A smaller percentage of U.S. homeowners were saddled with “underwater mortgages” in the second quarter as more homes entered the foreclosure process even as price declines slowed, real estate website Zillow.com said Monday 08/10/10. Fewer homeowners with so-called underwater mortgages, where the amount owed on the mortgage exceeds the home’s value, is indeed a positive for the housing market as it could mean fewer defaults and foreclosures down the road.

The percentage of American single-family homes with mortgages in negative equity fell to 21.5 percent in the second quarter from 23.3 percent in the first quarter and 23 percent a year ago, according to the Zillow Real Estate Market Reports. These underwater mortgages are one of the biggest banes of homeowners since negative equity makes many of them unqualified for home loan refinancing and prevents some from selling.

There is also additional good news since the HUD announced its Federal Housing Administration ,FHA, underwater financing program which should aid 3-4 million homeowners . FHA officials recommend that underwater mortgage holders contact their lenders to see if their bank or mortgage companies will be taking part in their program which starts September 7.

Beware of scammers

Recently, more than 30 people in New York have been charged in connection with mortgage-fraud scams as part of a nationwide federal crackdown dubbed “Operation Stolen Dreams.”  Preet Bharara, the U.S. Attorney for the Southern District of New York, announced charges in eight separate cases, with scams involving counterfeit documents, bogus loan-modification programs and loans to purchase properties that did not exist.

Almost half of the 38 defendants were charged as a result of an undercover investigation that recorded and videotaped people purchasing phony documents to use in support of fraudulent mortgage loan applications. There were more than 256 victims, dozens of financial institution and at least $29 million worth of fraudulent loans. This investigation is ongoing and could uncover more frauds.

A Queens, New York man pleaded guilty to leading a $10 million scheme that defrauded mortgage lenders. He admitted in the U.S. District Court in Manhattan that he headed a ring that recruited straw buyers to purchase homes and obtained more than two dozen fraudulent loans, according to prosecutors. Some targeted the Haitian-American community, claiming they would help on immigration and housing matters but instead use the victims’ information to create fake documents to obtain mortgages.

Here are some specific ways in which Mortgage Fraud occurs:

1. Property Flipping – An investor buys a house, gets it appraised much higher than it is worth and sells it off right away. This involves fraudulent appraisals, false loan documentation and exaggerated incomes in order to secure loans. Often, there are kickbacks across the board involving all the players in the transaction.

2. Nominee Loans/Straw Buyers – There are people who use stand-ins to do real estate transactions. The name and credit history of someone else is used or borrowed by another to borrow money and make big ticket purchases.

3. Fictitious/Stolen Identity – The applicant swipes the name, personal information and credit history of someone else and actually uses it to apply for loans. The crime may go beyond just mortgage fraud as it can also be compounded by cases of identity theft.

4. Foreclosure Schemes – This is a heartless case of preying on vulnerable people who are already at risk of losing their homes in foreclosure. Scamsters dupe the homeowners with the hope and promises of saving their homes if they cough up fees and payments or worse, deed transfers to the wrong hands.

5. Occupancy Fraud – When investors lie by claiming that they will live in an investment property as their primary residence or second home in order to acquire better terms for their loans, then they are breaking the law. I didn’t realize it but the reason for higher mortgage rates for investment properties is to protect lenders from the greater risks inherent in the business of lending to investors rather than primary home buyers.

Mortgage rates are the lowest they have been in more than 50 years making this a great time to buy a home. Mortgage-backed securities prices, which drive mortgage rates in the opposite direction, continue to perform well driving mortgage rates down even more. Panic about economic conditions at home and overseas, particularly in Europe, is credited with helping MBS prices and mortgage rates remain low.

FreeRateUpdate.com’s  research of  lenders’ rate sheets shows the following:

1. Conventional 30-year fixed mortgage rates are still at 4.25% for well-qualified borrowers paying 1 point origination and 15-year financing is available at 3.75%. Both fixed conforming interest rates are at all-time record lows.

2. Rates for FHA loans are just as good; however, APR on an FHA mortgage with the same note rate as a conforming loan is significantly higher because of MI and other FHA fees.

3.  Jumbo 30-year fixed mortgage rate is at an all-time record low as well, 5.25%.

4. Wells Fargo, the #1 originator of mortgages in the United States, is offering on their website a conventional 30-year fixed rate of 4.625, with an APR of 4.812%.

If the near record low mortgage rates being advertised everywhere has you wondering whether now might be the time to consider refinancing your mortgage, here are some things to keep in mind:

First, use a good mortgage calculator to see how much you might save by refinancing to a lower rate. If you can save a significant amount each month, then consider how much you’ll have to pay in closing costs to refinance. If you find that you’ll save a considerable amount on the monthly payment in addition to factoring in your closing costs, then proceed with the type of mortgage you might want to consider.

Keep in mind if you currently have an FHA loan, FHA Streamline guidelines have changed, so you may have to do an FHA inspection whereas previously it was not required.

The next thing you have to consider is how long you’ve been in your current home. Lenders review your record of payment and the length of stay before approving your mortgage refinance. Also, keep in mind that the more you owe, the higher your refinance cost may be, due to fees, interest, and possible penalties.

Finally, don’t forget about the appraisal process. Many property values have dropped recently, so make sure this won’t affect your refinance amount.

If you still have quite some time left before your home is paid off, refinancing now and locking in a lower rate can easily save you thousands in the long run.

*********************************************************************************

Best Buyer’s Broker Realty is an Exclusive Buyer Agent specializing in Long Island real estate (Nassau and Suffolk properties) and neighboring Queens County properties.

We don’t take any seller listings (yet we have more homes for you to see than most agents) and never have any potential conflict of interest like other agents who also represent sellers. We represent buyers only, 100% of the time. We can show you more homes for sale because we have access to MLS, FSBOs, Exclusives (homes that agents try to keep secret), foreclosures and homes not on the market that may be of interest to you.

We are not your traditional real estate agent. Our goal is to advise and protect home buyers and help them obtain the lowest price and best terms on their dream home. Call us at 516-887-6901 to see how we can help you save time and money. Or visit our sites at www.bestbuyerbroker.com or www.bestbuyersbroker.com

Nearly a quarter of all homeowners are sinking under a mortgage that is bigger than the value of their home.

Even Worse, that figure could rise to as much as 30% by the middle of next year as job losses and foreclosures climb.

In the city, those who owe more on mortgages than their homes are worth climbed to 12.5% in the second quarter from 10.3% in the first three months of the year.

Homeowners are being hurt by price declines. The estimated median value for single-family homes slid 12% from a year earlier in the 10th consecutive quarterly decrease.

About 25 million homes, or 48% of mortgaged properties, will be underwater as prices drop through the first quarter of 2011, analysts at Deutsche Bank wrote in a report released recently.

*********************************************************************************

Best Buyer’s Broker Realty is an Exclusive Buyer Agent specializing in Long Island real estate (Nassau and Suffolk properties) and neighboring Queens County properties.

We don’t take any seller listings (yet we have more homes for you to see than most agents) and never have any potential conflict of interest like other agents who also represent sellers. We represent buyers only, 100% of the time. We can show you more homes for sale because we have access to MLS, FSBOs, Exclusives (homes that agents try to keep secret), foreclosures and homes not on the market that may be of interest to you.

We are not your traditional real estate agent. Our goal is to advise and protect home buyers and help them obtain the lowest price and best terms on their dream home. Call us at 516-887-6901 to see how we can help you save time and money. Or visit our sites at www.bestbuyerbroker.com or www.bestbuyersbroker.com

With all the doom and gloom over housing, you might be surprised to know that this is a fantastic time to get a mortgage. Not if you have poor credit, to be sure. But you can get a great deal on a 30-year, fixed-rate, conforming loan these days if you have a solid FICO score, a manageable debt burden, and proof positive of a reliable income.

Rates are probably headed even lower in 2009, raising the question of whether you should borrow now or wait for a better deal. The experts are sharply divided over this one. Put it this way: If you’re a gambler, wait. If you can’t sleep at night worrying that rates will go up from here, buy and borrow now.

During ordinary times, one loan is about as good as another because most lenders’ offers on 30-year loans are clustered within around a quarter of a percentage point. Not now. With the economy so shaky, lenders are all over the map in how much risk they’re willing to take in making loans. So it really pays to shop around. And keep checking, because rates are constantly changing.

Forget what you were told in quieter times about the pros and cons of fixed- vs. adjustable-rate mortgage loans. These days, all the best deals are on fixed-rate loans because that’s the segment of the market that the government has been targeting with support.

On the other hand, if you got an ARM in the past and it’s coming up on an interest rate reset, don’t rush to unload it. Short-term interest rates have gotten so low that you’re very likely to see your monthly payment fall.

Before Making an Offer, Get Pre-Qualified

Home sellers are likely to give you a better deal on a house if you’re pre-qualified for a mortgage. Why? Because it shows you can get the deal done quickly. In this market, nothing burns a seller more than being strung along by a buyer who wants the house but can’t qualify for a loan to buy it.

On the other hand, if trying to decide when to refinance, this comes down to personal risk preferences. Of course, you should also run your numbers through one of the many online calculators (a rough rule of thumb is that it makes sense to refinance if the new rate is a full percentage point below your current rate and you don’t plan to move soon).

The Federal Reserve and Treasury Dept. seem determined to force mortgage rates lower in 2009 and are bound to have their way, however, with interest rates, nothing’s for sure.

So what do you think? Pull the trigger and buy (or refinance) now, or wait? We’d love to hear your opinion.

*********************************************************************************

Best Buyer’s Broker Realty is an Exclusive Buyer Agent specializing in Long Island real estate (Nassau and Suffolk properties) and neighboring Queens County properties.

We don’t take any seller listings (yet we have more homes for you to see than most agents) and never have any potential conflict of interest like other agents who also represent sellers. We represent buyers only, 100% of the time. We can show you more homes for sale because we have access to MLS, FSBOs, Exclusives (homes that agents try to keep secret), foreclosures and homes not on the market that may be of interest to you.

We are not your traditional real estate agent. Our goal is to advise and protect home buyers and help them obtain the lowest price and best terms on their dream home. Call us at 516-887-6901 to see how we can help you save time and money. Or visit our sites at www.bestbuyerbroker.com or www.bestbuyersbroker.com

HUD will require, for the first time ever, that lenders and mortgage brokers provide consumers with a standard Good Faith Estimate (GFE) that clearly discloses key loan terms and closing costs. HUD estimates its new regulation will save consumers nearly $700 at the closing table.

Last March, HUD proposed reforms to the longstanding regulatory requirements of the Real Estate Settlement Procedures Act (RESPA) by improving disclosure of the loan terms and closing costs consumers pay when they buy or refinance their home.

HUD will require the new standardized GFE and HUD-1 beginning January 1, 2010. To view these documents, click on the following links:

HUD’s standard Good Faith Estimate

HUD-1 Settlement Statement

*********************************************************************************

Best Buyer’s Broker Realty is an Exclusive Buyer Agent specializing in Long Island real estate (Nassau and Suffolk properties) and neighboring Queens County properties.

We don’t take any seller listings (yet we have more homes for you to see than most agents) and never have any potential conflict of interest like other agents who also represent sellers. We represent buyers only, 100% of the time. We can show you more homes for sale because we have access to MLS, FSBOs, Exclusives (homes that agents try to keep secret), foreclosures and homes not on the market that may be of interest to you.

We are not your traditional real estate agent. Our goal is to advise and protect home buyers and help them obtain the lowest price and best terms on their dream home. Call us at 516-887-6901 to see how we can help you save time and money. Or visit our sites at www.bestbuyerbroker.com or www.bestbuyersbroker.com

Housing is at the root of the financial crisis, and preventing foreclosures could bring a double-barreled benefit. It would allow families to remain in their homes and could also help keep the housing market from spiraling out of control. The more foreclosed homes that get dumped on the market, the more home prices will fall. The idea of helping Main Street has an undeniable appeal.

Given all the other imperfect emergency measures that the U.S. government has taken in recent weeks, it can certainly do more to stem foreclosures than it has. The Treasury Department’s $700 billion bailout fund, as it’s now structured, may spend almost nothing on troubled mortgages.

There are two separate groups of people who are at risk of foreclosure, and they often get muddled in any discussion of the housing crisis.

The first group is made up of people who, for whatever reason, will not be able to make their monthly payments. Some took out mortgages with initial monthly payments that they couldn’t afford. Others took out adjustable-rate mortgages whose monthly payments have ballooned to an unaffordable level. Still others have lost their jobs.

The second group is quite different. It is made up of people who are at risk of foreclosure not because they won’t be able to keep up with their monthly payments – but because they may decide they don’t want to continue making them. These are the homeowners who are “under water,” which is to say their houses have lost so much value that they’re now worth less than the underlying mortgage.

In recent weeks, several intriguing ideas for helping homeowners have begun making the rounds. So who should be rescued? Tell us what you think.

*********************************************************************************

Best Buyer’s Broker Realty is an Exclusive Buyer Agent specializing in Long Island real estate (Nassau and Suffolk properties) and neighboring Queens County properties.

We don’t take any seller listings (yet we have more homes for you to see than most agents) and never have any potential conflict of interest like other agents who also represent sellers. We represent buyers only, 100% of the time. We can show you more homes for sale because we have access to MLS, FSBOs, Exclusives (homes that agents try to keep secret), foreclosures and homes not on the market that may be of interest to you.

We are not your traditional real estate agent. Our goal is to advise and protect home buyers and help them obtain the lowest price and best terms on their dream home. Call us at 516-887-6901 to see how we can help you save time and money. Or visit our sites at www.bestbuyerbroker.com or www.bestbuyersbroker.com

Faced with plunging property values and rising defaults, lenders are charging borrowers higher mortgage rates and adding fees. Not all of these added costs are set in stone, however. If you’re looking for a loan, vigilant shopping and a little haggling can go a long way toward landing a better deal.

Here are some fees you need to watch out for:

Application Fees

Just because an ad says “no application fee” doesn’t really mean there’s no fee to get the loan. Fees paid outside of closing typically include an application fee, an upfront property appraisal fee, and a credit check. They might be disguised as something like a “document processing fee” or “doc fee.”

Risk Adjust Rates

Getting deemed a risky borrower is no longer just a matter of a low credit score. Lenders now consider other risk factors. Buy in an area that has seen values drop precipitously and you can expect a higher interest rate.

Down Payment Penalties

The days of zero down on a mortgage are over. Without a down payment of at least 20%, prospective homebuyers will undoubtedly get hit with a higher interest rate and need to pay for more points. (Each point usually amounts to a fee of about 1% of a mortgage.)

Also, if buyers can’t put 20% down, they’ll need to get private mortgage insurance, which typically costs 0.5% of the loan. Shopping around for lenders with more-favorable points and insurance charges can help lessen the blow.

Closing Costs

Closing fees amount to 2% to 5% of a home’s price. Location plays a big role, as taxes and other requirements vary by state. Some states require expensive attorneys to oversee the closing process, while others allow a title agent or escrow officer.

Ask potential lenders for a good-faith estimate of closing costs. Then check in weekly with whoever is handling the closing to see whether there are any changes in either lender or third-party fees.

*********************************************************************************

Best Buyer’s Broker Realty is an Exclusive Buyer Agent specializing in Long Island real estate (Nassau and Suffolk properties) and neighboring Queens County properties.

We don’t take any seller listings (yet we have more homes for you to see than most agents) and never have any potential conflict of interest like other agents who also represent sellers. We represent buyers only, 100% of the time. We can show you more homes for sale because we have access to MLS, FSBOs, Exclusives (homes that agents try to keep secret), foreclosures and homes not on the market that may be of interest to you.

We are not your traditional real estate agent. Our goal is to advise and protect home buyers and help them obtain the lowest price and best terms on their dream home. Call us at 516-887-6901 to see how we can help you save time and money. Or visit our sites at www.bestbuyerbroker.com or www.bestbuyersbroker.com

*********************************************************************************

If your credit problem isn’t too serious, you may still be able to get a traditional loan. First, you should correct any errors on your credit report, and challenge any entries you think shouldn’t be there. This is your legal right. If you can get it changed, then once those changes are reflected in your credit score, you may be able to apply again and get a loan for that home.

You also can go only to lenders who hold their own loans “in house.” This means they don’t sell them into the secondary market, which means the loans don’t have to meet certain requirements. A bank which holds its own loans can make their own rules (to an extent). Ask around to see if some of your local banks or credit unions keep mortgage loans in their own portfolio. Few do these days, but some still do. It pays to ask.

A more creative way to overcome bad credit is to buy a house with another person. This isn’t only for married couples. Any two people can buy a home together, and the lender will look at both credit histories. It might be tricky to buy a house with a friend, but it can be better for both compared to renting. For example, you might have a down payment, and your friend could have good credit. You could agree to sell the home five years later to recover your down payment and each of your respective shares of the equity that is built up from appreciation and the paying down of the loan.

Seller financing is another way to buy when you can’t get a loan because of bad credit. Some homes have sold without credit checks and even with nothing down by sellers who financed the purchase. Their motivation is usually to get a higher price and/or to sell a problem property, but this doesn’t rule out a good opportunity for you. When sellers don’t offer terms, find out if they own their houses free and clear. If so, you could make an offer that involves payments to the owner rather than getting a loan from the bank.

*********************************************************************************

Best Buyer’s Broker Realty is an Exclusive Buyer Agent specializing in Long Island real estate (Nassau and Suffolk properties) and neighboring Queens County properties.

We don’t take any seller listings (yet we have more homes for you to see than most agents) and never have any potential conflict of interest like other agents who also represent sellers. We represent buyers only, 100% of the time. We can show you more homes for sale because we have access to MLS, FSBOs, Exclusives (homes that agents try to keep secret), foreclosures and homes not on the market that may be of interest to you.

We are not your traditional real estate agent. Our goal is to advise and protect home buyers and help them obtain the lowest price and best terms on their dream home. Call us at 516-887-6901 to see how we can help you save time and money. Or visit our sites at http://bestbuyersbroker.com or http://bestbuyerbroker.com.

*********************************************************************************