Real Estate in Pasadena CA

As part of the Economic Stimulus Package the loan limit on reverse mortgages has been raised from $417,000 to $625,500. A 50% increase!

This means that someone whose home was worth $625,500 or more and qualified for a $300,000 loan a week ago would now receive $450,000 and never have to worry about making a payment! Interest rates are currently around 3% which means loan amounts are near all time highs.

With the stock market in the tank and investment income at all time lows a reverse mortgage may give seniors the security they need to make it through this tough time.

Seniors can also buy a home using a reverse mortgage and never have to worry about making a payment. If their current home is too big, too costly or just doesn’t work for them anymore may be able to sell and buy a lower valued home and never have to make a mortgage payment.

If you would like more information on the Reverse Mortgage for Purchase loan or the regular Reverse Mortgage loan contact Bob Bozanic at (818) 742-3664.

There's no telling how long the housing crisis will drag on. Here's what you need to know before you start shopping in a rocky market.

Rule 1: You can't time the bottom

Face it: The house you buy today will more than likely be worth less next year, which could get you thinking about trying to time the bottom. Resist. It's harder to do than you think, and this is the best buyers have had it in two decades, with inventories up and mortgage rates low.

Pace yourself, find the perfect place and drive a hard bargain: Ignore the seller's asking price and bid below what comparable homes are selling for. If the seller balks, move on. Remember that if you're trading up, your home could sit. So sell before you buy.

Rule 2: One reason to buy now - mortgage rates

Homes are plentiful and will remain so, but financing will be getting more expensive. True, the Federal Reserve has slashed interest rates, but fixed mortgages don't directly follow the Fed. They reflect the bond market's expectations about inflation, which remains a concern. The 30 year fixed rate, now at 6.1%, will likely reach 6.75% by December and 7% in 2009, says Celia Chen of Moody's Economy.com.

That means there could be a penalty for waiting to buy even if prices fall more. Today a $250,000 loan would set you back $1,500 a month. At 7%, a $1,500 payment gets you only a $225,000 mortgage. As for variable-rate loans, the spread between conforming ARMs and fixed loans is too narrow to do you much good.

Rule 3: Another reason to buy - rates on big mortgages

Mortgages in amounts greater than $41 7,000 - the limit for buying by federally sponsored mortgage agencies typically have run a fifth of a percentage point above conventional products. But investors are shunning jumbos, which now average 7.2% and are unlikely to drop much this year, according to HSH Associates. Certain jumbo borrowers could get relief, however. A new law allows Freddie Mac and Fannie Mae to buy loans as large as $729,750 in 71 high-priced areas. So far "jumbo conforming" loans average 6.6%. The program has gotten off to a slow start; you'll need to shop around. And unless Congress acts, this bargain will disappear at year-end.

Rule 4: Don't buy cheap; buy good schools

By now you've heard from somebody who knows somebody who got a great deal on a foreclosed property. But when you buy a house, you're also buying into a neighborhood. And foreclosures tend to be bunched in areas where residents and speculators alike took out exotic mortgages to get into homes they subsequently found they couldn't afford. That's not a recipe for stability. Prices and quality of life could both decline further.

Similarly, avoid developments that popped up in the past few years. They too likely have a lot of owners with risky loans and little equity, says Mike Larson of Weiss Research. Instead, go for areas with highly rated schools. They generally fare better during downturns, and that pattern is holding today, according to a recent study by real estate site Trulia.com.

Rule 5: Make sure your agent has your interest at heart

The real estate game has a built-in conflict of interest, since the listing agent and your agent both get paid by the seller and these days more sellers are offering extra cash to buyer's agents.

So make sure you're not being steered to a house that's better for your agent than for you. Agree up front on your agent’s commission (typically 3%) and that any extra payments will go to you, says Jon Boyd, past president of a buyer's agent trade group.

According to recent statistics released by the U.S. Department of Justice, about 1.6 million households experience theft of existing accounts other than a credit card (such as a banking account), and 1.1 million households discover misuse of personal information (such as their social security number) annually. In addition, a recent poll revealed that "sixteen percent of adults say they have had their credit or debit card used by someone they don't know without their permission" and that "substantial numbers" of people have taken specific steps to help prevent identity theft from happening to them.

Here are some important tips for keeping your information safe and sound:

• Give it to me in writing. While many of us have limited our exposure to telemarketing calls by utilizing the Do-Not-Call registry, charities are exempt from the Do-Not-Call rules. If you receive a phone call from any charity, ask the caller to send you information in the mail instead of giving out your credit card information over the phone. If you get any resistance, just hang up. If someone isn't willing to give you the chance to review some information, they could be interested in more than earning a commission.
  


• Just the facts. We often give unnecessary information like our date of birth and income level when we're filling out things like warranty cards for new products we've bought or supermarket club cards. Share only what's really necessary in every situation.
  


• Navigating the Net. Never post your address or your full date of birth on any social networking sites because both are pieces of information needed to steal your identity. In addition, if you utilize internet job sites, never give a potential employer your Social Security number until they are ready to hire you. Also, thoroughly investigate companies before you submit your resume and check the privacy policies of any online job boards to make sure they won't sell your information.
  


• The world of paper. Even though the Internet has added a whole new dimension to identity theft, there are still important steps to take when it comes to paper items. First, never keep your Social Security number in your wallet, glove compartment, and other easy-to-access places. Also, never have it printed on your checks or use it as your password. Second, when you are ready to get rid of old documents that contain important information, shred them. And last, if you have to mail something that contains sensitive information, drop the letter in a secure mailbox instead of a mailbox that anyone can open (like the kind at the end of many people's driveways).
  

The bottom line is this: When it comes to your personal information, share it on a need-to-know basis only!

Have a great week and stay cool!

With thanks to Ann Watson, Countrywide Bank, FSB