TEAM EMPOWERMENT MORTGAGE: August 4; Mortgage Rates Plunge, Historic Lows!; 5 Quick Tips for August 2011; Top Priorities of 1st Time Home buyers; Big Changes Coming For Appraisals; Thank God I Didn’t Buy Gold at $400 an Ounce!

“What you can do or dream you can do, begin it; boldness has genius, power, and magic in it” 

-Johann von Goethe: Was a German poet, novelist, and dramatist


REALTORS, this is a great opportunity for you to check-in with your clientele going back 2 years. Rates are at a historic low! Even if your client thinks they’re at the lowest rate possible, tell them to contact me just for 5 minutes of their time to make sure they are. They can likely save money on their monthly mortgage payment!

Zackry Cooper: 925-295-9350

NEW YORK (CNNMoney) — As Congress and President Obama hammered outa debt deal over the past week, mortgage rates plunged — hitting new lows in some instances.

The 30-year fixed rate, usually the most popular choice for homebuyers, fell to 4.45% from 4.57% last week — its lowest point since last November, according to the Mortgage Bankers Association.

Meanwhile, the rate on the less popular 15-year fixed plunged to a new record low of 3.52%, down from 3.67% a week earlier.

The up-front points lenders charged dropped as well, to 0.78 from 1.14 for 20%-down loans, according to the industry group.A homebuyer financing a $200,000 mortgage could save $14 a month and pay $720 less at closing based on the current points.

The rock-bottom interest rates drove up total mortgage applications — both for purchases and refinancings — by about 7%, compared with a week earlier, said Michael Fratantoni, the Mortgage Bankers Association’s vice president of research and economics. While the increase may seem substantial, he noted that applications are still well below last year’s level.

“Refinance application volume increased, but even though 30-year mortgage rates are back below 4.5 percent, the refinance index is still almost 30 percent below last year’s level. Factors such as negative equity and a weak job market continue to constrain borrowers,” he said.

Responsible homeowners left out in the cold

On Wednesday, a 30-year fixed was available that carried an annual percentage rate of just 4.03%. The overnight average was 4.37%, the site reported.

Mortgage rates are following bond yields lower, explained Greg McBride, Bankrate’s chief economist. The yield on 10-year Treasury notes hit 2.6% on Wednesday down from 3.03% the last week of July.

“The plunge in Treasury yields is because we’ve been hit with a string of poor economic readings,” said McBride.

Those include a weak GDP report and slowdowns in manufacturing, consumer spending and hiring.

Job killing companies

With rates so low and home prices down more than 30% from peak, there has probably never been a more affordable time to buy a home.

For some buyers though, “Time is of the essence.,” said McBride. “The loan limits (for Fannie/Freddie mortgages) drop on October 1 so acting now for closing by Sept. 30 is important for buyers in the upper price levels.”


1. Price it Right From the Start

It is crucially important that we try our best to price our listings correctly right out of the gate. We know it is difficult in today’s volatile market to place the correct price on any property. However, the consequences to the seller if we don’t do this can be severe for two reasons. First, in a market where prices continue to decline, any additional time taken to sell the home only means a lower selling price. The other reason: research has shown that properties that have experienced price adjustments wind up taking longer to sell and sell for less money no matter what the current market conditions are.

2. Window of Opportunity

While the banks are trying to correct and substantiate their foreclosure paperwork, large inventories of distressed properties coming to market have been delayed. That gives our current listing inventory a ‘window of opportunity’ to sell before the additional downward pressure of these distressed properties is felt.

3. Conforming Loan Limits

It will take an act of Congress to keep loan limits from falling on government backed jumbo loans in many of the higher priced regions in the country this October. This will result in consumers paying as much as ½ to ¾ of a point more on the rate of their 30 year mortgage.

4. August is a Great Time for Education

The two best months for real estate professionals to take education are August and December. These months rank 11th and 12th in regard to transaction counts in most markets. That means that the time invested in taking a class in either of these months is less expensive when factoring in possible lost business. You may decide to take a single class, take classes toward a designation or increase a skill set such as photography or enhancing your social media presence. August is a great time for investing time to make yourself more proficient in a certain aspect of real estate.

5. Remember, it’s up to YOU

Let’s keep it simple. Your success is determined by one and only one thing: your commitment to it. Don’t just want success – BE COMMITTED TO IT!



First-time home buyers make up a big chunk of home buyers. So what are their top priorities when shopping for a home? recently featured “must-haves” for first-time home buyers. Here are a few top priorities:

Affordable price. “Unlike a trade-up buyer, they don’t have any equity to roll into the purchase of their next home, so coming up with a down payment and the financial aspects of buying a home is the first concern,” says Paul Bishop, vice president of research for the National Association of REALTORS®. Fortunately, home affordability is at one of its highest in years and a large inventory of homes on the market provides plenty of options, which is helping first-time buyers find a good home at a great price.

Room to grow. Ken Shuman, spokesman, says that first-time home buyers often find its smart to search for a first home that not only accommodates their needs now but one that can accommodate them in 10 years, too. Space to accommodate growing families will likely be a higher priority than upgrades, such as granite countertops, Shuman says.

Turnkey. Surveys have recently shown first-time home buyers showing a preference for homes that are in move-in condition and in stable neighborhoods, rather than fixer uppers in depressed neighborhoods. In evaluating whether a home has been well-maintained, MacDonald suggests watching for such things as rotten trim on the exterior, dirty air-return ducts or a dirty filter in the HVAC system, or a damaged roof or gutters.


RPM owns and operates its appraisal services, it’s known as ASI (Appraisal Services, Inc.). Many changes have occurred in the appraisal industry over the last two years with even more to come.



Starting September 1, the way appraisers report their findings and the way they deliver a report will change. UAD stands for Uniform Appraisal Dataset which is the first part in a series of changes for how the overall loan is delivered to the GSE’s. They are doing this to make the appraisals more standardized as to what an appraiser might consider good condition in Texas is vastly different than what an appraiser in Connecticut might think. There are a total of 72 additions to the form with 60 being mandatory and 12 being optional. Phrases like neutral, beneficial and adverse will become standard. Very Good, Good and Average will be replaced in condition and quality fields with a 1 through 6 rating with 1 being exceptional and 6 being horrible. ASI has completed courses, seminars and webinars to help educate the appraisers on these changes, assist the underwriters, and to answer your questions when you see the new forms. Appraisals will also have to be delivered in both a PDF and XML format.

Some of the important changes are:

1) FHA and VA are also using the UAD reports but not the delivery method

2) Appraisals MUST be sent to the GSE’s before the loan for conventional and jumbo loans (Not FHA or VA)

3) If the lender orders a field review that review is sent with the loan and not the original appraisal

4) If an appraisal is sent to the GSE’s in the new format incorrectly it will be kicked out and deemed unacceptable

5) GSE’s wont accept a C5 or a C6 rating for condition

6) Any C6 issue makes the whole property a C6 rating unless subject to repair

Make no mistake these are major changes in the appraisal world in both reporting and technology. As a Realtor who uses Zackry Cooper you will have a huge advantage over your competition because we are working on ways to streamline it, and guarantee the reports acceptance into the GSE system.

Here is a link to a webinar if you would like to familiarize yourself with the changes. Click Here


We hope that headline grabbed you. The reason we used it was to bring some perspective to the debate as to whether or not homeownership is a wise investment in today’s troubled market. A family should never look at the purchase of a home simply as a financial investment. It is so much more than that. But, even if we look at it as only an investment, we must look at it in the long term. Let’s use gold as an example.

Gold had dropped from over $400 an ounce to $250 an ounce (a 40% decline) from February 1996 to August 1999. People were so glad they hadn’t bought at $400 an ounce.

Lord William Rees-Mogg, the current Chairman of The Zurich Club, in 1997 said:

“No investment has been so thoroughly exploded as gold; most people think that there will no more be another gold boom than there will be another boom in tulip futures in The Netherlands.”

Everyone knows what happened next. The proclamation of gold’s death was rather premature. Gold rose from $250 an ounce to over $1,500 an ounce in the next twelve years.

If we look at real estate in the long term, we can see that it has been a great vehicle for building family wealth. The Federal Reserve’s Survey of Consumer Finances, conducted once every three years, provides a snapshot of family income and net worth. Their survey has shown every time that homeowners’ net worth far exceeds that of renters. Here is the breakdown of the last several surveys:

1998 – Homeowner net worth exceed renters by 31x

2001 – Homeowner net worth exceed renters by 36x

2004 – Homeowner net worth exceed renters by 41x

2007 – Homeowner net worth exceed renters by 46x

The 2010 survey is not out yet but the National Association of Realtors’ has estimated that number to be approximately 41x in 2010. You may be thinking this is no longer the case based on the current fall in home values which have dropped back to 2000 – 2002 prices.

Harvard University just completed a study that showed:

“Even if homeowner wealth fell back to 1995 levels, it would still be 27.5 times the median for renters.”

Bottom Line

We are not predicting that real estate will see the same levels of appreciation that gold did. However, we do believe that the real estate market will rebound strongly.

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