More Banks Failing to Make the Grade - Happy New Year

Here in America we rely on a strong financial system (ie banks) to provide us all with capital to purchase the things that run our economy. Everyday it seems that we find out that the very people and institutions we all trust with our money fail to be trustworthy. Quite possibly that is because they have a monopoly on the business and there seems to be no alternative. We give them our money for next to nothing and in return we ask them to use it and keep it safe so that when we want it back it is there. They turn around and give the money to people with poor credit at very high rates and have no recourse if the people choose not to pay it back. They have no safe guards in place and will borrow money on a credit card easier then giving a secured loan with real property as collateral. Does anybody else see a problem with this? They are saying that we would rather borrow money without collateral vs having a house or real estate to back the loan. That means the house you live in is worth less than the piece of plastic in your wallet the banks hand out like candy.
 Yet without any hesitation when I go out and talk with people the banks are looking to either foreclose on or if possible they will talk them into modifying their loan to delay the foreclosure. The people will say to me I need to talk to my bank. These are the people you trusted when they gave you the mortgage that is messing up your life and you are going to trust them to look out for your best interests. I think that they need to understand the bank is looking out for the bank and they don't care who they wreck in the process.
 Real Estate agents come in many different packages but if you check them out there are lots of them that can help you out of what the banks got you into.The Realtor is legally bound to look out for the best interests of their clients. This is not the case for the banks. Until the government for the people by the people starts putting programs together that have the people in mind and not the banks and business we will continue down this path of distrust and lower home values.
 If this means we need to open a new kind of bank or reconfigure our financial system better to get started today then wait until we all have homes worth nothing and the American dollar is not worth the paper it is printed on. We already have that problem with some of our coins.
If you believe that our government is getting it right then today is a great time to purchase a home. If you need to sell your home because you owe more than it is worth call a realtor. They will advise you on the proper ways to be released from your home.
If you feel the banks are your best friend good luck with that and god be with you.
We at the Burkhardt Team would be happy to discuss these topics and more with anybody that is interested and will continue to get you current information and ideas. Please forgive us for any inaccuracy's and feel free to give us topics you would like us to blog on.

Merry Christmas from the Burkhardt Team

We at the Burkhardt team would like to wish everybody a Merry Christmas. Please remember during all the hustle and bustle that the true reason for Christmas is to remember the birth of our lord and savior Jesus Christ. Also remember to spend a moment with family and friends and if you can't be there a phone call can be pretty special to your loved ones.
Merry Christmas to all!!!!

Reverse mortgage gets affordable

BY marcie geffner, 

Bankrate

© Copyright 2010 Bankrate, Inc. All rights reserved.

Bankrate — 12/06/10

The reverse mortgage has matured.
These loans, which allow seniors to spend their home equity without selling their home, have historically been cumbersome and expensive. But new options now empower seniors to tap smaller amounts of equity in a more affordable way, according to Peter Bell, president of the National Reverse Mortgage Lenders Association, a group in Washington, D.C., that represents lenders and investors in the reverse mortgage business.
"Some changes from the market, from the regulatory side and in the counseling, have really improved the value proposition for a lot of seniors from what has been the traditional perception of reverse mortgages," he says.

Cheaper mortgage insurance

The biggest change is the introduction of a new reverse mortgage, called the Home Equity Conversion Mortgage Saver option, or HECM Saver. It has a cheaper upfront mortgage insurance premium, or MIP, compared with the traditional HECM reverse mortgage, now known as the standard option.
Mortgage insurance protects lenders from loan losses, though borrowers pay the cost. Most reverse mortgages are insured through the Federal Housing Administration, or FHA, a division of the Department of Housing and Urban Development.
The trade-off, due to the lower MIP and other program changes, is a 10 percent to 18 percent reduction in the maximum loan amount allowed on the saver option, and 1 percent to 5 percent on the standard option, depending on the borrower's age and interest rate, Bell says. The lower loan amount allowed on the saver option means the FHA's risk exposure is lessened.
"In exchange for taking less money, the borrower gets to pay a 0.01 percent upfront MIP instead of a 2 percent upfront MIP," he says.
The upfront MIP is based on the value of the house, not the loan amount. But still, the savings are clear. On a home worth, say, $250,000, the upfront MIP on the saver option would be just $25, while the upfront MIP on the standard option would be $5,000. That's a saving of $4,975.
Borrowers also pay an annual MIP of 1.25 percent of the outstanding loan balance on either the saver or standard option.

Lower origination fees

Another change is that many lenders have reduced or eliminated their origination fees on reverse mortgages, according to Barbara Stucki, vice president of home equity initiatives at the National Council on Aging, a nonprofit service and advocacy group for older Americans, based in Washington, D.C. The maximum loan origination fee was capped by law at $6,000 several years ago, but lower fees are now commonplace.
"Some banks charge no origination fee or a reduced origination fee, and some may charge little or nothing in the way of servicing fees," Stucki explains.
That could mean savings for borrowers, but it also means borrowers must shop around as the fees are no longer standardized. A low fee could be offset by a higher interest rate.

Lower interest rate

A third recent change is that lenders can now use a minimum expected interest rate of 5 percent, instead of 5.5 percent, to calculate the maximum loan amount, Bell says. That lower rate means homeowners can borrow more money at a lower cost.
Borrowers may be tempted by the fixed-rate option, but Susanna Montezemolo, vice president of federal affairs at the Center for Responsible Lending in Washington, D.C., says the adjustable rate may be a smarter choice because the fixed rate requires that the borrower tap the full amount of equity upfront.
"For the majority of people, it makes more sense to take out a minimum amount upfront and then have access to that line of credit, because they will owe less in interest over time," she says.

Deferred payments

The revamped reverse mortgage is an improvement, but it's still a loan against the value of a house. The borrower gets a lump sum, line of credit, stream of monthly term payments or combination of those choices, but the mortgage loan still accrues interest, and one day, the principal and interest must be paid off.
"It's very important that people understand they aren't getting rid of their mortgage. They are deferring the payments, and the payments are accumulating over time, and they are paying interest on the deferred payments," Stucki says. "It's like putting a spigot on your equity and it's draining out, and you are paying for the privilege of liquidity."
The maximum loan amount today is $625,000, but that could change if Congress decides to lower national loan limits.

Counseling required

Counseling, either in person or on the telephone, is required for all reverse mortgage borrowers. Counseling sessions are private and personalized to the borrower's situation.
The borrower must now demonstrate an understanding of the information before the counselor will issue a completion certificate, says Bell.
Some nonprofit agencies offer reverse mortgage counseling free or at a nominal fee. The going rate is about $125.
"Even if they have to pay, it's probably a good investment," Stucki says. "They could be locking up their home equity and potentially draining out that equity at an alarming rate if they get the wrong product or make a wrong decision."

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© Copyright 2010 Bankrate, Inc. All rights reserved.

Gary Keller of Keller Williams meets with short sale agents and banks to discuss 2011 changes

This is a brief overview of a meeting that was held with Gary Keller and some Keller Williams Short sale agents and bank personnel from around the country in November 2010. These are some of the highlights provided to us from one of the agents from our Keller Williams Professional Partners Surprise, AZ office that was part of the meeting. This may help you with your decision to short sale your house.

There was a lot of positive discussion from the meeting and I will tell you the banks, although slow to understand our market and see many of the bad decisions they have made to this point. Here are some key points that were discussed:

§  Many of the banks will no longer extend trustee sales over and over (we are already seeing this). Nationally this has been a bad move as the vast majority of foreclosure or trustee sale postponements have ultimately end up foreclosing anyway. Unfortunately some legitimate short sales will be lost due to this policy but ultimately the banks see this helping their overall loss and see this pushing troubled seller into starting the Short Sale process sooner.

§  Principal Reductions will not happen! Loan modifications down to 31% of the household income may happen however the terms of the loan are extended and interest will accrue thus creating even worse loan terms for most people. If you are desperate to stay in your home, this may be an avenue for you if you don’t mind the long-term drawbacks.

What does this mean to you? The biggest message here is DO NOT wait too long if you plan to Short Sale. There are many benefits in completing a Short Sale verse going to Foreclosure and the banks realize this. They also realize people are living in their home way too long without making payments and have taken advantage of the situation. Many banks and investors are pushing sellers to take immediate action if they desire to Short Sale or suffer the consequences by going to foreclosure.

 We will see the banks in 2011 being more aggressive however if you work with an experienced team, you will have options if there is enough time.

We at the Burkhardt Team would be happy to discuss these topics and more with anybody that is interested and will continue to get you current information and ideas. Please forgive us for any inaccuracies and feel free to give us topics you would like us to blog on. Special thanks to Jennifer Sanchez AZ RE agent Surprise, AZ

Burkhardt Team Thanksgiving Day Thankyou

We at the Burkhardt Team have much to be thankful for this year. We are thankful for the friendships we have made across this great country and abroad. We are thankful for our children and immediate family. We are thankful we still have all our parents. We are thankful for the trust our clients have shown us again this year as we navigate the real estate markets. We are thankful for our Keller Williams family and friends. We are thankful that we live in a country where you don’t always agree but have the right to say your piece and even sometimes agree to disagree. We are thankful we don’t have to go through another Minnesota winter again this year. So as you can see we have a lot to be thankful for and certainly know this doesn’t begin to list everything we are thankful for.  God has blessed each and every one of us and please take the time to say Thank you on Thanksgiving Day and always.

Thank You

The Burkhardt Team

Try before you buy!!!

PebbleCreek is a premeir active adult community in the great city of Goodyear, Arizona. They offer an opportunity for people to come and try out all the facilities and play golf and enjoy an evening at the restraut with current residents to allow you to tryout the lifestyle. This is a very low pressure way to try before you buy. The Burkhardt Team has used this program and can help you get signed up to try it out also. For more information please contact us and we will hook you up.

Tribute to our Veterans from Keller Williams and the Burkhardt Team

Dear KW Family –

On Veterans Day, we come together to pay tribute to the men and women who have worn the uniform of the United States Armed Forces. We are grateful for their acts of bravery; serving selflessly and rising to the occasion to protect our freedoms.  
They have truly shown the heights to which Americans can rise when asked and inspired to do so and we can all learn something from their courage. 
I hope you will take a moment today to commemorate the patriots who have risked their lives to preserve our Nation, the families who support them, and the heroes who are no longer with us – especially those who are members of our precious Keller Williams family.  
Yours in recognition and remembrance,

Gary Keller Co-founder and Chairman of the Board	Mo Anderson Vice Chairman
Mark Willis CEO	Mary Tennant President and COO