Mortgage and Real Estate Blog

There are some great motivational speakers out there and then there are motivational speakers that are just plain exhilarating. But what do motivational speaking and real estate have in common?

Well, not much really. But some of the best motivational speakers were successful in real estate before they became motivational speakers. And, in fact, some of the same success traits that motivational speakers teach can be applied to real estate success.

If you want to see what I mean, just read a few of the articles at Real Estate Information. See it for yourself.

How many reasons do you need? Anita van Wyk shares 7 reasons you should be using the World Wide Web to leverage your local real estate business. OK, so the article isn’t specific to real estate. It does, however, apply to real estate businesses.

To see what Anita has to say about using the Internet to give your real estate business better opportunities, visit Realty and Real Estate Information and get the full scoop.

Let’s say that you’ve been thinking about selling your home. One of the things that you’re likely to do is to look around your community so that you can gauge how many other homes are available - something that is ultimately going to have a lot to do with the economy.

Or, if you’re planning to buy a home rather than thinking about selling, one of the things that you’ll want to take a look at is the way that the economy impacts your situation. You will be able to do this by taking a closer look at the way lenders are considering credit scores before approving a mortgage, the cost of homes that are on the market (and the number of foreclosure signs that you see in a given area) and you’re going to want to look at the interest rates associated with mortgage loans during a given period of time.

Each of these factors of the economy is going to have an impact on the housing market (just as each of those factors within the housing market will have an impact on the overall economy). Because the economy impacts the housing market, it’s important to make sure that you have the basics down - and an understanding that’s focused on homes in your area.

The more that you’re able to do to look at the economy and the housing market in your area the more that you’ll understand what you’re up against (the best example of this may involve the real estate market in Southern California where some homes listed just weren’t selling as the median home price dropped from close to a million dollars to less than a quarter of that amount). After all, it’s not just your personal economic situation that matters - the community around you will ultimately have an impact too. By studying the economy some, you’ll be able to better determine whether or not you should be buying or selling a home.

A few years ago when mortgages were available to everyone who walked into a broker’s office, those who were interested in buying a home didn’t think twice about whether or not they could really afford the purchase. This - combined with housing prices that inflated far too dramatically - contributed to today’s economy.

What you’ll find is that, now, in the economy that we have to work with, more and more people are thinking about economic issues and whether or not buying a home is really a good idea. Additionally, because there are some tighter lending standards and the news reports that it’s harder to get a mortgage, there are a lot of people who aren’t really considering buying right now.

One of the things that is the most interesting about that, however, is the fact that home prices are really affordable right now. Properties that a year ago sold for well over $200,000 are now selling for less than $150,000 - more expensive homes are also selling for less than they would have a year ago at this time. In other words, there are a lot of great ways to save when you buy a home in the current economic times - especially once you factor in that mortgage interest rates are lower than they’ve been in a long while. As a result, you’re going to be able to discover long term savings as well.

Ultimately, you are going to want to consider your own financial situation. You’re going to want to think about your credit rating and your savings. However, what you’re likely to find is that if you’re in a position to buy, you shouldn’t let the economy stop you.

If you are thinking about buying a home, one of the first things that you are going to need to do involves looking at the economy. Simply put, even if your credit is impeccable, even if you know that you will be living in a given area for the long term and you have the savings that you need for a down payment, it’s important to take a look beyond yourself.

After all, you just might find that there are a number of ways in which looking at the economy can help you. Simply put, it’s by looking at the economy that you will be able to gauge whether or not the home that you are thinking about buying is set at the right price. The way that the economy factors in in some communities near Washington, DC, for example, you’ll find that there are home prices that have dropped more than 40% - and that nearby communities have homes that have dropped 25-35%. When you’re looking into buying a home, therefore, you’re going to want to have a sense of how much of an affect the economy has had.

Similarly, if you are looking for homes that are not in an area where there has been a dramatic economic impact, you will be able to look at the information to get a sense of how home values might be affected. In other words, before you buy, you will have the opportunity to see whether or not the value of a home is likely to drop.

By taking the time to think these things through before buying a home - by looking at the economy - you’re going to find yourself in a position in which you know more about what you’re getting yourself into. It’s as simple as that.

When you are thinking about buying a home of your own, there are going to be a number of things to think about. While a lot of those items are going to rely on your own situation - whether or not you’ve been saving for a down payment, how stable your job is, what the real estate market looks like in your area. However, it’s impossible - especially these days when even Warren Buffet is talking about losing large amounts of money - not to consider the economy before making the choice to buy.

In other words, you’re going to want to ask a few questions about the economy:

• Will I be able to get approved for a mortgage given that the banks just don’t seem to be lending?
• What can I do to improve my chances of getting a mortgage?
• How quickly with the value of a home depreciate and should I be worrying about it not coming back?
• Is it a smart time to invest in real estate especially since it seems that the stock market is a less than reliable option for growing my money right now?
• How much worse will the economy get before it gets better?

Ultimately, there may not be clear answers to those questions. Everyone’s situation is different as is every real estate market. When you look into buying a home and look into the economy, be sure that you are asking questions, exploring your options and thinking about more than just a narrow focus: make sure that you’re looking at the big picture.

On many levels, when people are thinking about the economy and about the housing market, the talk is focused on the plan that the president has mentioned with the intention of keeping those homeowners who are facing foreclosure in their homes. However, the reality is that the crisis doesn’t just affect small families who are starting out and trying to launch a life based on the American dream. In some cases, even those who are well off are finding themselves challenged by the times.

Today, news was released that Annie Leibovitz has temporarily sold the rights to nearly all of her work in order to pay down the mortgages associated with her homes. While the amount of debt that the photographer has is undisclosed, the simple reality is that in order to pay her debt, Leibovitz whose images are perhaps even more well known than her name borrowed over 15 million dollars.

It’s unlikely that the average person is in that much trouble when the time comes to the amount that they owe in order to keep their homes. It’s also fair to say that Leibovitz likely had additional options rather than giving up the rights of her art. But, when you are looking at the economy and the housing market, you’re going to find that the risk of losing everything is just as real (if not more real because you have less to leverage). In other words, the economy has had a dramatic impact on housing and other markets; the most important thing that you can do is going to be to stay on top of where you are.

Today was the day that the President went out and started to talk about the importance of stopping the foreclosure crisis. If you listen to all of the news stories, then one of the things that you are going to want to consider is that fact that there isn’t a carved in stone answer (and the president and everyone else are saying the same thing). Yes, there is an effort to focus on helping those homeowners who are not able to make their mortgage payments because of lost income, but that is not the only focus.

Similarly, the housing plan is focused on making an effort to help those who are underwater in their mortgages ride out a tough economy by helping to reduce the overall amount that they owe. There are a number of ideas written into the plan that also focus on making sure that those who knowingly borrowed more than they could afford to repay do not benefit from the plan. Of course, that may prove to be a lot easier said than done.

If you are looking into staying in your home and fighting foreclosure, you’re going to want to make sure that you keep an eye on the news to see what continues to develop over the next days and weeks. The more that you are able to learn about what’s going on and the more that you understand your own situation, the better the overall position that you will find yourself in - you may even find that you are able to stay in your home and have far more affordable payments.

There is a lot of talk about the economic stimulus package that was officially signed into law earlier today. Whether you were for it or against it, now that it’s in effect, it’s time to start taking a closer look at how it’s going to impact things that are important to you. If you’re looking into buying a home or have another interest in real estate, one of the things that will be interesting to you is going to be how the real estate industry is going to be affected by the changes to the economy.

The economic stimulus has four points that address the real estate market:

1. The home improvement tax credit will be extended for those who are looking at what they can do to make their homes more energy efficient - which, of course, will also help to lower your overall energy costs.
2. The first time home buyer tax credit will be increased for those who buy their first homes during the 2009 calendar year.
3. Those who are eligible to take out a reverse mortgage to supplement their incomes will be able to borrow more against the value of their homes.
4. In high cost real estate areas, the FHA and conforming loan limit amounts will be raised - allowing buyers to borrow more to get into a home.

In other words, if you are looking into buying a home or you are looking into making improvements to the home that you have, you’re going to find that there are some benefits included in the economic stimulus package.

If Ben Bernanke is to be believed, the economy is headed for some dramatic improvements - many of which are in regard to the credit crunch. The Fed Chairman is saying that, thanks to the money that’s been infused back into the system, lending restrictions are going to ease:

(source) Bernanke said Tuesday the vast array of special central bank programs appear to have helped ease a credit crunch that has been choking economic activity.

Appearing before the House of Representatives Committee on Financial Services, Bernanke said that measuring the impact of the Fed’s programs “is complicated by the fact that multiple factors affect market conditions.”

“Nevertheless, we have been encouraged by the responses to these programs, including the reports and evaluations offered by market participants and analysts,” he stated.

If what he is saying is true, this represents a positive change for the real estate market - it indicates that getting a mortgage ought to be easier for those who are thinking about buying homes of their own. However, it’s hard to know whether or not his opinion is to be trusted. At least one economic blogger wonders whether Bernanke is simply delusional or if he knows that he’s spreading information that isn’t exactly accurate and I tend to share her opinion. If the economy were truly showing signs of improvement, would we really have see so much coverage about the necessity of passing the economic stimulus package? I doubt it.

Yes, the economy is looking pretty bleak right now - some people will tell you that it’s going to get better, others are suggesting that it’s bound to get worse first.