All about realestate and current financing

One year ago….

It started with a trickle of failed subprime loans and without warning, the dam broke unleashing a torrent of failed mortgages and foreclosures. Last year, at this time, the mortgage markets were frozen, housing values were plummeting, the stock market was in free fall, Lehman Brothers crashed and burned and the Financial infrastructure of the United States was tottering on the brink of complete collapse. Bernie Madoff made off with a billion or more dollars of his client’s money and scheme after fraudulent scheme came into the limelight. There was no way to escape the media coverage. Foreclosures, bank failures, 401k’s turned to 201k’s, investment scams and the impending Next Great Depression were the story of the minute, the hour, the day, the week; relentlessly pounding us with wave after wave of devastating news. It just plain put everyone in a blue funk.

What a difference a year makes! The Cavalry arrived in the unlikely form of acronyms like TARP, HARP and HERA.

TARP(Troubled Asset Relief Program) is a $700Billion initiative that was supposed to purchase toxic assets(translation-foolishly underwritten failed mortgages) so that lender’s balance sheets would improve sufficiently to provide liquidity to the markets.

In short, it was meant to keep the banks from seizing up for fear of making bad loans while they had an unknown quantity of bad loans already on the books. It was soon determined that this was a bad use of the funds. So, the government(that would be you and me) decided to use our dollars to shore up the banks directly by buying shares in the biggest banks and then telling them what to do with their money. Most CEO’s of large banks did not like being told what to do and many gave back the money. So, eventually, we got around to using the money to make a market of cheap mortgage money so that everybody could refinance or purchase to a very affordable house payment; we went to main street with main street’s money. Imagine that. And…it’s working. 201k’s are now back to 301k’s, the stock market has regained some strength, the housing market is stabilizing, and Bernie, Tom and a bunch of others are in jail.

The next chapter will be bumpy….

The government has been providing almost all of the money to purchase mortgages for the past year, driving rates to historic lows. They are about to stop doing that because the money is running out. They have started to transition the mortgage market back to the private sector(expected to be complete by March 2010) and the private sector doesn’t think it’s a smart idea to loan money out for 30 years at these really low rates when they know that printing money is likely the only way out of the deficit that has been created. When that happens, the dollar is worth less(worthless?) and it will take more dollars to buy something. That’s inflation. Inflation is bad. If a loaf of bread costs $1 now and it costs $2 next year, but you aren’t making any more money, then you don’t get to buy as much bread. People on fixed incomes really lose in a scenario of high inflation. That would be the worker that gets a small raise each year and the elderly who are trying to live on Social Security or fixed incomes from pensions. So, if your buyer or seller has been waiting, use this to help them understand that the best opportunity of a lifetime to lock in an affordable payment, make that move, get off the fence, is right now. It could be a VERY long time before we see anything like the rates that are available today. Locking in on a fixed rate mortgage for 15, 20, 25, or 30 years is a HUGE inflation fighter. You may have to pay more for a loaf of bread but you’ll never pay more for your house payment.

Waiting to sell and buy until values go back to the peak? If you can wait until 2023, go ahead. That’s when values are predicted to return to peak levels in Minnesota. Otherwise, get going right now.

If values were to climb 5% over the next year, giving a seller more cash to put down, they would still have a higher payment due to the rates increasing.

The Home Buyer Credit of $8,000 will most likely be extended until June. This week, I learned from statistics gathered by the Minnesota Home Ownership Center that the average buyer this year is taking 11 months to make a buying decision, talking to 7 Realtors and 3 Lenders. To take advantage of this incredible bubble of opportunity, everyone is going to have to pick up the pace. In the Minneapolis Metro area there is less than a 5 month supply of homes in the 0-$250K range and that has caused prices to increase in this range by nearly 6% in the past 2 months. It’s provided a perfect opportunity for sellers with houses in this price range who want to move up a step. Values for move up houses are still lagging the market and are priced at close to 30% less than they were just 3 years ago. Make no mistake. The Homebuyer Credit is providing the impetus for this pocket of opportunity. In the months of July and August, Minnesota saw a record number of new Sheriff Sales and that means that by spring, sellers will be competing with a glut of new foreclosed properties, and higher interest rates.

I sure hope this helps you help someone make a buying or selling decision.

I’d love to know if this helps you help someone. Shoot me an e-mail at barbarac@fairwaymc.com and let me know if this helped you. - Barb Crea

PS. The window of opportunity on HARP and HAMP is narrowing as well. The Home Affordable Refinance and Home Affordable Modification Programs are also driven by rates. Right now, the ceiling has been raised to allow people who are at a 125% LTV refinance under the HARP program. HAMP has ramped up and under pressure from Washington, more and more people are getting their loans modified. So, if you know someone who is underwater, who tried last spring and failed, tell them to try again. In the spring, we were stuck with 95% LTV’s, then it was raised to 105% and now it’s 125%. The counselors have gotten a lot better at their jobs. Your clients will appreciate the help. The best place to get that help is still www.hopenow.com or have them call us and we’ll try to get them to the right place.

If you need help or someone you know would like to sell or buy contact me. madonna@seelhammer.com

or call 651-450-2164

Preventable suicide of youth!

I am amazed that with all the knowledge out there in our society, that we as a society do not demand that our schools do not provide the curriculum and tools to measure the success. The researched based programs which have a proven success rate are often sided stepped because of politics or cost. Think about it! Are the lives of our children not worth the price? Why do we stand by and allow the suicide rate to continue to escalate, when there is help for our kids. Proven through research based statistics. Dr. LaFromboise wrote such a curriculum, it has been in the market place since the early 90's, read it yourself and you will see how the stand alone chapters will work in any school. When you train teachers how to implement the subject matter into, English, Social Studies, Civics, Health and any class. American Indian Life Skills by Dr. Teresa LaFromboise, of Stanford University. Get it use, and stop our kids from this travesty.
Read the article that follows: Maybe Preventable???Really? Then do something proven!
Youth Suicide May Be a Preventable Tragedy
By Leslie LinthicumJournal Staff Writer
Within the past two months, four young people on the Mescalero Apache Reservation in southern New Mexico have taken their own lives. One was a 25-year-old man; another man was 19. Then it was a 16-year-old girl. On Sunday, a 14-year-old Mescalero girl died of an apparent suicide, the Ruidoso News reported. The tragic news brings back into focus the alarming problem of suicides in Indian country, a place where youths kill themselves at a rate 2 1/2 times greater than their peers. It is a vexing issue, one that has been studied by many academics and generally blamed on the depressing forces of poverty, substance abuse and isolation and the traumatic aftermath of the American government's relocation and assimilation efforts. If that were so, it would seem to be an unmovable problem. But it's not. The issue of suicides among Native Americans is made more complicated by the great success of some tribally based anti-suicide programs. Two of the most successful in the country were launched in New Mexico, one on the Jicarilla Apache Reservation in northern New Mexico and the other at Zuni Pueblo on the state's western flank. Those tribes have slowed the suicide rate through their efforts and — for many years — stopped it. In the span of about a decade, Jicarilla — once home to one of the highest suicide rates in the nation — reduced suicides by about 60 percent. Zuni Pueblo, which for decades had lost an average of two school kids every year to suicide, effectively reversed its suicide trend. How have they done it? By getting the attention and commitment of tribal leadership, agreeing it's a top priority and involving everyone in the community — schools, nurses, doctors, parents, elders. If they can do it, why can't everyone? Hayes Lewis was the superintendent of the Zuni school district in the 1980s when the tribe decided it had to change its course. Academics went in, studied the pueblo's structure and family, government and communication patterns and, working with the schools, developed the Zuni Life Skills Program. It was a curriculum that was integrated into language arts courses and covered communication skills, recognizing and dealing with stress, building self-esteem and encouraging students to recognize stressed or self-destructive behavior in others and intervene. "We told the students, we're not asking you to be clinicians or anything, and we totally understand you're kids," Lewis says. "But if you see something, here's the referral process." That referral process was not just an uncomfortable trip to a counselor's office. A school counselor or a home-school liaison would seek out the student quickly and check in. "It fairly immediately sent a message that you are really important and that we have a concern about your emotional and metal health." Sometimes the crisis could be as simple as a student being worried about his family being low on food, Hayes said, and tribal officials could quickly get a referral to an agency for help. Other times, long-term counseling could be recommended. Or a meeting with tribal elders might be set up. Or a traditional healing ceremony might be arranged. "They didn't just have one channel of assistance; they had a variety of them," Lewis says. Elders, who normally would be excluded from a clinical or school setting, were encouraged to be involved. "They had a lot of wisdom and a lot of cultural knowledge, and they were able to really get to the point in a way that was helpful," Lewis says. Zuni Pueblo has gone 18 years without any suicides in its schools, Lewis says. "It completely reversed." If there was a key to success, it was commitment. "That was the real priority of the community," he says, "and the Tribal Council basically set the tone for that prevention strategy." Another key was for the tribe to get over its own reluctance to talk about death and suicide. "It's always hard to talk about death and dying, but at some point you have to in respectful ways, as hard as it is for people," Lewis says. "There's always this talk that if you talk about death, you're going to bring death. But our problem was, if we don't talk about death, how are we going to end the taking of lives?" Acknowledging that suicide is taboo is part of the program. "That's one of the messages that we always send to our children, that based on our cultural advisers and our elders, is that suicide is not an option. For Zunis, that's not an acceptable alternative. So how can we help (youths) think through some of the options they do have?" Lewis now directs the Center for Lifelong Education at the Institute for American Indian Arts, which helps tribes align their resources so they can address their most critical concerns. Saving lives from being wasted is an obvious tribal concern. "We can do it ourselves," Lewis says. "I think if there was a message sent by tribal leaders and community leaders and educational leaders that the priority of having safe schools and meeting those prevention needs is paramount, then the action will follow or it should follow. So somebody really needs to be the champion." At Mescalero, the high school was just launching a three-year suicide prevention program in its high school, funded by a federal grant, when the first of the recent string of suicides occurred there in late August. (The tribe has seen worse years. In 2007, 11 tribal members killed themselves.) Jeremiah Simmons grew up on the reservation and just returned to run the suicide prevention program, which borrows many of the concepts of the Jicarilla and Zuni efforts. One of the cores of the program is encouraging every kid in the school to watch out for every other kid and get help as soon as problems begin to bubble. Another is to not be afraid of talking about suicide. "The idea of suicide is a very sensitive subject, and it's kind of taboo to talk about it here," Simmons says. "But avoidance hasn't really helped." UpFront is a daily front-page opinion column. You can reach Leslie at 823-3914 or llinthicum@abqjournal.com.

http://heavens-gates.com/18again/

http://heavens-gates.com/18again/

Oh yeah! I heard this and I new that I felt the same way!