Hi Chadcan
http://termodinamicaltd.com/webeurotrade/wp-content/vegetable.php?brother=16rhc5qecz8n0ue
Chad
Sunday, July 24, 2016
Tuesday, January 10, 2012
Mortgage Meltdown in 1500 words or less...
Over the last several years now there has been a severe downturn in the economy that has created opportunity for some and devastation for others. The mortgage market is just one piece of that picture, though a very important one. For years, people saw their home as a "piggy bank" and it often was the only retirement or other savings that they had. Their monthly payments would generally pay off the debt against the home, they would enjoy the tax benefit of home ownership (pay less taxes) and the home would continue to grow in its value. The home was a "piggy bank" in that they could easily pour some of that money back out of the home through refinancing or home equity loans. The money was often used to enrich their lifestyle with items such as a new boat or even to consolidate the boat, truck, motorcycle and credit card money owed into a neat little stack of debt against the big "piggy". Another version of the piggy bank home was the savvy investors who chose to get cash out of their home to invest in the stock market. Still others would simply sell their home at their whim and pay off all of their debt only to start fresh with a home that they could buy with no money out of pocket or no real qualification. In short: the market encouraged us to think that their was not a ceiling on the price homes would appreciate to...and we couldn't lose! There were products available that also helped us to think that buying a home was a
as an member of society here in the good 'ole U.S. of A. In fact, roughly 8 out of 10 people who applied for a loan with me during those "boom" years could be qualified for some form of RESPONSIBLE home finance...with the last two possibly choosing to finance elsewhere with the "questionable" mortgage broker lot.
Unfortunately, all of that came to an end and the "riches" of our homes became liabilities that we owed more on than they were worth. Blaming the mortgage professionals who encouraged "sneaky mortgages" for all of our housing market's ailments is like blaming the soldiers for the war in Iraq. However, the catalyst for the unraveled market certainly may have been in large part due to people giving up on paying their mortgages that maybe they never should have chosen or been encouraged to choose in the first place.
on our part as the general public was accepting the belief that home ownership is a right that should be afforded to everyone regardless of whether they are prepared to accept the responsibility or not.
Without going too far into the reasons for all of the "exotic" mortgages that were available to buyers for a few years, I will share that they were needed to meet a demand for Mortgage Backed Securities. Mortgage Backed Securities or "MBS" are simply little "shares" of a group of mortgages just like "shares of stock" is a portion of ownership of a publicly traded company like Apple. Investments such as stocks and bonds are backed with a promise that you will earn some sort of interest or return. Mortgage Backed Securities are no different and are traditionally offering a reasonable return on your money with minimal risk. (Traditionally, people were putting 20% of their
money into their homes up front!) You are buying mortgage shares. As the borrowers pay their payment, the shares pay a return and everyone is happy. Those who securitize mortgages or actually split them up into shares are referred to as the "agencies" (Fannie Mae, Freddie Mac, Ginny Mae, etc.) The marketplace for the selling of the shares is referred to as the "secondary market". With increasing world wealth and a desire for reasonable returns for minimal risk: DEMAND for MBS went through the roof and the Agencies were having a hard time keeping up with demand. They needed to have more product (MBS) to sell to interested investors. This can be traced to a need for more mortgages to be securitized.
What changed was the rating system. The way the rating of the MBS changed allowed the bond to be offered on mortgage batches that were "
" a good rating BUT there were MANY stinkers in the pile. People wanted a reasonable return on their investment with reasonable risk and had boatloads to invest so the "AAA rated" Mortgage Backed Securities a.k.a. Mortgage Bonds sold like HOT CAKES. In other words, people were buying "AAA" rating but it was really like a burrito wrapped in "AAA" rated loans, but FULL of Garbage and indigestion. With the new rating system, the agencies could offer HIGHER RISK loans and effectively "qualify" a MUCH broader group of people. They were able to offer mortgages with the new products to people who NEVER should have had or would have had a mortgage before or since.
A few years later, the rubber met the road. People stopped making their mortgage payments and in many cases with some of the "no job, no asset verified loans, NEVER made even one payment. That meant that the investors who bought shares of those mortgages unknowingly were not getting paid. They couldn't sell their shares unless they sold them for pennies on the dollar to other investors. The exotic mortgages went away...making the group of people who qualified for a mortgage MUCH smaller. Less people available to be financed meant less people to buy the homes on the market. Less people demanding homes on the market left more homes for sale and degraded their value. Entire developments sat empty because there simply was not enough people qualified to even purchase any of the lots anymore. Example: how many people qualify for a loan that requires zero down payment, no income verification and no assets vs. a loan that requires a down payment of 3% of the purchase price? When homes were devalued, people felt hopeless. Many walked away from homes that they were perfectly qualified for because the home was worth several hundred thousand less than what they bought it for and it was wiser to start over somewhere else. We didn't feel so "RICH" anymore and stopped spending money so readily. This led to less profit reported by many companies and so lower values in the stock market so our 401k's were also devalued often by thousands upon thousands of dollars. What a slump.
Okay, all of this is depressing right? Fortunately, with every misfortune for one, there is a fortune to be made by another. Opportunities abound for people who are interested in exploring this real estate market.
Three opportunities for buyers right now:
1. The feds stepped in and have invested over a trillion dollars in Mortgage Backed Securities over the last 3 years. Agency guidelines have changed making the MBS a very reasonable investment with a decent return. Confidence is UP in the once tarnished investment. This is keeping rates at all time lows. The MBS market will very likely stay strong in the near future but it is stronger NOW than EVER so now is a great time to take them in with mortgage financing.
2. Home prices are starting to level and in some areas are actually marking increases. For the last few years the market has been FLOODED with short sale and foreclosure opportunities. In many markets, the "fire sale" home has actually provided more comparable sales for appraisers to consider than homes sold by people who are making the payments just fine. The fire sale home has decreased the market to a place where it is now starting to go back up...the time to buy is now.
3. The best remain. Now, more than ever: it matters who you do business with. So many of the "fly by night" or part-time realtors and lenders simply haven't made it through this recent cycle of tumult and have decided to hang it up. Many of the professionals that are left are the best out there. Take time to investigate this for yourself and you will find that there are more people interested in helping you right now with sincerity and integrity than ever before.
Good luck in whatever you endeavor. Mortgages have been my life for over a decade and I have been in finance for longer. I have never seen an opportunity like this before and until you are ready, I will be available. Naturally, if you have questions on any of the above or would like to discuss further, please don't hesitate to reach out.
Cheers,
Chad
as an member of society here in the good 'ole U.S. of A. In fact, roughly 8 out of 10 people who applied for a loan with me during those "boom" years could be qualified for some form of RESPONSIBLE home finance...with the last two possibly choosing to finance elsewhere with the "questionable" mortgage broker lot.
Unfortunately, all of that came to an end and the "riches" of our homes became liabilities that we owed more on than they were worth. Blaming the mortgage professionals who encouraged "sneaky mortgages" for all of our housing market's ailments is like blaming the soldiers for the war in Iraq. However, the catalyst for the unraveled market certainly may have been in large part due to people giving up on paying their mortgages that maybe they never should have chosen or been encouraged to choose in the first place.
on our part as the general public was accepting the belief that home ownership is a right that should be afforded to everyone regardless of whether they are prepared to accept the responsibility or not.
Without going too far into the reasons for all of the "exotic" mortgages that were available to buyers for a few years, I will share that they were needed to meet a demand for Mortgage Backed Securities. Mortgage Backed Securities or "MBS" are simply little "shares" of a group of mortgages just like "shares of stock" is a portion of ownership of a publicly traded company like Apple. Investments such as stocks and bonds are backed with a promise that you will earn some sort of interest or return. Mortgage Backed Securities are no different and are traditionally offering a reasonable return on your money with minimal risk. (Traditionally, people were putting 20% of their
money into their homes up front!) You are buying mortgage shares. As the borrowers pay their payment, the shares pay a return and everyone is happy. Those who securitize mortgages or actually split them up into shares are referred to as the "agencies" (Fannie Mae, Freddie Mac, Ginny Mae, etc.) The marketplace for the selling of the shares is referred to as the "secondary market". With increasing world wealth and a desire for reasonable returns for minimal risk: DEMAND for MBS went through the roof and the Agencies were having a hard time keeping up with demand. They needed to have more product (MBS) to sell to interested investors. This can be traced to a need for more mortgages to be securitized.
What changed was the rating system. The way the rating of the MBS changed allowed the bond to be offered on mortgage batches that were "
" a good rating BUT there were MANY stinkers in the pile. People wanted a reasonable return on their investment with reasonable risk and had boatloads to invest so the "AAA rated" Mortgage Backed Securities a.k.a. Mortgage Bonds sold like HOT CAKES. In other words, people were buying "AAA" rating but it was really like a burrito wrapped in "AAA" rated loans, but FULL of Garbage and indigestion. With the new rating system, the agencies could offer HIGHER RISK loans and effectively "qualify" a MUCH broader group of people. They were able to offer mortgages with the new products to people who NEVER should have had or would have had a mortgage before or since.
A few years later, the rubber met the road. People stopped making their mortgage payments and in many cases with some of the "no job, no asset verified loans, NEVER made even one payment. That meant that the investors who bought shares of those mortgages unknowingly were not getting paid. They couldn't sell their shares unless they sold them for pennies on the dollar to other investors. The exotic mortgages went away...making the group of people who qualified for a mortgage MUCH smaller. Less people available to be financed meant less people to buy the homes on the market. Less people demanding homes on the market left more homes for sale and degraded their value. Entire developments sat empty because there simply was not enough people qualified to even purchase any of the lots anymore. Example: how many people qualify for a loan that requires zero down payment, no income verification and no assets vs. a loan that requires a down payment of 3% of the purchase price? When homes were devalued, people felt hopeless. Many walked away from homes that they were perfectly qualified for because the home was worth several hundred thousand less than what they bought it for and it was wiser to start over somewhere else. We didn't feel so "RICH" anymore and stopped spending money so readily. This led to less profit reported by many companies and so lower values in the stock market so our 401k's were also devalued often by thousands upon thousands of dollars. What a slump.
Okay, all of this is depressing right? Fortunately, with every misfortune for one, there is a fortune to be made by another. Opportunities abound for people who are interested in exploring this real estate market.
Three opportunities for buyers right now:
1. The feds stepped in and have invested over a trillion dollars in Mortgage Backed Securities over the last 3 years. Agency guidelines have changed making the MBS a very reasonable investment with a decent return. Confidence is UP in the once tarnished investment. This is keeping rates at all time lows. The MBS market will very likely stay strong in the near future but it is stronger NOW than EVER so now is a great time to take them in with mortgage financing.
2. Home prices are starting to level and in some areas are actually marking increases. For the last few years the market has been FLOODED with short sale and foreclosure opportunities. In many markets, the "fire sale" home has actually provided more comparable sales for appraisers to consider than homes sold by people who are making the payments just fine. The fire sale home has decreased the market to a place where it is now starting to go back up...the time to buy is now.
3. The best remain. Now, more than ever: it matters who you do business with. So many of the "fly by night" or part-time realtors and lenders simply haven't made it through this recent cycle of tumult and have decided to hang it up. Many of the professionals that are left are the best out there. Take time to investigate this for yourself and you will find that there are more people interested in helping you right now with sincerity and integrity than ever before.
Good luck in whatever you endeavor. Mortgages have been my life for over a decade and I have been in finance for longer. I have never seen an opportunity like this before and until you are ready, I will be available. Naturally, if you have questions on any of the above or would like to discuss further, please don't hesitate to reach out.
Cheers,
Chad
Thursday, October 27, 2011
HARP 2.0...RATED R for REFINANCE and the 3+2 rule and MY NEW PHONE NUMBER!
Harp 2.0 was announced earlier this week. What is it? HARP stands for "Home Affordable Refinance Program" and was aimed at people holding conventional mortgages to help them refinance. It was actually a version "2.0" of the George Bush plan aimed at helping underwater mortgagors in the U.S. The Bush plan was rated "R" for "RESTRICTED" and only actually helped a handful of people.
The NEW HARP program has yet to be finalized but changes are said to include:
Removing the current 125 percent loan-to-value ceiling on refinanced mortgages; Waiving risk-based fees on borrowers who take shorter term mortgages and reducing those fees for others; Eliminating the need for a new property appraisal where there is a reliable AVM (automated valuation model) estimate provided by the GSEs; Eliminating certain representations and warranties required of lenders to obtain the GSE guarantee. This will protect lenders from many of the buy-back requirements they face under current guidelines. Extending availability of the program through the end of 2013.
Finally:
--
Chad Schauers
Montana Mortgage Lender, Bozeman, Montana
The HARP program helped more home owners but there were still some pretty good roadblocks such as those self-employed individuals who were making payments but showing a decline in year over year income or those whose homes were too far underwater. The Obama Program was GETTING THERE but not quite. We have personally helped out MANY home owners through the HARP program though there were also too many that we had to turn away. Read more on "HARP Roadblocks" <here>
The NEW HARP program has yet to be finalized but changes are said to include:
Rates Popped up today with the FNMA 3.5% coupon ending the day DOWN 72 bps at 100.47. Looks like investors like the "plan" that the Europeans have put together to save their bacon over there. The money that left the bond market seemed to go to stocks.
The 3+2 Rule is a way to Prioritize your life each day. Watered down version: Pick the THREE most important things to get to and then 2 more bonus items. For the full version: <click>
After almost 6 years of living in Bozeman, I am finally getting a personal BOZEMAN cell number. Please update your phone and forgive me if you get this notice more than once: (406) 219-7873 or (406) 219 - S-u-r-e
Cheers!
Chad Schauers
Montana Mortgage Lender, Bozeman, Montana
NMLS# 583046
Wednesday, October 12, 2011
From the Horses Mouth...
For those who may be interested...there is a nationally recognized mortgage company for sale as of 5pm eastern standard time today. If you have already heard, that mortgage company is ours.
Chad
--
Chad Schauers
Montana Mortgage Lender, Bozeman, Montana
It has a great products offered, considerable market share, excellent processing and underwriting teams and a great reputation. Purchaser will need to continue to offer competitive rates/fees, continue providing quick turn times and closings through the underwriting and processing department, continue to practice "make sense" underwriting and continue to provide LOW Jumbo Financing rates to our clients.
We are not worried. It is business as usual. IN FACT: after a tough day in the markets, our rates actually got BETTER today...by 1/2 point in pricing on the 30 year fixed!
If you have questions or concerns, reach out. We'd love to hear from you.
Cheers!
Chad
Chad Schauers
Montana Mortgage Lender, Bozeman, Montana
NMLS# 583046
Friday, September 30, 2011
2 Tricks, one Treat...
Some quick Items. RATES dropped (yawn) and are in the UNDER 4% range on a 30 year fixed loan.
- RD is adding monthly RD FEE but reducing upfront fees...it is NOT Mortgage Insurance Monthly though
- FHA is lowering loan limits...but apparently not in Gallatin County. The FHA loan LIMITS Tool is here
- Treat: VA is lowering their funding fees! (by 50% with 5% down...see chart below)
Cheers! Chad
Details: >>>>
VA Funding Fee Changes Effective October 1, 2011
(YES we do offer VA loans!)
VA's funding fee is an upfront fee that is often financed so it increases the loan amount an payment slightly. VA doesn't charge a monthly mortgage insurance fee so the upfront "VA Funding Fee" compensates for that. If a veteran is disabled due to military service, they may be eligible to have the fee waived altogether. Remember that National Guard Reservists with active duty service MAY also qualify for a VA loan and other VA benefits. 
FHA Changes as of 10/1/2011 for Montana and everywhere else.
You may also see that FHA has announced the lowering of its limits effective 10/1/2011. I don't see where our county for Bozeman Montana FHA loans (Gallatin) is going to be affected so please let me know if you know something different. For your reference, here is a link to HUD.Gov's loan limit tool. You can see what limits are for FHA loans in Montana or anywhere FHA loans are offered. The counties that are most affected are the ones that were considered "high cost" where their limits are dropping from $729,000 and change to $625,500. The MINIMUM floor...so the most the loan amount is dropped to is $271,050.
Rural Development loans!
RD or USDA guaranteed loans are also changing as of 10/1/2011. They are lowering their upfront fee from 3.5% to 2% but adding a monthly fee equal to .00030% of the loan amount monthly. (About $30 on a $100,000 loan)
HOWEVER: when a client is financing in LESS money with the lower up front fee, the net difference is just over $20 bucks/month.
Example: Currently for a $100,000 Montana Rural Development Purchase Loan there is an additional $3500 financed in. With changes to the RD Guaranteed Loan program as of October 1, 2011 there will only be an additional $2000 financed. The smaller loan amount makes a smaller payment...
Note that the monthly "RD FEE" is NOT considered Mortgage insurance so if you check with your accountant, none of the tax benefits sometimes associated with mortgage insurance apply.
Chad
-- Chad Schauers
Montana Mortgage Lender, Bozeman, Montana
NMLS# 583046
Thursday, September 29, 2011
Believe...
This is a gem I found today...read the whole article here.
Rates are steady! Low 4% range for 30 years seems ridiculous. Snoopy is here...throw us a bone, eh?
Chad
Chad Schauers
Montana Mortgage Lender, Bozeman, Montana
NMLS# 583046
Tuesday, September 27, 2011
ZING!!!! Tips for your STALE listings...how to MOOOVE 'em.
This is a GREAT article from Trulia.com that can be found <here>
Let me know if I can help you with tip #5...
In today's market, most listings aren't instantly flying off the market. While we all know price is one of the most important factors in the sale of a home, there are other factors they can improve the saleability of your listings. Here are a few tips to get that stale listing sold plus a handy download designed just for sellers.
(1) Offer incentives or alternative financing options
(2) Make it accessible
Take a hard look at the accessibility of a home. Today's home buyer is impatient. They want to see homes and they want to see them now. Make sure your listings are simple and easy to show. Carl Medford, an agent with Prudential California Realty in the San Francisco Bay Area believes home accessibility is the #1 reason homes don't sell. "If we can't get in, we can't show the house. If we can't show the house, we can't sell it. We frequently end up showing less than six homes because we can't get access to homes on the list."
(3) Expose it- everywhere!
We are often surprised by the number of homes with property addresses undisclosed on the internet. It's no secret homebuyers are looking on the internet for homes, make sure they can easily find it. Two popular search filters we see prospective homebuyers using on Trulia.com are filters for listings with open houses and filters for listings with price reductions. Want more eyeballs on your listings? Make sure they are updated weekly on popular real estate search sites like Trulia and Craigslist and be sure to list your open home times to get the max exposure for your listings. Want more info? Check out 3 free ways to rank higher on Trulia.
(4) Refresh your photos
Today's homebuyer spends a lot of time online. As your listing becomes stale, so do the property photos. Consider retaking the photos, especially if seasons have changed. If taking new photos is out of the question, you may want ot consider changing up the order your photos display online to give it a fresh appearance for web browsing buyers. Many agents start their photos with a picture of the front of the house when they would be better served displaying the huge backyard or the amazing chef's kitchen.
(5) Put some zing in your marketing copy
In addition to stale photos, your marketing copy may be putting prospective buyers to sleep. "Check out my 3 bedroom, 2 bath home in a great location." Yawn. Add some zing to your headlines and descriptions to draw the attention of homebuyers. Your marketing copy needs to tell a story that appeals to the people most likely to buy your listing. Your copy can get old too. Simply freshening it up frequently is a good way to capture more attention to your listings.
It's your turn- what other tips do you use to move your listings?
Chad Schauers
Montana Mortgage Lender, Bozeman, Montana
NMLS# 583046
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