As a mortgage professional over the past twenty-five years, I have had the honor of helping families celebrate the holidays – as homeowners.  With rates remaining at historic lows, it has been very rewarding knowing that those I have helped this past year will benefit for a long time to come.

Today, I just want to take a moment to thank you for allowing me to be a part of your life, whether professionally or thru our friendship.  I look forward to working with you again in 2012.

So this holiday, from my family to yours, I extend my most sincere wishes for a safe and festive Christmas and holiday season. For those of you defending our great Nation, I wish you a very happy holiday and a safe return.

For more information about The Mortgage Messenger, please visit our website at www.MortgageMessenger.net.  If you have a mortgage loan need in the States of IL or WI, you can contact Jim Campanella via his website at www.JamesCampanella.com.

Today is Cyber Monday.  The day when those who do their Christmas shopping on the internet will find some amazing deals.  As I thought about the video I had just viewed I realized that in so many ways today represents how technology has changed our lives.  When I was growing up I remember being excited to see the new Sears Christmas Catalog arrive.  I am NOT that old, but as a child it was exciting to page through the catalog and look at all those amazing toys.  At no time did I ever imagine a world where you could just, with a few keystrokes, find every toy in the world.

This video represents the same technological advances.  I know who Bob Hope was and I remember being entertained by him on television.  I suspect most kids and even some young homeowners today, may not know who Bob Hope was or know of his unparalleled commitment to our troops.  Thanks to technology (and YouTube), all generations can take a moment and appreciate Bob Hope and understand the Christmas message to our Troops.

Take a moment and watch this video.  If after viewing the video you feel the same as I do, take a moment and find a way, your own special way, to give thanks to the men and women defending our Great Nation this holiday season…

Should you have a problem viewing this video and for more information about the Mortgage Messenger, visit our website at www.MortgageMessenger.net.

The program is expected to be available for all loan applications taken on or after December 1, 2011.  You can not even make application for this refinance until December 1^st.  Certainly you should expect more guidelines to be implemented before December 1^st, but at this time, here are the parameters necessary for you to benefit from HARP 2.0.  Keep in mind, your loan must be owned by FreddieMac or FannieMae.  You can look up whether or not these two agencies own your loan at the following sites:

• FannieMae:  http://www.FannieMae.com/loanlookup
• FreddieMac:  http://ww3.FreddieMac.com/corporate

The parameters are:

1. FreddieMac or FannieMae must have acquired the loan before May 31, 2009
2. Your loan must be more than 80% of your home value.
3. Your loan must be current and you cannot be 30 days or more late in the past 6 months and no more than 1 x 30 days late in the past 12 months.
4. At least one borrower has verifiable income.
5. I have read in other articles, but have not confirmed, that you will need to have at least a 620 credit score.  However, I have not been able to verify this information independently.

Based on the information released, there will not be an appraisal ordered at the time you refinance.  So if you have not been late on your loan and you obtained it before May 31, 2009, you may qualify to refinance at these low rates.  This program will have some “add-ons” to the rate, which means that the rate you receive will not necessarily be the lowest rates available, but will still be very attractive.

You will be able to refinance with your current lender or with any mortgage professional.  Watch this blog for updates as more information becomes available.

For more information about The Mortgage Messenger, please visit our website at www.MortgageMessenger.net.

Recently, I was watching my morning news and the commentators, as they drank their morning coffee, suggested that the phase “historic low interest rates” has been so overused it lost its impact with Americans.  This analysis could be true since rates are historically low and yet the mortgage industry, although seeing a slight increase in refinances, continues to suffer.  Based on the fact that we are at historically low interest rates loan officers should be writing a lot more loans.

So what does historic low rates actually mean?  Well, FreddieMac has been tracking the average mortgage rate in the United States since 1971.  They report monthly on the average rate across the country, as well as the average cost (points) to obtain the loan.  Keep in mind this is only an average and regional differences do exist.  Annually, the take the 12 month average of their monthly average rate to come up with their annual average.

This means that this year (2011) there is 40 years of historic data available through FreddieMac.  The chart below is a compilation of the data from FreddieMac’s website…

To put things in a little perspective, I started in the banking industry in 1981 (wrote my first mortgage loan application in 1985).  As you can see on the above graph, when I entered the industry rates were nearly 20% for a thirty year fixed rate loan!  I opened my mortgage company in 1989 when rates were still above 10% for a thirty year fixed rate loan.  I remember creating a flyer for the Realtors I solicited the day rates broke the 10% mark.  The flyer’s headline was “Single Digit Interest Rates!”

Now if you look at the graph for 2011 (thru 06/30/2011) you can see the average rate is below 5%.  What this means is that anyone who obtained a mortgage loan within the past 40 years, whether they refinanced the loan later or not, has never seen rates this low.

Does it make sense to refinance your current loan?  There are a lot of factors in making that decision, not just the fact that interest rates are so low.  Unfortunately today, factors such as current home value, credit score, job stability all come into consideration.  However, it certainly makes sense to consider your options!  Consult your current lender or a mortgage professional about the programs available to you and your particular situation.  These rates will not remain this low forever, but keep in mind unless you sell your home, you will be paying on your mortgage loan for 30 years!  Consider taking advantage of these historic low interest rates!

For more information about the Mortgage Messenger, visit our website at www.MortgageMessenger.net.  James Campanella (NMLS #6311) is a licensed loan officer in the States of Illinois and Wisconsin.  For more information about Jim, visit the ABOUT US tab at the website or www.NMLSConsumerAccess.org.

The following are some steps I took in creating my paperless financial organization system:

1. Make a list – The first thing I did was to make a list of all my monthly (and not so monthly) bills.  I actually hand-wrote this list, but I can see a real advantage if I was to have originally created this list in Excel.  My list included the name of the bill (i.e. gas & electric, mortgage) as well as their phone number, account number and their website.
2. Research each bill – Most of my monthly offer paperless billing.  I went to each of their websites and signed up for that service.  I also made note on whether or not I could pay the bill at their website electronically.  I noted this on my list also.  I chose to use my normal email account when signing up for paperless billing.  However, another option is to create a new email account (there are many websites offering free email accounts) so that all bills would be sent to that email account.  This could help with organization knowing that all monthly bills are sent to one specific email address
3. Create an online file system – Using my email account, I created folders to which I transferred my monthly electronic statements.  This works well since I can then access this information by simply logging into my email account from the web.  For the bills I still received by mail, I chose to scan them and also file them into them into these folders.  I also save these bills and statements to a folder on my computer.
4. Create a reminder system – I live by the slogan “out of sight – out of mind” so it was important to me to have some sort of reminder system on when bills were coming due.  In the past, I kept a physical file of all my bills and looked at that file regularly to know when they were coming due.  However, using a paperless system required me to reconsider the way I tracked due dates.  I could have chosen to set up payments at the company websites with future dates, but I rather go online when the bills were due and make the payments.  Certainly the calendar on a computer would work well for tracking due dates, but I found using my smart phone (iPhone) worked the best.  I use a free app called “Billinator” by Cellinova.  I am certain there is an app that works like it for Android, as well as Windows Mobile.  This app allows me to enter the information about each bill once and notifies me when bills are due.  It is simple, secure and most importantly – free!
5. Pay bills online – When I could, I used the company’s website electronic bill paying feature.  Some of my monthly bills didn’t offer that service, so in those cases I had the funds electronically withdrawn from my bank account (a service offered for free by my bank) to pay the bill.
6. Back-up files – My data is stored in a folder in my email, as well as on my computer.  I also back up my computer to an external hard drive every night.  This way I know my financial information is secure wherever my email account is hosted, on my computer, and if my computer was to “crash” on an external hard drive.  This information could also be stored on a CD-Rom or DVD for added protection.
7. Shred documents – By scanning all my bills and statements received through the mail, I have created an electronic copy.  The originals I shred to protect myself from identity theft.

I found that following these steps helped me overcome my need to physically touch and hold my monthly bills and helped me better organize and structure a paperless bill paying system.  It did take some time to grow comfortable with this system, but now I feel very confident that I know when my bills are due, have a method of paying them without ever writing a check and I have become more “green” through this process.

For more information about The Mortgage Messenger, visit our website at www.MortgageMessenger.net.

FreddieMac takes an average of mortgage rates from lenders across the country that they collect Monday through Wednesday of each week.  One of the issues with this data collection is that often rates can change more than once within a day.  This has been especially true when economic data has been released on those days.

The average rate that FreddieMac discloses does not include any fees paid known as points.  One point is equal to one percent of the loan amount.  By paying these fees a client can lower their interest rate.  For the recent week published, the average fee (points) paid on a thirty year loan was .7% (or $700 on a $100,000 loan) and .6% for the fifteen year loan.  As a customer shops for a mortgage loan this is important to realize.  In some markets, such as the Chicago area, often loans are quoted with no points.  This would mean that rates quoted would most likely be higher than that of what FreddieMac has published as the weekly average.

There are also regional differences in interest rates.  A potential home buyer in Texas will probably find better interest rates than someone looking for a mortgage in California or Florida.  Lenders have the ability to price loans based on geographical risks.  The higher the number of foreclosures – the more likely the interest rates on current mortgage loans will be above the national average.

To add to all the confusion over rates, there are also adjustments made to your particular interest rate depending on the level of risk the lender is taking with your file.  Loan-to-value, credit score and type of transaction all influence your final interest rate.

What does this all mean to you?  Post-2008 it has become even more important that you have a good understanding of the process of obtaining a mortgage loan.  Shopping for your loan can be confusing and frustrating.  The FreddieMac weekly average is just that – an average.  Although it is important to shop for your interest rate when you are looking for financing, it is also important to understand that you may not be quoted those specific rates disclosed by FreddieMac.  Instead, its weekly report should be used as an indicator of the direction of rates and current trends.  By shopping for a professional, qualified loan officer who offers competitive interest rates, you will find the process of obtaining a mortgage loan a little less complicated.

For more information about The Mortgage Messenger, visit our website at www.MortgageMessenger.net.

So with that in mind, I thought I would write about the 5 Reasons To Keep Your Finances Online.  Of course someone may say that there is a risk by keeping all your finances on a computer, but I would suggest the risk is greater for keeping your finances, like we have done for decades, in your house, in a file cabinet and ultimately one day, in your garbage can.

My five reasons are:

1)       You will eliminate your cost of paying bills with paper.

If you pay ten bills a month, in postage alone you will save over $50 annually by switching to a bed-based payment method.  That does not take in account the cost of your checks and envelopes.  In fact, you may actually receive some rewards by signing up for paperless billing.

I have to believe all banks and credit unions now offer bill paying services and if you are with a bank that does not, most likely your credit card company, mortgage or utility company takes payment right at their website.

2)      You will not need to go to the post-office as often.

Okay, this may not amount to a big savings, but keep in mind there is talk that the US Post Office is going to be delivering mail five days a week instead of six.  The cost of gas is certainly a factor for all of us when deciding to drive now-a-days so the idea of not having to go to the post office and leave mail in an unattended box makes good sense.

3)      You will reduce the cost and clutter of paper filing.

By creating folders on your computer or in a free email account, you save the cost of purchasing a file cabinet.  Electronic files are easy to transfer and even easier to back-up.  Keep in mind, in case of a fire in your home you may lose your records, however, if it is stored on a web-based back-up system your files remain protected.

4)      You have access to your files literally anywhere.

You can eliminate the tireless searches thru receipts and invoices by creating an electronic storage system.  If you use a free email account or a web-based back-up system,  you can literally access your files anywhere there is internet access.

5)       You will deter theft.

By now most people realize that mail is stolen from mail boxes and those wanting to steal someone’s identity often rummage thru garbage.  With  your information secured by password on a computer you are protecting yourself and deterring theft.

For many, I do realize, it is hard to embrace the concept of being paperless.  We have been raised all of our life to physically have something to touch and feel in our hands.  However, with identity theft on the rise and our need to protect our credit profiles, it is becoming more and more important to rid ourselves of paper and become paperless.

Next week I will have another segment about becoming more “green”.  For more information about The Mortgage Messenger, visit our website at www.MortgageMessenger.net.

Since the collapse of the real estate industry in 2008, there have been many changes, both in regulation and in procedures that affect the home buying process.  The handbook, which is geared for the first-time buyer but provides useful information for any home buyer, addresses things like the pre-qualification process, finding a real estate professional, working with a home inspector and understanding the foreclosures and short-sales.  The book is easy to read and follows the process of buying a home.

With the Mortgage Messenger using current technologies, it was only appropriate to publish this book in an electronic format.  In doing so, it also keeps the cost of the publication down so that anyone considering purchasing a home can afford the handbook.

The eBook can be found by searching the keyword “Mortgage Messenger” at Borders, Amazon, Barnes & Noble and Kobo Books and is available for all eReaders.  It can also be found at:

http://borders.bookbrewer.com/content/mortgage-messengers-homebuyers-handbook

For more information about The Mortgage Messenger, visit our website at www.MortgageMessenger.net.

•  Ask your neighbors to keep tabs on your home while you are away
• Call your local police and ask them to drive by every once in a  while
• Halt the delivery of mail and newspapers
• Use a variable timers that automatically turn your lights off and one in different rooms throughout your home
• Shut off the water to the home
• Install motion-activated cameras
• Hide important papers and valuables – Or put them in a safe or safety deposit

For more information about The Mortgage Messenger, please visit our website at www.MortgageMessenger.net.

And the very thought of being audited by them—usually turns into panic.  What you might not know is that back in the 1990’s, Congress passed the Taxpayer Bill of Rights Law, which places the burden of proof in tax disputes on the IRA — not the taxpayer.

However, there are some additional rights you have if you ever get that dreaded “audit notice” in the mail.

• You don’t have to meet with the IRS – You don’t have to meet with them face to face. Instead, you can conduct your “audit” thru the mail.  You avoid the stress of a personal meeting, the hassle of taking time off of work, or saying something that might be misconstrued by the auditor.
• You have the right to negotiate penalties – Of course, the IRS is not going to tell you this, but if you’ve filed your tax returns, acted in good faith and have not set out to deceive the IRS or dodge your tax liability, you can ask that any penalties be cancelled.
• You can appeal decisions made by the IRS – If you believe the tax liability and penalties are unfair or incorrect, you have 30 days to file an appeal.   However, it could take years before your case is heard, but the “filing” date is the critical part of this process.
• You have the right to “installment” payments – Let’s say you do end up owing additional money, you can set up regular monthly payments with the IRS.  Form 433A needs to be filed, listing your income, expenses, assets and liabilities.  They will determine the monthly payment you need to make.
• You have the right to challenge IRS notices – Just a little fewer than 50% of all IRS notices, requesting more money from you, are incorrect or incomplete.  But they keep sending them because it has been shown that people would rather just pay the money than fight the IRS.  Don’t take their word for it.
• You have the right to use a Taxpayer Advocate – If you feel you are getting the run around or no one at the IRS is willing to help you, contact a taxpayer advocate.  This is a division of the IRS to help citizens whose tax problems seem to be ignored.  Visit the IRS website and you’ll find a link that says “Contact Your Advocate”.  The service is free and it’s confidential.
• You have the right to make audio recordings when you meet—yes, you can record the whole meeting but you have to notify the IRS 10 days in advance.
• You have the right to represent yourself at an IRS audit – The tax code is complicated and unless you are fairly competent about the specifics of your tax audit, you might want to hire an expert to help you.  If you’ve had your tax returns prepared by a CPA, they will usually help with the audit meeting.  If you end up in US Tax Court, hiring a tax expert is highly recommended.

For more information about The Mortgage Messenger, visit our website at www.MortgageMessenger.net.