TEAM EMPOWERMENT MORTGAGE CHATTER: March 15; News & Headlines; Dim Homebuilder Outlook Improves Slightly; Digitizing Business Cards; Be A Real Estate Strategist for Your Clients; HARP extended on Year; Top 10 Reasons to Buy; Rent vs. Own

Make sure to eat healthy, and get your daily serving of fruits and vegetables!  Fight the colds, or work to keep them away. 


“Love is what we are born with. Fear is what we have learned here. The spiritual journey is the unlearning of fear and the acceptance of love back into our hearts.” — Marianne Williamson: Spiritual author and speaker


From an economic perspective, world stock markets are hitting 2 1/2 month lows today, and Treasury yields have dropped due to the devastation. Contrary to what some Wall Street analysts believe, one reader wrote, “What happened in Japan is a complete human and economic disaster, not an opportunity for economic growth. Rebuilding projects after a natural disaster are not stimulative whatsoever – the immediate economic effect of the quake/tsunami was that tons of capital and material wealth/assets were destroyed instantly (not to mention all the lives lost). Rebuilding the infrastructure returns that area to where they were before the quake/tsunami. That doesn’t equal growth in an economic sense – you have to distinguish between the seen (so-called job creation of the quake/tsunami) and the unseen (economic growth potential of that same labor and capital had there been no quake/tsunami). If one quake/tsunami is ‘supportive to economic growth’, wouldn’t that mean that 10 quake/tsunami’s would be phenomenal for economic growth? That makes no sense whatsoever.” The earthquake in Japan is no laughing matter. Just as Aflac – it fired comedian Gilbert Gottfried as the voice of its duck after a series of Twitter jokes about the earthquake in Japan, Aflac’s most important market.

The MERS saga continues. We’re continuing to see various rulings by various states on MERS’ ability to actually assign and foreclose on mortgages. Most recently it was the Supreme Court of the State of New York, which ruled in favor of Mortgage Electronic Registration Systems. The ruling judge wrote, “Plaintiff has shown that the assignment of the mortgage was not made retroactively…Although the assignment refers only to an assignment of the mortgage, physical delivery of the note is sufficient to transfer the obligation, and plaintiff has established that the note was delivered to it prior to the commencement of this action.”

Data improvements continue to be made. For example, the GSEs are focusing their efforts on providing resources to assist lenders and the appraisers they work with to prepare to implement the UAD (Uniform Appraisal Dataset). Any lender interested can visit Fannie’s and Freddie’s websites to glean more information than I can repeat here, which is recommended since it is the “wave of the Future: FannieUAD and FreddieUAD.

For the markets, MBS prices ended Monday nearly .250 better in price, while the 10-yr Treasury improved by about .375 and closed out at roughly 3.35%. Pushing bond and equity markets are, of course, the disaster in Japan, unrest in the Middle East-North Africa area, and European sovereign risk issues – all helping move money into US Treasuries. Believe it or not, one mortgage trader mentioned, “While supply has been limited, there are concerns that it will pick up some with the recent decline in mortgage rates.”

Today we have had Import Prices (+1.4%) and Export Prices (also +1.4%) and the Empire State Manufacturing data (stronger than expected at “17.5” versus February’s “15.4”). We also have the start of another FOMC meeting, but no change to rates is expected. Keep in mind that these monthly economic numbers really pale in comparison to the monumental events overseas. We are now at the low yields of the year, with the 10-yr down to 3.25% and MBS prices are better by .5.


Homebuilders’ pessimistic outlook improved slightly this month, but it remains dim amid falling home prices and a weak pace of construction.

The National Association of Home Builders said Tuesday that its index of industry sentiment for March improved slightly to 17. That’s the first gain in five months, after four straight readings of 16. Any reading below 50 indicates negative sentiment about the market. The index hasn’t been above that level since April 2006.

Last year was the worst in more than a decade for sales of previously owned homes and the worst for new-home sales in nearly a half-century.

Fewer homes mean fewer jobs. Each new home built creates, on average, the equivalent of three jobs for a year and generates about $90,000 in taxes, according to the builders’ trade group.

High unemployment, tighter bank lending standards and uncertainty about home prices has also kept many people from buying homes, despite low mortgage rates and home prices that have fallen by more than half in some markets since the peak of the housing boom. The industry received a boost in the first half of 2010 when the government offered tax credits to home-buyers. Once they expired in April, home sales plummeted.

Economists say home prices will hit bottom this year before a modest recovery takes hold. Large swaths of the hardest hit states, including Arizona, California, Florida and Nevada, continue to struggle with foreclosures and short sales, when a lender allows a borrower to sell their property for less than what is owed.

Still, the March reading is the highest for the builder index since last May, when it reached 22. The spring season is traditionally the best for home sales.

Regionally, the Northeast saw a one-point decline to 20 and the Midwest was steady at 12. The South jumped from 18 to 20 and industry sentiment in the West rose from 13 to 17.


Despite the promise of a paperless universe run entirely on mobile phones and laptops and tablets, the humble business card is still with us. When we’re out in the real world, the fastest way to reliably get our contact information to another human being is to hand them a piece of paper with our info printed on it. Business cards don’t crash or require an upgrade, or autocorrect our names into gobbledygook.

The challenge then becomes making use of the information we gather by way of business cards. The proverbial shoebox full of business cards that gets ever more full. The stack of cards from the last conference. The loose card you picked up by chance after a short conversation at a coffee shop.

Cardmunch is an iPhone app (a BlackBerry app is coming soon, according to the company’s site). It uses the phone’s camera to take a picture of the business card. That image is then uploaded to the Cardmunch server, where actual human beings transcribe the information.

Finally, the card data is downloaded back to your phone along with the image of the business card itself.

Most other card readers try to use machine recognition to figure out what’s written on the business card. If you’ve used any of these you know that you may spend as much time correcting the results as you would’ve spent just typing the data into your contact manager in the first place. Using human beings gives far better results, and Cardmunch does that.

Once the card data is in your phone in the Cardmunch app, you can import it into your contacts if you’d like. From the Cardmunch website you can export your list of “Cardmunched” contacts as CSV or VCF formats.

Another handy trick with Cardmunch is that you can immediately send a LinkedIn request (LinkedIn recently bought Cardmunch) and a follow-up e-mail. So all that post-conference follow-up can happen much more quickly and painlessly.


Today’s marketplace demands more than the basic requirements from Realtors. It requires investigation when you meet with a new buyer. It requires strategic thinking.

Many buyers are well educated when they enter home-sale transactions. They know what properties are selling for, what is active, what’s under contract, what the numbers mean, and how to analyze the market. They know what is happening today.

As real estate professionals, your market knowledge of yesterday has to be from a “shifts and trends” standpoint. More important to your long-term strategy, though, is your outlook for tomorrow. I do not mean speculation — you need to know about your clients’ future plans.

Too often we limit our client discussions to the deals: where things stand, how to put a deal together, and how to close the deal. Getting this far usually takes nuance. Getting beyond it takes an equal effort, if not more.

What about tomorrow? When do your clients plan to sell? I know, they just started looking. But likely they know when they plan to sell because they’ve talked about it. If they haven’t talked, it’s your role to begin the discussion.

Ask your clients about their goals for the next two to five years. If your buyer is single, and has a significant other, do they plan to move in together? If your buyers are recently married, do they plan to have kids? Do they see potential for a job promotion or starting their own business? Have they put their goals in writing?

Determine if your clients see today’s purchase as an investment or just a place to hang their hats. Where do they see the market going in the next three years, and what part of the country would they like to live in if their careers offer the opportunity to move?

If you know they are planning to start their own business, eventually the new home’s office will be too small and they will need additional bricks and mortar.

If they would love to have a second home in Colorado but it’s just a dream, assume your charge as their housing strategist, help them to create a second-home plan, and work the referral.

Talking with clients about tomorrow will give you a holistic understanding of their housing needs. Build a long-term strategy and then work to that plan. In your clients’ minds, you are now a part of their housing future and their lives. You’ve gone beyond where a newsletter or a market snapshot can take you.

We aim to be trusted advisers. Let’s raise the level of discussion with our clients and build trust together.


The Obama administration has given another year of life to an foreclosure prevention program allowing certain borrowers to refinance underwater mortgages owned or guaranteed by Freddie Mac and Fannie Mae.

The Home Affordable Refinance Program had been set to expire June 30. HARP, as it’s known, will now continue through June 2012.

With 30-year fixed-rate mortgages below 5%, the level they have inhabited much of the past two years, that may provide an attractive option for some homeowners.

One catch is that they can’t be too underwater — their Fannie Mae or Freddie Mac mortgages can be no larger than 125% of the value of their homes. They also must be current on their loan payments.

When HARP was announced in March 2009, the intent was to provide up to 5 million replacement loans to homeowners on more favorable terms.

That proved unattainable, as did the goal of the sister plan known as Home Affordable Modification Program. HAMP, as it’s called, initially aimed at modifying the terms of existing loans to help up to 4 million homeowners avert foreclosure.

While far off the ambitious early marks, Fannie Mae and Freddie Mac had provided 621,803 refinance loans under HARP as of Dec. 31, 2010, compared to 579,650 permanent modifications provided by HAMP.

The HARP program initially was designed to handle loans amounting to 80% to 105% of the value of the home. But as property values plunged, putting millions of homeowners further underwater on their mortgages, the loan-to-value ratio was increased to 125%.

In addition to extending the program for a year, Freddie Mac will exempt HARP loans from certain recently announced increased fees, according to Fannie Mae and Freddie Mac’s overseer, the Federal Housing Finance Agency.

The FHFA also said that Fannie Mae is changing its previous eligibility cutoff of Jan. 1, 2009, to May 31, 2009, meaning another five months of loans may be considered for a HARP refinance.

Additional information on the refi program is available in FHFA’s Fourth Quarter 2010 Foreclosure Prevention & Refinance Report, and at .

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