Frederick Md Homes For Sale – The Historic District

During the last quarter of 2011, mortgage rates plunged. The 30-year-fixed rate is reaching new lows of around 4%. Many homeowners are refinancing and many home buyers are taking advantage of these rates. But many may not realize that the 15-year rate is also attracting some attention.

15-Year Fixed Rate Mortgage

Between October and December 2011, the conventional conforming 15-year fixed rate mortgage averaged 3.30% with about 1 discount point, the lowest 15-year fixed rate mortgage rate in the product’s recorded history. 25% of refinances were from 30-year fixed rates to 15-year fixed rates in the Fall of 2011.

The 15-year fixed rate mortgage is very similar to the 30-year fixed rate, except in the term of the note. You’re compressing the same debt into 15 years instead of 30 years, so naturally, the monthly payment will be more, usually about 50% more. The savings are gained in the amount of interest paid over the 15 years instead of 30 years.

Sample Scenario of two mortgages:

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You can use this handy mortgage calculator to see the difference in the two mortgage products. It also has a rent vs. buy calculator.

Contact us for a list of recommended Lenders.

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The Highland  Group
Chris & Karen Highland *        301-831-9947
Turning Point Real Estate “ 301-831-8232
email us: isell4u2@msn.com
Text Us: 301-401-5119

I haven’t done a Friday Link Roundup in a while, there has been so much real estate news to cover.   This collection of articles has some great information about How to decide what is good debt and what is bad debt for you. Enjoy reading and have a great Holiday!

¢ Good debt, bad debt: The Money 101 lessons at CNNMoney give examples of good and bad debt.

¢ Credit utilization: Your debt-to-credit ratio, or credit utilization, tells how much you have actually borrowed of the total credit available to you, explained here at About.com.

¢ This About.com page says more about the difference between good debt for expenditures œthat will increase in value and can contribute to your overall financial health, and bad debt for things that go away, such as vacations and food.

¢ Good, bad, ugly: Financial adviser Cindy Diccianni adds the category of œugly debt, which would include payday loans, pawn shop interest and other œfringe banking.

¢ Education debt: A post at USNews.com describes the upside and down of student debt.

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The Highland Group “ Real Estate Teams
50 Citizens Way, Ste. 400
Frederick, Md   21701
301-831-9947 Direct
301-695-3020 Broker
email: isell4u2@msn.com

TEXT Us:   301-401-5119

HUD has a program called “Good Neighbor Next Door”. This program provides discounted housing for Law enforcement officers, public school teachers and firefighters/emergency medical technicians.

These public workers who want to live in and contribute to community revitalization can buy approved HUD foreclosures for 50% less than the list price.   YES, half-priced homes.

Eligable single-family homes are located in revitalization areas and are on a list availble at the HUD website.   Buyers must live in the home as their primary residence for 36 months and must buy the home as-is, as with most foreclosures.   Buyers must meet the requirements, also on the HUD website.

As of today, there are 8 homes listed in Frederick on the HUD website which are eligible for this program.   They range from $87,000 to $206,000, from 2 to 4 bedrooms.   Keep in mind that many of these homes need repairs, and many are eligable for FHA 203K financing.

Read more about HUD’s Good Neighbor Next Door program.   Call us for more details about buying HUD Foreclosures.

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The Highland Group – Real Estate Teams

Chris & Karen Highland *
Frederick County MD Real Estate Agents

301-831-9947              
  Real Estate Teams, LLC
Karen@highlandrealestategroup.com

The FHA Waiver of the Anti-Flipping rule has been extended through December 31st of 2011.   The waiver went into effect January of 2010, and has helped to sell some of the inventory of foreclosed homes, so FHA extended it for one more year.

Anti-Flipping Rules

In an attempt to crack down of house flipping, FHA created rules, enacted in 2005, that prohibit FHA from insuring a mortgage on a home that has been owned by the seller for less than 90 days.   “Flipping” is the predatory practice of quickly re-selling a property at inflated prices to unsuspecting borrowers.   The rules were intended to protect FHA borrowers.

FHA’s research shows that in today’s market, acquiring, renovating and re-selling a foreclosed home often takes less than 90 days.

One of the effects of the anti-flipping rule was that sellers of renovated foreclosures were less likely to take an offer from an FHA buyer because they would have to wait the 90 days, covering the carrying costs and risking vandalism and other problems arising from vacancy.   Since a good number of homes are bought with FHA financing today, this is a bottleneck to getting homes sold in neighborhoods blighted with foreclosures.

Protecting Buyers

As the waiver continues, there are still rules in place to protect buyers from predatory flipping practices:

• All transactions must be “arms-length”.   There must be no relations or interest between the buyer and seller, or other participating parties.
• When the sales price of the home is 20% or more above the seller’s acquisition cost, the waiver will only apply if the lender mees specific conditions.
• The waiver is limited to forward mortgages, it doesn’t apply to Home Equity Conversion Mortgage (HECM) for purchase program.

It Begs the Question…

How effective are the anti-flipping rules, anyway?   Does the imposition of 90 days really solve the problem?   I often question well-meaning fixes to problems that don’t really seem to fix the problem.   Fortunately, FHA is very quick to “tweak” the rules and make them fit the current housing problems.   It will be interesting to see if the fix to the fix of the problem sticks.

Any comments?

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The Highland Group – Real Estate Teams
                                       
                                                              Chris & Karen Highland
                                                                              301-831-9947
                                                                Real Estate Teams, LLC
chris@highlandrealestategroup.com                            
                                               
                                                                Pictures of Frederick

Buying a condominium has gotten more complicated since the housing crisis.   The effects of so many condos in foreclosure have made financing some condominiums difficult.

FHA Rule Changes

The latest effort of FHA to lower its risks has affected condominiums.   Unlike single-family home ownership (fee simple), condo ownership has stricter rules for mortgage insurance.   The entire condominium project must meet certain standards for a single condo unit to get FHA financing.   As of October 1, 2010, the standards just got tougher, with FHA’s new rules.

The two rules that apply to our current housing distress are:

¢  No more than 15 percent of the total units can be in arrears (more than 30 days past due) of their condominium association fee payment.

¢  At least 50 percent of the units of a project must be owner-occupied or sold to owners who intend to occupy the units.

Because of all the condos in foreclosure, the HOA dues are not paid, and several associations have more than 15% of their units in arrears. This means that the condos in that entire project cannot be purchased with FHA loans.

The second issue is that many units are being purchased by investors, so the percentage of owner occupancy is decreasing in many condominiums.   No FHA financing there. In some cases, even conventional financing won’t work.

Where in Frederick?

The HUD Website has a list of Condominium Developments and their current status as far as FHA approval.

As of today, the FHA approval has expired for 2 Condominium Developments in Frederick:     Ambertowne and Frederick Heights.

During 2011 there will be 21 Condominium developments which will have their FHA approval expire, and will need to re-apply under the new rules.

This list is fluid and could change at any time.

Use our free property search:

                                         
                                                                                                                                                                                                                                                                                                                                 
Or Search for Condominiums in Frederick                  

                  The Highland Group – Real Estate Teams
                           
                                                              Chris & Karen Highland
                                                                              301-831-9947
                                                                Real Estate Teams, LLC
chris@highlandrealestategroup.com                            
                                               
                                                                Pictures of Frederick

Affordability in everyday finances is usually a subjective term.

In the housing industry, Affordability is a term that reflects the average home price compared to the  median wage of an area.   For 19 years the National Association of Home Builders/Wells Fargo Housing Opportunity Index (HOI) has kept track of home price averages and puts out a yearly ranking of over 200 metropolitan areas.

For 5 consecutive  quarters the HOI has shown the highest levels of affordability since the study started 19 years ago.  

This quarter, the HOI showed that 72.2 percent of all new and existing homes sold in the first quarter of 2010 were affordable to families earning the national median income of $63,800.   This figure was  slightly higher than the previous quarter and near the record-high 72.5 percent set during the first quarter of 2009.

The combination of low housing values and record low mortgage rates have produced the most favorable environment for home affordability in years.  

How does Frederick fare in the affordability ranking?  

The Bethesda-Rockville-Frederick, MD metropolitan area ranks 146th nationally, and   57th regionally, with an affordability index of 75.4.   This means that 75.4   percent of all new and existing homes sold in the first quarter of 2010 were affordable to families earning the median income of $109,000.

Other interesting stats:  

Indianapolis, IN, and Youngstown, OH tied for first place with an affordability index of 95.   For the 8th consecutive quarter New York led the nation in the least affordable housing market with an index of 21.

Use our free MLS search to find your dream home:

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Helpful tools:

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                                        The Highland  Group “ Real Estate Teams
Chris & Karen Highland *        301-831-9947
                                                                                Real Estate Teams, LLC
email us: isell4u2@msn.com
TEXT US:   301-401-5119