Home Buyer Alert !!!!

If you are thinking at all about buying, selling or refinancing a home, there are a number of things happening in the real estate market at this time that makes this the best time to buy, sell or refinance a home in the foreseeable future.

1. INTEREST RATES ARE GOING TO GO UP !!!! – I believe that the current record low interest rate environment will soon be a thing of the past. In just a few months, we will look back on this time with nostalgia and remorse for not taking advantage of these low, low interest rates. The Federal Reserve has recently begun to signal that their efforts to keep interest rates at these very low levels will soon begin to be scaled back as the economy improves. The only thing keeping interest rates at these levels is the Federal Government’s total control of the mortgage market. Nine out of ten mortgages originated now are being funded or guaranteed by the Federal Government.

The current Federal program of buying mortgage backed securities issued by FNMA and Freddie Mac is scheduled to stop at the end of March. Opposition to the Federal control and funding of both FNMA and Freddie Mac is growing in congress. Until the private sector steps back in to the market to fund mortgage backed securities, capital for new mortgages is going to become scarce, and when that happens, interest rates have nowhere to go but up !!! Many economists are projecting a near term increase of anywhere from one-half to one percentage point in mortgage rates, with conforming loans increasing from just below 5% to close to 6%. This will make it increasingly difficult for borrowers to afford a home or to qualify for a mortgage.

2. Federal Tax Credit to Expire: The Federal Tax credit of up to $8,000 for first time home buyers is set to expire soon. To take advantage of this incredible opportunity, you must have executed a purchase contract by April 1st, 2010, and close escrow by July 1st, 2010. There is also a tax credit of up to $6,500 for existing homeowners who are buying a new home. This tax credit makes it much easier for buyers to afford to buy a home because it can fund most of their closing costs.

3. Home Prices have Stabilized in the South Bay – Home prices in the South Bay of Los Angeles appear to have stabilized, and the median home price has been rising in most markets the last few months. Competition from other buyers and sellers will increase as we move into the spring and summer buying season, the busiest time of the year for home purchases.

If you are thinking at all about buying a home or selling your home, call me right away before this window of opportunity disappears. If you are thinking of selling your home because of financial difficulties, I am a Certified Distressed Property Expert, with specialized training in advising homeowners regarding options in dealing with a delinquent mortgage including short sales or foreclosures. The legal issues relating to deficiency judgments as well as the tax issues for debt forgiveness are very complex , and you need to make sure you are dealing with a real estate agent with the necessary expertise and experience .

I look forward to speaking with you.