners should ask themselves the following six questions.

Do I have equity in my home?

Homeowners need to have at least 20 percent equity in their home to qualify for a new loan without paying private mortgage insurance.

Adding PMI to the cost of a new loan could negate the benefit of a refinance.

Today, many homeowners are underwater - meaning they owe more on their mortgages than the house is worth.

However, being underwater or having little equity does not necessarily rule out a refi.

"Homeowners should still apply for a refinance even if they have low equity, because there are some Fannie Mae and Freddie Mac programs and FHA loans that may accept them," Hsieh says.

"The best way to find out if you fit into a program is to go to a lender."

Roy Meshel, district vice president for W.J. Bradley Mortgage in Phoenix, recommends homeowners refinance quickly in case the housing slump deepens, causing values to depreciate even more.

Patrick Cunningham, vice president of Home Savings & Trust Mortgage based in Fairfax, Va., recommends an increasingly popular approach - the so-called "cash-in" refinance.

"Some people are opting to bring cash to the settlement in order to pay down their loan balance to qualify for a refinance," he says.

Do I have good enough credit?

Borrower credit scores play a big role in securing a good mortgage rate. In fact, you'll need a good credit score to qualify for any type of mortgage at all.

Mortgage rates operate on a sliding scale, with the lowest rates going to applicants with the highest credit scores of 720 or higher.

Borrowers with scores below 620 will have trouble qualifying for a mortgage at any rate.

What are my financial goals?

Many homeowners refinance to lower their monthly payments. A mortgage calculator can give borrowers a sense of what their new payment would be after a refi.

Others choose a shorter-term loan with higher monthly payments so they can reduce overall interest payments and own their homes faster.

"Some people are restructuring their loans to a 20-, 15- or 10-year mortgage, which works well for people with plenty of disposable income," Cunningham says. "But I worry that people are too focused on paying off their mortgage and not integrating this decision with their overall financial plan."

Cunningham urges borrowers to make sure they contribute to retirement savings and college savings, pay off high-interest debt, and save six to 12 months of expenses "before opting for a shorter, more expensive mortgage."

Meshel says people should consider whether they want to retire without a mortgage before opting for a new 30-year loan. Those who have employment concerns may want to refinance into the lowest possible payment in case they experience a job loss.

How long do I plan to stay in this home?

Mortgage professionals generally tell borrowers to expect a home refinance to cost 3 percent to 6 percent of the loan amount. A simple calculation shows how long it will take to reach the break-even point when the savings outweigh the costs.

"If the breakeven is at 15 months and you plan to stay in the home for five years or longer, it is probably worth it to refinance,"

Cunningham says. "But if you plan to move in two years, it may not make sense."

Meshel says long-term homeowners who are close to paying off their mortgages might not want to refinance because of the costs incurred.

What are the terms of my current loan?

Borrowers with adjustable-rate mortgages or interest-only loans should consider the potential benefit of switching to a fixed-rate loan. Hsieh says all borrowers with ARMs should switch to a fixed-rate loan unless they intend to move within one year.

However, Cunningham says some borrowers can benefit by sticking with their current ARM.

"Consumers with a subprime ARM should definitely switch to a new loan," Cunningham says. "But some with conventional ARMs may find that they are in a good loan and that their rates are actually dropping."

While new loans today rarely have a prepayment penalty, many homeowners still have loans with that restriction, which could reduce the financial gain of a refinance, Meshel says.

Do I have a second mortgage or line of credit?

Cunningham says borrowers with a second mortgage will face additional complexity when refinancing.

"Borrowers can either pay off the second loan or combine the two loans into a larger first mortgage," Cunningham says. "Otherwise, the lender holding that second loan must agree to stay in second position behind the lender of the first mortgage, which the lender may or may not be willing to do."

Note: Article written by Michele Lerner at Bankrate.com

Estate Planning And Real Estate

There are many reasons people don’t plan for the one certainty in life – Death. Some people would rather not think about grim thoughts; others could care less about planning and what happens after they are gone. And many people just rest upon false premises that of course their prized possessions would pass on to their loved ones without doubts.

A judge would disrespectfully disagree with those statements and you may be leaving behind one big mess.

• Martin Luther King Jr

• Howard Hughes

• Jayne Mansfield

• Sonny Bono

• Rita Hayworth

• John Denver

All of the people mentioned above died without leaving a will. The civil rights leader, Dr Martin Luther King Jr died without leaving a will and his estate became the jurisdiction of Georgia. Sure, everyone knew he was married to Coretta Scott King and had four children; however, the widow needed to post a bond in the amount of $20,000 for Dr King’s estate. If Dr King had done some estate planning and prepared a Will, it could have expressly stated that the executor, Mrs. King, need not post any bond.

Probate-avoidance isn’t complicated; you simply create a revocable living trust. The trust document names people you want to inherit each item of property. One significant advantage of a living trust is that you can name alternate beneficiaries – people who will inherit if your first choice does not survive you. You can even name alternatives for each of your alternatives.

You name a trustee, the same as if you were to name an executor to carry out your wishes upon your death. The trustee is in charge of keeping complete control of all the property and transferring to family, friends or whomever you named as the beneficiaries; and it’s handled all at no cost. So in the end, say you left your real estate to your eldest son, James Jr., the trustee can simply sign a deed transferring the property to James Jr.

Living trusts are the most flexible way to avoid probate. If there is a challenge to your living trust, it’s extremely difficult to attack. The person challenging your trusts would have to prove your signature was forged or influenced by someone else because you were incompetent at the time.

Setting up a valid living trust isn’t difficult; many do-it-yourself kits are available and you can get it notarized and witnessed to prove your frame of mind. For real estate purposes, a living trust is a wise strategy to avoid court.

Credit Killers That Ding Your Fico Score

There are a growing number of people who started out with great credit and who are now borderline. But then again, what is borderline? I hear the average FICO score just dropped to 703; then I hear from a mortgage broker you need a 770 to get the best interest rate; it’s really all up to the source, but consumers need to know what will boost your score and what kills your credit.

What makes up your Score?

1. Payment History; have you paid your bills on time and for how long. This accounts for approximately 35 percent of your score. If you have paid one or more of your bills 30 or more days late, your score begins to drop.

2. Amount owed; this accounts for approximately 30 percent of your score. Keep in mind, debt-to-credit ratio on your credit report is determined differently than on a mortgage application. Debt-to-credit ratio for your FICO score is determined by adding up all your outstanding balances divided by available credit.

3. Length of credit history; the amount of time you have held credit accounts for 15 percent of your score. This is not even included in your FICO score if you have had less than 6 months of active credit.

4. New credit. This amounts to 10 percent of your FICO score. Attempts to acquire new credit affect your score.

5. Type of credit you use (credit cards, installment loans, etc.). This accounts for 10 percent of your score.

Those are the 5 factors that make up your FICO credit score and while the financial world knows what makes up your credit score, FICO doesn’t exactly let us know much more. What’s so mysterious is how they use each factor.

It hasn’t been certified, however, it’s said that if you apply for a credit card, never use it and simply close the account that is a negative against your FICO score. Figure that out?

The Credit Killer

High Balances. If you have high balances on your credit cards and loans, your debt-to-credit ratio is going to be high which impacts your FICO score dramatically.

Not enough credit. The biggest myth is thinking you can have one credit card, make payments in full, on time every month and you’ll be rewarded with a outstanding credit score. Wrong! If you have only one credit card you look unimpressive, as if you can’t handle credit.

Length of credit history. Even if you have open accounts, active and paid on time, your credit history must go back 24 months to make a difference.

Closing accounts. When you close accounts, your debt-to-credit ratios take a big ding and this ratio makes up to 30% of your score. The longer each account is open, the better.

Now you know what makes up your score and the weight each item is given. Prioritize your actions and ramp up that FICO score.

Notices of Default in California Decline Sharply

The number of Californians entering foreclosure dropped steeply in the second quarter to the lowest level since 2007, a sign the foreclosure crisis in California is easing as the housing market stabilizes and regulators increase scrutiny of lenders. (Learn more this Wednesday, free, details here.)

Notices of default filed against California homes dropped 17% from the previous quarter and 19.2% from the same period last year, according to San Diego research firm DataQuick (full report here). A total of 56,633 homes received a notice of default, which is the first formal step in the foreclosure process.

“Homeowner distress spreads fastest when home price declines are steepest. And it now appears likely that, barring some new economic shock, the worst of the price declines are behind us,” said John Walsh, Data Quick President.

Note: Article written by Alejandro Lazo of the LA Times

The number of homes taken back by banks also fell in the second quarter. A total of 42,465 homes were repossessed during those three months, a 10.9% decline from a year earlier and a 1.4% drop from the first quarter. On average, California homes took 10 months to wind their way through foreclosure, up from 9.1 months in the previous quarter and the year-earlier period.

Foreclosures have slowed nationally partly because homeowners are challenging them in court and the nation’s biggest banks are negotiating a settlement with regulators over faulty repossession practices. Some experts believe that if a settlement is reached, foreclosures could surge again once banks overhaul their practices and compensate borrowers. But unlike states where the foreclosure system is overseen by the court system, California has seen a steady decline in default notice filings for more than two years with the housing market recovering faster than other hard-hit regions.

The second quarter marked the lowest level of default notices received by California homeowners since the second quarter of 2007. Last quarter’s numbers were also well below the record 133,431 default notices filed in the first quarter of 2009, when home prices were dropping sharply.

Homeowners in more affluent, coastal counties were less likely to enter foreclosure than those in other parts of the state. Mortgages on properties in San Francisco, Marin and San Mateo counties were the least likely to go into default, while those in Kings, Sutter and Yuba counties were the most likely, DataQuick reported.

In one sign that the most beaten-down areas of the state might be getting some relief, the default-notice decline was greatest in the state’s least expensive communities, where foreclosures had been the most prevalent, DataQuick said.

Most loans receiving default notices last quarter were made in 2005 through 2007, the tail end of the bubble, indicating that the most distressed homeowners in the state bought their properties during the run-up in home prices and during the height of the shoddy lending practices that pervaded the mortgage industry.

There has never been a better time to jump into foreclosure investing. Sellers and Banks are super motivated and the wholesale deals have been flying. See for yourself with a few our recent student deals here. You need to get your buying business off the ground now, as it doesn’t get better than this.

San Pedro, Marymount Expand Ties

EDUCATION: Business, global studies classes will add to the university's Sixth Street presence

Building on a partnership that seems to be off to a strong start, Marymount University will expand its footprint in downtown San Pedro this fall.

The first floor of the former Northrop-Grumman facility at 222 W. Sixth St. will be transformed into classroom space and offices to accommodate upper division business majors and students majoring in global studies, according to university spokeswoman Kelly Curtis.

That will be on top of the returning theater arts and music students set to return for classes on Aug. 29 in the Grand Annex in the 400 block of West Sixth Street. Those students also will expand their use in the coming year of the Warner Grand Theatre at 478 W. Sixth St.

But that's not all.

The following year, a two-story vacant storefront at 430 W. Sixth St. - the former Lad 'N' Lassie children's clothing shop - will be turned into art exhibit space, classrooms, research areas and offices.

Cultural arts benefactors Marylyn (Ginsberg) and Chuck Klaus purchased the building for the university in the couple's ongoing effort to support young artists while also bringing the arts and more life into downtown San Pedro.

For Marymount, the satellite location - now called Marymount's waterfront campus - has provided extra space needed after the Rancho Palos Verdes Catholic school expanded to a full four-year institution.

The growing partnership has paid off for everyone, Curtis said.

"We have just a tiny auditorium, so last year when we moved all our film series and theater students (to the 1,500-seat Warner Grand Theatre), we have much more student interest in theater," she said.

"The same with the jazz ensemble which now performs at (San Pedro's) First Thursdays and on a big stage (at the theater)."

The university's speakers series also will make use of the Warner Grand this year, she said, with Father Greg Boyle, the Jesuit priest who founded Homeboy Industries, scheduled to give a talk for students and the community at 7 p.m. Nov. 10.

"We believe (the partnership) is one of the most significant things to happen in downtown San Pedro in many years," said Liz Schindler Johnson of the Grand Vision Foundation.

"We felt that downtown San Pedro already has the flavor of a college town with its narrow, tree-lined streets, quaint stores and lots of artistic activities."

NOTE: Article written by Donna Littlejohn