BRAC ROAD RAGE?

Here is a list of changes due to BRAC that will impact the region.
Bethesda Naval-2,200 new jobs and estimated 1,000,000 hospital visits which is double than now.
That area is already extremely traffic heavy and will worsen as we approach the Sept 15th deadline.

MARK center in Alexandria-6,400 new jobs. As with most of the site additions major road and or bus service has been proposed but has not been added and most haven't been funded by any level of government. Out of 30 projects to improve traffic four are fully funded and six more are partially funded.

Fort Belvoir is adding 22,000 new jobs into an area that NOW can take 45 minutes to go one mile due to inadequate roads and enhanced security measures.

Hope this helps at least with the planning we all will have to do before Sept at the latest.

Down Payment rules changing?

The Obama administration is currently trying to force homeowners to have at least 20% down on your home purchase or refinance. If you can't come up with the down payment plus closing costs than you will be charged a higher interest rate and fees. Sixty percent of Americans don't have the down payment that unelected regulators not Congress are trying to require. Think of an average home in Montgomery county MD. Say 350k purchase price. That's $70,000 just for the down payment plus 10k estimated for closing costs. That price might be for a first time home buyer. What about a couple who bought in 2005 put down 20% and lost it thanks for the real estate crash? Perhaps the saved and can afford a 10% down payment now. Say they have had a few children since then and need a bigger home. The sales price is 585k and they saved 59k plus the closing costs. They can afford the payment and will break even on their current home. Meaning they really lost the large down payment from the original purchase. Excellent credit, high incomes, good solid borrowers. Under this new Obama plan these people would pay thousands of dollars in higher monthly payments. How much more? None can tell you for sure right now. I can tell you though that today the payment would be $2,826 p&i




Total payments over 30 years would be $1,033,669 estimated. Now if we raise that .25% which is the lowest increase I have heard then the monthly payment is $91 more a month or $32,760 over the life of the loan. Total payments then rise to $1,063.286 over the life of the loan. Remember each .25% increase costs $91. So if the rate increase is .50% which is VERY possible then it's $182 more to the couple per month. This simply will allow less people to purchase, less people to sell and not do anything to reduce the possibility that the mortgage will default.




Not to mention this was hardly the intent of the Senators involved when this proposal came to light. In fact research shows that lenders are better protected with an LTV of over 80% with MI then hitting some magic number of 20% down. Don't believe me? Ask the lenders they know this and price loans according to risk. Ask a lender if having 20% down on purchases of condos in FL mattered at all when that market was destroyed? It's just a number to make people feel good about the loan industry. To say they are "doing something" to fix the mess. Most of the mess has already been fixed and the gov't had precious little to do with it.







Locally this matters as few areas around DC have a majority of people putting down 20% Arlington was the leader with 45% putting less than 20% down and Prince William with 79% in VA. In MD 86% of people put less than 20% down in PG and 52% in Montgomery. DC was pretty good at 49%. Obviously you will put large segments of the possible home buying market out of the game. In the meantime you will have another flash crash of real estate values that affect everyone. If home prices crater, local government will be hit badly as tax revenue declines and programs are slashed and cut. So even if you don't own a home or don't plan on moving this does matter, it does affect you, it does make a difference to you. Don't wait until it's, too late. Call Congress and tell them what you think. The agencies will be collecting public comments let your voice be heard. Some low down payment loans such as FHA will still be available without the higher fees BUT are still higher priced loans. FHA has two type of mortgage insurance and are almost always higher monthly payments as a result. Right now we have two options conventional loans and FHA loans. The government starting with President Obama wishes to remove one of the options for you. Last time I checked removing options wasn't a smart idea under almost any circumstance. Especially when the one remaining option (FHA) carries a higher payment AND FHA has too many loans now and wishes to reduce the amount already. How will they reduce the loan demand? By raising rates and fees again. Hope this helps please let me know if there any questions.

Foreclosures MD/Montgomery County

Just wanted to give some quick facts on foreclosures in Maryland for the last quarter 2010. 2010-Montgomery County had the third-highest foreclosure activity behind Prince George's County and Baltimore city, and the fourth-highest number of mortgage loan default notices behind Prince George's County, Baltimore city and Baltimore County. We were far behind but are still hurting from the excess of the boom. Montgomery had 157 foreclosure filings in January compared to 486 foreclosure filings in January 2010. This is GREAT NEWS that they have dropped so much. Montgomery County had 103 foreclosure filings in February compared to 676 foreclosure filings in February 2010. I wish there were none, it's a terrible thing but this is going in the right direction. There were 134 foreclosure notices, 289 notices of sales and 243 lender purchases in the fourth quarter of 2010 in Montgomery County. Not all of these homes will go to foreclosure thankfully. If you face this as a possibility there is help available. Contact your lender first and there are HUD approved counseling also. Not to mention several government programs designed to keep you in the house or to get you out with some money to start over. Lastly here are some of the hot spots where foreclosures and defaults are highest in Montgomery County, MD. If you are interested in buying one of these foreclosed homes please contact a local realtor who knows Montgomery county VERY well. Clarksburg, ZIP code 20871 - Montgomery Village, ZIP code 20886 - Montgomery Village, ZIP code 20877 - Germantown, ZIP code 20874 - Takoma Park, ZIP code 20912 - Burtonsville, ZIP code 20866 - Laytonsville, ZIP code 20879 - Germantown, ZIP code 20876 This is where investors can get the best deals on housing as well as first time home buyers. I don't want to sound cruel but for the housing market to rebound we need to get these homes sold. Please contact me to learn how I can help you as a first time home buyer.

Fannie Mae Home Path

As of late last year Fannie Mae made a change to their Home Path loan program. Home Path is when the property is owned by FNMA and is in need of "light renovation" Typically about 3k in repairs. We see alot of demand for pre-approval letters for the Homepath but every time we price one out versus FHA or the FHA 203k program the overall payment is superior against the HomePath. Anyway the change is as follows.
Source of down payment will no longer be eligible if unsecured funds from a relative, domestic partner or fiancee.

It must be YOUR money not a gift. For superior options to HomePath just give me a call or email and I will be happy to walk you thru the process. Hope this helps.

Changes to loans for 2011

Just wanted to give a quick update on some of the changes that are now in effect. None of them are good for borrowers but it is what it is.
1. A foreclosure with in 7 years renders a borrower unable to get a loan regardless of circumstances.
2. All revolving debts must be included in DTI ratios no matter how many payments remain. Old rules allowed exceptions if payments expired in less than a year.
3. Conventional loans require credit to be repulled not less than three days before closing.If additional debts are found or the score has dropped the rate could change or the loan could simply be denied.
4. All credit inquiries within 120 days must be addressed to determine if more credit was obtained, the old rule was 90 days.

These are just a few of the changes that are making it tougher and longer to obtain a loan. And more expensive but the market is paying heavily still for the excess from years past.
Please consult with a qualified loan officer to see if any of these changes could possibly derail your purchase or refinance.

Rockville Uncorked.

Some thoughts on the on MD wines after the Rockville Wine Festival. First off, GREAT event, very well attended and lots of energy. Now the MD wines....Well they have come along way but in general they are not on par with our neighbor to the south. But the gap is rapidly closing. Alot of different wines with interesting grapes are being grown from Western MD to the shore counties. My beef remains the same with the alot of the VA wines. Yes they are tasty but not at the price points selected. Running Hare in Calvert county makes some good wines. A malbec and a Sangiovese were quite good. But not for $25!! Frederick winery made some nice whites for 15-17 and that was more what I was after. Too much sweet wines out there also for my taste. I still feel that you can get some good but not great MD wines and they are alot of fun BUT they are about $10 over priced compared to Napa and even VA. The best wine I tried was Shooting Star from Jed Steele. Tasted great and was only $15 per. Anyone can make good wine at 25 plus but can you do it for 15 on occasion? Not yes in MD in my opinion but they are coming on strong.

One government housing program that had run out of funds months ago was revived by Congress. The Senate yesterday passed HR 4899 to reestablish the popular U.S. Department of Agriculture Single-Family Housing Guaranteed Loan Program (Section 502 Housing) as a self-sustaining program.The Rural Housing program had run through its $13.1 billion funding by early this year and many buyers hoping to finance home purchases using Homebuyer Tax Credits were unable to complete their purchase.

This is GREAT news for lower income buyers in rural areas. Check with me as there are places that would surprise you that qualify for a 30 year low fixed rate. For example in Germantown MD you can use USDA in small sections of Milestone. If you know that area, you know it isn't rural any more. Please let me know if I can be of assistance.