GOOD FAITH ESTIMATE

HUD has proposed a new four-page Good Faith Estimate that includes a summary of loan terms, interest rate, monthly payment, whether the interest rate and principal balance can increase, by how much, and if there is a prepayment penalty. HUD says it’s easier to understand; the real estate industry says it’s not.

MORTGAGE RATES

Rates on 30-year mortgages jumped to their highest level in nearly eight months to 6.32 percent, reflecting increased concerns about what the Federal Reserve might do to battle inflation. Experts generally expect the trend to continue over the short term.

FORECLOSURES

The number of U.S. homeowners swept up in the housing crisis rose further last month, with foreclosure filings up nearly 50 percent compared with a year earlier, according to numbers released today by RealtyTrac.

REAL ESTATE TAXES

Some local governments blame property tax reform for their recent cutbacks. But Chris Holley, executive director of the Florida Association of Counties, said yesterday that tax income lost because of the housing slowdown has been "much more severe to local government than Amendment 1."

HOMEOWNERS INSURANCE

The Florida Insurance Guaranty Association, a nonprofit agency formed by the Legislature to pay claims of the insolvent Poe property insurance companies, has been slow to respond, say lawyers who have filed suit on behalf of nearly 300 homeowners in South Florida.

EMINENT DOMAIN

Eminent domain law, traditionally somewhat sedate, generated an earthquake in 2005 when the U.S. Supreme Court decided that governments could take property and give it to private developers. Florida then tightened its eminent domain laws, leading to a recent Orlando case that ended with the city paying $8.4 million for one family’s third-of-an-acre property.

EQUITY CREDIT LIMITS – HELOCS

Banks and other lenders, wary after the subprime collapse, have been suspending many home equity lines of credit (heloc) because homeowners’ debts have exceeded their homes’ property values.

HOMETOWN DEMOCRACY

Hometown Democracy – the proposed constitutional amendment that would make it more difficult to change land-use plans – could be on the November ballot if proponents win a just-filed federal court case. Sponsors sued yesterday, claiming Florida’s Feb. 1 cutoff date for signature petitions violates the U.S. Constitution.
 

HOMEOWNERS INSURANCE

Floridians with home, car, boat or business insurance policies will continue to pay a 1 percent surcharge for two more years. State officials are still trying to recoup losses suffered during the 2005 hurricane season and keep the Florida Hurricane Catastrophe Fund in the black.

HOME INSPECTORS

What should homebuyers expect from a home inspector? Members of the American Society of Home Inspectors (ASHI) created a Client Bill of Rights that, according to the Ethic Committee chairman, turns their Code of Ethics rules into "a commitment" to clients.

ASHI Client Bill of Rights

• To be assured the inspector is objective in his or her reporting and will not knowingly understate or overstate the significance of reported conditions.
• To be assured the inspector’s opinion is based on genuine conviction within the scope of his or her education and experience.
• To be assured the inspector stays current with the industry body of knowledge through continuing education.
• To be assured the inspector will not disclose inspection results or client information without client approval.
• To be assured the inspector has not accepted any form of compensation for recommending contractors, services or products.
• To be assured the inspector will not offer to repair or replace for compensation any component covered by the ASHI Standards of Practice for one year after the inspection.
• To be assured future referrals to the inspector from real estate agents are not dependent on the inspection findings or the sale of the property.
• To be assured the home inspector has no financial interest in the transaction.
• To be assured the inspector is not receiving compensation for the inspection from any other party.
• To be assured the inspector did not compensate the real estate agent or other party for the referral to the client.

FEDERAL HOUSING ADMINISTRATION (FHA) MORTGAGES

Demand for once-neglected FHA mortgages has surged because they don’t require the hefty down-payments or stellar credit scores that lenders have come to expect from borrowers. They might not be the cheapest loans around, but they are the best fit for some borrowers – and the only option for others.

SUBPRIME LOANS

Some regulators and members of Congress want to cut back Housing and Urban Development (HUD) oversight of Fannie Mae and Freddie Mac, saying HUD’s lax oversight played a role in the current mortgage meltdown. According to critics, HUD incorrectly encouraged sub-prime lending, labeling it as a positive move to create affordable housing.

ABANDONED (FORECLOSED) PROPERTIES

With foreclosures on the rise, officials are fielding more complaints about odors, algae-choked pools that could become breeding grounds for bacteria, toads and disease-carrying mosquitoes.

MORTGAGES

In every economic condition, one group suffers while another thrives. During the housing boom, local banks and thrifts struggled to compete with aggressive brokers and national lenders. Now, some community banks are regaining market share and helping more home buyers as rivals scale back or go out of business.

REAL ESTATE INVESTING

Real estate mutual funds (Real Estate Investment Trusts) are faring surprisingly well in the worst real estate market in decades. Could investors be seeing the silver lining of the gray cloud?