“It all depends on how we look at things.”

Those words by Carl Jung (the founder of the school of analytical psychology) describe the importance of perspective… which is exactly what last week’s economic reports on home sales require.

Existing Home Sales were reported well below expectations and a significant 27% decline from last month. But as Carl Jung said, let’s take a step back and gain a wider perspective about how we look at those reports… and what they mean.

It’s amazing how eerily similar the picture from 1992 compares to today. The 1992 real estate drought in Phoenix was the worst on record…until now.

We all know that the period following 1992 included terrific growth and opportunities in the economy, stock market and housing. If history repeats itself, which it often does, this could point to much better days in the future with opportunities in the present.

That’s my opinion…

This story broke on USA Today and has been re-printed on every major financial news network this week – so why not here!

by Nin-Hai Tseng, reporter
August 16, 2010: 05:17 AM EDT

Mortgage rates have hit new lows nearly every week, but many borrowers are still unable to take advantage of them.

Last week, U.S. mortgage rates fell for the eighth consecutive week to a record low after the Federal Reserve said it would buy more government debt to help the economy recover. A 30-year fixed-rate mortgage in the week ending Thursday dropped to 4.44% from 4.49%, according to Freddie Mac, which noted it was the lowest since the mortgage finance company began collecting data in 1971. The 15-year rate averaged 3.92%.

The fall in rates ostensibly means homeowners can lower their monthly loan payments by refinancing their existing loans. They’re certainly trying — the Mortgage Bankers Association reported last week that 78.1% of all mortgage applications fell under the refinance category, up from 58.7% in April.

But many of them are filling out all that paperwork only to get a rejection letter in response. The mortgage association does not quantify how many of those who apply for refinance actually get approved, but mortgage brokers say many homeowners are ineligible.

The stricter qualifications include a higher FICO score of at least 620, a higher down payment and lower monthly debt service ratios. Additionally, lenders typically won’t loan more than the appraised value of a home. The troubled housing market has left an estimated 15 million U.S. mortgages — one in five — worth more than the value of the homes they helped purchase. The growing mountains of paperwork required and higher bank fees have also discouraged some from refinancing.

Add it all up, and you get a 4.44% rate that most Americans can’t have.

What good is a 4.4% mortgage rate if you can’t get one?

Beat’s me.

That’s my opinion…

You read that right!

According to a study just published by Deutsche Bank that ranked prime and subprime loan servicers, the average time it is taking for Bank of America/Countrywide to close a short sale is 11 months!

The study went on to rank GMAC at the top of the list at an average short sale closing time of 6 months.

On the subprime side the numbers were even worse, with Ocwen being the worse with a time to process and close a short sale of 29 months, while Home Equity Servicing was the best of the subprime servicers at a closing time of 15 months.

Why is all of this data important?

Because so many buyers get impatient after 60 days….

BOTTOM LINE: If you need a home now, if you need a home fast…IGNORE short sales!

That’s my opinion…

Fannie Mae has launched KnowYourOptions.com, a new consumer education Web site that outlines the choices available to homeowners who are struggling with their mortgage payments, and provides guidance on how they can contact and work with their mortgage company to find solutions.

The online resource, which offers reliable and easy-to-understand information in both English and Spanish, expands on Fannie Mae’s ongoing efforts to help struggling borrowers find alternatives to foreclosure. Key features of KnowYourOptions.com include:

• an interactive Options Finder to help homeowners identify options that might be right for their situation
• calculators to help borrowers understand how many of the options work, including refinance, repayment, forbearance, and modification
• videos featuring real homeowners discussing how they received help and housing counselors providing advice
• a virtual assistant to walk homeowners through key areas of the site
• next steps and helpful forms, including a financial checklist and contact log to help borrowers be prepared when contacting their mortgage company or housing counselor.

KnowYourOptions.com provides homeowners who are having trouble paying or recognize they can no longer afford their mortgages with detailed information on:

• refinancing
• repayment plans
• forbearance
• loan modifications
• Deed-for-Lease
• short sales
• deeds-in-lieu

…and more

Check out KnowYourOptions.com today!

Standard Intro: MLS (Multiple Listing Service) photos are photographs that real estate agents take and publish online to “advertise and market” their listed properties to other real estate agents. Those same photographs are ported over to real estate sites on the internet like Realtor.com that everyday consumers have access to. I have been in the real estate business for several years, and along the way I have seen some very poor photographs that were taken by professional agents. I realize that professional real estate agents are not professional photographers, but hey…you have a right to expect quality for 6% don’t you? Especially since the photos of your house are going to end up on the internet for everyone to see!

Today, I am posting “Bad MLS Photo #6″ to the blog. Take a look!

Now I realize that not everyone makes their bed every day. But don’t you think it would be a good idea to make it on the day the pictures are being taken to advertise your home?

Perhaps the bed is made?

Or…upon further examination…
is there someone IN that bed?

Come on folks (and Realtors). We can do so much better!

There is a lot of misinformation floating around about investing in Real Estate with your IRA.

Here are 5 important facts that everyone needs to know:

1) A Real Estate IRA is Perfectly Legal. (see IRS Publication 590) as long as you follow the rules. For example, you can’t purchase (transfer) real estate you already own and you can’t purchase a vacation home that you plan to use. You also can’t rent office space from a building your IRA owns. Bottom line: No Personal Use Benefit!

2) Investments in Real Estate IRA’s are uniquely titled. Generally they are held as “Name of Custodian FBO [your name] IRA”

3) You do not have to purchase 100% of the investment with your Real Estate IRA. You can finance part of the investment or partner with others (additional tax responsibilities may apply if you use financing).

4) All property expenses must be paid for out of the IRA. You cannot use personal funds to rehab an investment property. Likewise when it comes to paying property taxes and insurance, your IRA must have the funds available to pay those expenses as well.

5) All income must be returned (deposited) to the IRA. That means you can’t live of the rental income – or spend the positive proceeds from a property you “flip” through your Real Estate IRA.

Real Estate IRA’s are not for everyone. But they are fantastic vehicles for wealth building for those who want to diversify their retirement funds into real estate.

That’s my opinion…

5 Real Estate Scams You Need to Know About

Don’t be duped by mortgage fraud. Here are a few common scams and the red flags you should look for in a transaction.

Mortgage fraud is pervasive: An estimated $4 billion to $6 billion in annual losses result from mortgage fraud, according to FBI reports. “An entire community can be damaged by mortgage fraud,” says Rachel Dollar, a lawyer from Santa Rosa, Calif., and editor of the Mortgage Fraud Blog. Mortgage fraud can lead to a spike in foreclosures, home values plummeting, and lenders raising their rates and fees to recover losses.

The crimes are often complex, involving several parties and occurring over multiple transactions. To protect you and your clients, educate yourself about mortgage fraud and be on guard for any warning signs in a transaction. You can start by reviewing these five scams, and then test your knowledge by taking ourMortgage Fraud Quiz.

1. The Foreclosure Rescue Scheme

The Scam: “Rescuers” promise cash-strapped home owners that they can save their home from foreclosure. The rescue, which involves paying upfront fees, can take multiple forms, such as the perpetrator obtaining a new loan on behalf of the owner or by having the owner sign over the home’s deed and then rent the home until they can repurchase it. Eventually, the home owner loses the home, either to foreclosure or the fictitious rescue company.

Red Flags: With foreclosure rescue programs, borrowers are often advised to sign over the title of their house to a third party, become renters of their home, not contact their lender, or send mortgage payments to a third party, according to Fannie Mae, which provides fact sheets on mortgage fraud.

2. Loan Documentation Fraud

The Scam: This fraud involves numerous schemes in which a borrower provides inaccurate financial information — such as about their income, assets, and liabilities — or employment status in order to qualify for a loan with lower rates and more favorable terms. Occupancy fraud is one growing area: Borrowers say they plan to live in the property when they actually intend to rent it.

Red Flags: Documentation may raise suspicion if the employer’s address is shown as a post office box, accumulation of assets compared to the person’s income appears too high or low, the new house is too small to accommodate occupants, the person has no credit history, or the application is unsigned or undated, according to Fannie Mae.

3. Appraisal Fraud

The Scam: A faulty appraisal — saying a property is worth more than what it really is — is connected to many types of mortgage fraud. It entails manipulating or overstating comparables, market values, or property characteristics in order to obtain a higher appraisal. The higher property appraisal, which generates false equity, is done by falsifying an appraisal document or using an appraiser accomplice to obtain the higher value.

Red Flags: Be skeptical of appraisals that are dated prior to the sales contract, list comparable sales that do not contain similarities to the property or are outside the neighborhood, the owner is not the seller listed on the contract or the title, or a third party participating in the transaction orders the appraisal, Freddie Mac warns.

4. Illegal Property Flipping

The Scam: This entails purchasing properties and reselling them at inflated prices. These scams usually involve faulty appraisals and inaccurate loan documents. The property is then refinanced or resold immediately after purchase for an inflated value. The home is purchased at a higher price, often by straw buyers working with the “flipper,” and eventually falls into foreclosure.

Red Flags: Some key things to look for are rapid refinancing of a property; the seller recently having acquired the title or acquiring the title concurrent with the transaction; an appraisal that comes in too high; a property that was recently in foreclosure being purchased at a much lower price than its sales price; or the owner listed on the appraisal and title not matching the seller on the sales contract, according to Fannie Mae.

5. Short Sales Schemes

The Scam: Borrowers owe more than the current value of their home so they fake financial hardship and no longer make their mortgage payments. An accomplice of the borrower then submits a low offer to purchase the property in a short sale agreement. The lender agrees to the short sale, unaware that it was premeditated. The property, after being purchased at the reduced price, is then often resold at the home’s actual value for profit.

Red Flags: The borrower suddenly defaults on the mortgage with no workout discussions with the lender, an immediate offer is made to a lender at a short sale price, the short sale offer is less than current market value, or a cash back is offered at closing to the delinquent borrower (disguised as “repairs” or other payouts, for example) and is not disclosed to the lender, according to Fannie Mae.

You can report instances of suspected mortgage fraud to Stopfraud.gov.

Article reprint from Melissa Dittmann Tracey – the multimedia Web producer of REALTOR® magazine. She can be reached atmtracey@realtors.org.

Lately I have spent a lot of time writing about distressed homeowners, home sellers, short sales and foreclosures.

But today I learned about “the other side”… Check this out:

It’s called Versailles because it was patterned after the royal chateau near Paris.

This 90,000+SF palace features a 6,000-square-foot master suite, a 60-foot by 120-foot grand hall with a 30-foot ceiling, a two-story library, spa, bowling alley and indoor roller skating.

All guest bathrooms come equipped with Jacuzzis!

The exterior is marked by stone columns and balustrades, balconies, mansard roofs, a huge porte cochere entryway and elaborate, carved lintels. There’s even a 20-car garage. The grounds include a baseball field, formal gardens, tennis courts, 1,200 feet of lake shore and a boathouse. There are three swimming pools, a rock grotto with three hot tubs and an 80-foot waterfall.

It is for sale in Windermere, Florida. The price? $100,000,000.00 complete, $75,000.000.00 as-is.

As-Is? Yes… as-is. It’s not yet finished.

So… did the owner run out of cash? Probably…. at least that’s my opinion. It’s a sign of 2010.

== NEW FLASH ==

The U.S. Congress on Wednesday approved a bill extending the closing deadline for homebuyers trying to take advantage of tax credits.

Homebuyers with contracts signed by April 30 who failed to go to closing by the June 30 deadline will now have until September 30 to complete their purchases. The House of Representatives on Tuesday approved the bill and it now goes to President Barack Obama for his signature.

The $8,000 tax credit for first time homebuyers and $6,500 credit for others purchasing a new primary residence was a very popular (but temporary) measure by the Obama administration to jump start home sales during the economic recession.

Without the extension, thousands of homebuyers would have missed the June 30 deadline because banks and settlement offices were struggling to deal with the volume of people rushing to close on their deals before the deadline.

What took them so long!

Seven-Year Lockout Policy for Strategic Defaulters

Fannie Mae just announced policy changes designed to encourage borrowers to work with their lenders and pursue alternatives to foreclosure.

Defaulting borrowers who walk-away and had the capacity to pay or did not complete a workout alternative in good faith will be ineligible for a new Fannie Mae-backed mortgage loan for a period of seven years from the date of foreclosure. Borrowers who have extenuating circumstances may be eligible for new loan in a shorter time-frame.

Troubled borrowers who work with their servicers, and provide information to help the servicer assess their situation, can be considered for foreclosure alternatives, such as a loan modification, a short sale, or a deed-in-lieu of foreclosure. A borrower with extenuating circumstances who works out one of these options with their servicer could be eligible for a new mortgage loan in three years and in as little as two years depending on the circumstances.

The fact is, there are people that are “strapped and trapped” financially in their homes and they need help. And for those people, help is available. It’s the people who don’t seem to care about their homes, the neighborhood they leave behind and the fact that one day (as crazy as it sounds) they may want to buy a home again… and when they do they will need a mortgage. It’s those people who deserve a 7-year slap on the wrist.

So there you have it folks. The next time you hear someone bragging about “walking away”… send them a link to this post.

That’s my opinion.