Mario Greco

FHA Streamline Refinance Program : There’s 5 Days Left

2009-11-10T19:18:29Z

Consider this a last call for FHA Streamline Refinances. Starting next Tuesday, the popular rate-lowering program gets strict on borrowers.

There’s 5 days left.

Under the current streamline refi guidelines, FHA homeowners have minimal program eligibility requirements.

FICO scores must be 620 or higher
The refinance must provide a “tangible benefit”
No mortgage lates allowed in the last 12 months

Beyond that, everything else goes, practically. There’s no income, asset, or job verification with the current FHA Streamline program. Neither is there an appraisal requirement. It doesn’t matter if you’re 50% underwater.

Until next week, that is.

Beginning November 17, FHA Streamline Refinance applicants must show evidence of income and employment, plus proof of cash required to close. Furthermore, the FHA is limited loan-to-values to 97.75% for homeowners that want to “roll closing costs” into their mortgage.

In areas of declining home values, this may render refinancing impossible.

There’s more changes, too, as highlighted by the Federal Housing Commissioner. Read up for yourself, or ask a mortgage professional for help.

If you’re a homeowner and you’re currently financed through the FHA, it may be prudent to explore the possibility of an FHA Streamline Refi. Mortgage rates are low right now and FHA guidelines are loose.

Starting next week, FHA Streamlines will be a completely different beast.

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State Hoping To Lure First-Time Homebuyers, Veterans With Incentive

2009-11-09T17:55:44Z

Chicago home buyers got the good news last week that the federal government was not only extending its first-time home buyer tax credit of $8,000, but was adding a $6,500 move-up home buyer tax credit, too. Combined, the two federal programs should make it easier for the majority of home buyers to afford condominiums or single-family homes in Chicago.

As if that wasn’t enough good news, Chicago Tribune writer Mary Ellen Podmolik in the Nov. 6 paper highlighted another new program, this one offered by the state of Illinois, to encourage both first-time buyers and military veterans to buy homes.

The state had already offered its HOME START program, a 30-year fixed-rate amortizing loan insured by the FHA. As of Oct. 30, the interest rate on this loan was just 5.25 percent. Now, though, the state has offered a companion piece to this program, the HOME START down payment assistance loan. This loan allows first-time home buyers to access additional funds to help them make their down payments. The loan is a 10-year, zero-percent, non-amortizing forgivable loan equal to 3 percent of the home’s purchase price. The loan does have a ceiling of $6,000.

To take advantage of the down payment assistance loan, buyers must first qualify for and obtain the Illinois Housing Development Authority’s 30-year HOME START mortgage. Military veterans do not have to be first-time buyers, but all other participants do. The program does require buyers to receive homeownership counseling.

The main benefit of this second down-payment loan is that it can easily become a forgivable loan. Buyers must simply stay in their homes for at least 10 years. Those who stay less will be required to pay back a certain portion of their loan depending on how long they stay in the house. In her story, Podmolik says that homeowners who purchase $1,000 houses and only stay in them for five years will have to pay $1,500 of their $3,000 down-payment loan back to the state.

We already know, based on national statistics, that the first-time home buyer tax credit did its job, encouraging more buyers to enter the housing market. I’ll be eager to see what impact Illinois’ new housing incentive has. My guess? It’ll encourage even more locals, including those looking for homes in Chicago, to enter the residential real estate market.

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Homebuyer Credit Gets New Life. Hallelujah!

2009-11-06T22:20:48Z

Members of the Senate did the right thing this week: Its members reached a compromise agreement that, if eventually passed by the House, will not only extend the $8,000 federal tax credit for first-time homebuyers, but will actually offer a new credit to move-up buyers. House members are expected to vote on the compromise measure soon.

Approving the new legislation would be a wise move. Reuters quoted Celia Chen, senior director of housing economics at Moody’s Economy.com, as saying that the government’s $8,000 tax credit for first-time homebuyers will have caused 400,000 additional home sales by the time it was due to expire at midnight on Nov. 30.

That’s a lot of housing sales generated by the credit. And with the nation’s, not to mention Chicago’s, housing market still in the fragile stages of a recovery, we can use every one of those additional home sales. Remember, a strong housing market usually means a strong economy. Generating more condominium and single-family home sales will help drive the recovery of both the national and local economies.

If approved, the Senate’s new compromise would extend the current first-time buyers’ credit and introduce a new $6,500 credit for move-up buyers. These buyers, both first-timers and move-ups, must sign a contract to purchase a new or existing primary residence between Dec. 1, 2009, and April 30, 2010. Buyers would then have until June 30 of 2010 to close their housing deals.

Adding the credit for move-up buyers would be a significant move. These buyers are eligible for the credit if the home they are leaving behind has served as their principal residence for five years or longer. Income limits for all buyers would jump to $125,000 for taxpayers filing single returns and $225,000 for those filing joint returns. That’s a change from the current tax credit’s income levels of $75,000 for single-filers and $150,000 for those filing jointly. The home these buyers are purchasing can be no more than $800,000.

Is the new compromise perfect? No. But for now, it’s the best tool we have to help boost the housing market’s recovery. Let’s hope it passes without controversy.

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How Affordable Is Chicago Housing? The U.N. Wants To Know

2009-11-05T18:08:19Z

The Chicago housing market is a strong one, even in a struggling economy like the one we’re experiencing now. But a strong housing market generally isn’t a cheap one.

The United Nations is about to find this out.

Raquel Rolnik, the UN Special Rapporteur on Housing, is scheduled to visit seven major cities in the United States to determine just how affordable housing is in this country. She began her tour Oct. 27 with a stop at Fernwood United Methodist Church in the city’s Roseland neighborhood.

I’m not sure what Rolnik thinks about Chicago housing after her visit to Roseland. But she should know that housing in the city, whether we’re talking about condominiums or single-family homes, while not cheap is far more affordable today than it’s been since the housing boom started.

According to statistics from the Illinois Association of REALTORS®, the median sales price of single-family homes, condominiums and townhomes came in at $225,000 in September. That might seem high, but it’s actually down 16.2 percent compared to the median price of $268,600 one year earlier.

To me, this is evidence that it’s possible to find a quality house in a good Chicago neighborhood at a reasonable, if not cheap, price. And housing here has traditionally been a good value, with homeowners generally seeing their residences increase in value if they hold onto them long enough, say five or seven years.

Where many buyers struggle financially when buying Chicago homes is in coming up with enough money for a down payment. Fortunately, many FHA loans still require down payments of as little as 3.5 percent of a home’s purchase price. The first-time homebuyer tax credit of $8,000, along with the new move-up tax credit of $6,500 that Congress is considering now, are a big help in making homes feel more affordable in the city, too.

Housing prices are never going to be low in a city that is as popular and offers as many amenities as Chicago. Housing values are a direct result of location, and Chicago happens to be a location that many people want to call home. But I think you’ll find that for such a major city, Chicago actually boasts relatively affordable housing prices. Don’t believe me? Try finding affordable housing in Los Angeles, San Francisco or New York City.

Again, I have no idea what that U.N. official thinks, but for my money, Chicago is a terrific housing buy.

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A Simple Explanation Of The Federal Reserve Statement (November 4, 2009 Edition)

2009-11-05T18:00:28Z

The Federal Open Market Committee voted to leave the Fed Funds Rate within its target range of 0.000-0.250 percent.

In its press release, the FOMC noted that the U.S. economy “has continued to pick up” since the September FOMC meeting and that housing market activity has increased.

It’s the third consecutive post-FOMC statement in which the Fed speaks optimistically about the U.S. economy – a signal that the recession is likely over.

The economy isn’t without threats, however, and the Fed identified several in its announcement, including:

Ongoing job losses for American workers
Reduced fixed investment by businesses
Ongoing challenges for the financial markets

The overall tone remained positive, however, as inflation appears to be held in check.

Also in its statement, the Fed confirmed its plan to hold the Fed Funds Rate near zero percent “for an extended period” and to honor its $1.25 trillion commitment to the mortgage bond market.

The Fed plans to wind down its mortgage market support over the next 5 months, reaffirming its March 2010 exit date. For now, Fed support helps hold mortgage rates down.

Mortgage market reaction to the Fed’s press release is negative overall. Mortgage rates are rising.

The FOMC’s next scheduled meeting is December 15-16, 2009.

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Wrigley Field, New Owner, Might Be A Boon To North Side Housing

2009-11-02T17:25:51Z

The Ricketts family made its introduction to Chicago last week. Unless you’ve canceled all your newspaper subscriptions, threw out your TVs and radios and unplugged your Internet connection, you probably know that the Ricketts are the new owners of the Chicago Cubs.

You should also understand that the ownership change is big news for the city and the real estate market. You don’t have to be a Cubs fan to appreciate the positive impact that the team has had on housing values on the North Side. There are many reasons why condominiums and single-family homes in Wrigleyville, Lakeview, Lincoln Park and Southport have historically appreciated in value so steadily. A big one is the strength of the North Side neighborhoods with their wealth of entertainment, dining and shopping options.

Like the Cubs or not, the Wrigley Field experience, and the bars and restaurants it has attracted to the North Side, is a big part of the entertainment that has made the North Side’s top neighborhoods so attractive to so many homebuyers.

This is why anyone who’s interested in buying a condominium or single-family home in Lakeview, Lincoln Park or Roscoe Village should be happy now that the Cubs have a new owner, Ricketts family public face Tom Ricketts, who seems intent on turning the Cubs into a consistently winning squad.

The hope among Cubs fans is that Ricketts will sink enough money into the team to turn it into an annual World Series contender. This would be great news for the neighborhoods surrounding Wrigley.

A strong Cubs team means more visitors to the area during baseball season. These visitors will spend more dollars in the bars and restaurants outside the field. New diners, café’s and coffeehouses will continue to open.

And this, of course, means that the neighborhood will remain strong, something that can only be good for local housing prices.

As I mentioned earlier, there are many factors accounting for the consistent strength of the housing industry on Chicago’s North Side. Wrigley Field and a strong Cubs team are just two of these reasons.

But they are awfully important ones.

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Chicago Magazine: Featuring Mario Greco’s Listing at 600 N. Kingsbury #TH106 – A “River View” in River North

2009-10-30T23:41:59Z

Click here to view the embedded video.

Recently, 600 N. Kingsbury #TH106, one of Mario’s elite listings, was featured in a video and article in Chicago Magazine. You can read the article here. 600 N. Kingsbury is a 3 bedroom, 3.1 bath duplex with an amazing view of the river. It is surrounded by a huge, quiet park in the heart of River North.

The property is completely customized – ranging from the exquisite stone, tile, and glass work, to the massive, 2-story windows that promise an unsurpassed view of the river. Even the staircase was designed to be see-through, preserving the views in a sweeping array of steel and wood. There are a number of custom wood finishes throughout the interior, ranging from Wenge (imported from Africa), to pecan, bird’s-eye maple, and black and yellow walnut.

Huge stainless steel columns add a polished, crisp feel to the living areas, which are offset by the incredibly soft 100-knot wool and silk Tibetan rugs. The kitchen features ultra-high end appliances, custom cabinets, and a stainless steel backsplash. Entertainment is provided by a myriad of built-in speakers (14 to be exact) and flat screen televisions, while comfort and relaxation can be found in the custom baths which feature spa-like amenities.

The outdoor space is Christy Webber Designed, featuring trees, flowers, a fountain, and a large park just a step off of the patio. Gas, water, and electricity lines have been run outside, turning the patio into the perfect space for entertaining. Even guests can be treated to heated, indoor parking since 6 private parking spaces are being sold with the unit.

For more information or to schedule a showing, please contact Mario at mgreco@rubloff.com or 773.572.6505.

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Home Sales On The Rise Nationally, Too!

2009-10-30T16:39:07Z

Existing home sales jumped significantly in Chicago during the month of September. Not surprisingly, Chicago was mirroring a national trend.

The sales of existing homes – including single-family homes, condominiums and townhomes – jumped 9.4 percent in September of this year when compared to the same month one year earlier. That’s a significant increase, and provides further proof that the country is in the middle of a housing recovery that’s steadily gaining steam.

The country was on pace in September to see 5.57 million homes sold for the year. That compares quite favorably to the 5.10-million-home pace that the country was on in September of last year.

Existing home sales reached their highest level since July of 2007, when the country was on pace to see 5.73 million homes sold during the year.

Officials with the National Association of REALTORS® pointed to the high number of first-time homebuyers as one reason for the increase in home sales. It’s no surprise, then, that association officials continued their pleas for their federal government to extend the $8,000 first-time buyers tax credit.

This tax credit, association officials said, has encouraged a growing number of first-timers to get off the fence and into the housing market. That’s why the REALTORS® association is hoping that the government will not only make the tax credit permanent, but will extend it to all home buyers, not just first-time ones.

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How To Find Good Deals As The Buyers Market Comes To An End

2009-10-30T16:31:31Z

At some point in their lives, every home buyer in America has wondered “Is now the best time to buy a home?” In this 3-minute video, NBC’s The Today Show does a good job of answering the question.

The conclusion? Yes, but not if you’re going to overpay.

The Buyers Market is ending, we learn, as home prices rise across most of the country. Pockets of opportunity remain, however, and the focused home buyer can still find a “good deal”.

Some of the video’s tips include:

On what types of homes can you get the best prices
What you can learn from looking in a seller’s closet
How to identify a desperate seller

The piece also goes negative on short sales, noting the amount of time required to buy one. Short sales typically do take longer to close versus a ”traditional” purchase, but that doesn’t mean they should be avoided.

There’s plenty of bargains in the short sale arena, too.

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What The Media Missed In September’s New Home Sales Report

2009-10-29T16:59:49Z

Some days, newspaper headlines are a terrible place to get your real estate news.

Today is one of those days.

After the September New Home Sales report showed sales volume down from August, the mainstream media jumped on the story:

But the headlines miss the point, somewhat. Yes, home sales volume is important to housing, but it’s not as important as home supply.

A deeper look at the New Home Sales data reveals an interesting comparison point:

New home sales volume fell 3.6%
The number of new homes available for sale fell 3.8%

In other words, sales outpaced supply — a running theme this year and a positive signal for housing.

Since peaking in January 2009, the supply of newly-built homes has now dropped by 40 percent. The average sale price is up 15% over the same period.

This is why you can’t get your real estate news from the headlines. You have to dig a little bit deeper to get the real story.

September’s New Home Sales report was plenty strong. The housing market recovery continues.

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