Understanding What Causes Interest Rate Movement The Federal Reserve constantly evaluates the US economy and, when necessary, takes steps to address inflationary concerns and avoid economic recession or depression. The mass media, in turn, reacts by providing a wide range of opinions and interpretations of the Fed's monetary policy. This can make it very difficult for consumers to decipher how such actions will influence interest rates in general and mortgages in particular. And although actions of the Federal Reserve can have a direct impact on the Prime rate, mortgage interest rates are dictated by the trading of mortgage-backed securities, which are similar to bonds and trade on a daily basis. This means that the real dynamic at the heart of interest rate movement is the competitive... 05/20/2009

  HUD recently announced that qualified First-Time Home Buyers who want to take advantage of the available tax credit of up to $8,000 now have another option available to them to help them become homeowners. It's clear that first-time home buyers have been having a major impact on the housing market this year. The National Association of Realtors announced that first-time buyers, who typically account for less than 40% of home sales each year, have been especially busy...in March, homes that were purchased by first-timers accounted for 53% of all sales, and this percentage is expected to hold true for all of 2009. With home affordability higher than ever, available tax credits and some of the lowest interest rates ever recorded for home loans, who can blame them? Particularly as a firs... 05/18/2009

1. Free Money. The $8,000 tax credit for first-time home buyers is valid through December 1, 2009. This is a special tax credit from the government that you don't have to pay back, as long as you stay in the home for at least 36 months.2. Affordability. Based on recent property declines and current interest rates, home affordability has not been higher since it was first tracked over 40 years ago. Your grandparents couldn't have received a better interest rate than you can today.3. Tax Breaks. The IRS allows you to deduct the interest you pay on your mortgage, your property taxes and, in many cases for those who qualify, some of the costs to buy your home and mortgage insurance. Owning a home is a great way to lower your tax bill.4. Build Wealth. Unlike paying rent, with each mortgage ... 05/15/2009

In August 2009, the Post- 9/11 Veterans' Educational Assistance Act (signed by President Bush in 2008) kicks in for qualifying members of the military on active duty since September 11, 2001. The most comprehensive education program since 1944, this law is designed to provide veterans with a similar level of educational benefits provided to service members at the end of World War II. Under the new law, qualifying veterans could receive payment up to the full cost of tuition and fees at the most expensive public school in the state in which you enroll. This basically guarantees a free education if you attend your state institution and qualify for the full amount. Under the new law, the current $1,200 program enrollment fee will also be waived. According to the U.S. Department of Veteran... 05/14/2009

  Finding a mortgage that's right for you should be easy. But there are often many different programs to choose from, as well as a myriad of ways to structure the loan in terms of the amount, term, payment, rate, closing costs...the list of options may seem endless.However, because there are so many options available, it's important to seek advice from an experienced mortgage professional who has your best interest at heart. The first step in determining which program is right for you is to ask yourself the important questions listed below. These questions can also help you confirm that you've chosen the right mortgage professional as well, because he or she should be asking you the same questions before trying to put any mortgage in place: How long do you anticipate living in your hom... 05/13/2009

  In the last several years, some significant changes in both the real estate and home loan sides of the housing industry have had an impact on real estate transactions. The issue I would like to bring to your attention today could go further and affect the way you do business.The Home Valuation Code of Conduct (HVCC), which became effective May 1, 2009, governs the way in which appraisals must be ordered for all residential real estate transactions, where the loans are sold to Fannie Mae and Freddie Mac.The purpose of this new regulation is to ensure that the value of the home - on which a mortgage is being issued - is arrived at both independently and objectively.While loan originators have traditionally been able to order appraisals directly from local appraisers who they know to be... 05/09/2009

Pre-approved Buyers: Disaster-Proof Your Deal A constriction in mortgage product offerings and the ongoing effects of the credit crunch have radically changed our business. It's not all doom and gloom. There is still plenty of money available to creditworthy borrowers. But lender guidelines have tightened significantly, and the days of easy credit with no down payment and no documentation are all but over. With this in mind, it's more important than ever for homebuyers to get pre-approved - not pre-qualified - in order to avoid the kind of painful last-minute surprises that can blow up deals. With actual written documentation that proves the full support of a lender, pre-approved borrowers represent less risk to sellers. Of course, there is no way to guarantee a flawless transaction ev... 05/08/2009

The New Jersey Housing and Mortgage Finance Agency provides a variety of programs to help prospective home buyers to purchase a home.    Tax Credit Loan Program - The "Prefund" Program Now Available Up to $5000.00 Pre-Fund Stimulus Rebate!The First-Time Home Buyers Tax Credit Loan ("TCLP")  Programprovides a loan to pay downpayment and/or closing costs to Agency  Home Buyer Program first-time  home buyers  who meet all of the requirements of the Home Buyer Program and who are eligible for the credit as permitted by the federal law establishing the credit and the  guidance provided by the IRS  in the General Instructions that accompany IRS Form 5405 and  who apply for a TCLP loan on or after April 8, 2009 and close on the home purchase between April 8, 2009 and December 1, 2009. The TCLP... 05/07/2009

  Did you know that the major credit bureaus sell your personal information? It's true! Known as "trigger leads", the files of borrowers applying for a home loan are immediately flagged, packaged, and sold by the credit bureaus to the highest bidders. For about $25 to $100 or more, your name and certain specifics about your credit report, including your address, phone number, mortgage history, and even your FICO score range, are sold to unscrupulous mortgage companies which then blindly solicit your business. This results in numerous unwanted phone calls and junk mail offers which are in no way associated with your real estate agent or loan professional.Unfortunately, no legislation presently exists to prevent the credit bureaus from profiting at your expense. As a trigger lead, you ar... 05/07/2009

With 2 million layoffs recently, the employment websites are busier than ever. And it's not just jobseekers who are making these sites so popular. Consumer-protection and law-enforcement groups and better-business bureaus are reporting that a whole new breed of scammers and "phishers" are also logging on to get your personal information to steal your identity. If you, or someone you know, are using the Internet to get a new job, protect yourself. Never supply Social Security numbers or bank account numbers over the phone or on your resume. Also, be wary of "work-at-home" or business opportunities which cost money or fees upfront for supplies, background checks, and other phony charges. The Wall Street Journal reported recently that many of these scam opportunities involve "medical billi... 05/05/2009

Mortgage Interest Rate Myths This may come as a shock to many borrowers, but it's absolutely true. Mortgage interest rates are not set by the Federal Reserve and, contrary to popular belief, mortgage rates are not directly tied to the yields of US Treasury bills, bonds, or notes - including the 10-year Treasury Note. That's right. Despite what you might hear in the media, mortgage interest rates are actually set by lending institutions, and are based solely on the performance of mortgage-backed securities. For years now, the media and inexperienced loan officers everywhere have suggested that the 10-year Treasury Note, a government-backed security, is directly tied to mortgage interest rates, that the two are separated by a specific interval - which is simply not true. The graph on thi... 05/01/2009

A good credit score translates into lower interest rates for home-shopping borrowers. In a mortgage lender's eyes, the higher your score is, the less risk you are, and the more likely it is you will pay off your debt. For this reason, borrowers with lower scores usually end up paying higher interest rates on their loans.If this is you, don't panic. There are a number of things you can do to adjust your credit score to receive a favorable review from the underwriter. Here are a few suggestions:Should I pay off all my past due balances and charge-offs? This is usually a good idea, but you only need to worry about the past due balances and charge-offs that have occurred in the last two years. Items more than two years old have little effect on your current credit score. In fact, if you pa... 04/30/2009

  You've already filed your 2008 tax returns and maybe you've already received your refund. That means it's too late to obtain the $8,000 tax credit for first-time home buyers enacted by President Obama's Stimulus Plan, right? Wrong. The great thing about this tax credit is that you can still get the cash this year, even if you've already filed your taxes for 2008 - and the money is yours to keep. You don't ever have to pay it back, as long as you stay in the home for at least 36 months. There's a lot of confusion in the media surrounding this tax credit, but it's actually pretty simple. Qualified first-time home buyers (anyone who hasn't owned a home in the three years prior to the purchase) can receive a tax credit of 10% of the purchase price up to $8,000. All you have to do is purc... 04/29/2009

    Everyone makes choices. Their outlook on life, whether at home, at work, behind the wheel or at the theater, directly correlates to the decision to be either positive or negative. In essence, it's as simple as whether you see the glass half full or half empty. As author Stephen R. Covey puts it in his much publicized book, The 7 Habits of Highly Effective People,* you can choose to be proactive or you can choose to be reactive. He takes his theory a step further, saying that a proactive stance leads to greater success and contentment. From that perspective, a reactive person is sabotaging himself or herself. Covey contends that every single day, people have 100 opportunities to be proactive or reactive. Let's say you're in your car on the freeway and an overly zealous driver is pra... 04/28/2009

Certain mortgage companies will pay top dollar to know exactly who is in the market for new financing. What's more, the major credit agencies not only allow files to be flagged whenever someone applies for a home loan, they actually sell this private information as leads to the highest bidders! For a price tag of $25 to $100, names, addresses, phone numbers, mortgage histories, and even FICO score ranges are sold by the credit bureaus to mortgage companies, which then blindly solicit business. Unfortunately, no legislation exists to prevent credit companies from profiting from this practice. As trigger leads, consumers are simply at the mercy of any number of solicitations designed specifically to discredit the mortgage professionals they've come to know and trust. Remember, a limited ... 04/27/2009

In order to obtain a home loan, a borrower is usually required to have a homeowner's insurance policy in place. Experts agree that the most important question homeowners should ask when shopping for a plan is the A.M. Best rating of each company. New companies pop up all the time, and homeowners need to be informed about what a company can offer in terms of protection against potential risk. Consumers should also become familiar with the liability portion of their policy. ACV (Actual Cash Value) policies pay claims based upon the depreciated value of the item or items lost. However, replacement cost policies will pay the full cost required to actually replace the items. To ensure that the right amount of insurance is purchased, homeowners should obtain an appraisal every five years or ... 04/17/2009

  Consumers are often baffled by the home appraisal process. They may feel their home is worth a certain dollar amount, and therefore, the appraised value doesn't make sense to them. It is important to know that appraisal guidelines are dictated by the lenders. In many states, the lenders must disclose the purpose of the appraisal, as each situation carries its own set of rules.In essence, lender guidelines force appraisers to put a fair market value on a home based upon comparable sales in the area where the home is located, as the home must be bracketed according to size and value. For example, there is no set amount associated with a great view, pool, spa, bathroom upgrades, etc. If a homeowner installs a custom pool that cost them $30,000, and the local marketplace supports the val... 04/16/2009

Money-Saving Tips from the Pros   Fresh rains in the early spring are symbolic of the season itself, offering a revitalizing cleansing of the outdoors. The warming weather also offers a reminder to homeowners that now is the ideal time to do a bit of spring cleaning.  After all, a bit of due diligence by homeowners not only freshens their living quarters, it also helps them save money and avoid more costly repairs down the road. "Making a list of items to check around the home this season - and then actually following through with the tasks - can help reduce home maintenance and utility costs," says Angie Hicks, founder of Angie's List, the nation's leading provider of consumer ratings on local service providers. It's important that homeowners schedule needed services as quickly as poss... 04/15/2009

      I once heard the expression, "Communication is the lubrication in your organization." That couldn't be truer, especially in the world of business. You simply can't over-communicate when dealing with clients. I find that the best way to eliminate the constant state of reactivity in which most of us work is to employ proactive communication strategies, such as the following:Make a list of the people with whom you correspond regularly.Take note of all the recurring questions that you have to answer time and time again. Then ask yourself how you can provide the information to these individuals in advance. For example, let's say you're a real estate agent, and you know that during every transaction you are going to receive a telephone call from the buyer regarding the home inspection r... 04/14/2009

In theory, finding the right mortgage should be a fairly simple process. After all, there are literally hundreds of options to choose from, including Fixed Rate, Adjustable Rate, Hybrids, and Interest Only loans, to name just a few. Mortgages are available with interest rates ranging from an introductory rate of 1.00% to well over 10.00%. Borrowers can even finance up to 100% of their home's value and, in some cases, their closing costs as well. In reality, however, this vast selection of mortgage products has made choosing the right one a challenging endeavor, to say the least. Without sound advice from an experienced mortgage professional, consumers are at the mercy of a complex financial decision that could impact their lives for years to come. At a minimum, home buyers should consi... 04/10/2009