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Weather Changin’ on the Economic Front

Weather is changing again and it isn’t just about Halloween.


Its fall, no doubt about that with the last few chillier  nights. Not sure what happened to the summer at all this year between some blazing days and drying plants. People are painting their lawns — no kidding — thats a new one on me.  But it  was a great year , even as good as 2014. Sales were brisk and a lot of people I know found jobs, got settled, got moved or just decided retirement was a thing of the past.

So what about the market? The general economic forecast is not all Halloween candy. In general I am seeing regular price reductions in formerly hotter areas. Inventory is down and buyers are holding back like they do every year at this time. The banks are getting a handle on short sales which means they are converting them to bank owned properties as sellers try to use that system to avoid selling their home at all.

Says Lynn Franco, Director of The Conference Board Consumer Research Center said : “Consumer confidence is now back to levels last seen during the 2008-2009 recession. Consumer expectations, which had improved in September, gave back all of the gain and then some, as concerns about business conditions, the labor market and income prospects increased.  The Present Situation Index posted its sixth consecutive monthly decline, as pessimism about the current economic environment continues to grow.”

Banks have responded to the national changes

On Aug. 9, the U.S. Department of the Treasury released Supplemental Directive 11-08: Home Affordable Foreclosure Alternatives Program (HAFA) – Policy Update effective Oct. 15.
These policy enhancements will affect borrowers as follows by clarifying program criteria and rules
  • An FAQ clearly defines program criteria and rules. Borrowers can access the information from the Home Loan Assistance website   at by:
    1. Navigating to the Next Steps section or selecting Frequently Asked Questions from the Additional Support area.
    2. Look for the “If my mortgage is not owned by Fannie Mae or Freddie Mac…” question and select Home Affordable Foreclosure Alternatives Policies

Property and borrowers will have some increased options regarding being  considered for loan modification.Individuals relocating from homes that are upside down will have some increased options. Wells Fargo made claims in a recent seminar that they would take a more personal approach and look at homeowners that were more than 30 days late on their mortgage payments.

Regarding Fannie Mae/ Freddie Mac loans, the Federal Housing Finance Agency (FHFA)  will broaden the scope of the Home Affordable Refinance Program (HARP) by removing the current 125 percent loan-to-value cap for fixed-rate mortgages.  Other program enhancements include, among other things, reducing certain fees, eliminating the need for a new property appraisal if the FHFA has a reliable automated valuation model (AVM) estimate, and extending HARP until the end of 2013.  New federal guidelines for the HARP changes should be released to mortgage lenders and servicers by November 15.

More information is available at FHFA.

So what does that mean for YOU?  It’s not over.  As Jet Li said in the Forbidden City when his student runs down a list of future horrors and what if’s   “Remember to breath.”

…and prepare.

  1. take a a close look at your income, expenses and future expenses
  2. look at your needs vs your wish list
  3. make your move after you have made your best guess about your own situation

If your family has grown and you need more room or a better school, be willing to accept less for your home in order to buy more in the current market. Make up your loss with a gain on your purchase. I’ll help you develop a strategy for your home that maximizes the dollars you will get.

If your future expenses are high enough such that your mortgage and house expenses will eat you out of house and home consider downsizing or renting for awhile until you can save or make plans and save your credit.

For a in depth discussion on your spreadsheet for your home and your future try calling a free resource: your realtor. With my lender at First Funding we can help you to plan your remodel to sell your home looking its best in the spring for as few dollars as possible and discuss Prop 60 and 90 which would allow you to move within Santa Clara to a smaller home and take your tax base with you. Check out my website in the schools section to start looking for the best schools to move to for the most affordable price.

So enjoy the witches and goblins in your neighborhood. They aren’t any more real then they have ever been. Take a walk, don’t eat candy with transfats and welcome home , we live in a great place.

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