Category Archives: Real Estate

Online Mortgage Shopping Made Easier

February 11, 2011 jd

The vast amount of information available online about mortgages – such as interest rates, loan benchmarks, prepayment penalties, and the like – can cause home buyers to feel confused and overwhelmed when shopping for a mortgage. Most surprisingly, a recent survey found that only 61 percent of homeowners surveyed said they comparison shopped for a mortgage, and 39 percent said they took out a home loan based on just one quote.

MAKING SENSE OF THE STORY

Resulting from consumer feedback about lending Web sites being unhelpful or difficult to navigate, some of the nation’s leading mortgage sites have responded by working to become more consumer-friendly. The revamped sites allow borrowers to not only browse lender rates and terms, but also learn about market trends and read comments from other loan shoppers.
One of the challenges borrowers have, according to Keith T. Gumbinger, the vice president of HSH Association, is that while there is plenty of mortgage information available, consumers often have difficulty understanding the technical aspects of a mortgage, such as when an adjustable rate mortgage actually adjusts, and when a prepayment penalty applies.
One site, LendingTree, allows consumers to browse quotes from various lenders, read an array of industry articles, use research tools and calculators, and peruse consumer-generated ratings and reviews of lenders. In December, the company created an online feature in which borrowers can post a mortgage-related question to be answered by a LendingTree loan specialist.
Online direct lender, Quicken Loans, offers an expanding number of customer-written reviews on buying and refinancing. Beginning in March, consumers can download Quicken Loan’s iPhone app and track when appraisals come in, closing dates are set, and when other time-sensitive hurdles in the home-buying process are reached.
Some major lenders also are making changes, including Bank of America, which offers articles and tools specifically for first-time buyers, and another set for more experienced borrowers.
Of course, borrowers also can forgo the online aspect of mortgage shopping, and instead work with an experienced mortgage broker who can help guide the buyer through the process, including locking in the best rates available for their situation.

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For all your real estate needs Call

John J. O’Dell
Real Estate Broker
(530) 263-1091

DRE# 00669941

Real Estate

5 Unexpected Foreclosure Hotspots

February 6, 2011 jd

One of the lakes in Grouse Ridge, Nevada County, CA

While Las Vegas boasts the worst foreclosure rate in the country, several other cities are creeping up with the fastest growing rates of foreclosures — and they’re in some unexpected places.

These cities mostly have one thing in common: They’re all battling a growing number of job losses among their residents that are leading more home owners to default on their mortgages.

Here are five cities with some of the fastest-growing foreclosure rates in the country:

1. Spartanburg, S.C.
Foreclosure rate: 1 in 60 homes

This city in upstate South Carolina faced a 228 percent increase in foreclosure filings in 2010 — making it the nation’s fastest-growing foreclosure rate. In 2009, the city’s unemployment rate hit 12.7 percent in 2009, dropping to 10.9 percent in 2010, yet still well above the national average.

2. Albuquerque, N.M.
Foreclosure rate: 1 in 46 homes

Albuquerque had a 60 percent increase in foreclosures in 2010. This city has had one of the fastest-growing metro areas over the past decade, attracting young professionals and retirees, but its economy was hard hit by the recession.

3. Myrtle Beach, S.C.
Foreclosure rate: 2.25 percent

Myrtle Beach had a 44 percent increase in foreclosures in 2010. Once a big draw for vacation-home buyers, the city’s second-home market was crushed by the recession when tourism dropped and unemployment increased.

4. Savannah, Ga.
Foreclosure rate: 1 in 40 homes

Savannah had a 37 percent increase in foreclosure filings in 2010. Its unemployment rate is still on the rise; in November it rose to 8.9 percent. Many of the foreclosures in the city are in its Historic District or The Landings, popular areas where home prices rose quickly during the housing boom days.

5. Charlotte, N.C.
Foreclosure rate: 1 in 50 homes

Charlotte also had a 37 percent increase in foreclosure filings in 2010. Its unemployment rate is dropping; it was 10 percent in November. Charlotte has become the 33rd largest metro area in the country, growing by more than 30 percent in the past 10 years.

For all your real estate needs Call
John J. O’Dell
Real Estate Broker
(530) 263-1091

DRE# 00669941

Real Estate

Fees For Home Mortgages Increase

February 5, 2011 jd

For the first time since 2009, Fannie Mae and Freddie Mac are raising risk fees charged to lenders on loans they buy for resale to investors. Fannie and Freddie also are adding risk fees to more loans offered to borrowers with exemplary credit. Although lenders could absorb the cost, most are expected to add the fees to loan costs.

MAKING SENSE OF THE STORY

To avoid a fee or to receive a discount, most borrowers will need FICO scores of 740 or better and down payments of at least 25 percent.
The fee increases likely will affect most loans with terms longer than 15 years that are sent to Freddie beginning March 1, and to Fannie beginning April 1.
The most notable aspect of the fee increase is that the fees are being added to more loans to borrowers with higher credit scores. With few exceptions, risk fees previously hadn’t applied to borrowers with FICO scores of 740 or higher.

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John J. O’Dell
Real Estate Broker
(530) 263-1091

DRE# 00669941

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Real Estate

Countrywide Financial Executives Settles With State of California for $6.5 Million

February 4, 2011 jd

Sunset over Scotts Flat Lake from my deck 2/3/11 In the background is the Coast Range

By John J. O’Dell

Finally some justice against Countrywide Financial Corporation for all of their shady lending practices.. They created mortgage loans which were bound to be foreclosed on. Here’s a press release from the office of the Attorney General of California explaining what they did:

Attorney General Kamala D. Harris today (February 2, 201) announced a $6.5 million settlement of a predatory lending case against Angelo Mozilo and David Sambol, former officers of Countrywide Financial Corporation. Attorney General Harris announced the settlement money will be used to establish an innovative statewide California Foreclosure Crisis Relief Fund to combat the effects of California’s high rates of foreclosure and mortgage delinquency.

“Our prior settlement with Countrywide provided restitution for foreclosed homeowners and set in motion loan modification programs that have helped tens of thousands of consumers,” Attorney General Harris said. “We will use the current settlement to help Californians affected by the mortgage crisis by providing grants to agencies that help homeowners facing foreclosure with relocation assistance and providing money to state and local agencies to prosecute mortgage fraud.”

This settlement concludes litigation filed by Attorney General Edmund G. Brown Jr. in June 2008 against Countrywide Financial Corp., Countrywide Home Loans and Full Spectrum Lending, as well as Mozilo and Sambol. The financial relief provided under the current settlement augments the Attorney General’s October 2008 settlement with Countrywide to provide loan modifications and other foreclosure relief valued at $8.68 billion nationwide, with $3.5 billion provided to California borrowers.

According to the lawsuit, leading up to the mortgage crisis, Countrywide lured borrowers with low “teaser” rates often as low as 1 percent adjustable rate loans. Its loan officers obscured the downsides of these loans, which included rapidly rising rates after teaser rates expired, big prepayment penalties, and negative amortization in which a borrower’s total loan costs rose even as additional payments were made. Countrywide also loosened its mortgage standards and verification procedures in order to write more loans.

As a result of these practices, tens of thousands of homeowners with Countrywide loans ended up in default and foreclosure. The Attorney General’s lawsuit alleged that Mozilo and Sambol knew of these practices and allowed them to continue.

The complaint alleged that Countrywide sought to increase its share of the nationwide mortgage market to 30 percent through a deceptive scheme to mass produce loans – with little concern about borrowers’ long-term ability to afford them. It then would sell the loans on the secondary market to earn the highest possible premiums.

The settlement with Mozilo, the CEO of Countrywide, and Sambol, its president, was filed today in Los Angeles Superior Court. Mozilo and Sambol left Countrywide when it was purchased by Bank of America in July 2008.”

Source: Attorney General’s Office

So what do you think?

For all your real estate needs Call

John J. O’Dell
Real Estate Broker
(530) 263-1091

DRE# 00669941

Real Estate

Nevada County Housing Market December 2009 Compared to December 2010

January 28, 2011 jd

Another year in the Real estate market in Nevada County saw a drop of 11 percent in home prices from December 09 to December 10.

In December 2009, the median price of homes in Nevada County for sale was $339,900 and there were 1009 listing for sale. In December 2010 the median price of homes was $303,500 or a difference of -$36,400. In December 2010 there were 1,026 listings and 81 homes sold in that month.

Foreclosures seems to have slowed down somewhat, which may be due to the problems which the banks and Wall Street created during the height of the housing bubble. As you may or may not know, most of the problems were created when banks started lowering their lending standards. They allowed stated income loans (now known as liar loans) and negative amortization loans, where the buyer could pay any amount of the loan that they wanted to. Of course in a couple of years the terms changed and the home owner could not possibly make payments on their mortgage.

The banks then sold the mortgages to Wall Street, who packaged them into bonds. The rating companies gave these bonds a rating based on the overall FICO score, not knowing what kind of mortgages they were giving a high credit rating to. In other words, the bond may consist of 25 percent or more of subprime loans, but have an overall FICO high enough to call the bond triple A. Included in these loans there might be loans to clients with good credit ratings but have a loan that was bound to fail such as the negative amortization loans.

In order to get FICO scores by Wall Street, loans were made to recent immigrants who might have been here for only a few years but because they made their payments on t

All of these bonds became worthless when the home owners started defaulting. Wall Street’s haste to create these bonds and sell them worldwide resulted in sloppy book keeping and the mortgage notes in many cases became lost.

Thus we have the “robo signing” or more illegal works by our illustrious banks. This has created a brief slowing down of foreclosures and I think that maybe the banks are concerned about all of the mortgage bonds they created and in some cases still hold.

By John J. O’Dell
Real Estate Broker
For all your real estate needs call
(530) 263-1091

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Real Estate

Sacramento Man is Sentenced to 18 Years in Prison for Ponzi Scheme

January 23, 2011 jd

Charles Ponzi, the man from whom the term “Ponzi Scheme” came from.

SACRAMENTO – In a case prosecuted by the state Department of Justice, William Arthur Sassman II, who looted the life savings of dozens of investors to bankroll his own lavish lifestyle and finance his own investments, was sentenced today to 18 years in prison.

Sassman convinced people who had painstakingly saved for their retirement that he could make a lot of money for them. Instead he used their money for his fine clothing, his expensive cars, his several homes and his own illegal investments.

Sassman, 42, of Sacramento, appeared in Sacramento County Superior Court today where he had previously entered a guilty plea on 13 felony counts of grand theft.

Judge Lloyd G. Connelly sentenced Sassman to prison and ordered him to pay more than $4.45 million in restitution to 48 victims. No funds have been found, however, and it is unlikely victims will receive repayment.

An investigation by agents of the Department of Justice revealed that Sassman, a licensed insurance agent, operated a Ponzi scheme starting about 10 years ago in which he repaid current investors with money from new investors.

Using a book he wrote, “Secrets of a Worry Free Retirement,” Sassman convinced investors, many of whom were senior citizens, to shift their life savings to “high return” investments. These investments included foreclosed properties and real estate on Mare Island (Vallejo) and in other states, commercial property in El Dorado Hills near Sacramento, the production of a laptop computer stand called the “Notefloat,” which never sold, and annuity, stock and foreign currency investments.

Read the rest of the article Office of Attorney General

Real Estate

Real Estate: Finally a Good Investment

January 21, 2011 jd

The housing market still looks pretty bleak: There were a record 1 million foreclosures last year, home prices are still falling in many regions, and the number of “underwater” properties is at a record high.

And things don’t look much better in other areas of real estate. The number of construction jobs continues to decline, even as other parts of the economy have added jobs. And mortgage rates have moved higher as long-term Treasury yields have backed up during the past few months.

Basically, the real estate market remains a mess.

Real estate encompasses a wide range of markets – homes, apartments, hospitals, office buildings, strip malls, dormitories and other properties. But for our purposes, let’s focus on residential real estate, or homes. Here are four reasons to think residential real estate might represent a bargain – with one big caveat.

MAKING SENSE OF THE STORY FOR CONSUMERS

• Everyone hates homes – When the housing market is in the doldrums, people tend to avoid thinking about the value of their home. Sellers complain they’re not getting offers and buyers bemoan the strict lending requirements. However, prospective buyers should be contrarian and take advantage of a down housing market.

• Smart people are buying real estate – A prominent hedge-fund manager said in a speech last fall: “If you don’t own a home, buy one. If you own a home, buy another one, and if you own two homes, buy a third and lend your relatives the money to buy a home.” He believes that interest rates and home prices will rise this year, so real estate bargains won’t last much longer.

• Real estate performs well during inflation – Convention says Treasury Inflation Protected Securities, commodities, and real estate do well in an inflationary environment. Real estate performed well during the period in the 1970s, when persistent inflation and high unemployment occurred.

• Demand may be coming back – Job creation and getting people employed are the two major factors in the housing rebound. There’s much debate about when the job market will recovery. Optimists say the recovery will happen this year, while pessimists say it won’t happen for several years.

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John J. O’Dell
Real Estate Broker
(530) 263-1091

DRE# 00669941

Real Estate

Living Room of Home Cantilevers 45′ Into Space

January 18, 2011 jd

This home, built in West Stockbridge, Mass seems to be built with expense as an after thought. Why would anyone want to cantilever a living room, other than to say I can? The elevation of the living room can be constructed much cheaper in many different ways. However, if you have a dream and have money, here’s what you get according to the Wall Street Journal

“The home is a slim, 17-by-90-foot rectangular volume of glass and steel, the house slopes down a hill in the Berkshires before dramatically cantilevering for 45 feet. The great room floats 14 feet above the ground and has walls of glass on three sides with sweeping views of the surrounding, hilly countryside. The home’s poured concrete floor vibrates when the couple’s 65-pound Standard poodle, Oberon, bounds with enthusiasm after a ball. (Mr. Schwartz blames Oberon’s particular bounding style.)

“I thought it was going to be a ranch house,” said the 59-year-old Ms. Fiekowsky, a violinist who plays with the Boston Symphony Orchestra, admitting she, too, was nervous when her husband told her he wanted to have half the house float in the air. Mr. Schwartz, whose firm Schwartz/Silver Architects has completed projects for clients including the Massachusetts Institute of Technology and Princeton University, noted that the house’s cantilevered space is counterbalanced by a massive concrete basement hidden in the hillside. He said it’s “over designed” for stability and can hold 60 people safely, plus several thousand pounds on the home’s rooftop terrace.”

For all your real estate and construction needs, Call
John J. O’Dell
Real Estate Broker
(530) 263-1091

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Real Estate

Home Buying Paralysis? Tips for Getting the Best Deal Faster

January 17, 2011 jd

The inventory of homes for sale has increased in recent months, causing some buyers to hesitate before making an offer on a home for fear a better home at a more favorable price will become available.

Although real estate agents are showing more homes to clients, people still are buying homes, especially first-time buyers. According to the latest figures from the NATIONAL ASSOCIATION OF REALTORS® (NAR), first-time buyers now account for 50 percent of all home sales.
Some agents claim that today’s buyers are having a problem staying committed to the home search. During the height of the market, home buyers were more apt to make housing hunting a priority and to move on a good deal. Real estate experts advise today’s home buyers do the same to be successful in their home search.
Making a list of “musts” and “wants” for home features will help home buyers narrow down the search. Identifying key features, such as the number of bedrooms or bathrooms, will help buyers avoid being overwhelmed by the number of homes available.
Buyers are best advised to work with a REALTOR® who is familiar with the area. Media reports that home prices will decline further may be true for some areas, but not necessarily in all areas. All real estate is local, so finding out what’s happening in a specific neighborhood is most helpful.

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John J. O’Dell
Real Estate Broker
(530) 263-1091

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Real Estate

A Little Known Strategy for Cutting Mortgage Payments

January 16, 2011 jd

Homeowners looking to lower their monthly mortgage payments and reduce their interest rate may be able to do so without refinancing. A little-known strategy called recasting or re-amortization is available through some mortgage lenders and servicers, and eliminates the hefty fees and daunting credit requirements of refinancing.

Re-amortization requires borrowers pay off a lump sum of the principal amount on the mortgage and asking to have the monthly payments reset according to the original interest rate and loan terms. The lump sum reduces the principal, so the new monthly payments decrease slightly and interest paid over the life of the loan is reduced.

Lenders typically charge an administrative fee of $150 or more to re-amortize a mortgage; however, borrowers are not required to pay closing costs or submit to another credit check.

Re-amortizing works well for homeowners unable to qualify for refinancing, especially those who are self employed or have low poor credit.

Homeowners consider re-amortizing their mortgage should be aware that some lenders require a minimum amount to be paid toward the principal in the lump sum. JPMorgan Chase, for example, charges a $150 fee and requires a minimum $5,000 payment toward the principal.

Another challenge is finding a lender, or loan servicer, that offers re-amortizing. JPMorgan Chase and Bank of America exclude loans backed by the Federal Housing Administration and Dept. of Veterans Affairs, and loans that were sold off and securitized may also need investor approval.

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For all your real estate needs Call
John J. O’Dell
Real Estate Broker
(530) 263-1091
E-mail jodell@nevadacounty.com

DRE #00664491