Maureen Webber’s Blog

The Michigan House of Representatives recently passed several statues to help regulate the mortgage industry. Still awaiting disposition in the Senate, the statues establish licensing standards for mortgage brokers not related to any banking institution.

MI State Representative Mark Meadows (D - 69th District) explains the statutes: “You may ask why the Legislature would meddle in what is essentially a business decision and why we would exclude banks from its coverage. While banks have made their share of bad investments in these tough economic times, they have not played a great part in the foreclosure crisis. You have read about sub-prime loans. What they are is a loan to an individual with perhaps the ability to pay the introductory rate but little chance to pay the escalated rate that will take place in the future. Many of the mortgage loans issued by private mortgage company brokers fell into this category. It may have been anticipated that the mortgage company would end up owning the property with escalating land values, and end up with a windfall profit. What was unanticipated, was the enduring, endless, unremitting decline in our economy.”

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Below is a list of the bills that make up the House’s Predatory Lending Package, currently awaiting Senate Disposition:

Please note: All bills sent to the Senate for consideration
Theses bills make up the House’s predatory lending package which targets a variety of practices which disproportionately affect lower income and minority borrowers. Predatory lending occurs most frequently with subprime loans, or loans made to people who ordinarily would not qualify for a loan.

- HB 5294 (Simpson), Passed 80-29
House Bill 5294 amends the title and definitions sections of the Consumer Mortgage Protection Act to include predatory lending.
- HB 5295 (Tobocman), Passed 81-28
House Bill 5295 prevents lenders from including various products in home loans.
- HB 5296 (Melton), Passed 81-28
House Bill 5296 creates additional requirements for lenders who use high-cost home loans.
- HB 5297 (Angerer), Passed 106-2
House Bill 5297 (H-1) provides technical changes the Consumer Mortgage Protection Act.
- HB 5299 (Clack), Passed 72-37
House Bill 5299 provides claims and defenses for civil cases concerning high-cost home loans.
- HB 5300 (Corriveau), Passed 99-10
House Bill 5300 (H-1) amends the Consumer Mortgage Protection Act to add to and clarify the duties of the Commissioner of the Office of Financial and Insurance Regulation (OFIR).
- HB 5301 (Gaffney), Passed 101-8
House Bill 5301 (H-1) amends the Consumer Mortgage Protection Act to revise the penalties for violations of the Act.
- HB 5302 (Ebli), Passed 109-0
House Bill 5302 (H-1) the Consumer Mortgage Protection Act to revise and update the intent of the act and to whom it applies.
- HB 5303 (Calley), Passed 106-2
House Bill 5303 (H-1) makes technical changes to the Consumer Mortgage Protection Act.
- HB 5307 (Young), Passed 85-23
House Bill 5307 establishes the requirements that brokers, licensers and servicers must follow when making a mortgage loan.
- HB 5308 (Valentine), Passed 81-27
House Bill 5308 creates these same responsibilities for individuals licensed under the Secondary Mortgage Loan Act.

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There is some relief for the homeowners of Michigan who have already moved into a new home and are still trying to sell their previous residence.

The number of days homes languish on the market has continued to rise leaving many homeowners stuck paying two mortgages when they decide to move. 

New legislation in Michigan will enable home sellers to retain 2 principal resident exemptions for property still on the market after the seller has moved elsewhere in the state.

The Michigan Association of Realtors (MAR) reported that House Bill 4215, now Public Act 96 of 2008 sponsored by Representative Ed Gaffney (R-Grosse Pointe Farms) enacts that the seller can retain an additional exemption for up to three years on property previously exempt as the owner’s principal residence if the following circumstances are met:

• the property is not occupied,

• the property is for sale

• the property is not leased or available for lease

• the property is not used for any business or commercial purpose

This is of great relief to home sellers who are not only stuck with two mortgages, but also hurt by the rising taxes in the non-homestead property they are trying sell. 

Call me at 313-404-5551 for more information on this new and helpful legislation!

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Depending on a buyer’s needs and wants, a high number on the “walkability” score chart could be a good or bad thing.  A new website called Walk Score allows you to plug in your address and will then tell you what your “Walk Score” is. 

The higher the score, the closer you are to grocery stores, coffee shops, restaurants, shopping, etc.  The site not only lists all the businesses it is basing the score on, but provides a map showing your home (or prospective home) and the location and distance of all the businesses.   

If you are a buyer who would rather live “away from it all”, then a low walk score might be more to your liking.  A low score would mean that the businesses others may find convenient are not within close walking distance of your home. 

Before deciding to purchase you should find out the walk score of your neighborhood and decide if you would rather have convience or relative seclusion. 

Click here to get your Walk Score!

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The number one mistake people make when they struggle to make their monthly mortgage payment is giving up! The only way to turn the situation around is to talk to your lender first.  Your bank is aware of the current real estate market and the economic struggles many people are facing - they don’t want to have to foreclose on your home.

Most homeowners panic and simply abandon the home and the debt…but by working with your lender you can most likely save your home, your credit score, and your sanity.

The following articles are a good read for anyone who may be facing default of their mortgage.  Most Importantly: Call your lender!

What if I miss a payment?

Pay Day Loans Make it WORSE for Homeowners

Foreclosures Slam Doors on Pets Too

FHA (Federal Housing Administration) loans for home-buyers have been around since the 1930’s and are starting to make a comeback in today’s market.  With most mortgage lenders making it more difficult to get a loan, many buyers are turning to FHA.

FHA insures loans, reducing the risk of default lenders face when a purchaser is putting down less than 20%.   In the past, FHA’s appraisal guidelines and mortgage limits have turned some buyers away.  But FHA is changing with the times.

Some might see it as bad news that FHA now recognizes many of the current loan default problems are due to purchasers receiving loans they really weren’t qualified for and couldn’t afford.  In response to this realization, FHA now has credit score requirements.

It used to be that FHA was the way to go if you had a low credit score - but last week they instituted a minimum credit score requirement of 550.  On Monday (March 17) they upped that to 580.  If your credit score is below 580 you will have a difficult time finding a lender.

Some good news is that FHA mortgage limits are now high enough to accommodate most buyers  - and while the minimum down-payment is 3%, there aren’t heavy restrictions on where that 3% can come from.  It CAN come from seller concessions. 

FHA also offers very competitive rates, and is the best option for many buyers right now. If you have previously been turned down for a mortgage, but have a credit score of at least 580, it is something you need to look into. 

For all your real estate needs, click here!

It’s that time of year again! The time of year assessments come from your city and a ton of homeowners storm the gates angrily waving pieces of paper.  If you are one of those people there are a few things you need to know.

First of all, start early.  If you know ahead of time that you are going to be appealing your tax assessment make your appointment as soon as allowable.  Most cities start the appeal process in February - so make sure to check as soon as you have an inkling you will be appealing.

You will first have to meet with your local appeal board - and be prepared for them to turn you down.  Most don’t even have to give you a reason.  So be ready to make an appointment with the State Tax Tribunal to appeal.  At the State Tax Tribunal the city assessor will HAVE to give reasons….oh, and the State Tax Tribunal DOES allow you to use foreclosure homes as a comparable, while the local board usually will not. 

If you are using recent comparable property sales to make your case, make sure that all of the properties sold no later than DECEMBER 31 OF THE PREVIOUS YEAR.  Anything from the current year will not factor in to the assment. 

Interesting Related Article: Tax Hikes Stun Homeowners

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It’s time to purchase! If you are a pre-approved purchaser who wants to buy, but you have been told to wait until the market hits rock bottom - then now is the time to re-think that strategy.  In truth, there is no time like the present to buy.  All you will accomplish by waiting is making yourself unhappy living somewhere you would rather not be. 

A recent article in Time magazine written by Dan Kadlec very succinctly explains why there is nothing to be gained in waiting.  First of all, the market for buyers is unbelievable right now.  Deals abound in pretty much every state and county. 

If you are mentally ready to purchase and plan on staying in the same home for at least five years, you need to make your move.  Literally. 

This article is a MUST READ for anyone who is thinking of waiting to purchase: Ignore the Headlines

For all your real estate needs click here!

Simply click on the headline to read an article:

AUCTIONS NO LONGER DRAW A CROWD

HOME SALES FALL AGAIN

JANUARY FORECLOSURES UP

FACING FORECLOSURE, SOME JUST WALK AWAY

EVEN THOSE WITH GOOD CREDIT FACE CRUNCH

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Simply click on the headline to read the article:

“Project Lifeline” will help to delay foreclosure

Mortgage lender Countrywide and housing advocacy group ACORN reach agreement

Some relief for mortgage stresses

Easy upgrade ideas from This Old House

Projects to help you organize your new home

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When you have been trying to sell for 6 months and you’ve made all the changes and updates recommended by your Realtor, including keeping the price at pace with the market, and your home is still in NOT selling, it can be hard to keep a cool head.

The real estate market in Wayne County, Michigan has been declining for some time now and the rest of the country is just starting to catch up.  With news outlets reporting daily that there is no end to the decline in sight, it can be very hard to be a home Seller.

The plain fact of the matter is that there are more homes for sale than there are buyers to buy them - and that can be frustrating and painful. 

The first step is to take a deep breath and evaluate the situation. Are you truly priced right? Have you honestly made all the updates and improvements suggested to you? Have you listened to the feedback given by prospective purchasers? If the answer is a resounding NO - then what are you waiting for?  Time is of the essence in this real estate market and you need to be at the top of the game from the word GO. 

If you can honestly answer YES to those questions then at least you are doing all you can to sell your home.  The first step is to release all the negativity that you feel about the lack of a sale.  If you and your Realtor are both doing everything you can to sell the home, then remaining positive is key.

It may seem silly, but every night before you close your eyes tell yourself that your home will sell.  Generating positive energy does not guarantee the perfect buyer will come knocking at your door the next morning, but it never hurt anything!

You and your Realtor cannot control the state of the market, or the decline in home prices.  Take responsibility only for the things that you can control: the price and condition of your home.  Your Realtor should be responsible for effectively marketing the property.

I understand that sometimes there are other mitigating circumstances that can make a lack of offer very frustrating.  Be it fear of defaulting on a mortgage or an impending move, you can still only do so much.

Be candid with your Realtor about your needs, and they will usually have a suggestion or solution for you.  Sometimes taking less for you home than it is worth is the only way to make it work - but things are never hopeless!  

Based on your individual situation there is always some other step that can be taken. If you truly feel desperate you may want to consider a Short Sale or renting out your home - your Realtor can help you with the details. The main thing is to keep your chin up and not let the negativity about the housing market get to you. 

Be realistic - but also be optimistic!  

For more information visit: www.realestateone.com/maureenwebber