Second home sales are dropping a bit, but there are some buyers that are helping to prop up the luxury home market. Foreign buyers are taking advantage of the current situation in the US real estate market to make second home and investment property purchases. Inman News reports on foreign buyers and second home sales:

Real estate professionals tell Inman News that foreign buyers
are taking advantage of lopsided currency values against the U.S.
dollar in some market areas and are propping up second-home sales while
many U.S. buyers are taking a wait-and-see approach.

With the real estate market in decline, not to mention the US dollar weakness, many in other countries are seeing this as an opportune time to buy real estate in America. And, while the luxury home market usually holds up better than the rest of the real estate market, it is starting to see some cracks now, too.

I really kind of like these PSAs with the slightly disturbing-looking pig about building savings. In the current climate, it is especially important to concentrate on saving money, and paying down debt.

I really kind of like these PSAs with the slightly disturbing-looking pig about building savings. In the current climate, it is especially important to concentrate on saving money, and paying down debt.

The department of Housing and Urban Development has offered a new Good Faith Estimate form. This is a good thing. The new form makes disclosure to borrowers in simpler terms, avoiding a great deal of jargon. The Inman News blog offers a look at this latest mortgage form:

The form discloses basic loan terms in plain English that’s free from
unnecessary jargon. Six of the most important disclosures are stated on
the first page in simple yes-or-no questions that aren’t likely to be
overlooked or misunderstood. A separate section outlines the costs of
the loan along with helpful descriptions that explain the purpose of
each cost, and again, are written in plain language.

Of course, the new Good Faith Estimate form isn’t perfect. And while it does limit some cost increases, the loan comparison section is lacking. Lenderama points out that the new Good Faith Estimate form also does not address kickbacks with any clarity.

And, obviously, there is no way to force compliance on unscrupulous lenders, or make up for mortgage lender (or borrower) incompetence. But the new HUD Good Faith Estimate form is a step in the right direction.

Even though existing home sales rose in February, new home sales fell. New home sales were most likely affected by restricted credit as mortgage lenders are wary of giving out home mortgage loans.

Many mortgage lenders have tightened their requirements in recent months, requiring improved credit scores and reducing amounts they are willing to finance for home mortgage loans. This means that many buyers have to get existing homes, since those are seeing falling prices.

Before you visit mortgage lenders, check your credit score to determine what you need to do in order to bump it up a bit. And prepare to moderate your wishes. You could find a great buy if you are willing to settle for an existing home.

Existing home sales rose in February, according to US data. For the most part, this is due to the fact that foreclosures and other issues are prompting much lower home prices.

This is encouraging many buyers to make purchases of homes in foreclosure — or from sellers motivated to avoid foreclosure. Indeed, the real estate market trend of foreclosures is prompting home tours of homes in foreclosure.

Be aware, though, that even though there are lower home prices, many mortgage lenders still have rather high qualifying standards. You will need a good credit score and a down payment in order to qualify for a home mortgage loan.

Despite protestations by the Federal Reserve to the contrary, many investors are starting to think that mortgage bonds could be next on the list of things the Fed will do to help the economy recover from its current funk. Bloomberg reports on what some think would be a good move:

“An RTC-type structure is interesting, and it may not be
that much of a burden on taxpayers in the long run,” said Barr
Segal, a managing director at Los Angeles-based TCW Group Inc.
who helps oversee $80 billion in fixed-income assets. The
government should purchase the mortgages and reissue “debt
that’s backed by the U.S. government and there you go, you’ve
unclogged the drain,” he said.

While the Fed has ruled such a move out for now, the institution has shown that it will do just about anything in the name of "economic stimulus."

Today’s Friday Fun Video is an Axis Bank home loan ad. I really enjoyed this ad. It made me laugh. Happy Friday!

Today’s Friday Fun Video is an Axis Bank home loan ad. I really enjoyed this ad. It made me laugh. Happy Friday!

The government is allowing restrictions on Fannie Mae and Freddie Mac to be eased in order to allow the companies to finance larger home loans, as well as a greater variety of home mortgages. The New York Times reports on the move:

Combined with restrictions that were eased last month that will enable
the companies to help finance a greater variety of mortgages as well as
much more expensive home loans, the officials predicted that the two
companies would be able to buy or guarantee about $2 trillion in
mortgages this year.

While this may help with some refinancing, I’m not sure that the answer is to ensure that more people can get bigger home loans. We should be taking a hard look at how we as a society view debt, and how we can change our debt based economy.