Four Ways to Spice Up an Open House

Open houses are a great way to meet potential clients, and showcasing the home in an attention-getting way can cement potential sellers’ confidence in the Realtor.

1. Take advantage of branding opportunities.

Water bottles on hot days with a custom label can be a great source of advertising. A picture of the house with contact information on the bottle is not only fun, but a way to keep both the home and the Realtor in the mind of the visitor after the open house.

2. Go beyond the basics with food.

You may have heard the age-old technique of baking cookies in the home to infuse it with the scent of homemade treats. However, food at an open house can be another way to stand out. It can encourage people to stay longer and strike up a conversation. Think outside the box – ice cream, chocolate fountains with strawberries, or lattes from an espresso machine.

3. Don’t forget the music.

Having music softly playing enhances the atmosphere and detracts from an empty feeling in the home and makes it more inviting. Soft jazz or other non-lyrical music can be played from an iPod and dock system. Have it centrally located so the music is heard throughout the home.

4. Consider the early evening

A recent Realtor Magazine article suggested holding open houses not only on Sundays, but during twilight hours. This way, people can visit the home directly after work, expanding the potential buyer pool.

The Power of Bona Fide Pre-Approval

While most mortgage lenders offer a form of “pre-approval” for a loan, Mortgage California is one of the few lenders anywhere that can do an actual fully underwritten loan pre-approval. With our banker and broker business model, pre-approvals for loans are not conditional on multiple minutiae of a transaction.

It is difficult to overestimate the power of a real loan pre-approval and its role in a successful real estate transaction. Pre-approvals make the seller of a house more comfortable about the offer, and in a competitive market, this can make all the difference.

According to Bay Area Realtor Larry Miller of Coldwell Banker, standard practice in the area is that a loan pre-approval accompanies the offer on a home. When the pre-approval comes from Mortgage California, he is able to give the seller complete confidence that the buyer is, in fact, qualified and the transaction will be able to close.  Not so with many other pre-approvals, which are not fully underwritten and thus are only worth the paper they’re printed on.

“If a seller is looking at two different offers, they can feel much more confident with the Mortgage California one,” said Miller.

The difference between the loan pre-approvals the real estate agent sees from other loan companies and from Mortgage California is the reliable commitment of the latter that the buyer does indeed qualify.

Looking over pre-approval letters from three diffferent companies, one of which being Mortgage California, Miller pointed out the extensive conditions on the other letters – one of which included more than eight conditions under which the”pre-approval” was not guaranteed.

“How much confidence can this give you?” asked Miller, in reference to the extensive conditions and lack of guarantees on one pre-approval letter.

A true pre-approval from Mortgage California gives homebuyers a huge competitive advantage when making an offer on a home, because sellers can be completely confident that the buyer is indeed able to purchase the home, speeding up the transaction and ensuring its success.

This Week’s Market Commentary

This week is extremely active with seven relevant economic reports in addition to another FOMC meeting and two fairly important Treasury auctions. The economic reports range from low importance to extremely high importance with the majority being in between those two.

There is relevant economic data being posted each day of the week, making it likely that we will see a fair amount of movement in mortgage pricing over the next several days.

March’s New Home Sales will be released late this morning. It gives us an indication of housing sector strength and mortgage credit demand, but is the week’s least important report. Unless it varies greatly from analysts’ forecasts, I am not expecting the data to cause much movement in mortgage rates. Analysts are currently forecasting a sizable increase in sales of newly constructed homes.

The Conference Board will post April’s Consumer Confidence Index (CCI) late Tuesday morning. This index is a key indicator of future spending by consumers. The group surveys 5000 consumers from across the country about their personal financial situations. If sentiment is strong or rising, it is believed that consumers are more apt to make large purchases in the near future. However, if they are concerned about issues such as job security and investments, they will probably delay making large purchases. The latter is better for the bond market and mortgage rates because the expected slowdown in spending would keep inflation and economic growth concerns to a minimum. But, a sizable increase could hurt the bond market, pushing mortgage rates higher Tuesday. It is expected to show a reading of 64.4, which would be an increase from March’s 63.4 reading. The lower the reading, the better the news for mortgage rates.

March’s Durable Goods Orders will be released early Wednesday morning. This report gives us an indication of manufacturing sector strength by tracking orders for big-ticket items at U.S. factories. These are products that are expected to last three or more years, such as appliances and electronics. Current forecasts are calling for an increase in new orders of 1.9%. This would be a sign of manufacturing sector growth, but this data can be quite volatile from month-to-month. Therefore, a small variance between forecasts and the actual results will not heavily influence the markets or mortgage rates. A decline would be considered good news, while a large increase would indicate manufacturing sector strength. A sign of solid manufacturing growth could lead to higher mortgage rates Wednesday.

This week’s FOMC meeting will begin Tuesday but will not adjourn until Wednesday afternoon. It will likely adjourn with an announcement of no change to key short-term interest rates, but we may see some volatility in the markets following the 2:15 PM ET post-meeting statement. There appears to be more and more discussion about when the Fed will have to start raising key interest rates to prevent inflation from strengthening. If the statement gives any hint of when that may be, or there is a change in the regular canned portions of the statement, we could see a sizable change to mortgage rates Wednesday afternoon.

In addition to this week’s economic reports, there are two relatively important Treasury auctions that may also influence bond trading enough to affect mortgage rates. There will be an auction of 5-year Notes Wednesday and 7-year Notes on Thursday. Neither of these sales will directly impact mortgage pricing, but they can influence general bond market sentiment. If the sales go poorly, we could see broader selling in the bond market that leads to upward revisions to mortgage rates. However, strong sales usually make bonds more attractive to investors and bring more funds into bonds. The buying of bonds that follows usually translates into lower mortgage rates. Results of the sales will be posted at 1:00 PM ET each auction day, so look for any reaction to come during afternoon hours.

Thursday has the single most important data of the week. That would be the preliminary version of the 1st Quarter Gross Domestic Product (GDP). This is arguably the single most important report that we see on a regular basis. The GDP is the sum of all products and services produced in the U.S. and is considered to be the best measurement of economic growth or contraction. I expect this report to cause major movement in the financial markets Thursday and therefore the mortgage market also. Analysts are expecting it to show that the economy grew at an annual rate of 1.7%, which would be a sizable drop from the final quarter of last year. A smaller increase would be considered good news for mortgage rates. But, a stronger than expected reading would almost certainly cause stock prices to rise and bond prices to fall, leading to higher mortgage rates Thursday morning.

The week does not close quietly with three reports scheduled for Friday morning. March’s Personal Income & Outlays is the first of them, coming early Friday. It helps us measure consumers’ ability to spend and current spending habits, which is important to the mortgage market due to the influence that consumer spending-related data has on the financial markets. If a consumer’s income is rising, they are more likely to make additional purchases in the near future. This raises inflation concerns and has a negative impact on the bond market and mortgage rates. Current forecasts are calling for a 0.4% increase in the income reading and a 0.5% rise in spending. If we see smaller than expected readings, the bond market should open higher Friday morning, making an improvement to mortgage rates a good possibility.

The second report of the day is the 1st Quarter Employment Cost Index (ECI), which tracks employer costs for wages and benefits. This gives us a measurement of wage-inflation. If it shows a large increase, we may see wage inflation concerns cause the bond market to fall and mortgage rates to rise. A smaller than expected increase would be good news for the bond market and mortgage pricing. Current forecasts are showing a rise of 0.5%.

The last piece of a data is the University of Michigan’s update to their Index of Consumer Sentiment for April. This report gives us an indication of consumer sentiment. I don’t expect it to have a significant impact on bonds and mortgage pricing unless it varies greatly from forecasts. Current forecasts are calling for little change from the preliminary reading of 69.6. This means that surveyed consumers were just as optimistic about their own financial situations as they were earlier this month.

Overall, look for plenty of movement in the financial markets and mortgage rates several days this week. Wednesday will likely be the most important day of the week with the FOMC adjournment and the fairly important Durable Goods data, but we may also see noticeable changes to rates Thursday after the GDP is posted. If this week’s reports reveal weaker than expected economic conditions, the bond market should extend its rally and mortgage rates should fall for the week.

Homes Sales in Santa Clara Country Hit 4-Year High

This past March has seen the most home sales in Santa Clara and San Mateo counties in four years. According to an article in the San Jose Mercury, sales were up 4 and 5% in the respective counties since March last year.

However, prices remain lower in these counties. “The median price for a single-family home in Santa Clara County was $528,000, down 4 percent; the median sales price in San Mateo County was $595,000, down 15 percent from a year ago,” said the Mercury.

South Bay sales were greater than Bay Area sales as a whole, with a 1.9% increase in home sales.
Foreclosure sales made up 31.5 percent of Bay Area resale transactions. Short sales — at prices less than the value of the mortgage on a home — made up 17.6 percent of the market.

The president of Dataquick, which measured these results, said “The housing market has certainly moved well back from the abyss of two years ago… [but] The big issue continues to be mortgage financing, which is still problematic for many potential borrowers.”

How to Get Finances Back on Track After Being Unemployed

If you are back in the workforce after a layoff, you might be wondering how to address financial issues.
For many re-employed people, a new paycheck might not solve all money problems. According to a survey by CareerBuilder, among workers who were laid off in 2010 and found new jobs, 61 percent took pay cuts.

With money tight, pay attention to urgent expenses first.

Attend to maintenance on your home and car. If you put off medical care for yourself and your family, that should be attended to. Advisors for Money magazine say it’s important to get the basics back on track.

The next priority is paying off credit card debt you have accumulated, paying more on the card with the highest interest rate first. Big credit card debt can harm your credit rating.

Paying off a home-equity line of credit is less urgent. The interest is tax deductible. Since the debt is secured, it won’t affect your credit score very much.

Since you have probably used all or most of your cash reserves, it’s important to rebuild them at the same time. If you have $500 a month in discretionary money, advisors recommend that you put $300 toward debt and $200 toward savings.

Next comes your retirement fund. Even if you can only manage a very small amount, contribute to your new company’s 401k plan right away.

If you don’t have enough cash to save and pay down debt, plus put a small sum into your retirement plan, it might be wise to refinance your mortgage. Especially if you have significant home equity, it will be easier to do now that you are employed.

Once you have met these goals, you will have more money to put into living life instead of playing catch-up.

Big Banks Penalized by Fed for Foreclosure Practices

Last week U.S. regulators penalized fourteen of the country’s biggest banks for improper foreclosure practices, according to a recent Wall Street Journal article. The banks were ordered to revamp their methods for handling troubled borrowers.

While no fines were issued, officials say they are coming to the 14 banks. This regulatory action occurred “as Obama administration officials and representatives of state attorneys general met with the bank representatives in an ongoing effort to reach a broader deal over alleged mortgage-servicing abuses, which brought foreclosures to a near halt last fall.”

This action would not interfere with possible civil fines and settlements. The banks have 60 days under the order to clean up their system, preventing documentation errors and ensuring they have the proper staff to handle home foreclosures, along with other changes.

In addition, an independent consultant must review the foreclosures from 2009 and 2010 to ensure fairness.
To read the full article, click here.

This Week’s Market Commentary

This holiday-shortened week is pretty light in terms of economic news scheduled for release. There are only three economic reports scheduled and none of them are considered to be highly important to the financial or mortgage markets.

Accordingly, there is a decent possibility of seeing a relatively calm week in the mortgage market, assuming that the stock markets do the same.

There is nothing of importance scheduled for release today. March’s Housing Starts is the first data, coming early Tuesday morning. It gives us a measurement of housing sector strength and mortgage credit demand by tracking starts of new home construction and the number of permits issued for future starts.

This data usually doesn’t cause much movement in mortgage pricing unless it varies greatly from forecasts. It is expected to show an increase in construction starts of new homes. Good news for the bond market and mortgage rates would be a decline in home starts, indicating housing sector weakness.

Wednesday’s only data is March’s Existing Homes Sales numbers from the National Association of Realtors. This report also gives us an indication of housing sector strength and mortgage credit demand. It is considered to be moderately important to the markets, but can influence mortgage pricing if it shows a sizable variance from forecasts. Ideally, the bond market would like to see a drop in home resales because a soft housing sector makes a broader economic recovery difficult. Analysts are expecting to see an increase in sales between February and March. The larger the increase, the worse the news for bonds and mortgage rates.

The third and final report of the week will be posted late Thursday morning when the Conference Board releases their Leading Economic Indicators (LEI) for March. This data attempts to measure economic activity over the next three to six months. This is considered to be a moderately important report, so we may see a slight movement in rates as a result of this report. It is expected to show an increase of 0.2%, meaning it is predicting slight growth in economic activity over the next several months. A smaller increase, or a decline would be considered good news for the bond market and could lead to slightly lower mortgage rates.
The bond market will close early Thursday and will remain closed Friday in observance of the Good Friday holiday. The stock markets will be open Thursday for a full day of trading, but will also be closed Friday.

The markets will reopen for regular hours Monday morning. The early close and Friday holiday may lead to some volatility in bonds Thursday afternoon as investors protect themselves over the long weekend. I don’t believe that this volatility will necessarily impact mortgage rates, but the possibility does exist, especially if the preceding days were active.

Overall, it is difficult to label one particular day as the most important of the week with no key economic data or other events scheduled. A good part of the week will likely be heavily influenced by the stock markets. If the major stock indexes rally, bonds will likely suffer and mortgage rates will move higher. If stocks fall, we could see mortgage rates move lower the next few days. There is nothing on the agenda that is of much concern, but keep an eye on the markets and maintain contact with your mortgage professional if still floating an interest rate as conditions can change at any time.

It’s Spring! The Home Market is Heating Up

The big day was March 20, the first day of spring. As almost everyone knows, it begins one of the most active seasons for home searches.

For good reason: If you can dodge the April showers, the weather will be nice. Flowers coming out everywhere will tempt you to drive about and see what appeals to you. Even if you haven’t decided to take the plunge, you could find that today’s bargains are hard to resist.

Home sellers will be out there with bells on. They know that buyers, dreamers and lookers will be out in force. Whichever category you fall into, they and their real estate agents will be pleased to see you.

Agents know that the lookers and dreamers of today could be buyers in the future. The agents are available in their offices or at open houses to tell you about the finer points of buying and selling. When your time comes, you will be prepared and knowledgeable.

Visiting open houses can be more than an enjoyable Sunday afternoon activity. Visitors get an idea of what features and home designs would best suit their needs, as well as what features should be added to their list of wants. Often, they can pick up a sheet of detailed information on a home, which can be referred to later on.

In spring, there are more homes on the market than at any other time of the year. You’ll find good bargains on some foreclosures that banks are willing to sell at a reduced price. But whether or not a home that interests you is in foreclosure, the price will be less than it would have sold for a few years ago.

That doesn’t mean that sellers aren’t willing to negotiate. Many have significant reasons to sell. Some sellers have to move to another city because of their work. They want to make a move well before school begins in fall.

Other properties might be part of an estate and heirs want to make a deal. Some sellers are retired and want to move to a smaller place.

There are many reasons sellers and their agents would like to see you!

Inexpensive Home Maintenance Tasks Can Prevent Big Expenses in the Future

For a few hours’ time and a small investment, you can do a lot to protect your property. Even renters can ensure comfortable surroundings with some of these tips.

Get energy efficient. If you have not yet installed a programmable thermostat, now is the time to do it. You can reduce your cooling costs by 10 percent, according to the U.S. Department of Energy. Thermostats cost $40 to $70.

Seal around the tub and shower. Cracked or poorly sealed caulking around tubs, showers, and sinks can lead to water damage to floors, walls, and the ceilings below, say experts writing in Money magazine. When you see cracks or gaps, buy a $5 tube of caulking and reapply.

Prevent fires. Check your fire extinguisher to see if it’s still charged. If you need a new one, buy an extinguisher that works on both kitchen and electrical fires. The National Fire Protection Agency recommends one that is labeled ABC. Cost is about $40.

Test the sump pump. Before a heavy rain floods your basement, test your sump pump to see if it works. Pour water into the well around it. Raising the water level should make it go on.

Prevent shocks. Electrical outlets near water in the kitchen and bathroom should have ground fault circuit interrupters that protect from a shock They have “test” and “reset” buttons. If you need one, the GFCI costs about $10, but you should hire an electrician to install it.

Service the garage door. Spray penetrating oil such as WD-40 into the hinges and rollers so the door will open and close more easily. Test the safety reverse mechanism by placing an object in the door’s path to see if it stops. WD-40 costs about $7.

A House Remains a Great Shelter from the Storm

Knight Kiplinger, editor-in-chief of Kiplinger’s Personal Finance, reminds homeowners and home buyers that an investment in a home not only a sanctuary for you and your family, it also remains a great tax shelter.

The ability to deduct property taxes is “the last great tax shelter” and you get a tax break on a large part of the profits if you decide to sell in the future, Kiplinger says.

Kiplinger speculates that for some years to come, home values will not rise much more than the national level of inflation. Values will still rise but they won’t skyrocket, he says. That means that, unlike in the bubble years, when you buy a house now, you can’t expect to make a huge profit if you sell the house in a year or two.

But speculating in real estate is not the most important thing homebuyers are looking for. Rather, they visualize the place they want and search for more comfort, convenience and enough space, a home where they can relax and raise their families.

Some look forward to living in the same home for many years. They dream of holiday gatherings in the homestead with their children and grandchildren.

A home is the largest investment most people will ever make and it is the most desired investment. Fortunately, thanks to the modern mortgage system, people don’t have to save for decades to afford a house.

Low mortgage interest rates give the practical-minded another reason to move forward with housing plans. While the average 30-year mortgage interest rate is about 4.17 percent, some mortgage companies are offering even lower rates. While rents rise every year, fixed mortgage payments stay the same.

Some retirees want to age in place, that is, keep their home for years after they retire. Others want to downsize. If less space is what they want, that problem is easy to solve.

The Complicated World of Credit Scores

Lenders use different credit scores for different purchases.

If you have successfully navigated a website that offers to sell you your credit score, you may think you have all the information you need in order to apply for a loan or new credit card.

Not necessarily. The score you received could be quite different from what a lender receives. Different scores are offered for mortgages, car loans, insurance and more.

Under the Fair Credit Reporting Act that took effect January 1, lenders must either tell those who apply for credit what score was used, or tell them how it was used if the applicant doesn’t receive the best terms available.

Here are some reasons why a credit score (a number between 300 and 850) still won’t tell you how a lender evaluates of you:

* Some lenders give the best rates to people with a score of 740, others may use 760 or higher. Some give credit to people with scores in the high 500s, but others require 620 or more.

* Credit scores don’t reflect whether you are making good financial decisions or poor ones.
If you refinance your home at a lower interest rate, inquiries could show up on your report. Inquiries lower a score.

* Late payments show up on your score for a couple of years, but paying down a high balance has an immediately beneficial impact.

* If you pay your credit card bill in full every month, you don’t get a zero balance on your credit report. The report shows the balance at the end of the billing period, before the payment.

* Rather than checking your score frequently, you are better off making sure the information on your report is correct. Make your payments on time and reduce monthly balances for a month or two before applying for a loan or mortgage.

This Week’s Market Commentary

This week brings us the release of seven relevant economic reports for the bond market to digest. We are also heading into corporate earnings season, which could lead to fluctuations in the stock markets.

If earnings come in lighter than estimates, the stock markets may fall, leading to an influx of funds into bonds. But if earnings and forecasts are strong, the major stock indexes may rally, pulling funds from bonds and leading to higher mortgage rates.

There is no relevant economic news scheduled for release tomorrow. The first report of the week comes Tuesday morning but it is the least important one. February’s Goods and Service Trade Balance will be posted early Tuesday morning. This data gives us the size of the U.S. trade deficit, but unless it varies greatly from forecasts, it likely will not cause much movement in mortgage rates. Current forecasts show a $45.7 billion trade deficit.

The first important report will be posted early Wednesday morning when the Commerce Department will release March’s Retail Sales data. This piece of data gives us a measurement of consumer spending, which is very important because consumer spending makes up two-thirds of the U.S. economy. Forecasts are calling for a 0.5% increase in sales last month. If we see a larger increase in spending, the bond market will likely fall and mortgage rates will rise. However, a weaker than expected reading could push bond prices higher and mortgage rates lower Wednesday.

The Federal Reserve will post its Fed Beige Book report at 2:00 PM ET Wednesday. This report is named simply after the color of its cover and details economic conditions throughout the U.S. by region. Since the Fed relies heavily on the contents of this report during their FOMC meetings, its results can have a fairly big impact on the financial markets and mortgage rates if it reveals any significant surprises. Generally speaking, signs of strong economic growth or inflation rising would be considered negative for bonds and mortgage rates. Slowing economic conditions with little sign of inflationary pressures would be considered favorable for bonds and mortgage pricing.

The two Treasury auctions are scheduled for Wednesday and Thursday. There is a 10-year Treasury Note sale Wednesday and a 30-year Bond sale Thursday. We could see some weakness in bonds ahead of the sales as investing firms sell current holdings to prepare for them. This weakness is usually only temporary if the sales are met with a decent demand. The results of the auctions will be posted at 1:00 PM ET each day. If the demand from investors was strong, the bond market could rally during afternoon trading, leading to lower mortgage rates. If the sales were met with a poor demand, the afternoon weakness may cause upward revisions to mortgage pricing Wednesday and/or Thursday afternoon.

Thursday’s important data comes when the Labor Department will post March’s Producer Price Index (PPI) at 8:30 AM ET. It will give us an important measurement of inflationary pressures at the producer level of the economy. There are two portions of the report that analysts watch- the overall reading and the core data reading. The core data is more important to market participants because it excludes more volatile food and energy prices. If it shows rapidly rising prices, inflation fears may hurt bond prices since it erodes the value of a bond’s future fixed interest payments, leading to higher mortgage rates. A slight increase, or better yet a decline in prices, would be good news for the bond market and mortgage rates. Current forecasts are calling for a 1.0% increase in the overall reading and a 0.2% rise in the core data.

The remaining three economic reports will all be posted Friday morning. This first will be March’s Consumer Price Index (CPI). This index is one of the most important pieces of data we see each month. It is similar to Thursday’s PPI but measures inflationary pressures at the consumer level of the economy. If inflation is rapidly rising, bonds become less appealing to investors, leading to bond selling and higher mortgage rates. As with the PPI, there are two readings in the index that traders watch. Analysts are expecting to see a 0.5% increase in the overall readings and a 0.2% rise in the core reading. If we see larger increases, we could get higher mortgage rates Friday.

March’s Industrial Production data will be posted at 9:15 AM ET Friday. It gives us a measurement of output at U.S. factories, mines and utilities, translating into an indication of manufacturing sector strength. Current forecasts are calling for an increase in production of 0.6%. This data is considered to be only moderately important to rates, so it will take more than just a slight variance to influence bond trading and mortgage pricing.

The final release of the week is the University of Michigan’s Index of Consumer Sentiment at 9:55 AM ET Friday. Their consumer sentiment index will give us an indication of consumer confidence, which hints at consumers’ willingness to spend. If confidence is rising, consumers are more apt to make large purchases. But, if they are growing more concerned of their personal financial situations, they probably will delay making that large purchase. This influences future consumer spending data and can have a moderate impact on the financial markets. Good news would be a sizable decline from March’s 67.5 reading. Current forecasts are calling for a reading of approximately 66.0.

Overall, look for the most movement in rates the middle part of the week. The Retail Sales and CPI reports are the biggest names on the agenda. Either of them can cause significant movement in the markets and mortgage rates, so either Wednesday or Friday will probably be the most active day of the week. Look for the stock markets to influence bond trading and mortgage rates the first part of the week, but we can expect to see the most movement in rates the latter part.

Focusing on Color: Painting your World

Wherever we go, we respond to color, though its effect is often underestimated. Color use is important to us in our homes and workplaces.

If you are selling a house, you will want to choose different colors than those you might use for your own home.

If you just purchased a house, you can add some of your own personality with paint.

HGTV’s Shari Hiller says color accounts for 60 percent of our response to a room. Here is some advice.

Living room: Start with colors you love from something in the room. Consider colors from artwork, a rug, dishes, an accessory or furniture for a main color or accent. Buy two or three quarts of paint. Paint sample boards to hold up to the furniture, fabrics and surfaces you choose.

If you aren’t sure where to begin with a color, experiment in a bathroom, a small hall or area between rooms.

The dining room: Do you want the area to feel social and stimulating or be formal and quiet? Warmer, contrasting and somewhat brighter colors add to a sociable atmosphere. Deeper blue-greens and neutral colors make the dining area more formal.

The monochromatic color scheme: In any room, one color need not be boring. You can create bold or subtle variations within one color group with contrasting paint finishes. It helps to use matte finish paint for walls and slightly shiny eggshell paint for wood trim. The paint will appear to be a slightly different color. It can be attractive to paint an entire wall in a lighter or darker hue of the same color.

White or off-white tint can be a striking accent when used as trim with a monochromatic color group.
For bedrooms: Softer, cool colors and neutrals create a quiet feeling.

Children’s bedrooms: Stay away from bright and intense wall colors, which are said to lead to unrest and irritability.

For an accent color in any room, select a warmer color, more toward reds, or a cooler color more toward blues, to compliment your main color group.

Home Alarm Systems Offer Security and Peace of Mind

Home security systems used to be thought of as just for high-end homes and high-income buyers. Today, improved technology and competitive pricing have made systems more affordable. There is a system for everyone.

Besides notifying the monitoring center of a potential break-in, the systems can include features such as monitored fire protection, carbon monoxide detection, water penetration and have sump pump failure alarms.

Home video systems allow users to monitor their home from a remote location. Users can make sure their kids are fine and keep an eye on their homes.

It’s no longer necessary to have a landline telephone to ensure a system operates without fail, and it’s not necessary to have an Internet connection.

While statistics show a home without an alarm system is more likely to be burglarized, the added benefits of fire protection and other services are immeasurable. It’s about peace of mind, according to Angie Hicks, founder of Angie’s List, a nationwide provider of ratings in more than 500 categories (http://www.angieslist.com/).

Ask a prospective provider to visit your home and recommend how best to protect it. A typical system can be installed for $49 to $350, depending on the features. Monthly monitoring fees usually start at around $25.

Know the contract terms, which are usually for multiple years, and learn about any fees that are not included in the installation and monthly costs.

Lower Loan Limits Coming October 2011

At the beginning of the mortgage meltdown a couple of years ago, Congress enacted emergency legislation raising the limits on High Balance Conforming Loans.

These loans are designated “conforming,” meaning lower interest rates and typically a slightly easier transaction to get approved and closed when compared to Jumbo (or non-conforming) financing. The High Balance variety is only available in designated high cost areas, like the San Francisco Bay Area.

Currently the “temporary” limit on these loans is $729,750. This means that if you put 20% down on a $900,000 home, you can get a conforming loan in the amount of $720,000. Effective October 1, 2011 the emergency legislation expires and is not expected to be extended. This lowers this High Balance Conforming Loan to $625,500.

So, what does that mean to you? If you buy the same $900,000 home and put 20% down, your loan will now be considered a Jumbo loan. Rates on Jumbo loans are typically 1-1.5% higher, so if today you could get that loan for, say, 5% your payment would be $3865.12. The same loan amount using the Jumbo rates would be 6-6.5%, bringing your payment to $4550.89. Over 30 years, that totals over $246,000! The other option would be to put a larger down payment on the property, to the tune of nearly $100,000.

The important thing to note is that if you are looking for a loan to purchase a home, or refinance the one you already have, now is the time to move forward. The limit will remain at the higher point until the first of October, giving home buyers the spring and summer seasons to purchase a property before the high limits are gone.

To find out what the current loan limit is in your area, you can access the Fannie Mae website to see a county-by-county spreadsheet.

Higher limits have really helped people get into homes here in the Bay Area. Once those limits reduce, there will be fewer options for those trying to get into the real estate market. I’ve been talking to all my buyers and giving them fair warning that the time to move is definitely now.”

Time to Buy a New Home?

Today, you can get all of what you need and most of what you want.

When it comes to fine kitchens, more bedrooms, storage space, and great features, your chance of getting them all is better than in many previous years. How about a deck and a sunroom?

The recent Housing Affordability Index by the National Association of Realtors is 173.8, or about 40 points lower than in 2008.

How to Qualify

 The average price for a single-family home in the index is $170,300. To qualify for that purchase at an interest rate of 5.09 percent, buyers would only need a family income of $34,512.

Another interesting way to look at affordability was shown recently in The Wall Street Journal. The Journal reported that the cost of a home now is equivalent to about 19 months of total income for an average family.

Previously, home prices averaged about 24 months of an individual or family income. That means more buyers can afford a home right now.

While the affordability numbers are a good indication, the number of available homes is also a plus. Home buyers can find many in their price range to choose from. Why should they pay high rents when they could be accumulating equity?

What Mortgage Brokers Say

Home ownership is a smart choice when you have reached a stable situation in your life. According to mortgage brokers, that means you have decided on a life path and are taking steps to achieve it, and your income is secure.

When you aren’t moving to another city in the next several years, and you have savings for a down payment, you are ready to move forward with your housing plans.

An idealized vision of how life should be will help you choose a home, but the mortgage brokers say the basic facts to justify The American Dream should be in place.

This Week’s Market Commentary

This week brings us the release of little relevant economic data for the markets to digest. We will, however, see the minutes from the last FOMC meeting.

There are no important monthly economic reports scheduled for release this week, so look for the stock markets to heavily influence bond trading and mortgage rates.

There is nothing of relevance scheduled for today or Tuesday morning, but Fed Chairman Bernanke will be speaking at a financial conference in Georgia tomorrow evening. Whenever he speaks, the markets pay attention and this one will be no different.

However, since the speech is at 7:15 PM ET, we won’t see its impact on the financial and mortgage markets until Tuesday morning. I don’t believe that his words will cause too much movement this time, but the potential does exist, especially since it is an extremely light week in terms of economic releases and other relevant events. Therefore, we should be attentive to what he says.

The first important event comes Tuesday afternoon when the Fed releases the minutes of their last FOMC meeting. Market participants will be looking at them closely. They give us insight to the Fed’s current thought process and individual Fed member opinions.

Any surprises in the 2:00 PM ET release, particularly about inflation or when the Fed may start raising key interest rates, could cause afternoon volatility in the markets Tuesday and possible changes in mortgage pricing.
The only other data worth mentioning is the weekly release of unemployment figures Thursday morning. This data usually does not impact mortgage rates much, but due to the lack of other data on the calendar this week’s update could influence rates. Analysts are expecting the Labor Department to announce that 385,000 new claims for unemployment benefits were filed last week. This would be a small decline from the previous week. The larger the number, the better the news for the bond market and mortgage rates.

Overall, there are several variables that could make this week very quiet or quite rocky for mortgage shoppers. Tuesday’s FOMC minutes could very well be a major market mover or a complete non-factor. In other words, we may have a very calm week ahead of us, or we may see rates move noticeably several days. With no important economic data to drive trading and mortgage rates, bonds may move with stocks.

This means large stock gains could lead to bond selling and higher mortgage rates. But stock weakness could lead to mortgage pricing improving for the week.

The “Mom Cave”

It’s new, it’s fun, and it’s strictly personal!
Now that the “man cave” has become an established custom in homes, women have taken the cue to establish a spot of their own. Forget men’s huge TVs, theater chairs and eating spots, where they do manly, messy, sporting things. A woman’s personal place is entirely different.

Whether it was formerly a guest room, a place next to the family room in the basement, or any unused space, the “mom cave” is generally filled with personal mementos and comfort items. It’s a room they can call their own.
Many women, not just moms, are taking over a space in their homes and turning it into a haven where they can relax and pursue personal interests. Decorators are applauding the trend.

Here’s what’s needed to create the cave: A place to sit, storage space, an area to do what they want to do, such as scrapbooking, and space for occasional visitors. The walls can be decorated with old or new photographs in fun frames, and bright wall colors or fancy wallpaper served as a background.

New York designer Elaine Griffin embraces the concept and recently partnered with Homegoods in Manhattan to show the new decor and space suggestions. She says the mom cave is where a woman, who nurtures everyone else, goes to nurture herself.

Griffin loves color. She says mom caves should be fun, feminine and highly personalized. They should include a reading place, probably with a nice throw on the arm of a chair, or a chaise lounge, a bookcase painted in a bright color, a fancy area rug, and maybe boxes of brightly-colored file folders and lamp shades that reflect a woman’s tastes.

If they don’t have a whole room, Griffin suggests taking over a spot, such as under a stair landing, for a sanctuary using narrow console tables, a rug and armchairs. Or part of the family room or dining room could be captured for their own.