The DNJ Daily Market Report -- Jason Yasser, Mortgage Blogger

April 15 Is 1 Week Away And 27 Million Taxpayers Have Yet To File. If You're One Of Them, Here's Some Tax Tips.

Wed, 08 Apr 2009 07:45:00 -0700

There are 138 million taxpayers in the United States and, according to the IRS, 20 percent of them file their taxes within 7 days of April 15. In a holiday-shortened week, that means that 27 million people had better get a move on.

And while a portion of this year's last-minute filers will file with storefront operations like Liberty Tax Service or H&R Block, many others will self-prepare with the help of tax software from TurboTax or TaxCut.

If you're a member of the do-it-yourself crowd, consider taking a review of this year's tax law changes before starting your returns. The stimulus package signed into law this past February made a profound impact on tax liability and the list of changes may be helpful for you.

A few of the new, allowable income tax deductions for 2008 include:

Mortgage debt forgiveness in the event of a short sale
An additional standard deduction on real estate taxes paid
$8,000 tax credit for homes bought since January 1, 2009

TurboTax offers 4 tax filing choices online, ranging in price from $100 to free. If you're among the 27 million yet to file, choose whichever program fits best -- just choose it before April 15.

Filing could take several hours. Plan accordingly.

How To Know If You're Eligible For A Making Home Affordable Refinance

Tue, 07 Apr 2009 09:38:02 -0700

April 4, 2009, marked the official start of the Making Home Affordable refinance program.

Expected to help 5 million homeowners, the Making Home Affordable program "looks the other way" with respect to falling home values, approving mortgage applications based on borrower payment history and benefit to the homeowner.

Not every homeowner is eligible for a Making Home Affordable refinance, however. There are 3 basic criteria that must be met.

First, your existing home loan must be backed by either Fannie Mae or Freddie Mac. Thankfully, both companies provide online lookup services. Start with the Fannie Mae site because Fannie has a greater market share and because Freddie Mac's site requires your social security number.

Next, you must have a perfect mortgage payment history over the last 12 months. Even one payment made 30 days late disqualifies you from participating in the Making Home Affordable program. It is okay, however, if you were 20 days late on your payment and incurred late fees.

And lastly, the balance on your mortgage cannot exceed your home's value by more than 5%. The math formula is (Mortgage Balance) / (Home Value). If the quotient is greater than 1.05 then your loan-to-value exceeds 105% and you are not eligible for Making Home Affordable.

Now, assuming you meet the criteria, there are some noteworthy details of the Making Home Affordable program:

If you didn't pay mortgage insurance prior to refinancing, you won't have to pay it after refinancing -- even if your loan-to-value exceeds 80%.
All refinances require income verification -- even if the original mortgage was a stated income loan.
Second mortgages cannot be paid off using loan proceeds -- they must be subordinated

There are other guidelines, too, and both Fannie Mae and Freddie Mac have dedicated portions of their website to the Making Home Affordable program. To the layperson, unfortunately, the information may be a bit technical.

Even the government's fact sheet can be a little dense at times.

Therefore, if you have specific questions about the Making Home Affordable program and your own eligibility, first check to see if Fannie or Freddie is backing your loan. If they are, pick up the phone and call your loan officer to plan next steps.

The program ends June 10, 2010.

What's Ahead For Mortgage Rates This Week : April 6, 2009

Mon, 06 Apr 2009 08:40:00 -0700

Mortgage markets were up-and-down last week as rates fell Monday and Tuesday before surging higher from Wednesday through Friday.

In some case, after touching all-time lows, conforming mortgage rates added a half-percent in the second half of the week, ruining some homeowners' chance to refinance.

It was the second week in a row that mortgage rates worsened.

One reason why mortgage rates are up is because investors are turning bullish on the economy, even as it sputters.

From investors' perspective, the data is weak, but not as weak as it has been -- or could have been. It's a glass-is-half-full approach and it's the opposite of how Wall Street worked in 2008.

For example, from last week:

Consumer Confidence measured a paltry 26.0 -- but the reading was up from February's all-time lows
The Case-Shiller Index showed a big drop in home prices -- but the report ignores strong housing data from the last 60 days
Unemployment rates reached 8.5 percent nationally -- but employment is a lagging indicator for the economy

In time, we'll learn whether investors were on-time or premature in their bets for an economic turnaround but, for now, the mere belief that the economy is improving is leading mortgage rates higher. And until Wall Street's sentiment changes, rates should continue in that direction.

This week, there won't be much chance to change traders' minds. For one, it's a holiday-shortened week. Secondly, there's just one release of importance to markets -- Wednesday's release of the March Fed Minutes.

Mortgage rates may not rise for the third week in a row this week but long-term momentum is working against rate shoppers. If you see a rate you like, consider locking it. Before long, it might be gone.

(Image courtesy: The Wall Street Journal Online)

By The Time You Read About Low Mortgage Rates, It Was Already Too Late To Get Them

Fri, 03 Apr 2009 07:45:00 -0700

Thursday morning, homeowners in different parts of the country awoke to find similar-sounding newspaper headlines:

Rates on 30-year mortgages sink to 4.78%, a new low (LA Times)
Mortgage rates at record low for 2nd week (Miami Herald)
Mortgages hit another record low (San Francisco)

The underlying story was that Freddie Mac's weekly Primary Mortgage Market Survey showed the lowest, average 30-year fixed rate mortgage in its 38-year, rate-tracking history.

Once again, however, the headlines came too late for homeowners.

Prior to Thursday's market open, mortgage markets had already worsened from their record-setting levels. Slowly at first, and then with momentum. The shift pressured rates higher so that when lenders issued their Thursday morning rate sheets, most showed an 1/8 increase from Wednesday's close.

The negative momentum carried into the afternoon, too, forcing a second increase of an 1/8 percent.

The Freddie Mac survey may have been accurate when the sun came up Thursday, but by the time the sun went down, it wasn't even close. It's why you can't do your rate shopping by watching newspaper headlines. Mortgage markets are volatile and rates often change without notice.

Thursday, they did it twice.

Another Positive Housing Signal : The Number Of Homes Under Contract Increase

Thu, 02 Apr 2009 09:07:01 -0700

The number of homes under contract to sell is rising, another signal that the housing market may be regaining its footing.

As reported by an industry trade group, the Pending Home Sales Index gained 2 percent in February. The report measures MLS-listed homes in "pending" status -- sold but not yet closed.

Pending Home Sales is not a perfect statistic, though, by any means.

For one, the Pending Home Sales Index doesn't account for non-MLS listed homes including For Sale By Owner properties and mass foreclosure auctions. In certain markets nationwide, these two categories represent a large percentage of the overall transaction volume.

Secondly, Pending Home Sales samples just 20 percent of all MLS-based transactions -- hardly a complete listing.

But most importantly, a "pending" home sale is not the same as a closed home sale. A lot of things can go wrong between the time a home goes under contract and the supposed closing date. For example, the home inspection could fail, the contract could fall apart, and/or the buyer's financing could be denied in underwriting.

All things equal, though, Pending Home Sales is a fair forward-looking indicator for the housing market as a measurement of buy-side demand for homes.

When Pending Home Sales rise, it's tells us that buyers and sellers are matching up, clearing out market inventory. And actual home sales often follow "pending" ones -- 80 percent of Pending Home Sales will close within 60 days.

Are Home Values Rising Or Falling? The Answer Depends On Who You Ask.

Wed, 01 Apr 2009 08:59:07 -0700

A report published Tuesday showed that home values fell nearly 3 percent in January 2009 versus the month prior and by 19 percent from last year.

On the surface, data from the study looks like more bad news for housing. With deeper inspection, though, we uncover reasons to discount the report's finding.

For one, the report includes home price data from just 20 cities around the country -- and they're not the 20 most populated cities, either.

For example, data from #4-ranked Houston is not included and neither is #7 San Antonio nor #10 San Jose. #54 Tampa, however, is included.

Secondly, the report is two months lagging.

Published March 31, its data is only accurate as of January and a lot has happened in the last 2 months. This includes a record-drop in interest rates and the introduction of an $8,000 tax credit for qualified first-time home buyers. The stimulus has helped raise home sales volume on both new homes and previously-owned ones.

And lastly, one more reason to question the relevance of the Case-Shiller report is that a government study on the same topic showed home values rising over the same period, not falling. According to the Federal Housing Finance Agency, home values grew 1.7 percent from December 2008 to January 2009.

In the end, home values are a local phenomenon that can't be summarized as a national "summary". National data can be helpful for watching longer-term trends, but it shouldn't be used to make a "Buy or Not Buy" decision.

For that, talk with a real estate professional with access to local data instead.

Source
List of United States cities by population
http://en.wikipedia.org/wiki/List_of_United_States_cities_by_population

(Image source: LA Times )

8 Things You Absolutely Shouldn't Do Now That Your Mortgage Application Is In-Process

Tue, 31 Mar 2009 08:45:00 -0700

With mortgage rates are hovering near all-time lows, lots of Americans are taking advantage of refinance and home buying opportunities.

The downside of today's unexpectedly-low rates, though, is that mortgage lenders are ill-equipped for the rush of new business.

As a result, the process of underwriting and approving new mortgage applications is taking some conforming lenders as long as 2 months to complete.

This is double the time needed as recently as six months ago.

Because there may be 60 days between the application date and the closing date, it's important for applicants to remember that mortgage approvals can be revoked at any time prior to funding.

As mortgage applicants, there are many events that are out of our control -- job security and health matters, for example. But there are also events that are within our control.

Knowing that mortgage approvals can be fragile, here are 8 things you should absolutely not do while your home loan is in process. It may be the difference between being approved by the bank, and being turned down.

Don't buy a new car or trade-up to a bigger lease.
Don't quit your job to change industries
Don't switch from a salaried job to a heavily-commissioned job
Don't transfer large sums of money between bank accounts
Don't forget to pay your bills -- even the ones in dispute
Don't open new credit cards -- even if you're getting 20% off
Don't accept a cash gift without filing the proper "gift" paperwork
Don't make random, undocumented deposits into your bank account

Now, avoiding these items may not be practical for everyone. For example, if your car lease is expiring and you need a larger vehicle, it doesn't mean you can't buy the car -- just check with your loan officer first to be sure the new payments won't "break" your approval.

The same goes for accepting cash gifts from parents. There's a right way and a wrong way to accept gifts and doing it the wrong way may prevent you from using the gift as a source of downpayment.

Mortgage lending is full of "gotchas" and with underwriting times stretching to 60 days, it's a lot more likely that a mortgage applicant will trip into one. Following these 8 rules, though, is a good start.

What's Ahead For Mortgage Rates This Week : March 30, 2009

Mon, 30 Mar 2009 08:00:00 -0700

The stock markets made strong gains last week but the mortgage markets barely moved in the wake of the Treasury's "toxic asset" plan.

After carving out wide trading ranges on most days, mortgage pricing ended the week slightly worse overall.

From an economic standpoint, though, last week was an interesting one.

Existing home sales showed unexpected strength
New home sales showed unexpected strength
Data showed home prices rising unexpectedly

In addition, consumer confidence rose unexpectedly, too.

To rate shoppers, these "unexpected" developments are warnings worth heeding because mortgages trade on expectations of the future. And "the future", you'll remember was widely expected to be an economic abyss.

This is one of the many reasons why mortgage rates are so low right now -- during uncertain times, investors flock to safe investments. But when those expectations change, mortgage rates usually do, too.

And quickly.

Our current recession has been thus far called "housing-led" and was predicted to last several years. Last week's data, however, provides at least some evidence that the recession may be ending; that the economy may find its way forward sooner rather than later.

Indeed, even members of the Federal Reserve now call for a turnaround starting in as few as 6 months.

For now, market reaction to the unexpected data has been tepid. Therefore, watch for developments over the coming weeks and -- perhaps more importantly -- keep an eye on the investor mindset. If bond markets start to sell-off en masse, don't be surprised if mortgage rates race higher by quarter-point leaps at a time.

Meanwhile, this week, the biggest data release is Friday's jobs report. It's expected to show unemployment reaching to 8.5% with another 656,000 Americans losing their jobs in March. As before, if the data isn't as bad as expected, watch for stocks to rise and mortgage rates to go with them.

FHA Cash Out Refinances Getting More Strict As Of April 1, 2009

Fri, 27 Mar 2009 09:24:00 -0700

If you're in want of a cash out refinance, the most liberal cash-out program in town is about to make qualification more difficult.

Effective April 1, 2009, the FHA is reducing the maximum loan-to-value on cash-out refinances by 10 percent, dropping the loan size limit from 95% of the home's value to 85%.

In its official press release, the FHA days it's making the change to "limit its exposure to undue risk".

It also lists the following cash-out requirements:

With less than 12 months since the purchase date, a home's value cannot exceed its original purchase price -- even if home improvements were made.
A homeowner must be current on his mortgage payments to qualify
A second, verifying appraisal may be necessary, depending on loan traits
Co-signers may not be added to the mortgage note in order to qualify

The last day to register a FHA 95% cash out refinance is Tuesday, March 31, 2009. The loan does not need to be "locked" -- only registered.

So, if you know that a 95% cash out FHA refinance is in your future, talk to your loan officer before Wednesday morning about registration.

New Home Sales Figures Show Unexpected Improvement

Thu, 26 Mar 2009 07:45:00 -0700

The national housing market got its third piece of good news in 3 days:

Monday: Existing Home Sales up
Tuesday: Home values appear higher nationally
Wednesday: New Home Sales up

And although national real estate statistics are irrelevant to the local markets in which real estate transactions happen, to a country of would-be and wanna-be home buyers, repeated positive news on housing can be a strong signal that it's time to get off the sidelines.

At least, that's what the data is showing us. According to an industry trade group, first-time home buyers accounted for half of all sales of previously-owned homes.

The stimulus package's $8,000 tax credit likely played a role in this 50 percent figure, as well as sagging home prices in most markets and low mortgage rates nationwide.

But lest we carried away, we can't forget that February's New Home Sales is still the second-lowest tally on record and that two months of data doesn't define "turnaround".

On the other hand, if the trend continues through the Spring Buying Season, we'll likely look back at Winter 2009 as the low point in housing.

(Image courtesy: LA Times)

Watch Out For Mortgage Rates When Gas Prices Rise

Wed, 25 Mar 2009 08:38:44 -0700

Don't look now but oil prices are climbing.

This should worry today's home buyers and would-be refinancers because some of the same forces that helped to push crude past $50 for the first time in 4 months also cause mortgage rates to rise.

March 18, the Federal Reserve committed an additional $1.15 trillion to support the economy.

Since the announcement, investors have questioned whether the Fed is purposefully spurring inflation. The Fed's total debt purchases now total $1.75 trillion.

And to finance its purchases, the Federal Reserve is printing new money, devaluing the U.S. dollar along the way. This then leads to inflation which, all things equal, causes oil prices to rise, gas prices to rise, and mortgage rates to go with them.

As we've seen the last few summers, oil prices and mortgages seem to touch their yearly high points while the weather is warmest.

(Image courtesy: The Wall Street Journal)

Monthly Home Sales Rise 230,000 In February 2009

Tue, 24 Mar 2009 09:03:42 -0700

Each month, the National Association of REALTORS^� releases a study called the Existing Home Sales report. It's a detailed look at "used" home sale data from all four regions of the country.

Among the key findings of each Existing Home Sales report is something called the "median sales price", the statistical price point at which half of the homes in the U.S. sold for more, and half sold for less.

Last month, the median sales price in the United States fell to $165,400, down 15.5 percent from a year ago.

Nevertheless, just because the median sales price is lower from last year doesn't mean that the housing market is losing steam. The median sales price is just the middle point of all home sales in all U.S. markets. By definition, it groups New York City and Danville, Illinois; Los Angeles and Cheyenne -- markets that have little do with one another.

When median sales prices are falling, it doesn't point to housing weakness, per se -- just that more homes are selling at the lower end of the pricing spectrum than at the higher end.

Going forward, it's believed that a reduction in home supplies is the key to a complete, national housing recovery. It's encouraging, therefore, in a month known for a high volume of new listings, that the number of homes sold kept pace with the number of new homes available for sale.

The current housing inventory stands at 9.7 months, flat from January.

(Image courtesy: The Wall Street Journal)

What's Ahead For Mortgage Rates This Week : March 23, 2009

Mon, 23 Mar 2009 07:45:00 -0700

Mortgage markets scored big gains last week, sparked by the Federal Reserve's pledge to buy $750 billion more mortgage-backed bonds in 2009.

Conforming mortgage rates fell on the week, overall.

But Federal Reserve intervention wasn't the only good news for rate shoppers last week. New evidence showed -- for the time being, at least -- that the U.S. economy may be reversing direction:

Homebuilders are breaking ground on new homes again
First-time jobless claims are falling
Inflation is present and, therefore, deflation is not

Should the economy continue trend stronger through the summer, it will likely fuel stock market gains, drawing cash away from mortgage bonds. This would lead mortgage rates higher -- perhaps for good.

Today's levels are artificially low, after all, supported by government intervention more than economic fundamentals. After the Fed's Wednesday afternoon announcement, rates fell to all-time lows before recovering sharply into the weekend on economic optimism and fears of inflation.

This week, the trend higher may continue.

In addition to the economic data set to be released this week, the U.S. government is expected to unveil its "toxic asset" plan Monday. If the plan includes issuance of new federal debt, inflation concerns will grow and that should lead mortgage rates up once more.

Some of the week's key events include Monday's Existing Home Sales report, Wednesday's New Home Sales report and Friday's consumer spending report, as well as President Obama's Tuesday evening address to the nation.

Rates can make huge changes from day-to-day and even from hour-to-hour. If you're shopping for a new home loan and find a mortgage offer that "fits", consider locking it right away. With so much news hitting the wires this week, the rate quote is likely to expire quickly.

History As A Teacher: What To Do When Mortgage Rates Plummet

Fri, 20 Mar 2009 10:08:00 -0700

For the fifth time in a year, rate shoppers learned an important lesson this week: When mortgage rates plummet unexpectedly, they often recover just as fast.

Wednesday, the Federal Reserve's newest $750 billion mortgage market pledge helped to push conforming mortgage rates near their lowest levels since WWII.

24 hours later, however, those rates were expired.

After considering the long-term implications of the Federal Reserve -- literally -- printing new money to service the recession, markets grew fearful that the Fed's interventions will eventually lead to inflation. Inflation, of course, is the enemy of mortgage rates.

So, if you're looking for the explanation of why rates rose as suddenly Thursday as they fell the day prior, this is it. And, in hindsight, rate shoppers might have seen it coming, if only because we've seen the exact pattern 4 other times:

After the Fed's "surprise" rate cut in January 2008
After the Fannie Mae and Freddie Mac takeovers in September 2008
After the Fed announced its first $500 in support in November 2008
After the Fed zeroed out the Fed Funds Rate in December 2008

Sharp drops in mortgage rate, it seems, are followed by immediate bounce-backs.

Unfortunately, not every would-be refinancing homeowner saw the increase coming. People that locked Wednesday captured the lowest rates in 6 decades. Everyone else wishes they had.

From day-to-day, we don't know if mortgage rates will rise or fall. Nobody knows that. But, we do know that mortgage rates tend to follow patterns and we've seen the above pattern 5 times now.

When mortgage rates plunge like they did Wednesday, they rarely low for long. When you find a rate you like, get in and get locked as soon as possible. By tomorrow, it's likely to be gone.

Explaining What The Federal Reserve Did In Plain English (March 18, 2009 Edition)

Wed, 18 Mar 2009 17:30:08 -0700

The Federal Open Market Committee voted to leave the Fed Funds Rate unchanged today, within the target range of 0.000-0.250 percent. This doesn't mean the Fed stood pat, however.

On plan to resurrect the economy using "all available tools", today, the Fed announced a new, $1.5 trillion round of fiscal support for the treasury and mortgage markets.

The stimulus will likely be Thursday morning's headline story.

In its press release, the FOMC touched upon a few of the prevailing economic issues, using these points as a legitimizing backdrop for its newest debt load:

Job losses and wealth loss are dragging down consumer spending
Some U.S. trading partners are falling into recession
Businesses are cutting back on investment and inventory

Of interest is that the FOMC said today's inflation levels may be too low to support economic growth at all. This condition is more commonly called deflation. The Fed's latest actions, therefore, may be a deliberate attempt to induce inflation through unprecedented borrowing.

For home buyers and potential refinancers, this is terrific news -- at least in the short-term. By introducing new demand for mortgage bonds, the Fed will help pressure mortgage rates lower. Already this afternoon, mortgage rates fell and they will continue to fall until the market reaches a new equlibrium.

After the Fed's last intervention, markets reached their balance point in about a day-and-a-half.

Source
Parsing the Fed Statement
The Wall Street Journal Online
March 18, 2009
http://online.wsj.com/public/resources/documents/info-fedparse0903.html

Today's Signal That Home Prices May Have Already Bottomed: Building Permits

Wed, 18 Mar 2009 07:33:00 -0700

There's a mixed message in February's Housing Starts data and it may be a good sign for home sellers in the near-term.

As reported by the government, new home construction rose by 22 percent last month. The press is running with the headline number, calling it evidence of a market bottom.

A more thorough inspection, however, reveals a different story.

The 22 percent figure applies to all homes built -- including apartment building units. Isolating residential units, February's housing starts rose by just 1 percent. Furthermore, the data's margin of error is 11 percent.

Statistically, we can't know if residential housing starts really rose last month, or if it fell instead. What we do know, though, is that the number of building permit requests rose.

Permits to build single-family homes were up 11 percent in February nationwide.

To home sellers, the rise in building permits may confirm that a housing market turnaround is already underway. Builders wouldn't be putting new inventory on the market, after all, without being sure of their ability to sell it 9 months hence.

The headline figure of 22 percent is attractive, but it's not completely honest. It's not the number of housing starts that matter so much right now as the number of housing permits. A rise in permits signals that homebuilders -- a group that's lost a lot of money in the last 2 years -- think the worst of housing is already over.

(Image courtesy: The Wall Street Journal Online)

The Federal Reserve Is Meeting And What It Means To Your Mortgage Rate

Tue, 17 Mar 2009 09:43:00 -0700

The Federal Open Market Committee begins a scheduled, 2-day meeting today to discuss the country's monetary policy. As is custom, the group will issue a press release to the markets upon adjournment.

There are 8 scheduled FOMC get-togethers annually and the post-meeting press releases are among the most powerful market-moving events of the year.

It's not the Fed's actual policy changes that causes fortunes to be won or lost, though.

These changes can predicted and traded -- and, therefore, hedged -- on Wall Street using Fed Funds Rate Futures. For example, Wall Street predicts with 97% certainty that the Federal Reserve will not make a policy change at this time.

As opposed to than policy change, it's the verbiage of the FOMC's press release that can really move markets. This is because the press release is a clear-eyed look into what the Federal Reserve thinks of the United States economy -- its strengths, its weaknesses, and its threats.

After its January 2009 meeting, the FOMC's press release said:

The economy has weakened further
Employment has declined steeply
A gradual recovery may come later in 2009

Since that meeting, though, a number of high-profile economists, including Fed Chairman Ben Bernanke, have said the likelihood of economic recovery increased for late-2009.

This is why tomorrow's FOMC press release is so important. It will contain clues about the Federal Reserve's next steps and current psyche. Undoubtedly, it will make a significant impact on the mortgage markets.

In general, when the Fed alludes to inflation and stronger growth, mortgage rates rise. Talk of a recovering economy and rising oil prices in tomorrow's press release, therefore, would likely raise rates from their current low levels towards levels not seen for 6 months.

In the end, it's what the Fed says that matters more than what the Fed does. The FOMC is expected to leave the Fed Funds Rate within its target range of 0.000-0.250 percent.

(Image courtesy: Wall Street Journal)

What's Ahead For Mortgage Rates This Week : March 16, 2009

Mon, 16 Mar 2009 08:21:23 -0700

Mortgage markets lost a little bit of ground last week, edging mortgage rates higher in a week marked by the largest stock market gains since November.

Once again, mortgage rates couldn't sustain a rally of more than 5 days. Not since late-2008 have mortgage rates managed to fall two weeks in a row.

Last week's market was impacted by three distinct factors:

Bank balance sheets weren't as bad as feared
Discussion started on new bank valuation methods
Traders got optimistic that "the worst is over"

The rally will likely continue into this week, too. This after the 60 Minutes interview with Ben Bernanke in which the Fed Chief said he won't let big banks fail and that the recovery will likely begin later this year.

It's the first interview with a sitting Federal Reserve Chairman in history.

Coincidentally, the Federal Reserve will be in the spotlight this week as it concludes a two-day meeting Wednesday after which the Fed will issue its standard, post-meeting press release at 2:15 P.M. Although it's not expected to make Fed Funds Rate changes, the markets will closely watch the Fed's language for clues about the next phase of monetary policy.

In general, when the Fed indicates that inflationary pressures may build, mortgage rates rise. Moreover, in the above interview, Bernanke alluded to such inflation and the need to control it in the future.

Despite the small rise in rates last week, mortgage rates remain low and favorable for high-credit scoring borrowers. Volatility is still a factor, however, so if you're nervous about rates rising, it may be best to lock early in the week -- before the Fed's Wednesday announcement.

4 Minutes Of Guidance For Soon-To-Be Real Estate Investors

Fri, 13 Mar 2009 08:49:40 -0700

"Most of the biggest real estate fortunes were not made in good times, but in bad times like this" Barbara Corcoran reminds us in this talk with NBC.

It's important perspective for Americans wondering how to invest in foreclosed properties without losing their cash or their credit rating.

In the 4-minute interview, Corcoran quips on the basics and the essentials of foreclosure investing,

"Everyone who loses their shirt loses it somewhere else."
"Every big shark started small."
"The house on the corner sets the tone for the block."

She also lends some personal perspective to rent rolls, the cost of losing a tenant, and finding a good business partner.

Banks are anxious to sell their foreclosed homes and that makes this an ideal time for shrewd real estate investors. If you're new to the game, watch the video and take good notes.