The advent of the subprime market reflects a sea change in the way banks make [tag]home loans[/tag]. As recently as the mid-1990s, potential homeowners had to get over high hurdles to borrow money. Background checks could take weeks or months. Lenders typically required down payments of at least 20% of a home’s value. People with dented credit, or young folks without adequate credit histories, had few if any options. Over the past decade, though, a convergence of factors has emboldened banks to lend where they wouldn’t before. For one, the development of the Internet and advances in computing technology have made it much easier and cheaper to process and package new loans. (more…)

It never ceases to amaze me how widespread and deep-seated the belief is that somewhere out there must be a good fairy who will solve all of our financial problems. This belief sustains lotteries, which help keep poor people poor, and a host of schemes directed at homeowners that promise to [tag]pay down their mortgage loan[/tag]s quicker and easier.

Some of these schemes are outright frauds, such as the one peddled by Success Trust and Holding that I warned readers against last year. It took until August of this year before the SEC took action against them, by which time they had relieved more than 500 homeowners of several million dollars. At the opposite end of the spectrum are schemes that discipline borrowers to [tag]make extra payments[/tag], of which the most important are biweekly programs. So long as borrowers understand that they don’t need a biweekly program to make extra payments, and that what they are purchasing is only a convenient way to discipline themselves to make the extra payments, these programs are fine. (more…)

One of the many oddities of [tag]real estate investing[/tag] is that the best time to plunge in is usually just when things are starting to go south – meaning now. While momentum is starting to carry the market down, home prices are still out of range for a lot of would-be buyers, which helps to buoy rents. Further burgeoning the tenant ranks are the thousands of homeowners selling now in the face of rising interest rates. According to the National Association of Realtors, rents nationwide are expected to jump an average of 5 percent by year’s end.

First, inventory is shrinking: Public universities have suffered from continual belt-tightening in recent years, leaving most without money to upgrade or build out dorms and other housing units. Second, demand is skyrocketing: Colleges are starting to see a surge in admissions, especially from so-called [tag]echo boomers[/tag], the children of baby boomers. For investors, that adds up to remarkably low vacancy rates near campuses. Prime Property owns 21 apartment buildings in five [tag]college towns[/tag] in Florida and the Midwest, and Zaransky says “we are 100 percent occupied” – even during summer months. (more…)

A great teacher taught me years ago that many of the nuances of [tag]real estate law[/tag] only matter when it matters. How you hold title is one of those nuances and it really matters when it matters. Consider the case of one of our distraught readers whose significant other had placed both their names on the title in Joint Tenancy more than three years ago. Just a few months later, the relationship went south, and the significant other wanted to switch everything back the way it was before the [tag]Joint Tenancy agreement[/tag].

The problem was this reader pointed out that she had “made monetary contributions to ALL the upgrades done within the house, paying for 90 percent of the total renovations done which has increased the value of the property as well. I contributed to the household over the years I was there, but did not specify that these funds went to the mortgage, and these funds went to whatever. I just want to be fairly compensated for my “loss.” As a Joint Tenant, technically I am entitled to 50 percent of the equity, right? I am not on the loan. Help and fast. He sent me a letter from a lawyer and I want to make sure I know what I am talking about before I respond.” There are several ways of [tag]holding title to property[/tag] and if what this person wrote is correct, asking for a [tag]quit claim deed[/tag] is not one of the guaranteed 50 ways to leave this lover without an interest in the property, or at least a court appearance. (more…)

As the housing market continues to cool, [tag]higher interest rates[/tag] have increased the [tag]mortgage payments[/tag] for homeowners who have [tag]adjustable rate loans[/tag], or [tag]ARM[/tag]s, causing the number of them defaulting on their mortgages in default to rise. On The Early Show Thursday, money maven Ray Martin spelled out the problem, and offered advice to homeowners finding it harder and harder to make their mortgage payments:

According to Moody’s Economy.com, the percentage of mortgages with delinquent payments has risen nationally to 2.33 percent, the highest level since 2003. The metropolitan areas that saw the biggest increase in mortgage delinquencies include McAllen- Edinburg-Mission, Texas; Merced, Calif.; Fort Smith, Ark.-Okla.; and Las Vegas-Paradise, Nev. It’s expected that mortgage defaults — in which a borrower misses one or more payments on a loan — will increase when the economy weakens and job losses rise. Typically, higher job losses translate into a higher percentage of homeowners missing loan payments. At this time, the percentage of home loans in default at 2.33 percent is closer to the historical average. (more…)

I believe I spent about $6,000 over 14 years upgrading the electricity in the last house. I had an electrician who believed that if the squirrels hadn’t chewed the knob and tube to shreds, you blend it with the other generations of wiring, update and upgrade where needed, reorganize the box and work from there.

Test all [tag]smoke alarms[/tag] at least once a month, following the manufacturer’s instructions, or push the “test button” on the face of the alarm cover. Put new batteries in your smoke alarms at least one time each year; sooner if the alarm makes a regular chirping signal, indicating low battery power. If smoke alarms are more than 10 years old, buy new smoke alarms. When possible, use interconnected smoke alarms. Hard-wired, interconnected alarms with battery back-up run on your household wiring and are tied in together so that if one alarm operates, they all signal together. Also, wireless technology is now available to enable homes to have an interconnected smoke alarm system that can be installed independent of household wiring. (more…)

Real estate market downturn creates strange bedfellows as brokerage sleeps with the enemy. The U.S.[tag] real estate market[/tag] may be running out of steam, but the downturn may be helping to clear the air of mistrust between traditional [tag]realtors[/tag] and the Internet community as two realty firms announced groundbreaking deals with [tag]Google[/tag] and [tag]Microsoft[/tag].

Late Thursday, Prudential California/Nevada/Texas Realty, one of the largest real estate brokerages in the United States, said it will make its property listings available for search on Google, a watershed move for a major player in an industry that jealously guards its listing data.

In another air-clearing announcement, John L. Scott Real Estate, a Pacific Northwest-based realty company, said it will expand its use of [tag]Virtual Earth[/tag], Microsoft’s satellite and aerial imagery service, to home shoppers in Portland, Oregon, and Vancouver, Washington. (more…)

University life, for many traditional students, is one of few bills and responsibilities. However, every spring, new graduates enter the real world of full-time careers, families and [tag]mortgage[/tag]s. The average traditional student will first encounter mortgages in their first attempt to buy a home, without prior knowledge of what [tag]mortgage brokers[/tag] are looking for and what they need in order to be able to approve them.

Lenders require a copy of one’s driver’s license and social security card. If loan seekers have been renting, they must bring in the contact information of their landlord. They must also bring the most recent two months of bank statements for all accounts including stocks, checking, savings and money market accounts as well as tax information for the past two years and pay stubs for the past 30 days. It is wise to contact the [tag]loan agent[/tag] prior to your meeting in order to make sure that there are not other requirements for that individual lender. Once the [tag]loan seekers[/tag] have made their appointment with a lender and have gathered all of the information that is, necessary there are four things that lenders look at in order to approve loans: [tag]credit worthiness[/tag], cash on hand, income/job stability and [tag]debt ratio[/tag]s. (more…)