24 May

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Post-TRID, More Homebuyers Reading Their Mortgage Disclosures

23 May

By Jacob Passy, National Mortgage News, 

Ninety-two percent of homebuyers are reviewing their mortgage documents before closing on the loan since the Truth-in-Lending Act/Real Estate Settlement Procedures Act integrated disclosures, or TRID, went into effect in October, versus 74% previously, a survey by the American Land Title Association found.

ALTA surveyed 800 homebuyers before TRID went into effect and 700 homebuyers who closed after it took effect.

Pre-TRID, 77% of homebuyers said their closings took place on time, versus 74% after it took effect, ALTA found. The top reasons cited for delays included issues with lender underwriting, a delay on the lender’s part or a snag involving TRID’s three-day rule, according to Michelle Korsmo, ALTA’s chief executive.

ALTA’s survey also found that more homebuyers are unsure if they bought an owner’s title insurance policy with the new disclosures in place. Twelve percent of homebuyers reported a lack of certainty on this detail under TRID, versus 8% under the old disclosures.

“Consumers should leave the closing table confident that they know they purchased an owner’s title insurance policy and protected their property rights,” Korsmo said in a press release. “Unfortunately, the CFPB’s current approach does not provide consumers with clear information about their title insurance costs. The required calculation under Know Before You Owe for title insurance fees is not transparent or accurate and is inconsistent with the Bureau’s mission to better inform consumers.”

Real Estate Values: How do I know if it’s beneficial to add onto my home?

19 May

When making a decision about a major home improvement project such as adding new space, it’s important that you ask yourself the following three questions:

Will the addition improve my family’s quality of life?

First and foremost, make sure that your investment will pay off in terms of your quality of like for the remaining years that you will live in your house.

Will the improvement make it significantly easier to sell the house?

Some improvements may not recoup every dollar they cost. However, when the time comes to sell your house, you may find that certain improvements increase demand for your house. For example, today’s buyers may shy away from smaller, old-fashioned kitchens and bathroom. Though remodeling these rooms in can be expensive and you probably will not recoup their costs dollar for dollar, updated kitchens and bathrooms will probably reduce the time it takes to sell your house and make it easier for you to get the price you want.

Will the improvement recoup the money it will cost?

In fact, very few improvements return dollar for dollar regarding increasing the value of your house. For years, Remodelingmagazine has conducted an annual survey of large and small home improvements that includes a survey of real estate agents to determine how each improvement affects the sale price. In the 2016 survey, only one of the 27 improvements they reviewed—adding fiberglass attic insulation—would recoup its cost. Additions — whether bathrooms, family rooms, master suites, decks or even a second story — were among the improvements that are least likely to pay for themselves. In fact, all additions except adding a deck or a family room would return less than 60% of their cost when the house is sold. Decks recouped either 75% for a wood deck or 67.5% for a deck made of a composite material. Family rooms recouped 67.9% of their cost. For more information, read more about Remodeling magazine’s cost vs. value study.

Despite the results of the study, homes are more than investments. You should always consider the lifestyle benefits for your family over the time you plan to live in your home. Spread the cost of the addition over the years you will spend in the home – will the addition improve your family’s lifestyle over a sufficient period to make it worthwhile? Talk to a real estate agent or an appraiser about whether the addition you are considering will make it easier to sell your home in your market. Weigh all three factors — family lifestyle, saleability, and cost vs. value — before making your decision.

New Staff at Tradition!

13 May

We would like to introduce new members of our staff.   Joe continues to be our head reader clearance person.

Connie Powers is our new Reader Clearance person.  Connie has 27 years’ experience with Lothel Abstract.  Connie is reading and clearing files and assisting clients with questions.  Email Address is cpowers@traditionta.com.

Steve Askinas, our in-house Legal Counsel, is reading and clearing files and assisting clients with questions.  Email Address is saskinas@traditionta.com.

Fred Chandler, who had worked at both Topaz and Tradition, is back on a part time basis.  Fred is reading and clearing files and assisting clients with questions.  Email Address is  fchandler@traditionta.com

Jannine Bekatoros is my sales assistant.  She is a great lady.  You may have already met Jannine when she has made visits with goodies.  Email Address is  jbetakoros@traditionta.com

Margaret Jayne Barker has joined our sales team.  Margaret has many years’ experience as a title closer and sales person.  Email Address is mbarker@traditionta.com.

The best email address is info@traditionta.com.

If you have any questions you can always reach me on my cell at 516-382-0308.

Thank you and have a wonderful weekend.

Karen Keating

Tradition Title

67 East Main Street

Bay Shore, NY  11706

Office # 631-328-4410

Fax # 631-328-4413

Cell # 516-382-0308

2 May
American Land Title Association

April 28, 2016 16:54 ET

ALTA Committed to Consumer Transparency as CFPB Opens Door to Clarify TRID

WASHINGTON, DC–(Marketwired – April 28, 2016) –  The American Land Title Association (ALTA), the national trade association of the land title insurance industry, released the following statement in response to Consumer Financial Protection Bureau (CFPB) Director Richard Cordray’s letter to financial services joint trade associations today:

“ALTA’s primary goal for proposed adjustments to TRID (Know Before You Owe) this July is ensuring consumers receive clear information about their title insurance costs on the closing disclosure,” said Michelle Korsmo, ALTA’s chief executive officer. “The current disclosure calculation is inconsistent with the Bureau’s mission to inform consumers about the true costs of their real estate transaction.

“ALTA appreciates Director Cordray and the CFPB stepping up to the plate and committing to provide more clarity on TRID. We value their openness in this process moving forward. We have worked closely with the Bureau for over five years on TRID. We are committed to continuing our conversation with Director Cordray and the CFPB staff to correct the calculation of title insurance policy premiums on the mortgage disclosures this summer.

“The complexity of TRID makes it difficult for mortgage originators and secondary market investors to determine if they have complied with this massive regulation. ALTA will use this opportunity to work with the CFPB to ease this uncertainty for our members.”

About ALTA

The American Land Title Association, founded in 1907, is the national trade association representing 6,000 title insurance companies, title and settlement agents, independent abstracters, title searchers, and real estate attorneys. With offices throughout the United States, ALTA members conduct title searches, examinations, closings, and issue title insurance that protects real property owners and mortgage lenders against losses from defects in titles.

ZILLOW HOME VALUE INDEX

25 Apr

Data through March 2016

$186,200

  • 4.8% 1-year change
  • 2.7% 1-year forecast

The median home value in the United States is $186,200. United States home values have gone up 4.8% over the past year and Zillow predicts they will rise 2.7% within the next year.

Foreclosures will be a factor impacting home values in the next several years. In the United States 3.1 homes are foreclosed (per 10,000).

With U.S. home values having fallen by more than 20% nationally from their peak in 2007 until their trough in late 2011, many homeowners are now underwater on their mortgages, meaning they owe more than their home is worth. The percent of United States homeowners underwater on their mortgage is 0.1%.

Recap of NRMLA Eastern Regional Meeting – Day Two

19 Apr

HECM Update from Key HUD Staff

On April 5, 2016, the New York Eastern Regional NRMLA Conference continued, starting with HUD staffers Karin Hill, Erica Jessup, John Olmstead, Phillip Caulfield, Patrick Porter and Kasey Watson.

The average age of consumers approved for HECMs dropped continually over the years to a low of age 71 in 2013, while the current average age bumped up to just over 72 years old.  There are 650,000 loans outstanding now.

A revised HECM Financial Assessment and Property Charge Guide is in the works ans will be published soon. Some notes on Financial Assessment:  Fully funded LESAs (Life Expectancy Set-Asides) may be required based upon credit history and/or property charge history.  Residual Income shortfalls may be dealt with using compensating factors, including income from the HECM itself.

Reverse Mortgage Counseling:  There are 270 agencies, with 460 active counselors.  Interestingly, 62% of all counseling is done by only 10 agencies, and alarmingly 54% of all counseling is done by just 4 agencies.  There is a 70% “pull-through” rate, or percentage of consumers counseled who actually closed loans.

Mortgagee Letter ML 2016-07 gives options for loss mitigation, including an “At-Risk” extension for borrowers age 80 and over.  The HUD FOC (Financial Operations Center) handles all claims.  In 2015 approximately 40,000 claims were paid.

How Reverse Mortgages Fit Into Americans’ Retirement Plans

This last session of the New York conference was presented by Professor Wade Pfau of the American College of Financial Services.  He spoke about our assets, including Human Capital (our jobs), Home Equity, Financial, Insurance, and Social Capital (Social Security, Medicare, Pensions, Community Support).

His suggested uses of a Reverse Mortgage were for housing expense (by paying off a mortgage), to delay Social Security until an optimal age of 70, to support retirement spending, and strategic use to manage a retiree’s tax bracket.  He discussed “success” as a measure of having enough money into the future.  The use of a reverse mortgage to pay off a current “forward” mortgage has the highest rate of success in the models he has created, and using a tenure payment disbursement from a reverse mortgage has a high rate of success compared to an income annuity.

Details of his models and recommendations can be found in the NRMLA conference slides, and in his recent articles in Forbes.