by Julie Lane,

VP of Legal and Compliance for Keller Williams Realty International

Come January 1, 2010, the new and improved Real Estate Settlement Procedures Act of 1974 (RESPA) will be fully en force. Considering this is the first sweeping change in the home buying process since 1974, it is worthy of our full attention. The new RESPA means more than new forms-it means major changes in the way real estate closings happen.

More to follow…

Buyers seeking FHA funds, per HUD Secretary Shaun Donovan last week, says they will be met with tougher credit standards and higher fees. Permissible “Seller Assist” or concessions will also be cut per the, Realty Times - Washington Report.

With high unemployment pushing up vacancies, no credit capacity and property values declining, commercial real estate markets remain stressed with little prospect for significant near-term improvement, according to The Real Estate Roundtable’s latest quarterly survey of senior commercial real estate executives.
http://www.reuters.com/article/pressRelease/idUS140531+02-Nov-2009+PRN20091102

Frustrated by the banks’ inability or unwillingness to stop an avalanche of foreclosures, some of the hardest hit states are considering lawsuits over the creation and marketing of millions of bad loans as well as the dismal pace of mortgage modifications. Such cases would have been impossible until a Supreme Court decision in June allowed the states to exercise their own supervision, giving them significant leverage.
http://www.nytimes.com/2009/11/03/business/03suits.html?_r=1&ref=business

The extension and expansion of the homebuyer tax credit is the pending business in the Senate right now, and a vote is expected sometime this week. Follow the link below for details on what the extension and expansion of the credit entails.

http://www.realtrends.com/go/view_media.php?mp_id=8576&cat_id=1359

The number of signed sales contracts to buy homes rose in September for the eighth straight month, according to recently released data from the National Association of REALTORS®. Most analysts trace the steady improvement to the government’s first-time homebuyer tax credit program, which has brought in between 200,000 and 400,000 additional sales that would not have otherwise been made.
http://money.cnn.com/2009/11/02/real_estate/
September_sales_contracts/index.htm?postversion=2009110210

$8000 Federal Stimulus For Buyers

The federal government wants to give away money.

If you know anyone who hasn’t owned a home within the last three years, the federal stimulus plan will give them an $8,000 tax credit (not just a deduction!) if they buy a home this year. But there are conditions…

The most important is that to qualify, the sale MUST CLOSE BY DECEMBER 1st.

That may sound like a lot of time but it’s not. There are a lot of factors that come into play these days. First of all, many mortgage companies and banks have seriously reduced staff and mortgages are taking much longer to process. That means it will often take two months from getting a property “under contract” until it can actually close. So backtracking from December first, that takes us back to October first to have an accepted contract.

The next issue is the time to get an answer from the seller. If a buyer is considering a “Short Sale”, the time for an answer often stretches into two or three months. Foreclosures aren’t quite so long, but it is often taking financial institutions several weeks to accept or decline an offer. Forgetting about short sales, even if a buyer’s first offer is accepted, we need at least four weeks. That takes us back another four weeks from October first to September first. If a buyer has to make, for example, three offers until one is accepted, that takes us back to at least August first, if not earlier.

Now we have to look at houses and decide on the best ones for the buyer’s needs. That could take a little time so it is now obvious that in this challenging real estate market we need to start looking for a home in June if we want to claim our $8,000!

Please contact me, and I can guide you through the process and help you down the best path possible.

by Phoebe Chongchua

It’s no surprise that buyers are looking for a bargain but now even more people are gaining interest in the growing foreclosure market. According to Trulia.com and RealtyTrac, a recent survey shows that 55 percent of U.S. adults are at least somewhat likely to consider a foreclosed home when buying real estate. That’s a nearly 10 percent increase from November 2008.

However, many buyers are a bit leery of foreclosures because approximately 85 percent said they can’t identify negative aspects of the properties. That figure also rose by 5 percent from the last quarter of 2008. Among the top concerns are hidden costs, a risky process, and further de-valuing of the foreclosed property. Buying a foreclosure doesn’t have to be a scary and unknown process if you take the right precautions. Inspect before you buy is a good motto for any real estate transaction but even more so with a home that has been foreclosed and possibly sitting vacant for long periods of time.

Read the full story at:  Realty Times

Investors who are buying up Wells Fargo (WFC Quote) shares these days are arguably making one of the riskier gambles in big bank stocks, though the payoff looms large if they are correct.

Wells executives believe the government’s stress test finding — namely, that the bank needed to raise $13.7 billion in additional capital — were far afield from reality.

According to Wells, regulators did not take into consideration just how far the company wrote down Wachovia’s assets, and they severely underestimated Wells’ ability to generate revenue. The company is encountering strong mortgage business, “booming” deposits, wide interest margins and investment-banking opportunities, all with a vastly shrunken dividend. Plus, Wells says, cost savings and synergies at Wachovia that were better than initially expected.

“The Fed’s results differ considerably from our results … and that was under a stress scenario,” CEO John Stumpf asserted in a conference call on May 8 to discuss an equity offering in which Wells raised $2.6 billion more than the $6 billion that had been first targeted. “We feel very confident in our numbers. We’ve had a 20-year record here at Wells Fargo and if there’s one thing we do know, it’s revenue.”
Our Top 10 Stock Search

In short, says Stumpf, much of the capital Wells is required to produce will be “additive, if you will.”

The boastful attitude of Stumpf and other managers like Chairman Dick Kovacevich, who called the stress tests “asinine,” and CFO Howard Atkins, who has touted Wells Fargo’s operational successes in a confident, but data-centric manner, have solidified confidence in the firm, which first appeared after an earth-shattering earnings report.

Positive analyst notes supported those initial gains, as did surprisingly strong results from other major banks like Bank of America (BAC Quote), JPMorgan Chase (JPM Quote), Citigroup (C Quote) and Goldman Sachs (GS Quote). Increasing signs of life in the left-for-dead economy and stress-test requirements that are less dilutive than some investors had feared have propelled Wells further, along with the rest of the market.

Article Source:  TheStreet.com

Find a local agent that specializes in that area

By James R. Hagerty
From RealEstateJournal.com

Question: I want to invest in foreclosure property. Where do I get up-to-date information?

Tony: Steve Berges, a seasoned renovator of distressed homes and author of real-estate investing guides including “The Complete Guide to Flipping Properties” (John Wiley & Sons, 2003), suggests that novices interested in buying foreclosed houses find a good local agent specializing in that area. He says many real-estate brokerages have agents who are experts on foreclosed properties. Some of them advertise that skill in local real-estate publications. Agents who work regularly with banks in finding buyers for foreclosed homes should be able to let you know what’s available and guide you through what can be a complicated process. Try to find someone experienced in your market who can recommend an agent.

Another real-estate author, William Bronchick, whose books include “Flipping Properties: Generate Instant Cash Profits in Real Estate” (Dearborn Trade, 2001), suggests finding a local information provider to e-mail you regular reports on notices of default. He pays about $40 a month for one such service covering six counties. There also are national companies that provide such information, but sometimes their information is dated, Mr. Bronchick warns.

A good source of data on repossessed homes being sold by the U.S. government is the Web site of the Department of Housing and Urban Development (www.hud.gov). Information on available homes is updated weekly, HUD says.

Both authors warn that the pursuit of foreclosed properties is highly competitive in some markets and no sure ticket to riches. Mr. Berges says he invests in houses only if he is confident he can make at least a 15- to 20-percent return on his money. He wants a wide margin for error because the costs of rehabilitating and selling a house can be hard to predict. That furnace that seemed sound could conk out before you sell the house. Aside from the cost of buying and fixing the house, you need to tot up the likely cost of financing, insurance, taxes and any brokerage commission on your eventual sale of the property, Mr. Berges says. “It’s not as cut-and-dried as you might be led to believe,” he says, but it can be very profitable if you get it right.