Presidential Debate Video Back-Up

Plan For Helping American Families

NOW: Thats why were going to have to go out into the housing market and were going to have to buy up these bad loans and were going to have to stabilize home values, and that way, Americans, like Alan, can realize the American dream and stay in their home. [Presidential Debate, via CNN, 10/7/08]

THEN: McCain Told Americans To Work A Second Job Or Skip Vacation. During his speech on the mortgage crisis, McCain said, Of those 80 million homeowners, only 55 million have a mortgage at all, and 51 million are doing what is necessary working a second job, skipping a vacation, and managing their budgets to make their payments on time. That leaves us with a puzzling situation: how could 4 million mortgages cause this much trouble for us all? [McCain Remarks On The Housing Crisis, 3/25/08] **VIDEO LINK**

Energy

NOW: We have to have all of the above, alternative fuels, wind, tide, solar, natural gas, clean coal technology. All of these things we can do as Americans and we can take on this mission and we can overcome it. [Presidential Debate, via CNN, 10/7/08]

THEN: McCain Said Clean Technologies, Including Wind, Solar, & Tide, Dont Work. While speaking at a town hall meeting in Portsmouth, New Hampshire in December 2007, John McCain said, When you say wind solar and tide, most every expert that I know says that, if you maximize that in every possible way, the contribution that that would make given the present state of technology is very small, is very small. Its not a large contribution Id be glad to send you the figures that theres the amount of–even if we gave it the absolute maximum, uh, wind, solar and tide, etc. The clean tech – the truly clean technologies dont work. [McCain Town Hall In Portsmouth, New Hampshire, 12/4/07]

Social Security

NOW: Social Securitys not that tough. We know what the problems are, my friends. And we know what the fixes are. We gotta sit down together cross a table. Its been done before. I saw it done with our wonderful Ronald Reagan, the conservative from California, and the liberal Democrat, Tip ONeil from Massachussetts. Thats what we need more of. And thats what Ive done in Washington. Senator Obamas never taken on his party leaders. [Presidential Debate, 10/7/08]

THEN: McCain Said Social Security As It Was Originally Set Up Is A Disgrace. At an event on July 7, 2008, Senator McCain said, Americans have got to understand that we are paying present day retirees with the taxes paid by young workers in America today. And thats a disgrace. Its an absolute disgrace, and its gotta be fixed. [Town Hall Meeting, Denver Colorado, 7/7/08]

Duration : 0:1:1

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Duration : 0:10:19

Technorati Tags: Alt-A, crisis, defaults, FDIC, foreclosure, foreclosures, Housing, Mortgage, Subprime

Duration : 0:3:52

Technorati Tags: ACORN, corruption, Home Loan, Housing, illegal alien, immigration, Mortgage

Duration : 0:2:24

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Part 6 (Excerpts)

Arizona is not a recourse state, so chances are you will not owe 1099 C Income

In Arizona, typically its not a recourse state, so if they are telling you that theyre going to garnish your wages because you didnt pay back your entire mortgage, there is a local bank ,that was threatening a very good colleague of ours about a small second mortgage that person had taken out. Threatening to send it to collections and garnish her wages. It simply isn’t going to happen.

But nevertheless, there is still the tax implications that apply, if you need to navigate through this maze. There is a lot to it, you need to protect yourself. You talked about bankruptcy is one of those exclusions, right? One of the problems with bankruptcy is people dont understand the bankruptcy laws. They are so tight now and your feet are really held to the fire from the federal government right now. It’s not like you just didn’t make your mortgage payment, so you go file bankruptcy, it’s just not realistic. Assuming bankruptcy is the last resort option for everybody. And we certainly want to avoid that, it would not be sound financial advice from any credible source that I can think of.

Let’s walk through a case scenario, somebody who is listening to this broadcast, their head is spinning right now, they’re thinking, oh my gosh. I should have known about the tax implications, a short sale versus loan modification. Let’s start at the top and work through a quick scenario. And then we’ll point out the specifics of what they should be considering right now.

For example, we talk about this all the time and to your credit Michael Barnes and to Velocity Financials credit, you were early in bringing out the loan modification for people who were in a distress situation regarding a mortgage, maintaining or keeping up with the mortgage payment. So you started going down the path where the refinance started to become a much more difficult option, with new constraints and all the other factors that led to part of this economic crisis, a loan modification has become a buzz topic today. Driving to the station today, driving down Camelback Road, I see a sign on the corner. You know, one of those stick in the ground, homemade jobs, that says don’t refi a Loan, modify, with some success rate and the phone number.

Hang on there I want you to say the success rate. The sign literally said, 99% success rate, and it goes back to the point that you made when they say that they can reduce your mortgage principal by tens of thousands, hundreds of thousands of dollars, thats the absolute last resort for any lending institution. Thats not what this is about, so let’s start with that, then we will work on the tax ramifications of how that might work in the overall financial strategy.

I am familiar with the loan modification industry here in Arizona. There is no regulation, unfortunately. We at Velocity Financial work with a national network of attorneys, so if you’re the guy in El Centro California, or youre in Phoenix, or youre in Alaska it doesn’t matter where you’re at. We have someone who is an expert in that field in that state because the laws are different. But without the regulations some person with the ugly yellow sign on the side of the road says he has a 99% success rate, I don’t believe him it’s probably not using an attorney, who knows, dont buy into that garbage. Were going to tell you the truth, if we cant do a loan modification, we will tell you that we cant do it. And if a loan modification is not the best thing for you, you can find the some of these other options.

Duration : 0:5:19

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Part 4 (Excerpt)

80% of homes can be purchased with FHA Financing

You also talked about this graph you put together, it talks about the month of November was a 25% increase over the previous year. Obviously prices have gone down and it looks like it then has gone back up, and so once we finish selling off this inventory there is a good chance that were going to be finding or hitting the bottom.

I think just in that region of $150,000 to $200,000 region that prices have really stabilized at this point, they may go down a little bit more, but I think for the most part, because that is where the financing is right now, with the FHA and the conforming loan limits, anybody in that price range can still get a loan. If youre looking to buy something over $400,000 youre going to have a lot more trouble just because the financing is not available.

Well the financing is a lot more difficult over the $417.000 loan amount number. Luckily Velocity Financial still has some of the interim small jumbo financing available, still with decent rates and the larger jumbos there is still financing available but nothing like this median home price of $275,000 and below. Well and I think what that goes back to, specifically with the FHAs, because, what percentage of the closing costs can be contributed by a seller on an FHA loan? Its pretty high right?

FHA financing, the Federal Housing Administration has had a standing rule for quite some time that the seller can contribute up to 6% of the sales price towards the closing costs. Realistically on a $250,000 purchase price youre not going to need 6% towards closing costs, so you would want to use that money to lower the price or buy down the interest rate, or any number of different things. So in a situation like that you could have the seller come in, pay all of your closing costs for you, you can keep that money in the bank, you could use it to fix up the house, you can do whatever, and all you would be responsible for is a small down payment.

Thats correct, 3% of the sale price down, you can have the seller pay the property taxes up to a year in advance, the home owners insurance, the home owners association fees, they are called prepaid or escrows. They can pay all of that. What is the loan limit right now for FHA? Currently the FHA loan limit is $346,250, its kind of an odd number, that does go away at the end of this month, December. However if youre lucky enough to have a home picked out in that price range, you want to try to get it done by the end of the year, so long as were able to get it underwritten in house, our firm will still be able to close on that with a higher loan limit after the first of the year.

The new limits probably going to be your next question, so as of January 1 in Maricopa County its $271,000. Even at 271, with the scenario I was talking about before, in Maricopa County, 70-80% of the home sales still would have fit within that 271 limit. Yes, one thing that I do want to point out is that when the Housing and Recovery Act of 2008 expires that huge loan limit of 346 expires, that was the deal, they are going to try to get it extended but we cant plan on that necessarily, but only 10% of the properties in Maricopa County fit into that 271 to 346 range.

Now I know the answer to this but you dont happen to be qualified to do FHA loans are you? Yes Velocity Financial is FHA approved, were one of less than 15% of the lending institutions in Arizona that can do FHA financing, not only for purchases but for refinancing as well. Which I think is some of the stuff we want to talk about as well because some of the old rules for refinancing simply dont apply anymore.

Brett did you have anything to add? Yes, two things stood out to me in that discussion and one of the things was the bigger picture concept in my mind thats the way it works. Its how I am wired, I start with that then I narrow my way down to the specific scenario given a clients circumstance.

What that big picture represented to me and one of the things that you pointed out with your charting Dan and the work that you have done, is the year over year home sales is shrinking the inventory that exists in Maricopa County, and when that inventory shrinks, we all know that new homes and building had pretty much dried up, so allowing that inventory to shrink is a very positive thing in terms of stabilizing, or placing a bottom, or putting the housing market back on a path of growth long-term, and so that was one of the things that stood out to me.

Duration : 0:6:32

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Duration : 0:0:8

Technorati Tags: Estate, finance, Green, Home, Housing, LEED, Platinum, Real, Renewal, technology, Urban

Duration : 0:2:41

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Duration : 0:3:40

Technorati Tags: Financial Services, Housing

Duration : 0:0:8

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