“As bad as the 2009 numbers are, they probably would have been worse if not for legislative and industry-related delays in processing delinquent loans,” said James Saccacio, chief executive officer of RealtyTrac.

Saccacio said that monthly foreclosure filings hit their peak in July, then declined for four months before rebounding at years end. He said trial loan modifications, state legislation extending the foreclosure process and an overwhelming volume of inventory clogging the foreclosure pipeline were the main factors contributing to the second-half declines.

But “in the long term, a massive supply of delinquent loans continues to loom over the housing market, and many of those delinquencies will end up in the foreclosure process in 2010 and beyond, as lenders gradually work their way through the backlog,” he said.

There were a record 41,000 single-family home foreclosures in the Phoenix area last year. A new Realty Studies report from the Arizona State University’s W.P. Carey School of Business and ASU economist Jay Butler also said there were 4,000 foreclosures in Phoenix in December and 3,000 in November.

Median home price in the area was $140,000 in December compared to $148,600 in December 2008.

There were also 600 condos that were foreclosed on in December versus 285 such defaults in 2008.

Butler said the rebound of Phoenix’s housing market remains elusive to many.

“Recovery is a perception issue,” said Butler. “Some people believe they will see recovery when their home values are back where they were, and that’s going to take a long time. As for the economic recovery, Phoenix-area layoffs are still coming, and there’s an expectation interest rates may get higher, so the housing market will probably bounce around for a while longer.”

As the date draws near many potential buyers are finding themselves in a touch position, should they cancel their lease early and buy a home? Or should they wait it out and hope that the tax credit is extended?  To help ease potential buyers minds we bring to you 10 reasons that the home buyers credit will be extended.

Reason #1: The NAR.  The National Association of Realtors is 1.2 million strong and they are spending time and money mounting unusually intense grassroots lobbying campaigns to make the case for extending the credit, and maybe even expanding it. The effort is targeted at the districts of members of congress.

Reason #2: The Hard Economic Facts. Lawmakers are aware of “the hard economic facts” and constituents are showing their representatives the numbers of houses that are sold in each district because of the 8000 tax credit. the economic ripple effects on local businesses, manufacturers and service industries; new jobs and income; plus the additional tax revenues that all this activity will help produce for local governments.

Reason #3: The NAHB.  The National Association of Home Builders like the NAR is lobbying congress hard.  They are proposing not only for the extension of the tax credit, but also an expansion.  They are calling for the tax credit to be raised from $8,000 to $15, 000, and to make every american eligible, not just first time home buyers.

Reason #4: Stimulus. 300,000 to 350,000 additional sales of houses will be stimulated this year by the credit. Each home sale generates approximately $63,000 in downstream “ripple effects” elsewhere in the economy.  According to the NAR - sales of furnishings, appliances, lawn mowers, landscaping, renovation materials, plus moving expenses.

Reason #5: Congress seems to be on board.  Bills are already pending in both houses to extend the credit for another year. Senate Majority Leader Harry Reid, D-Nev., whose state has been among the worst hit by the housing bust, reportedly now favors an extension of the credit. He was quoted to that effect by the Las Vegas Sun, adding, “It’s something we can get done.”

Reaons #6: Jobs. Extending the tax credit would mean creating 350,000 new jobs according to the NAHB with unemployment approaching double digits lawmakers are trying to save and create as many jobs as possible, extending the tax credit is a sure fire way to do that.

Reason #7: Bang for the Buck. The 8000 first time home buyer tax credit has been the fastest acting of all of obamas stimulus spending. Congress wont want to choke off that spending before all the rest of the money gets down the pipes.

Reason #8: Stabilization. The housing market has been stabilizing, but it is still soft.  There has been very slight growth over the past two months, Congress will not want to take the risk of destabilizing the sector right before the 2010 elections.

Reason #9: Size. The housing market in the U.S. accounts for more than 15% of Gross Domestic Product. Congress knows it needs to keep this sector strong if it wants the recovery to continue.

Reason #10: A sense of entitlement. The american people have has this program for a year now, they do not want to give it up.  Congress knows this, they also know that they want to keep their job.

So there you have it.  There is no guarantee that the credit will be extended, nor that it will be expanded.  Just know if you are in a lease, or can not purchase in the next two months, there is still hope.

If there is one thing the media has made us aware of throughout the course of this morgage meltdown, its just how creative(and crazy) lenders were with the financing options.  As the credit from the banks tightened so did the lending options available for buyers.

While most of the exotic loans of the past are gone their are still many financing options available.  Below is a list of options and what it takes to qualify for the loan.

Conventional Loan: A conventional loan is a lender agreement that’s not guaranteed or insured by the federal government. At one point in our history, conventional loans were the only mortgage loans available and they were all made by local lenders such as banks, savings and loans, and credit unions. They kept and serviced these loans in their own portfolio until they were either paid in full or foreclosed on.

A Conventional loan typically requires a large down payment that may not be required when financing through the government, however it does offer more flexibility because you are working directly with a bank.

FHA: FHA loan is a federal assistance mortgage loan in the United States insured by the Federal Housing Administration. The loan may be issued by federally qualified lenders.  FHA primarily serves people who cannot afford a conventional down payment or otherwise do not qualify for PMI.

Required Documentation For FHA Loans

• A two year history of employment in the same field is required
• If you are a recent college graduate, your last two years of schooling can be used if you are currently working in your field of study
• Credit Scores normally need to be above 620 for Conventional financing-580 for FHA and VA looks at a case by case basis
• If no credit history exists-you may use cell phone bill, cable bill, previous rental history, etc. to establish a “pattern” of good credit payments
• Proper ID as defined by the Patriot Act (State Driver’s License or Birth Certificate along with a copy of your Social Security card required)
• Debt Ratios should be below 36/46

VA:  A VA loan is a mortgage loan in the United States guaranteed by the U.S. Department of Veterans Affairs. The VA loan allows veterans 100% financing without private mortgage insurance or 20% second mortgage. A VA funding fee of 0 to 3.3% of the loan amount is paid to the VA and is allowed to be financed. In a purchase, veterans may borrow up to 100% of the sales price or reasonable value of the home, whichever is less. Since there is no monthly PMI more of the mortgage payment goes directly towards qualifying for the loan amount, allowing for larger loans with the same payment.

The VA does not make home loans, they insure them.  We are VA approved and can help you with your VA loan request. Some VA benefits include:
- No downpayment is required in most cases
- Borrow up to 100% of purchase price
- Lower closing costs
- Mortgage is assumable
- No Private Mortgage Insurance (PMI)
- No penalties if you prepay the loan
- You may be eligible for waiver of VA funding fee
- VA support during temporary financial difficulties

GRH: A Guaranteed Rural Housing loan is a federal assistance mortgage loan in the United States insured by the RHS.

Some key features include:
-  No PMI. That’s right, no private mortgage insurance.  Like VA, this program has a Guaranteed fee that can be financed into the loan the same way VA loans have a Funding fee.
- 6% seller help/contribution is allowed
- No minimum contribution from your own funds.  FHA has a 3% requirement.  There are also no cash reserves required, as is the case with your typical conventional loan.
- This program only offers a fixed rate option for primary 1 unit residences.  Current maximum loan amount is $417,000.

requirements for loan:

• 1-unit primary residences, including single-family dwellings, condominiums, planned unit developments (PUDs) and eligible manufactured homes.
• Non-farm
• Leasehold and rehabilitated properties
• Property must meet the rural designation as defined by RHS

Good Neighbor Next Door Loan: Good Neighbor next door program is made available by HUD so law enforcement and Teachers may purchase a Hud home at half price.  If the police officer or Teacher uses fha financing for this purchase he/she will only need a downpayment of $100 and can finance the closing costs into the loan.

Interest Only and Adjustable Rate loans are still available but given the current market situation they are not used often.

A crowded room at the 5 Star Conference this week erupted as Gabriele Harrison announced that Fannie Mae will be using asset management companies to handle their companies short sale requests in the future. Fannie Mae, the single biggest player in the mortgage market, will be informing clients that they will need to work with asset management companies when “short selling” their property.

An asset management company acts as a middle man between the banks that own the mortgage and the client that is trying to short sale the property. Asset management companies are already big players in the Foreclosure market, but up until now have not worked with short sale properties. The change that Fannie Mae and Freddie Mac are making should have some positive effects. Because most major banks use them for their foreclosed on properties, making the shift to Short Sale homes should be fairly straightforward. Using one company for all short sales will also streamline the process and speed up the time it takes for a client to short sale their house.

However, the new process is not great news for everyone. Since the housing collapse in late 2006 real estate agents have struggled to stay afloat, many agents have turned to short sales and working with distressed properties to help them stay afloat during the down market. When Fannie and Freddie start working exclusively with the asset management companies they will essentially be cutting out these agents. Fannie and Freddie currently own roughly half of the mortgages in America, if other big banks follow the lead small real estate agents will be all but cut out of the picture.

Details on the short sale process are still to come. We have put in calls to Mrs. Harrison (Fannie Mae) and Mrs. Beckles (Freddie Mac) however they were both unavailable for comment. We will keep you up to date on all the new developments as they come. We are still doing research but thought this information was worth sharing even in its primitive state.

There are some major changes that participants and attendees of the parade should be aware of. To cut down on parade costs, the distance the parade travels has been cut in half. The parade will now start out on Guadalupe road and run to Hackmore Street. Because of the shorter distance money will be saved on police monitoring, road blocks and trash containers. Also paved school district lots will be used to stage parade participants instead of the dirt that was used previously. This will cut down on costly dust mitigation.

The Gilbert Town Council voted last night 7-0 to put the parade back on due to the new funding received by the parade committee. The next hurdle is getting word out that the parade is still on. So tell your friends and enter your business to be in the parade for only 250$ this Nov 14th!

When the Gilbert Promotional Corp. lost most of its private funding for the parade due to the downturn in the economy, they turned to public funding and the help of the Gilbert Town Council.  The council turned down the groups request for public funding in a 5-2 vote Tuesday night.  ”It was a tough decision for everyone all around,” said George Pettit, town manager.

As a sponsor and participant in the parade since 1994 Remax Alliance Group is saddened by the news of the cancellation.  We enjoyed the opportunity to give back to the community and celebrate the tradition that the parade represented.  However, we look forward to the return of the parade in the future and the prosperity that its return will represent.

If there is a silver lining it is that the Council did vote to fund the Gilbert Days Rodeo.  The Rodeo is a 3 day event attended by up to 5,000 spectators.  For more information on what activities will be available during the Gilbert Days Celebration view the calendar here.

J.D. Power’s polling results show that the importance of additional services has increased by 12 percentage points among buyers and by 8 percentage points among sellers from last year alone.  Simultaneously the survey reports that the use of these services has declined due to cutbacks among services offered by real estate agencies.

“In a tight market, every aspect of service offered will be scrutinized very closely,” Jim Howland, senior director of the real estate and construction practice at J.D. Power and Associates said. “For this reason, it is critical for real estate companies to promote the value that they bring to buyers and sellers, not only in any additional services they offer, but also in their agents and operations.”

Choosing and agent is a tough decision in the best of times, and can be downright daunting in hard economic times such as these.  Looking into the services offered by a prospective agency is a great place to start.  Not all companies are cutting services. In fact some are even offering new and creative options to help their clients such as the Mortgage relief Package.

Other findings in the study include:

• The proportion of first-time home buyers has increased considerably — to 56% in 2009 from 44% in 2008.

• For both buyers and sellers, the agent is still the most important driver of overall satisfaction.
• Home sellers report that, on average, 3.2 open houses were conducted for their property in 2009, compared with 4.5 in 2008.
• Approximately 64% of home sellers used a Web site listing to market their home in 2009, up from 61% in 2008.

Fireworks Photo (C) Forrest Milder

Enjoy Gilbert’s  “Old Fashioned Fourth of July“ with rides, kids activities and lots of fun!  Bring your family and friends and have a great time celebrating the our country’s independence! 

On Saturday, the gates at Mesquite High School open at 4pm with fireworks around 9pm.  While admission and parking are free, some of the activities do have a small fee – and credit cards are NOT accepted. 

Chairs, blanks and umbrellas are welcome.  Pets, alcohol or glass containers are not permitted.   For more details, visit the Gilbert’s website.

Bringing enthusiasm and new ideas to the Council, first place winner, Jenn Daniels, shared with us that “I am very excited to get to work.  There is much to be done in our community and I’m ready to roll up my sleeves and serve the great people of Gilbert.”  

Gilbert Town Council is comprised of  the Mayor and six Council members, each voted to a four year term.  The three freshman members of the Council join long time Gilbert advocates, Councilmen Steve Urie, Les Presmyk,  Linda Abbott, Dave Crozier.

As long time Gilbert community members, all of us at the Reeves Team are eager to see the new Council members take their place and the new leadership they bring.  Their combined ideas and skill sets, while very unique to each member, will hopefully prove to be beneficial to the growth of Gilbert.

More election results are available on line, as well. 

From all of us on The Reeves Team, Congratulations to all!   

Unfortunately these days, this is neither unusual or unexpected…almost considered standard practice. Having put in an offer in on an REO (Real Estate Owned aka Bank Owned property) about three weeks ago, Troy Reeves finds himself in the same position, wondering the same thing. “Why do banks take so long to respond?” Troy and The Reeves Team are experienced real-estate-owned agents who have worked with small and large banks in getting responses to offers. So, while having lunch the other day, we brainstormed some ideas as to why the process length seems to vary:

1) The Asset Management Company (who has been hired by the bank to handle the sale of the property) has been given strict instructions to hold any offers for a minimum number of days.

2) The Asset Management Company has been instructed to hold all offers until a minimum number of offers have been received.

3) The Asset Management Company has been given strict instructions to hold all offers until the end of the month, end of the quarter or end of a fiscal year.

4) Sheer Volume – Consider the stacks of paperwork that one Asset Manager deals with and is responsible for processing; then consider the number of signatures (approvals) that may be required to advance the purchase process.

5) The offer has been approved by the Asset Management Company and then requires a secondary approval by the Investment Group (that purchased the loan previously). Take into consideration that this group may only meet once a month. If this is the case, an additional 30 days could be added on to the waiting period.

Perhaps just the sheer volume of foreclosed homes on the market is overwhelming. Certainly the banking industry could not have been prepared for this influx – even with advance notice. Is there a solution? The bank’s first solution was the moratorium. The period of time that the banks “held” off on putting any new properties on the market. What did this waiting period accomplish? If the intent was to slow down the fall of property values, perhaps it did help accomplish just that. While the prices are not exactly where they were before the 2005-2006 housing boom, at least we’re hopeful that the downward spiral has slowed. While it may be too soon to tell, for now, we’re all in this together … waiting.