If you are needing a 100% Mortgage, take a look at Rural Housing loans. The GRH program works well for many Americans and they use a common sense approach to lending.   30 year fixed rate Loans can be 100 plus loan to value ( the fee financed can exceed the value ) No down payment required For Moderate income households ( up to 115% of the county or national median income ) Closing cost can be included in the loan No limit on seller contribution by USDA rural development Eliminates requirements for private mortgage insurance Can be used for new or existing properties Guarantee fee of 2% of loan amount due after closing Qualifies for community reinvestment act credit http://www.rurdev.usda.gov/     09/19/2008

Thanks to our government effectively bailing out Wall Street, you can say hello to 7% interest rates soon. One of the upsides of a shaky financial market is a strong bond market in a "flight to quality!" Now, everyone is back into the stock market, thanks to this manufactured bull market. I am in shock... From Naked Capitalism: New measures to shore up the markets are coming so fast and furious that it is becoming hard to keep track of them. What most people do not realize is that they produced some not-very-pretty unintended consequences. As we discussed (courtesy reader Lune) at the time: 1) Congress raises conforming limits on Fannie/Freddie to help unfreeze the mortgage market. Result: agency spreads skyrocket, bringing down Bear and a host of hedge funds. Mortgage markets still rem... 09/19/2008

Here is the press release: SEC Halts Short Selling of Financial Stocks to Protect Investors and Markets Here is the order from the SEC: IT IS ORDERED that, pursuant to our Section 12(k)(2) powers, all persons are prohibited from short selling3 any publicly traded securities of any Included Financial Firm....This Order shall be effective immediately and shall terminate at 11:59 p.m. EDT on October 2, 2008, unless further extended by the Commission. 09/18/2008

Credit scoring is a statistical method that lenders use to quickly and objectively assess the credit risk of a loan applicant. Today this is more important than ever The score is a number that rates risk associated with paying your debt on time.   Credit scores only consider the information contained in your credit report. They do not consider your income, savings, down payment amount, or demographic factors like gender, race, nationality or marital status. 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 re-establishing a good ... 09/18/2008

In another historic move, the Federal government of the United States has pumped more money into foreign markets to attempt to help their markets "un-seize!" Here is the release from the Fed: For release at 3:00 a.m. EDTToday, the Bank of Canada, the Bank of England, the European Central Bank (ECB), the Federal Reserve, the Bank of Japan, and the Swiss National Bank are announcing coordinated measures designed to address the continued elevated pressures in U.S. dollar short-term funding markets. These measures, together with other actions taken in the last few days by individual central banks, are designed to improve the liquidity conditions in global financial markets. The central banks continue to work together closely and will take appropriate steps to address the ongoing pressures.F... 09/17/2008

This is the first step toward resinstating seller-funded down-payment assistance in some form. It still has to make its way through the House and Senate. From Marketwatch: GAITHERSBURG, Md.,, Sept 16, 2008 /PRNewswire-USNewswire via COMTEX/ -- Bipartisan legislation would reauthorize downpayment assistance Ann Ashburn, President of AmeriDream, issued the following statement today after the House Financial Services Committee adopted H.R. 6694, legislation designed to reauthorize and reform downpayment assistance programs that the Bush Administration banned in July. "Today's committee vote was a positive step toward preserving downpayment assistance, but our work is far from over," said Ashburn. "Now more than ever, members of Congress need to know that Americans are watching their vote o... 09/16/2008

NAR put this out a while back, but does it still makes sense today ? Tax write off:  According to the U.S. Tax Code you can deduct the interest you pay on your mortgage, property taxes, and some of the costs involved in buying your home. Home value: While the median price of single family homes nationally has gone down -1.8% between 2004 and 2007 the Mobile Real Estate has thrived by increasing in value by 6.4%. Even with a 6.4% percent increase in value the Mobile market is still considered a buyer's market thanks to the ongoing tremendous growth. Stats offered by the NATIONAL ASSOCIATION OF REALTORS.  Equity: When owning a house it is possible to gain equity value in many different ways. Supply and demand, new commercial development (accessibility), new schools in the area, new highwa... 09/16/2008

This should make the market go much higher until they realize that the problem isn't solved! From CNBC: American International Group will get an $85 billion bridge loan from the federal government in exchange for an 80 percent stake in itself, sources have told CNBC. Sources said the loan, which will allow AIG to avoid bankruptcy, will be secured and include incentives for quick asset-sales by AIG.Government warrants for most of AIG's equity will severely dilute existing shareholders. Read the entire article here: http://www.cnbc.com/id/26743248     09/16/2008

The Fed held rates steady at 2% despite pressure from the financial markets... For immediate release The Federal Open Market Committee decided today to keep its target for the federal funds rate at 2 percent. Strains in financial markets have increased significantly and labor markets have weakened further. Economic growth appears to have slowed recently, partly reflecting a softening of household spending. Tight credit conditions, the ongoing housing contraction, and some slowing in export growth are likely to weigh on economic growth over the next few quarters. Over time, the substantial easing of monetary policy, combined with ongoing measures to foster market liquidity, should help to promote moderate economic growth. Inflation has been high, spurred by the earlier increases in the p... 09/16/2008

From MarketWatch: Fitch Ratings downgrades AIG to 'A' Fitch Ratings said late Monday that it downgraded American International Group because the insurer's ability to raise capital for its holding company has become "extremely limited." Fitch also kept AIG on Rating Watch Negative. This may be the next shoe to drop for the mega-insurer. It remains to be seen what S&P and Moody's decides to do! Another crazy night... 09/15/2008

Cost of living in 1968 Dow Jones Avg- 943  ( today 12,000-14,000 ) Avg cost of a new home- 14,950.00 ( today 225,500.00 ) Avg income - 7,850.00  ( today 48,200.00 ) Avg monthly rent - 130.00 ( today 1,153.00 ) Gallon of gas - .34 ( today 4.00 ) Avg cost of a new car - 2,822.00  ( today 27,958.00) Movie ticket- 1.50 ( today 7.00 ) Loaf of bread - .22 ( today 3.12 ) Gallon of milk- 1.21 ( today 4.12 ) HOME INTEREST RATES in 1968  - 6.5 %   TODAY -  5.25%     "The financial and credit crisis has lingered on for over a year now, and today some of the biggest casualties are being seen. After 158 years in existence, Lehman Brothers filed bankruptcy due to overexposure of high-risk loans in the mortgage arena. Merrill Lynch is being acquired by Bank of America, which will save them from the sa... 09/15/2008

The five most important words in the language are:  I AM PROUD OF YOU. The four most important words in the language are: WHAT IS YOUR OPINION? The three most important words in the language are: IF YOU PLEASE. The two most important words in the language are:  THANK YOU. The least important word in the language is: I. ~ Robert W. Woodruff 09/15/2008

From the Fed press release: Release Date: September 14, 2008 For immediate release   The Federal Reserve Board on Sunday announced several initiatives to provide additional support to financial markets, including enhancements to its existing liquidity facilities.  "In close collaboration with the Treasury and the Securities and Exchange Commission, we have been in ongoing discussions with market participants, including through the weekend, to identify potential market vulnerabilities in the wake of an unwinding of a major financial institution and to consider appropriate official sector and private sector responses," said Federal Reserve Board Chairman Ben S. Bernanke. "The steps we are announcing today, along with significant commitments from the private sector, are intended to mitigat... 09/14/2008

After the Lehman bankruptcy news, it now looks like Bank of America is close to a deal to buy Merril Lynch. This, after the Countrywide takeover, is huge news for BOA. The financial markets may continue this buyout/bankruptcy waltz for a little while... From theNew York Times' Dealbook: Bank of America is in advanced talks to buy Merrill Lynch for at least $38.25 billion in stock, people briefed on the negotiations said on Sunday, as a means to preserve that investment bank while Lehman Brothers looks likely to collapse.The move suggests a desperate effort at triage on Wall Street, as Bank of America works to shore up the likely next victim of the credit crunch. A deal, valued at between $25 a share to $30 a share, could be announced as soon as Sunday night, these people said. Merrill s... 09/14/2008

This shouldn't surprise anyone who has been watching closely. The government can't bail out everyone and Lehman had ample time to find a suitor...which proved to be impossible in this credit and capital starved market. From the NY Times Deal Book Blog: Lehman will seek to place its parent company, Lehman Brothers Holdings, into bankruptcy protection, while its subsidiaries will remain solvent while the firm liquidates its holdings, these people said. A consortium of banks will provide a financial backstop to help provide an orderly winding down of the 158-year-old investment bank. And the Federal Reserve has agreed to accept lower-quality assets in return for loans from the government.But Lehman's filing is unlikely to resemble those of other companies that seek bankruptcy protection. B... 09/14/2008

Keep copies of all earnest money checks and proof that the checks have cleared your bank.  Provide this documentation to your lender so that you get proper credit on your closing documents. Notify your mortgage company of the final sales price at least five days prior to your closing.  If your sales price changes from the original  contract, the lender will need copies of all addendums and change orders for the upgrades.  The final closing documents cannot be prepared until both builder and buyer agree to the final sales price. A final inspection is required on all new construction before the loan is closed.  The   appraiser must inspect the property to ensure that it was completed to the original plans and specifications.  The mortgage company schedules this inspection.  The home must... 09/14/2008

The Treasury is attemtping to broker a deal  for Lehman without having to use any more government money. Thid may help stabilize the jittery financial markets... From Bloomberg: U.S. Treasury Secretary Henry Paulson and New York Federal Reserve Bank President Timothy Geithner urged the heads of Wall Street's biggest firms to find a solution to the plight of Lehman Brothers Holdings Inc., signaling their reluctance to use government funds to bail out the investment bank, people familiar with the talks said. Talks between the government and the banks continued today, New York Fed spokesman Andrew Williamssaid. Yesterday's meeting, convened by Geithner, began at 6 p.m. with Kendrick Wilson, a former Goldman Sachs Group Inc. executive whom Paulson tapped last month as an adviser, helping le... 09/13/2008

"Bad credit? No problem!" Unscrupulous mortgage brokers and lenders use lines like this to aggressively target families and steal their single largest source of wealth-home equity. As families work hard to build wealth through homeownership, abusive loans can quickly sabotage their progress and even push them into foreclosure. Predatory lending is most common in the subprime market, where home loans cost more and often come with monthly payments that increase over time. Subprime loans result in foreclosure far more frequently than mainstream "prime" loans. To make matters worse, many of the families steered into high-cost subprime loans could qualify for more affordable, less risky financing. Only a decade ago, the subprime market was a small fraction of the home loan market. At year-en... 09/12/2008

An appraisal of real estate is the valuation of the rights of ownership. Instead of just creating the property value, the appraiser uses market data to derive a value estimate.   The appraiser must take the site, amenities and the physical condition of the property into consideration when compiling the report.  Before the appraiser can come to a final opinion of value, there must be a good deal of data conducted and collected.  He will inspect the property as part of preparing the report.   The need to accurately define the purpose of the appraisal is essential due to the many types of value, such as Fair Market Value, Insurance Value, Tax Value and Value In Use. Mortgage companies request the majority of real estate appraisals to confirm the property's purchase price for loan purposes... 09/12/2008

A credit default swap (CDS) is a credit derivative contract between two counterparties, whereby the "buyer" or "fixed rate payer" pays periodic payments to the "seller" or "floating rate payer" in exchange for the right to a payoff if there is a default or "credit event" in respect of a third party or "reference entity". If a credit event occurs, the typical contract either settles by delivery by the buyer to the seller of a (usually defaulted) debt obligation of the reference entity against a payment by the seller of the par value ("physical settlement") or the seller pays the buyer the difference between the par value and the market price of a specified debt obligation, typically determined in an auction ("cash settlement"). A credit default swap resembles an insurance policy, as it c... 09/11/2008