Spokane Real Estate and Mortgage Info

Have you given up? Thrown in the towel?

Well Newsweek magazine says you have in their article "The Quitter Economy." I know catchy headlines sell magazines, but this got me riled up this morning - you CAN'T QUIT!! There are families to feed and lives to live.

Of course we're not giving up. And it doesn't take much on your part to do the complete opposite:

• Yesterday I had a lunch with a top producing real estate agent in my area. Janet, I met him via some of that "junk" advertising that Realtors don't respond to.
• This morning I have a scheduled conference call with another local Realtor to discuss some joint marketing.
• Contrary to the Newsweek article, mortgage brokers ARE APPROVING loans. The banks and credit unions may be choking on their limited menu of loan products but mortgage brokers are doing fine, thank you very much. In fact I've spoken to a dozen other brokers in the last two weeks who want to join our firm - yes, we're hiring (as are others). Residential home loans are being approved everyday for people who have jobs, decent credit (not perfect!), and a few thousand dollars in cash.
• Home buyers are getting incredible deals on foreclosed homes, REO's (bank owned properties), and short sales. Coupled with low interest rates, your buying power is pretty good right now.
• Exising home owners are refinancing into lower rates and lower monthly payments, or converting their ARMs and Option ARMs into fixed rate loans.

I don't mean to trivialize the situation of anyone who has lost a job or a home. That IS a difficult situation but you still CAN'T give up.

Have you given up?  Let's talk about it and turn it around for you.

Michael Mullin
Lake Spokane Home Loans
First Priority Financial

Spokane, WA
(509)252-9151
MMullin@TheLoanConsultant.com

A friend forwarded me a story posted by Diana Olick with CNBC titled "What Is Worse - Personal Bankruptcy Or Foreclosure?"

The full article can be read HERE

I thought Diana's post had some valid points but there were some important details missing - so I emailed her.  I'm not sure I should have done that, but I've already hit the Send button in Outlook so it's too  late to take back my rant.

Because my comments are now in the public domain I figured I may as well share them with everyone else -

"Diana, I read your post with interest because I am in the lending industry and am talking to clients every day that are asking me the same question. The problem is that the answer depends upon the borrower’s circumstances, so there is no one answer. IF you want to stay in your home then bankruptcy might be the “best” choice because you may be able to get the judge to reorganize your debts in such as way that you can afford the mortgage payments. The reason the new administration is working on the “cram down” provision for bankruptcy judges is that may be the most effective way to stem the tide of foreclosures. Now, I’m not a proponent of allowing judges to forgive mortgage debt because I think it opens other cans of worms – however, lowering the debt level on a home to the current market value may just give the homeowner the HOPE they need to keep making payments. People are “walking away” from their mortgages because they have no HOPE of ever seeing that money again. When you are $200,000 upside down in a condo it is going to be a very LONG time before you ever get back to even again – so why keep making payments? Every day we see Fortune 500 executives getting “bailout” money from the US Government (yours and my tax money) because they ran their companies into the ground. Why is a corporations' responsibility to manage their finances properly any less than yours or mine? Regarding the FICO rep’s explanation of how a foreclosure effects your credit – he didn’t have the entire story. I’ve personally seen a credit report with a 700 FICO from a loan applicant that had a foreclosure one year prior – so I’m not sure I believe his “200 point drop” comment. However, the mortgage giants (Freddie Mac, Fannie Mae, HUD, and VA) ALL have provisions for dealing with applicants that have had foreclosures on their credit reports REGARDLESS the actual FICO score. In all cases, an applicant will have to wait significantly longer to obtain a mortgage after a foreclosure than after a bankruptcy."

So, what is worse - personal bankruptcy or foreclosure?  You are going to need a CPA to figure the tax consequences and an attorney to truly answer that question. As to which one will be worse for your credit report - I don't think that's very important in light of the other troubles you have.

If you want to talk about how a foreclosure or bankruptcy effects your ability to purchase a home - now that IS something I can help you with.  Give me a call or shoot me an email and we can talk about it.