Real Estate Information

By Brad Bennett,

President

Columbus Board

of Realtors®

We hear a lot in the media about what’s happening nationally in the real estate market. But these national reports don’t give a true picture of what’s happening in our own back yard.

• Inventory levels are at record highs!

There are more homes listed today than any time on record. This means you have a great selection of homes to choose from!

However, we’ve seen a slight decline in the number of homes listed and expect that to continue. So move fast, as you’ll likely never again have as large a selection of homes for sale as there is right now.

• Central Ohio home values have increased almost 33 percent in the last decade.

While year-to-year fluctuations are normal, real estate remains one of the best performing and consistent long-term investments. Average Central Ohio home sale prices have increased on average 3.6 percent each year from 1996 through 2006 and 40.2 percent over the last 11 years combined. If you are looking for dependable growth rates, real estate is still your number one investment choice.

• Mortgage interest rates are close to 40-year lows.

The average 30-year fixed rate mortgage (about 6.4 percent) remains near 40-year lows and more than an entire percentage point below 2000 levels.

For example, with a $250,000 mortgage, a rise in interest rates from 6.5 percent to 7.5 percent means an additional $2,000 in annual payments. This may boost some currently available homes out of financial reach.

Lower interest rates allow more people to afford homes, as well as to get more home for the money.

• Home prices are very competitive.

Right now, there are more homes for sale than buyers to buy them (i.e. a Buyer’s Market). The result is that sellers are forced to price their homes to compete. As the market corrects itself, home prices will start to increase again. So, buyers act now while homes are priced to sell!

Every market is different. Talk to a Realtor about what’s happening in your community.

Now is a great time to buy!

By Brad Bennett,

President

Columbus Board of Realtors®

For the first time in more than four years, the Federal Open Market Committee this week lowered its target for the federal funds rate 50 basis points to 4-3/4 percent.

Many believe that, when the Fed slashes its rates, mortgage interest rates drop. Although this can occur, generally this is not the case, but it is good news for housing.

The recent half point cut was intended to induce lenders to say yes more often – especially to jumbo borrowers, who have applied for mortgages greater than the conforming limit of $417,000.

Lately, lenders have become more reluctant to extend jumbo mortgages, because investors are scared of buying packages of jumbo loans for fear of the quality of the loans. That’s what froze the jumbo market, and observers believe the Fed is trying to thaw it out by making it cheaper for lenders to borrow.

Making borrowing  more affordable will make money more available and this will have a positive affect on the housing market.

Will this translate to lower interest rates? No one knows. But here’s what we do know!

The current interest rates of 6.5 percent are extremely favorable for buyers, near historic lows, and likely to go up in the future.

• Home priced don’t necessarily move in unison with interest rates.

So, if  you wait to purchase a home, and the price drops $10,000, you could end up losing money. How? If interest rates were to move up a half-a pointduring this period, the savings on the reduced home price would be more than offset by the higher monthly payment you would be making over the life of the loan.

We know that:

•  Interest rates are low today.
• Home prices are down.
•  There are  plenty of homes to choose from.
• Sellers are willing to bargain and builders are willing to offer attractive incentives.
• These favorable variables could change for the worst.

Now is a great time to buy!

By: Bill Alsnauer, CLU

2500 W Dublin-Granville Rd

Columbus, OH 43235

614-764-2411

State Farm® agent

There are lots of homes for sale and many good options for financing.  Here are two that might be of interest.

1.  Wells Fargo has a program for FHA/VA buyers that offer an interest rate is 6.5% for 30 years, but for the first year the rate is 5.5%.  For example, on a $100,000 mortgage the payment for the first year would be $567.79, and then for the remaining 29 years the payment would be $632.07 (principal and interest only).  The closing costs are approximately $1900.  There is also down payment assistance money available for qualified buyers.

2.  There is also OHFA (Ohio Home Finance Association) bond money available.  There are two different programs.  There are some income restrictions and mortgage limits.

Option one has an interest rate of 6.375%, 1% origination fee, you must put 3% of the purchase price down.

Option two has an interest rate of 6.875%, 1% origination fee plus either 2% or 4% grant funds available for down payment and closing costs

You can find out more about this program at www.ohiohome.org/homebuyer or by contacting Jamie Sutton at Wells Fargo Home Mortgage 614-880-9345

Contact the Jackson Team to help you navigate through the home buying process.  Don’t miss out on a great opportunity for a most important investment!

By MELANIE MCINTYRE

Daily Reporter Staff Writer

Reproduced with permission from The Daily Reporter

Seniors in Central Ohio have yet another place to run for their reverse mortgage needs as Columbus' Insight Bank announced Monday that it now offers the product to qualified borrowers.

"Rising energy costs, rising heath-care costs, and rising taxes are making it difficult for Ohioans to enjoy their later years. Reverse mortgages provide a little much-needed financial flexibility," said Insight Chief Executive Officer Mark Kelly.

A reverse mortgage is a loan against one's home that owners do not have to pay back for as long as they live there; the loan only is available on primary residences.

Essentially, reverse mortgages allow homeowners aged 62 and up to convert part of their home equity into tax-free income that can be put toward home improvements, travel and other out-of-pocket expenses, he said.

Payouts can be distributed in a lump sum, regular monthly payments, a line of credit or a combination of all three. There is no minimum income or asset requirements, the borrower never gives up title to the house, and a reverse mortgage income does not impact eligibility for Social Security, Medicare or other insurance-based retirement benefits.

Still, owners remain responsible for property taxes and insurance, and reverse mortgages typically carry an origination fee, a servicing fee, interest and closing costs.

Borrowers who still owe money on a first mortgage usually are eligible for a reverse mortgage, Kelly said, depending on the home's current value and the outstanding balance on the original loan.

Single-family one unit dwellings are eligible properties for reverse mortgage programs, though some also accept two to four-unit occupied dwellings, condominiums, manufactured homes or single units in a planned unit development.

Also, a property should have few or no outstanding liens, though they can be paid off with reverse mortgage proceeds, according to the American Bar Association Commission on Law and Aging.

The AARP contends that the most homeowners get the largest cash advances from the federally-insured Home Equity Conversion Mortgage and that it is almost always the least expensive private sector reverse mortgage.

More than 300,000 senior homeowners have used HECMs since 1990, meaning they account for almost 90 percent of the reverse mortgage market, according to the U.S. Department of Housing and Urban Development. As of July, the Federal Housing Administration already had backed 69,833 loans.

Before Insight Bank borrowers are approved for a reverse mortgage, they must meet with an independent counselor from a government-approved housing counseling agency, Kelly said.

To give consumers an opportunity to do that-and learn about refinancing, foreclosure prevention, legal rights, loss mitigation and credit counseling- the state of Ohio and HUD are co-sponsoring three "Borrower Outreach Days" next month in Columbus, Nelsonville and Perrysburg.

Columbus State Community College will host the Columbus event on Sept. 18 from 2 p.m. to 8 p.m. Interested parties can visit www.com.state.oh.us/bod or call 800-CALLFHA for more information. 

Clintonville Homes Tour is coming up on Sunday, September 9, 2007.  This is the Silver Anniversary Tour and features 8 homes throughout Clintonville.  It’s a great chance to get the inside scoop on some homes you have always wanted to see!  Tickets are available at the following locations prior to the tour:

The Backyard Experience – 3515 N. High St.

Fifth Third Bank –Torrence & High (3615 N. High) & Henderson & High (4400 N. High)

Re/Max Capital Centre – 3805 N. High St.

Coldwell Banker King Thompson – 3468 N. High St.

Faulkner Realty – 3003 N. High St.

Tickets are $9 before the tour, $12 on Sunday.  Tickets will be sold at Backyard Experience and each home on Tour Day.

Proceeds will benefit The Clintonville Fund.

More information is available by clicking the following link:

http://www.clintonville.org/Clintonville_Fund/Homes Tour/homes_tour.htm

Before deciding on what terms they will offer you a loan (which they base on their “risk”), lenders what to know two things about you:  Your ability to pay back the loan, and your willingness to pay back the loan.  For the first, they look at your income to debt obligation ratio.  For your willingness to pay back the loan, they consult your credit score.

The most widely used credit scores are FICO scores, which were developed by Fair Isaac and Company, Inc., (and they’re named after their inventor!).  Your FICO scores are between 350 (high risk) and 850 (low risk).

Credit scores only consider the information contained in your credit profile.  They do not consider your income, savings, down payment amount, or demographic factors like gender, race, nationality or marital status.  In fact, the fact they don’t consider demographic factors is why they were invented in the first place.  Credit scoring was developed as a way to consider only what was relevant to one’s

willingness to repay a loan.

Past delinquencies, derogatory payment behavior, current debt level, length of credit history, types of credit and number of inquiries are all considered in credit scores.  Your score considers both positive and negative information in your credit report.  Late payments will lower your score, but establishing or reestablishing a good track record of making payments on time will raise your score.  

Different portions of your credit history are given different weights.  Thirty-five percent of your FICO score is based on your specific payment history.  Thirty percent is your current level of indebtedness.  Fifteen percent each is the time your open credit has been in use (ten year old accounts are good, six month old ones are not as good) and types of credit available to you (installment loans such as student loans, car loans, etc., versus revolving and debit account like credit cards).  Finally five percent is pursuit of new credit----credit scores requested by creditors.

Your credit report must contain at least one account, which has been open for six months or more, and at least one account that has been updated in the past six months for you to get a credit score.  This ensures that there is enough information in your report to generate an accurate score.  If you do not meet the minimum criteria for getting a score, you may need to establish a credit history prior to applying for a mortgage.

Please contact:

Valerie Behre

Loan Account Executive

val@markemortgage.com

It’s virtually impossible to change your score in the time between when most people decide to buy a home or refinance their mortgage and when they apply.  So the short answer is, you really can’t “on the spot.”  But there are strategies you can live with to make sure when you apply for a loan your score is as high as possible.

Make sure that the information each of the three credit reporting bureaus has on you is consistent and up to date.  Order a copy of your credit report about once a year, and dispute any inaccuracies.

Note:  Theoretically, if a series of credit reports is requested on your behalf during a limited amount of time, your score goes down until time passes without any inquiries.  Changes in the law though have made “consumer-originating” credit report requests not count so much.  Also, a series of requests in relation to getting a mortgage or car loan is not treated the same as a number of credit card requests in a limited time.  This is because the credit bureaus, and lenders, realize that people request their own credit reports to keep up with what’s on them, and smart consumers shop around for the best mortgage and car loans. 

Unsolicited credit card solicitations in the mail don’t count against your credit scores so don’t worry.

The two main components of your credit score are your payment history and the amounts you owe.  Bankruptcy filings and foreclosures, which can stay on your credit report for as many as 10 years, can significantly lower your score.  It’s never a good idea to take on more credit than you can handle.

Late payments work against you.  It’s extremely important to pay bills on time, even if it’s only the minimum monthly payment.

Don’t “max out” your credit lines.  Since the size of the balance on your open accounts is a factor, lower balances are better.

Don’t close paid off revolving accounts.  If you have paid the accounts in full and you don’t want to use the account any more, destroy the card (s) but leave the accounts open.

Please contact:

Valerie Behre

Loan Account Executive

val@marketmortgage.com

It’s not too late…

 CLINTONVILLE CONCERT SERIES FINALE - The last of the Civitan sponsored Park of Roses Concerts will be this Sunday at 7PM.

The Clintonville Band and Choir will perform at the Park of Rose Gazebo. All concerts are free and everyone is welcome.

 CLINTONVILLE WOMAN’S CLUB SUMMER LUNCHES – Wednesday, August 29^th and Wednesday September 5^th. Lunches are $10 and include salad, entrée, beverage and rolls.  The Clintonville Woman’s Club is located at 3951 N. High St.

 THE CLINTONVILLE CHAMBER NEWSLETTER - will be published and mailed Thursday, August 30^th. If your business has a Business Brief item you would like included or if would like to include an insert in the newsletter please contact the chamber office at 262-2790. The cost of an insert is $70, plus 350 copies.

 THE CLINTONVILLE CHAMBER’S CRUISE THE VILLE was a big success thanks to the many sponsors, volunteers and of course the cruisers that attend the event. Go to www.cruisetheville.com to see many photos. Also, look for the full page ad in the August 30^th issue of THISWEEK IN CLINTONVILLE for a full listing of much deserved thank-you’s.