Weekly Market Forecast

MSHDA reduces the interest rate today to 5.875%!!!!!!

Week of: Monday, August 13, 2007

Present Market Conditions
The financial markets have been in the media headlines with high levels of volatility over the past week. Although 98.6% of all U.S. mortgages are performing and not late or in default, foreclosure rates are up 30% since 2006 among loans to borrowers with marginal credit. As a result, major investors have begun to shy away from mortgage backed securities. In essence, the entire mortgage debt market is being adversely affected by high levels of “irrational fear”. Several retail lenders have gone out of business because they have been denied access to their corporate warehouse credit lines. Consumers can have ample access to purchase homes and refinance existing loans but current market conditions will lower loan to value ratios and raise interest rates on jumbo mortgage loans.

Expectations
Ken Goldstein, an economist for the Conference Board, has said he doesn’t believe the sub-prime situation is enough to send the economy off-track. According to Goldstein, though, as long as employment stays strong and workers’ earnings grow substantially (4 percent annually, according to him), confidence – and spending – will remain high and the economy will chug along. “Not only is the economy strong enough to survive the crisis, it’s strong enough to quiet it,” he said.

Guidance
Mortgage interest rates remain historically low. With tightened lending standards and the heightened awareness of the importance of professional financial advice, its in your best interest to work with a knowledgeable mortgage lender when purchasing or refinancing your home.

Authored by Georgie Cook
Traverse Mortgage Corporation
(231) 947-9700
(800) 968-3680
georgie@traversemortgage.com

Debt to Income Ratios?

Presenting words of truth written by a Traverse City area mortgage guru, Guy Cole of Countrywide Home Loans.

You’re meeting with your lender. All of a sudden terminology is being thrown at you left and right. Closing costs, pre-paids, down payment, assets, liabilities, income to debt ratios. You were ok up to the last one. Ratios? Now we are back in math? Lenders determine how much you’re loan amount can be based on how much you make and how much you owe, commonly called debt to income ratio’s. Example: Gross monthly income is $5,000.00 per month; therefore your housing cost should not exceed 31% or $1,550.00 including property taxes and home owners insurance. Your total debt should not be more than 42% of your income or $2,100.00. This is where you need to establish your own budget based on total expenses per month to insure you’re comfortable with the total payment that you’re being quoted. Things have a tendency to get a little scary when you’ve paid all of your monthly expenses only to discover you need to go grocery shopping and guess what? All of the money is now gone. Have fun looking for your home, the team at International Realty Plus is a great place to start.

Authored by Guy Cole
Countrywide Home Loans
(231) 941-5767 ext. 226


CMD 1261 – Traverse City, Mi

April & May Bi Monthly Newsletter

SUBJECT: Listing activity report for April & May 2007

Summer is finally upon us and what great weather it’s been! The previous two months have been reminiscent of past years with improved activity across our inventory. April turned out to be one of the best months we’ve had in a long time & May also carried a good amount of momentum. The increase we experienced in deals being written and closed, at the start of the year, has continued.

However, you’d have to be living a sheltered life to not have read something in the papers or publications that pertain to the very tough market throughout the nation and, unfortunately, the worst here in Michigan. This trend continues with no apparent end in sight! Realtors are working harder than ever to find buyers, to put deals together and to manage them to a close. The hours required just to survive have increased dramatically. We are very glad to be doing as well as we are and it highlights that in this new economy, business as usual just doesn’t make it. Our Company’s internet presence continues to provide superior representation and marketing in an attempt to locate buyers that the competition cannot.

Overall predictions nationwide are that sellers will need to continue to reduce their asking prices and northern Michigan remains no exception. Price is the primary driving force and not much else seems to matter. Our team is doing its part to stay at the forefront and to seek out as many effective venues as possible to market your property. A couple of examples are new, additional websites such as: landwatch.com & landandfarm.com. Additionally, we’ve utilized new downstate print venues and local publications to advertise not only our inventory but our main website: a 24 hr. /365 day link to the details of your listing.

We expect good activity during the next couple of months, but please keep in mind that most of June and July typically sees a plateau in activity with few dramatic increases until August. Only time will tell, but you can be assured that we will capitalize heavily on any and all inquiries.

Thank you again for your continued loyalty & support. Please feel free to stop by, call or email us at anytime with any comments, concerns or questions.

Brad Nichols
brad@irpmi.com
231-883-2255

Weekly Market Forecast

Week of: Monday, April 16, 2007

Present Market Conditions
March U.S. retail sales rose 0.7 percent, boosting the U.S. economy. With job gains and higher wages, the labor market remains the main reason why consumers have continued to spend. Though consumer spending is on the rise, consumer sentiment fell in early April to figures that are at an eight month low. This drop in sentiment has been attributed to higher gasoline prices and continued declines in the housing market.

Expectations
Albeit we continue to have a mixed bag of economic news, former Federal Reserve chairman Alan Greenspan feels that the world economy will provide a “cushion” to the U.S. economy. As the trade gap narrows for the third month in a row, Greenspan said growth in the rest of the world is creating demand for services from U.S. companies such as Microsoft Corp. It is predicted by the International Monetary Fund the global economy will grow by 4.9 percent this year, following a 5.4 percent expansion in 2006. The IMF said the U.S. would grow 2.2 percent this year.
Guidance
Fixed-rate mortgages remain below 6.5 percent, there has been a robust rise in non-farm payrolls and there have been solid gains in personal income and consumer spending. These factors coupled with the many incredible incentives being offered with home purchases makes this the quintessential time to purchase. To ensure you capitalize on this excellent scenario, always seek assistance from a qualified, professional Loan Officer.

Rehabilitation is Steps Away

Presenting words of truth written by a Traverse City area mortgage guru, Guy Cole of Countrywide Home Loans.

You’ve driven by it, you’ve gotten out and looked at it, you’ve even went up to the windows and looked inside and said “this place has alot of potential.” But then you’ve said “we can afford it, we just can’t afford to fix it up.” Well, I say, yes you can and this is how: FHA has a program called 203k which actually is set up for this reason. You even get to work with the contractor of your choice, not ours, you can even do some of the work yourself because you look so cool with more paint on you than on the wall. The best part is, it’s all under one mortgage and you have 6 months to complete it. You don’t need an expensive 2nd mortgage or even the infamous HELOC (home equity line of credit). You love the house, you love the location, and you love the potential this house is offering. Don’t pass it up, REHABILITATE IT!!!

Authored by Guy Cole
Countrywide Home Loans
(231) 941-5767 ext. 226