Mortgage Rate News

Real estate auctions are becoming more popular as the recession continues and people look for ways to turn the current housing market problems to their advantage. Indeed, with home prices lower, it is little surprise that the bargain hunters are out in force. And one of the best places to look for good deals is a real estate auction. However, there are some very important things you should consider before committing yourself at a home auction. Jeff Rose at Good Financial Cents offers this helpful advice when it comes to shopping at a real estate auction:

1. Know the property: You should have a good idea of the location of the property, its features and its current market value. Do your research and find out the reason that the property is being auctioned. You should also be well aware of liens against the home (especially tax liens), and understand the type of responsibilities you will have to take if you buy a home at auction. This includes checking to see whether the home is structurally sound and in reasonably good shape.
2. Understand the auction process: A home auction may not be what you think it is. It is important that you understand home auction processes in general, as well as that you understand the rules that govern the specific auction you are interested in. You should also realize the costs involved, and prepared to pay them.
3. Carefully consider whether buying at auction is for you: Finally, after doing the research, you need to decide whether this mode of home buying is a good idea for you. There is a certain amount risk involved when buying a home at auction, so it is a good idea to carefully think things through and decide whether it is the right decision for you to make in your circumstances. If not, there are plenty of other good deals available.

Image by Getty Images via Daylife

Home prices continue to drop, prompting many to continue looking for a real estate market bottom. Indeed, for Quarter 1 of 2009, home prices fell by 19.1%. This decline in home prices indicates that the real estate market is far from out of the woods yet. CNN Money reports on the home price index, and what it shows:

The S&P/Case-Shiller National Home Price index, a bellwether of real-estate market direction, plunged a record 19.1% during the quarter compared with the first three months of 2008. That followed an 18.2% drop last quarter.

The Case-Shiller 20-city index dropped 18.7% year-over-year, also a record. It fell 18.5% during the last three months of 2008. This index has plummeted 32.2% from its July 2006 peak and has fallen 32 straight months.

Now is still a good time to buy, even if the real estate market bottom has yet to be reached

Many people are still waiting for the real estate bottom before they buy. They want to make sure that home prices are at rock bottom before they commit to purchasing a home. However, this is not exactly necessary. Even though we may not be at the real estate bottom, home prices are still lower than they have been in years. Additionally, mortgage interest rates are lower, and there are a number of government incentives aimed at helping encourage home buying.

Indeed, buying a home right now is still a great deal. It’s certainly a better deal than it was in the fall of 2007, when I bought my home. The recession has piled on top of the housing market collapse to create a situation in which there are many homes for sale. As people move to find other jobs, lose their homes to foreclosure and have other problems, home prices have fallen as sellers take what they can. This means that it is a definite buyer’s market, with low home prices and motivated sellers willing to sweeten the deal.

Image by Dustin C Oliver via Flickr

Today is the observation of Memorial Day. The actual Memorial Day is not until Saturday, but it is observed the last Monday in May, so that is today. I think it is a good idea to take a few minutes to reflect on the sacrifices made by our service men and women on behalf of the country. While these are things we should think about every day, taking the time on a special day set aside for the purpose is, I think, a good thing. It requires us to dedicate a little more time to the effort.

With our volunteer army, it is especially important to recognize the losses and sacrifices of those who serve. After all, they are not required to do so. They do it because it needs to be done. It is right that our service men and women — and their families — be rewarded with educational benefits, medical and health care, and other opportunities. We should be far more accommodating to those who have given so much than we currently are as a society.

VA home loans

One opportunity that service men and women can take advantage of is the VA home loan program. The Department of Veterans Affairs offers guaranties of home loans to help veterans and their families buy homes. And it is possible right now for veterans to get help if they are facing mortgage trouble. The VA has counseling available and help for those looking for relief under Making Home Affordable. Here is what the Department of Veterans Affairs has to say about its VA home loan efforts:

Since 1944, when home-loan guaranties were offered with the original GI Bill, VA has guarantied more than 18 million home loans worth $911 billion.  Last year, about 135,000 veterans, active-duty service members and survivors received loans valued at nearly $24 billion.

About 2.3 million home loans still in effect were purchased through VA’s home-loan guaranty program, which makes home loans more affordable for veterans, active-duty members and some surviving spouses by protecting lenders from loss if the borrower fails to repay the loan.  More than 90 percent of VA-backed home loans were given without a downpayment.

If you are veteran looking to buy a home, the VA can probably help you with a guaranty. You can go to a VA information page to learn more about home loans.