“The victory of success if half won when one gains the habit of setting goals and achieving them. Even the most tedious chore will become endurable as you parade through each day convinced that every task, no matter how menial or boring, brings you closer to fulfilling your dreams.” – Og Mandino: Author, The Greatest Salesman in the World.

HARP PROGRAM

Investors will be coming out with their guidelines for this program sometime in November and realistically originations could begin as soon as December, most likely January. No one is positive that investors will roll this program out to private mortgage bankers but everyone feels it is immanent as Fannie and Freddie have changes their “reps and warrants” for this program that protects the investors and private mortgage bankers from buy backs.

• You must be current on your mortgage to be eligible. Mortgage must be on time for last six months and have only one late in the last year.
• Borrowers still need to qualify according to conventional standards.
• There are no LTV restrictions and investors may allow an AVM instead of a full appraisal (this is yet known if investors will overlay this)
• Borrowers do not have to refinance with their current servicer.
• If your loan does not currently have MI, you will not have to add MI.
• No cash out
• You can refinance 2nd homes and investment property under some circumstances
• You can roll closing costs into the loan
• Seconds: must agree to subordinate; cannot be part of the first
• Program will end in January of 2014

Web sites to find out if a loan is serviced by Fannie or Freddie:

http://www.FannieMae.com/loanlookup or call 800-7Fannie

http://ww3.FreddieMac.com/coporate or call 800-Freddie

IS YOUR HOME WINTER-PROOF?

Don’t let your home get the winter blues. As the cold weather approaches, home owners can do the following maintenance checks to ensure their properties are ready for the winter months. The real estate Web site Zillow offers some of the following tips:

Check the weather stripping along your door and door frame to ensure there are no gaps that can let cold air seep into your home. Also, you may want to add weather stripping or caulk to your windows to prevent any drafts and wasting energy.

Sweep out those chimneys. The National Fire Protection Association advises home owners to sweep out the chimney at least once a year to help prevent house fires.

Service those furnaces at least once a year too. It’ll cost about $100 and can help avoid costly repairs later or a malfunction of carbon monoxide pumping into the home, which can be deadly.

Prevent frozen pipes, such as by using heating tape to wrap any exposed pipes on the home’s exterior and turning off the water as well as draining any water remaining inside the valves.

IS THE NEW-HOME MARKET FINALLY LEVELING OFF?

The nation’s largest home builders are reporting that buyer traffic is picking up, sales are increasing, and prices are stabilizing, a recent Wall Street Journal article notes.

This week, the Commerce Department reported that for the first time in five months new-home sales rose, increasing 5.7 percent in September. Builder confidence also rose, reaching its highest level in a year in October, according to an index of builder sentiment by the National Association of Home Builders.

Falling home prices and low mortgage rates are drawing out buyers, some builders report. And builders say they are trimming some of the big losses that have plagued them since the housing bubble burst, but they note, they still have a long way to go in climbing out of one of the worst years on record for new-home sales.

PulteGroup Inc., the second largest builder in the country, reported an 8 percent increase in revenue to $1.14 billion in the most recent quarter. The company also reported narrower losses in the most recent quarter: $139.3 million in losses this quarter compared to $995.1 million a year earlier, The Wall Street Journal notes.

Ryland Group Inc. also narrowed its losses: $21.3 million from $29.9 million the year prior. Its revenue also increased, rising 23 percent to $249 million, and its closings also rose 20 percent and orders climbed 30 percent.

“Hopefully, this is an indication that we reached a baseline of demand for new homes in this country and that better days are ahead,” Larry Nicholson, Ryland’s chief executive, said in a conference call with investors.

SURVEY REVEALS 5 HOME BUYING MYTHS

Overall, today’s home buyers tend to be fairly knowledgeable about the real estate market, but there are still a few points of confusion in the process, a new survey by Zillow of 1,000 potential home buyers finds.

Here are the five main areas of confusion the survey revealed:

• Appreciation: About 42 percent of home buyers believe home values will appreciate by 7 percent a year. Reality: Historically, home values in a normal market appreciate by 2 to 5 percent in a year.
• Mortgage insurance: 41 percent of buyers think they will have to purchase private mortgage insurance, regardless of the amount of their downpayment. Reality: Buyers only need to purchase PMI if their downpayment is less than 20 percent of the home’s purchase price.
• Appraisals: 56 percent of the buyers said the purpose of the appraisal was to determine if a home was in good condition. Reality: That’s the purpose of a home inspection; an appraisal estimates fair market value.
• Home owner’s insurance: 37 percent of home buyers said that buying home owner’s insurance is optional. Reality: Lenders require homebuyers to purchase homeowner’s insurance.
• Ownership: 47 percent of home buyers said a prospective buyer owns a home after the purchase contract is signed. Reality: The purchase and sales agreement is the beginning of the closing phase, but it can be a long process until they finally take ownership.

FORECLOSURE SLOWDOWN STABILIZES REAL ESTATE VALUES

Home values were down on a yearly basis in August, but showed relative stability in the near term, according to indices that track home values nationwide.

Home values fell 4.5 percent year over year in August, to $172,600, and remained essentially flat compared to July, according to the Zillow Home Value Index, released today. CoreLogic’s Home Price Index showed a similar drop year over year, down 4.4 percent, with month-to-month prices also remaining virtually flat.

Overall, prices have dropped 30.5 percent since an April 2006 peak, according to CoreLogic. When distressed sales (bank-owned homes and short sales) are excluded, the drop from peak stood at 21 percent in August.

Zillow’s index report showed a somewhat similar drop from a June 2006 peak: 28.3 percent. That index tracks 157 metropolitan areas nationwide. Of the 25 largest metros tracked, all saw their index values remain virtually the same on a monthly basis.

On a yearly basis, Sacramento, Calif., saw the biggest drop (-11.3 percent), followed by Minneapolis-St. Paul, Minn. (-10.7 percent) and Atlanta (-10 percent).

Only Pittsburgh experienced year-over-year value appreciation: 2.8 percent. That metro continues to be the only one among the top 25 to have seen its index value remain essentially flat from peak, falling only 0.8 percent.

Miami-Fort Lauderdale, Fla., and Orlando, Fla., have seen the biggest drops from peak, each down 54.5 percent.

The rate at which homes were foreclosed in August was 9.2 out of every 10,000 homes, a decline from 10.9 of every 10,000 homes in October 2010, before investigations into documentation irregularities lengthened foreclosure timelines. Foreclosure resales stood at 19.5 percent of overall sales.

“Due to the robo-signing controversy, the pace of foreclosure liquidations has been slower than it would be otherwise, which is impacting home-value trends positively. Eventually the pace will pick up again, putting more bank-owned homes into local markets and putting additional downward pressure on prices,” said Stan Humphries, Zillow’s chief economist, in a statement.

“We remain encouraged about the organic stabilization in home values that we have been seeing absent the federal homebuyer tax credits, but we remain concerned about the impact that recent economic turmoil and continued weak economic indicators will have on future home sales and home-value trends.

“At this point, we maintain the expectation that a definitive bottom will not occur until 2012 at the earliest.”

According to CoreLogic’s price index, home prices fell a slight 0.7 percent year-over-year in August when distressed sales are excluded.

“The continued bright spot is the nondistressed segment of the market, which is only marginally lower than a year ago and continues to exhibit relative strength,” said Mark Fleming, CoreLogic’s chief economist, in a statement.

In September, home prices remained little changed, either from August or over a three-month period starting in July, according to a report from Altos Research.

Altos’ 10-city national composite dipped 0.6 percent in September from August and 1.3 percent from July, to $444,045. Salt Lake City posted the largest price change from August, an increase of 1.7 percent.

Unsold inventory in the 10-city composite fell in every market, declining 1.9 percent overall from August and 2.3 percent from July. Tampa, Fla., posted the biggest decrease from August: 9.9 percent.

“The mass liquidation of foreclosure portfolios is best described as a trickle. The inventory is coming on the market slowly as more loans are modified to keep homeowners in their homes. Although the millions of properties in the shadow inventory are still looming, there is nothing that indicates a flood of foreclosures hitting the market anytime soon,” the report said.