Rates are fantastic, prices have stabalized and many folks are planning on staying in their current home longer. So the question is should I refinance or not?

Reasons to Refi:
1. Lower rate
2. Change from ARM to fixed rate
3. Cash out
4. Divorce or dissolution of a business partnership

Reasons to not Refi:
1. Moving soon
2. Cost outweighs savings

To find out how long it will take to recapture the cost of a refinance just take the total cost and divide it by the monthly savings = number of months to break even. After you break even your net savings begin every month after that.

Popularity: 3% [?]

PDC will begin accepting OYO Entry Packets between the hours of 9:00 a.m. and 5:00 p.m. on Monday, November 9 at 9:00 a.m. until Monday, November 30 at 5:00 p.m. To be considered for the OYO program households must submit an OYO Entry Packet to PDC prior to the deadline. Once the deadline has passed no further packets will be accepted unless the number of entries is deemed to be insufficient to allocate the funds budgeted for the program.

A complete OYO Entry Packet must be delivered to the Portland Development Commission (PDC) to the attention of the Neighborhood Housing Program at 222 NW 5th Avenue, Portland Oregon 97209 by the above deadline. If the packet is mailed, regardless of when it is postmarked, it must still be stamped as received by PDC prior to the deadline.

An OYO Entry Packet must include all of the following relevant documents:

A fully completed and signed OYO Questionnaire (which will be posted at www.pdc.us/oyo, November 9, 2009 by 9 a.m.)

Proof of current income for all adults in the household, such as one month of current pay stubs, 2008 W2’s or award letters for all income earners in the household. If self-employed, provide copies of 2007 and 2008 federal tax returns and a current profit and loss statement for 2009.

A credit approval letter from a first mortgage lender for a 30-year fixed rate loan. The approval letter must demonstrate that the application has been fully underwritten including a credit approval, credit scores and the underwriter’s signature.

Certification from the first mortgage lender that they can close a first mortgage loan with a second OYO loan and that the OYO loan meets their programmatic requirements (form will be posted at www.pdc.us/oyo on November 9, 2009 by 9 a.m.).

A copy of the signed Uniform Loan Application (1003) that was submitted to the first mortgage lender.

A copy of the Good Faith Estimate and Truth in Lending Disclosure provided by the first mortgage lender.

Proof that the borrower has at least 1% of the purchase price in their own funds to purchase the home.
Appropriate documents include bank statements (checking and savings account) and/or a gift letter from a family member.

FIRST MORTGAGE FINANCING TERM LIMITATIONS:

To obtain the approval letter, applicants select a lender of their choice. The loan MUST be a 30 year fixed rate conventional, FHA, HUD 184, or VA loan.

The interest Rate cannot significantly exceed the current market interest rate as determined by PDC.
Loan fees cannot exceed a 1% loan origination fee, a 1% yield spread premium (if applicable) and cannot exceed $1,000 in other direct lender or broker fees.

Lenders need to confirm that their first mortgage underwriting guidelines will permit a Community Second up to 105% combined loan-to-value, or other limits imposed by the loan type they have selected.
The total Debt-to-Income Ratio must be under 45% and the proposed house payment (PITI) must be no less than 30% of the household’s gross monthly income.

When PDC receives a OYO Entry Packet it will be date stamped by the PDC receptionist or security guard to prove the package was received by the deadline, 5:00 p.m. on November 30. Upon request the deliverer of the packet will be provided a receipt documenting it met the submission deadline. PDC will NOT accept electronic submissions of an entry packet by fax or e-mail.

Prior to the drawing all packets will be reviewed by PDC staff to determine which entry pool they fit into. The two types of entry pools are:

Low-income (80 percent of Median Family Income as adjusted for size) first time homebuyers (applicants who have not owned and occupied a home in the past three years); or all other eligible entries.

All eligible entries will be sorted into these two different types and then assigned a sequential number. From the pool of all eligible entries, 32 of the entries will be randomly selected made up of 24 entries from the first pool and 8 entries for the second pool according to the approved selection process (link to detailed selection process). All households who are selected via this process will then be notified that they will be considered for the program subject to qualification and funding availability. The drawing will be held at 10:00 a.m. on Thursday, December 3 at the office of the Portland Housing Bureau located at 421 SW 6th Avenue Suite 500 in Portland.

This selection process will be conducted in accordance with federal, state and local fair housing laws and is an equal opportunity housing event. For more information about the selection process please contact Jon Gail at 503-823-3292 or by e-mail at gailj@pdc.us.

Popularity: 3% [?]

I’m writing this to answer all the rumors out there about the first time home buyer tax credit extension.

Right now you still need to close by November 30th, 2009
The proposed new bill would extend that to being in contract by April 30th, 2010 and closing prior to June 30th, 2010.

The new bill would also give qualified buyers that are buying a ‘move-up’ home a $6,500 credit but you have to have lived in your current home at least 5 years and there will be income restrictions as well.

Another add-on would be an extension of unemployment benefits.

This is still being debated – stay tuned for updates as this bill continues to change and hopefully get passed into law soon.

Popularity: 1% [?]

With winter coming and investors flocking back into real estate I wanted to give you my short guide to investing in real estate.

Benefits of real estate:
1. Leverage: You can borrow most of the money needed to buy the asset
2. Insurable: Insurance protects your asset
3. Income and Appreciation: If done right you can make money every month and then more when you sell or trade
4. Taxes: Depending on your status you can write off some or all of the depreciation of buildings [check with your CPA]. You can also do a 1031 exchange and defer your capital gains if you re-invest in more investment real estate. [again, see your CPA or 1031 exchange facilatator]

How it works: Investing means making more money than you’re spending and here’s how you do it.
1. Rent: You rent the property for more than it costs you to own and maintain the property. This is called positive cash flow. Here’s how you figure it out.

Take the Rental income and subtract the following:
1. Vacancy
2. Property Taxes
3. Insurance
4. Management
5. Repairs/Maintenance
6. Utilities
7. Misc
The sum of these things gives you your NOI or Net Operating Income

Take your NOI and minus your mortgage payments
The sum gives you your cash flow

You can take this a step further and see your pre and post tax cash flow as well.

I can give you a detailed analysis that will give you many more metrics and fancy acronyms if you make certain assumptions about the future, like appreciation, vacancy, changes in cost of expenses, etc.

Basically – you just need to use the best info you can get, be realistic about costs and vacancies and make sure you have more money coming in than going out.

Popularity: 2% [?]

In Oregon, property taxes are assessed for realproperty, machinery and equipment, manufactured structures, business personal property, and floating property. Oregon has an ad valorem property tax system, which means the property taxes you pay are based on the value the county assessor establishes for your property.

The assessor estimates the value of most taxable property on January 1, prior to the beginning of the tax year. The tax year runs from July 1 through June 30. January 1 is called the “assessment date.” The assessor’s estimate of value will appear on the tax statement mailed to you in October.

The following terms and definitions are provided to help you understand how your property is valued and assessed:

• Real Market Value (RMV) is the value the assessor has estimated your property would sell for on the open market as of the assessment date. RMV appears on most property tax statements.

• Maximum Assessed Value (MAV) is the greater of 103 percent of the prior year’s assessed value or 100 percent of the prior year’s MAV. MAV is not limited to an increase of 3 percent if certain changes are made to your property. These changes are called exceptions. MAV does not appear on most tax statements.

• Assessed Value (AV) is the value used to calculate your tax. It is the lesser of RMV or MAV. Assessed value appears on your tax statement.

You may appeal the current year real market, maximum assessed, specially assessed, or assessed value of your property. However, the authority of BOPTA to reduce the MAV and AV of your property is limited to the calculation allowed by law and an appeal may not result in a reduction of tax.

The majority of appeals will be based on a difference of opinion between you and the assessor about RMV. In such cases, you will need to present evidence about the market value of your property as it existed on the assessment date. Evidence might include an appraisal report of your property done by an independent appraiser or a comparison of your property with similar properties that have recently sold in your area.

How to Appeal Property Taxes

Popularity: 4% [?]