Wednesday, December 10, 2008

Hi Everyone:

Why is it in a crisis, everyone seems to forget the rule "Buy low, sell high?" Well, maybe it's because we've watched too much "Deal or No Deal" and keep thinking there's more, more more. I was discussing the historically low interest rates (in the low 5's for FHA - unheard of!) with my good friend Vince Ventura at Evergreen Mortgage. He shared an article with me that came from one of their Senior Loan Consultants. I hope it helps you understand why continuing to say "No Deal" to this market and these interest rates might be a huge mistake!

As always, feel free to call us with any of your questions concerning real estate. We can be reached at 503-371-5209 during business hours.


From: Vince Ventura, Branch Manager
Evergreen Home Loans
3400 State Street, Suite G-780
Salem, Oregon 97301
(503) 588-2667 tel
(503) 588-2236 fax
(503) 932-4621 cell
(888) 821-9251 toll free

From: Donald Burton Sent: Wednesday, December 10, 2008 11:43 AMTo: AllEMMCSubject: I'm waiting for my 4.5% mortgage the government promised....

Ginny Lee in our Seattle office forwarded me this article. Greed was a factor in the real estate meltdown. No one was immune. Now it seems that greed again, is playing a role as would-be homebuyers and refinancers are waiting for their gift from the government of a 4.5% mortgage. It's possible but they could be waiting a long time.....

4.5% Rates Possible?The news is abuzz about the Treasury lowering home loan rates to 4.5% to stem the foreclosure crisis but details have been lacking. The Treasury Department stated it is looking for additional ways to help the struggling housing industry and believes lower rates are needed.
This idea is similar to the November 26th announcement from the Federal Reserve where they indicated the intent to purchase up to $500 billion in mortgage-backed securities from Fannie Mae, Freddie Mac and Ginnie Mae. In addition they would buy another $100 billion in direct debt issued by those firms. The November news caused bond prices to spike higher and forced mortgage rates lower. Just like any commodity, whenever tremendous buying interest exists, prices rise. Mortgage rates fell almost 1/2% in rate following the announcement. However, the following week market forces continued and rates spiked a bit higher from the recent lows.
It is important to remember that there are no details to the Treasury plan as of yet. The Federal Government does not directly dictate home loan rates. Rates are determined by price movements of Mortgage Backed Securities (MBS), which compete for investor funds in the open market. The Treasury can buy mortgage bonds on the open market but remember that they are not the only entity buying and selling these instruments.
The Treasury is in a very tough position in trying to manipulate home loan rates. Creating a new Federal mortgage program could be very risky. How would rates be set, who would qualify, and can the funds be used for purchases and refinances are just some of the questions being asked. The other critical concern is implementing such a program without destroying the current mortgage securities market. Doing so could have the unintended consequence of causing additional economic turmoil.
Rates are not going to 4.5% with the wave of a wand by Hank Paulson or Ben Bernanke. As a matter of fact, the massive borrowing to fund the TARP program has a negative effect on rates. At this time, the announcement still leaves a lot of uncertainty. What we do know is that rates are at historic lows and house prices have moderated setting up a great scenario for people who need to refinance or are looking to buy a home. Waiting for rates to fall to 4.5% may leave people sorely disa

Ginny Lee
Senior Loan Consultant
Evergreen Home Loans

Monday, December 8, 2008

Hi Everyone,

If you're like me, you're REALLY busy getting ready for the Christmas holiday. This year has been interesting, to say the least. This is the first Christmas my husband Greg and I have had an "Empty Nest." I never realized how much scurrying around I did so the kids would have that magical Christmas! This year, though, we've decided to merge the old traditions with some new ones. And it's been an exciting adventure.

One thing that never changes, though, is the reality of the real estate market. I recently came across an article at that does the best job I've seen, of explaining pricing strategy.

I'd encourage you to read it in it's entirety. It explains why the worst news from your Realtor might be the very best news you could receive.

I can tell you this is the approach we're taking with our sellers. And what are they seeing in terms of results; selling in 2/3's the time the average Realtor takes, for 9% higher average sales price. That's a strategy worth talking about!

If you have any questions about what you're reading, please don't hesitate to call my office at 503-371-5209.

Have a merry holiday season.


Monday, December 1, 2008

Hi Friends,
Well as you might imagine, anyone in the real estate industry, who plans to survive this market correction, is staying very very focused right now....and I'm no exception!

In spite of that, I found this opinion from the New York Times, and felt it was important for all of you to be alerted. Please feel free to call us any time you need a referral to a reputable mortgage broker, we'd be happy to assist.

Happy Holidays!

OPINION November 24, 2008 Predatory brokers have returned, but this time as loan-modification companies, offering to work deals — for cash up front.