In this Blog:
-Rates flat ahead of big announcement
-FHA Condo rule changes.
-Appraiser dying off.
-IRS 4506T, what is it?
-Top 10 List
 

Rates

Well pretty much flat for Idaho, and we anticipate that will be the status quo for the next 2-3 weeks as everyone hold back a little, anticipating the Federal Reserve will hike interest rates on December 16^th.

We have had some improvement over the last 7 days from our large drop off, but most lenders are keeping any improvement out of rates and holding rates where they are.

Weekly Jobless Claims still at 271,000
Building permits down 1.060 vs est. of 1.162M, showing builders are slowing.
Home builder Index dropped from 64 to 62, again showing builders slowing.

We also had inflation data come out, year over year we are at 1.9%, and the Fed indicated that they wanted to see 2.0%, this is another indicator that Fed should raise rates in December.

Also this week, lots of the Federal Reserve Governors spoke, and pretty much all gave indication of a rate increase.

The bets are a .25% rate increase from the Federal Reserve on December 16^th. This will be the 1^st increase since 2009, and although a .25% increase doesn’t have a direct influence on Mortgage interest rates, it does have a psychological and indirect on mortgage rates.

Don’t float, lock them.  Depending upon what the Fed says on the 16^th, we could see lots of volatility.  While most traders believe that the stock market and mortgage market has a .25% already priced in, the words that come out of the Fed’s statement will cause lots of volatility.

FHA Condo

FHA this week released new Condo Requirements, looks like making it slightly easier to get FHA certified for Condos.

Keep in mind, in order for a Condo to go FHA, the Condo needs to be HUD certified, and very few in the treasure valley are, you can check out condo that are and are not certified by following this link, they put in Boise, Idaho, and take a gander:

https://entp.hud.gov/idapp/html/condlook.cfm

The new Mortgagee Letter ( 2015-27) can be found here: http://portal.hud.gov/hudportal/documents/huddoc?id=15-27ml.pdf

Although a boring read, being that it is written by government, it is a good informational read, especially if you are selling or buying Condos.  And what is required to be come FHA certified.

IRS Form 4506t

Many of you have been seeing lenders ask for this from to be completed by borrowers, and borrowers are wondering why they have to do it.  Let’s discuss.

IRS form 4506T, you can download a copy here: https://www.irs.gov/uac/About-Form-4506T

This form allow the lender to pull tax transcripts, or formatted copies of Federal Taxes form 1040.  And the questions arises, why do we have to pull copies of taxes, when the borrower provides us them at application.

Well it is all about fraud, what was happening is borrowers were submitting 1 tax return to the IRS, showing that the borrower makes very little income, thus not having to pay lots of taxes.  And then the borrower would submit another “different” copy to the lender, showing that they make a whole ton of money so they qualify for a larger home.

Well now we have to compare the Tax Transcripts with the Taxes the borrower hands us, and they have to match, if not…well..let’s say some government officials are going to be calling.

And what happens in the past, happens in the present, yes, Lenders are still seeing people fudging their taxes, so all applications now have to have a 4506T with them.

Appraisers

I have been commenting on this for a while, but it seems to be getting worse and worse.  There are less and less appraiser, and more and more work.  This article is a great read of the upcoming issue with appraisal and appraisers:  http://www.marketwatch.com/story/the-number-of-real-estate-appraisers-is-falling-heres-why-you-should-care-2015-11-18

It is pretty eye opening about trends and how pretty soon we could see 2-4 week appraisal running $1000 each.

Top 10 Way to Hand Out Business Cards:

1. Put your business card on Flyers you hand out to all the neighbors around your new Listing.
2. Staple your business card on candy and hand out at Halloween or during open houses.
3. Lots of stores still have bulliten boards, leave 5+ there.
4. Send out Christmas Cards to past clients with business cards.
5. Take a little bag of cookies to all of your past clients, attached busines card.
6. Go buy Costco Pumpkin Pies, attach business cards.
7. Hand business cards to all cashiers at Costco/Walmart.
8. Attached to a package of flower seeds with a small note, spring is coming time to plant flowers and buy a new home.
9. Leave business cards with receipts when going out for dinner.