Changing the Way Credit Card Companies Do Business

One of the major changes makes standard over-limit fees a thing of the past.  Rather than automatic over- limit fees, overdraft coverage is now an additional service that cardholders must choose to opt into.  Consumers who do not opt in will have their transactions denied when they lack sufficient funds in their account.  Credit card companies are aggressively trying to persuade users to opt into this service to avoid a major hit to their revenue.  The over-limit fees are typically $30 for each transaction that is not backed by sufficient funds.

There are also changes in billing and payments. Before the new laws, payment dates were often inconsistent from month to month, and as a result would not be processed before the due date.   Users who thought their payments were submitted on time were getting hit with late fees and interest rates that were seemingly out of nowhere.  Now with the new legislation, bill payments are due on the same day every month.  The law requires that statements be sent out 21 days prior to their due date.

How Do These Changes Affect Your Credit?

Due to the changes brought on by the new legislation, credit card companies are drastically reducing available credit limits by as much as 50%.  For those with an outstanding balance, a sudden reduction in available credit limits means you will now have a higher debt-to-credit ratio, which could potentially lower your credit score to spite the fact that you haven’t actually taken on more debt.  A good rule to abide by is to aim to keep your debt less than 10- 30% of your available credit.

Credit card companies are adapting their business models to remain profitable amidst the new laws, and are sending out notifications to cardholders regarding these changes, which can include higher interest rates or fees or a reduction of rewards.  This eliminates any element of surprise, and also allows cardholders to opt out of an account if they don’t agree with the new terms.  If you opt out, your account will be closed and you will have five years to pay off any debt incurred under the old terms.

How Do These Changes Affect My Ability to Finance a Home?

The new credit card laws will make it easier for people to know what they are spending now that credit card companies are required to clearly indicate exactly what users are paying in interest, and how long it will take them to pay off their credit cards if they only make the minimum payments.  Credit card companies now have to apply your payments to your most expensive debt first.  For instance, if you had a different interest rate for credit card purchases and cash advances, the credit card company must apply your payments to whichever debt has the highest interest rate first.

There will be an adjustment period as we are met with rapidly-reduced credit limits, but these new rules will actually benefit homebuyers in the long run, helping them pay off their bad debts and improve their credit scores making it easier to secure financing for their next (or first) home!

Warren Residential Group

If you’re considering buying a home, you need the help of a trusted advisor to find a home that fits your budget and your needs.  Contact Warren Residential Group to help guide you through the process of buying Boston real estate, or browse our apartment listings if you’re still working on your credit score!

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‘Potential’ is all about maximizing your investment dollar and is measured largely by foreseeable changes that will make the area more convenient and desirable, and therefore increase the value of your home in time.  The article uses Somerville as an example.  While not widely considered to be one of Boston’s most attractive locations, it is becoming increasingly popular, due in part to the pending improvements of public transportation with the extension of the MBTA Green Line.

The prospect of such improvements weighs heavily with those who value potential in their real estate investment.  Other area improvements such as new restaurants and stores in Davis Square and other parts of Somerville also indicate that the area is ‘up-and-coming’ and a good investment.  Many neighborhoods of Somerville are often already compared to Cambridge Real Estate, for example.

On the other hand, there are those who believe that the future potential of a currently-less-desirable-location is not worth sacrificing the convenience or piece of mind that comes with investing in an already-established area.

These individuals might feel more comfortable investing in a less impressive home in a more affluent neighborhood in order to stay within their budgetary constraints and live in a location they desire.  For example, would you rather live in a Boston waterfront condo, or for the same price, purchase a home in Dorchester that is three times as large?

In order to determine what will drive your Boston Real Estate search, you should create a list including your ideal area amenities and your ideal property features, and then determine what you value most in each category.  Once you’ve determined what matters most to you, you can use your list and your budget to help guide you in your search for a new home.  You may find you are willing to live further from the city in exchange for a private parking spot, or decide that you’d rather pay the extra money to live in the city and have a shorter commute, etc.

An experienced Boston realtor can help you weigh the costs and benefits of the ‘location’ and ‘potential’ of the properties you are considering investing in.  The realtors at Warren Residential Group have the experience and knowledge to help you find a home that suits your needs and fits your budget.  Contact us today for assistance or uses our Sales Search Tool to browse our large inventory of Boston and Greater-Boston homes for sale.

Source Article here.

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This exclusive small city is a perfect blend of urban and suburban living with plenty to do.  Proving its versatility, there is an active farm with a farm stand, upscale shopping centers, and numerous playgrounds and recreational parks that boast great views of Boston.  It’s also home to the oldest country club in the nation, appropriately titled The Country Club. The location doesn’t hurt either. It’s an easy commute into Boston, and residents can walk a short distance to Fenway to catch a Red Sox game.

Don’t have a family?  Don’t rule Brookline out just yet.  It also made Money Magazine’s list of the ‘Top 25 Best Places for the Rich and Single’.  The article describes these locations as where the highly educated and affluent young professionals reside, and further describes them as “suave” and “sophisticated”.  Looks like Brookline has something for everyone!

Brookline also happens to be filled with some of Boston’s prime luxury real estate. A Warren Residential agent can provide additional information regarding buying or renting a Brookline apartment or Brookline condo. Contact us to help you make the most of your search for Brookline real estate.

You can view the article and the rest of the locations that made the top 100 here.

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Other statistics reflect this currently successful real estate market: there is a 2.6$% increase in the median home price range from last month, now $290,000 from $282,520 from May of 2009. Additionally, condo sales have also increased 24% to 1,950, as compared to 1,570 in May of 2009.

If you are thinking of purchasing a home, now’s the perfect time to browse our listings and contact us for a showing! Pictured below is one of our units available in the Back Bay – click here to read more about this listing.

Source article:  Boston Business Journal

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“The Warren Group, a Boston-based real estate tracking firm, provided us with the following median prices for 2005 and 2009 (2005 was considered the market peak in Massachusetts; since then, the median single-family home price has shrunk by 20 percent statewide).”

Here are the top 10 picks.

If you are interested in learning more on current great investments or wish to know how your Massachusetts town is weathering the storm please contact a Warren Residential agent, we are happy to assist you.

#10. BROOKLINE

Median single-family home price in 2009: $1,169,250
Change since market peak in 2005: +4%
Median condo price in 2009: $451,000
Change since market peak in 2005: -3%
Population: 54,896
Residential tax rate: $10.97

#9. WESTON

Median single-family home price in 2009: $1,207,600
Change since market peak in 2005: +1%
Median condo price in 2009: $665,000
Change since market peak in 2005: +9%
Population: 11,711
Residential tax rate: $11.10

#8. DOWNTOWN BOSTON (BACK BAY – BEACON HILL – WEST END – NORTH END - WATERFRONT – MIDTOWN – CHINATOWN – SOUTH END)

Median single-family home price in 2009: $1,958,000
Change since market peak in 2005: +45%
Median condo price in 2009: 510,000
Change since market peak in 2005: -2%
Population: 79,731
Residential tax rate: $11.88

#7. NATICK

Median single-family home price in 2009: $417,750
Change since market peak in 2005: -9%
Median condo price in 2009: $310,000
Change since market peak in 2005: +29%
Population: 31,880
Residential tax rate:$11.67

#6. LYNNFIELD

Median single-family home price in 2009: $495,000
Change since market peak in 2005: -12%
Median condo price in 2009: $452,200
Change since market peak in 2005: +45%
Population: 11,412
Residential tax rate: $12.84

#5. ROWLEY

Median single-family home price in 2009: $420,000
Change since market peak in 2005: -10%
Median condo price in 2009: $349,900
Change since market peak in 2005: +75%
Population: 5,738
Residential tax rate: $12.50

#4. WINCHESTER

Median single-family home price in 2009: $710,000
Change since market peak in 2005: -3%
Median condo price in 2009: $360,000
Change since market peak in 2005: +9%
Population: 21,090
Residential tax rate: $11.51

#3. CAMBRIDGE

Median single-family home price in 2009:$680,000
Change since market peak in 2005: +2%
Median condo price in 2009: $408,000
Change since market peak in 2005: -3%
Population: 105,596
Residential tax rate: $7.72

#2. JAMAICA PLAIN

Median single-family home price in 2009: $529,000
Change since market peak in 2005: +6%
Median condo price in 2009: $316,650
Change since market peak in 2005: -2%
Population: 38,074
Residential tax rate: $11.88

#1.  WENHAM

Median single-family home price in 2009: $550,000
Change since market peak in 2005: +5%
Median condo price in 2009: $599,000
Change since market peak in 2005: +87%
Population: 4,788
Residential tax rate: $15.56 per $1,000 of assessed value

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According to Bankers & Tradesman the Boston real estate market has finally hit bottom.

…Sure, condo prices and sales finally slowed in downtown Boston, but Dorchester, Roxbury, East Boston, Mattapan and Hyde Park saw thousands of homeowners fall behind on their mortgages over the past few years, many losing it all.

But here’s one key sign: The number of foreclosed homes sitting empty and inviting trouble in these neighborhoods has fallen dramatically, reports Evelyn Friedman, head of the Department of Neighborhood Development.

So, what does this mean for you?  Well simply put the time to buy is right now.  If you have been waiting for the “bottom” this is it and slowly pricing will begin to increase.  If you are in the market for a new home please contact a Warren agent, we look forward to helping you.

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While the market continues to fluctuate, Mark Strickland of www.bostonrealestateobserver.com notes that the current real estate market trends for the South Boston neighborhood potentially weigh in favor for both the seller and buyer. Strickland defines these advantages as follows:
•    Seller Advantage Market – there is currently less than a six (6) month supply of homes for sale
•    Buyer Advantage Market – there is currently more than a six (6) month supply of homes for sale

As of January 21st, 2010, all condos priced at or under $499K in South Boston are in a Seller Advantage Market, whereas all other condos are in a Buyer Advantage Market. All multi-families are in a Seller Advantage Market, as are single-family homes priced under $499K. Single-family homes priced between $500K and $749K are in a Buyer Advantage Market.
While this data shouldn’t indicate that there are NO exceptions, it provides a good understanding of where the market is and where you can go from here. Stickland further explains his terminology: “In a Seller Advantage Market, a particular owner may be flexible on price if there are mitigating circumstances such as a pending relocation, or the pre-purchase of another home. Similarly, in a Buyer Advantage Market there are always going to be sellers who are unrealistically inflexible on their price because they are in no hurry to sell, or still unrealistically believe that their home is worth far more than it actually is.” He also recommends hiring a good Marketing Agent or Buyer’s Agent to understand your individual circumstances within the larger context of your neighborhood’s market conditions.

(This data was compiled through a 12-month rolling calendar from December 2008 to December 2009 for condos, multi-family and single-family homes. You can find more information on additional Boston neighborhoods in the full article, here)

Also make sure to check out our selection of available South Boston Apartments!

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Going green pays and saves.  According to a study by the Joint Center for Housing Studies of Harvard University, for every dollar decrease in annual home energy expenditures, house values increase between $11.63 and $20.73.

Also, going green can lower the tax bill.  New federal tax credits are now available for green home improvements on a principal residence.  Qualifying modifications must meet a certain energy efficiency level to be eligible for the credit.

The credits are available for improvements purchased and in service from January 1, 2009, through December 31, 2010.  The amount of the credit is deducted from any income taxes the homeowner may owe. The credit is nonrefundable, allowing taxpayers to lower their tax liability to zero, but not below zero.

Tax credits are available at 30% of the cost, up to $1,500, in 2009 through December 31, 2010 (for existing homes only) for:

• Windows and Doors
• Insulation
• Roofs (Metal and Asphalt)
• Heating, Ventilating, and Air Conditioning (HVAC)
• Water Heaters (non-solar)
• Biomass Stoves

Tax credits are available at 30% of the cost, with no upper limit through December 31, 2016 (for existing homes and new construction) for:

• Geothermal Heat Pumps
• Solar Panels
• Solar Water Heaters
• Small Wind Energy Systems
• Fuel Cells

Make sure you purchase products that come with a Manufacturer Certification Statement — a statement from the manufacturer that indicates the product qualifies for the tax credit. For record keeping, experts advise that homeowners retain all receipts.

Additional details can be found at www.energystar.gov/taxcredits and www.homedepot.com/taxcredit

Also feel free to contact a Warren Residential Group agents at contact@warrenre.com or call us at 617-848-9616 to find out more!

To search for a house that you can turn green, CLICK HERE!

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Clients always ask me about mortgages.  They ask:  What is the current rate?  How much of a loan can I get?  Etc., Etc.  Well, the answer is that there really is no one answer for those questions.  There are so many variables that come in to account that it is impossible to give solid answer.  So, I asked our good friend Christina Longo over at Prospect Mortgage if she at least has some basic criteria for my Boston condo buyers to use as a guide.  Here is what she gave me:

For First time Home Buyers –

Credit score above 650

Need full documentation files (W-2, pay-stubs, bank statements, tax returns)

3.5% of own funds needs to be own funds into the transaction – unless putting 20% or more down

Verbal verification of rent for 12 months – name and # of landlord

FHA allow as little as 3.5% down

MA housing as little as 5% down (approval predicated on low income qualifications)

Condo guidelines –

All New Construction buildings (where the developer hasn’t yet turned over to homeowners association) you need 51% pre-sale requirement

No litigation allowed against the development

If commercial space in building – must be less than 20% of building (or can go for an exception)

All common areas and unit must be 100% complete to close on the unit

PMI – less than 20% down you need Private Mortgage Insurance (PMI)

You cannot go over a 41% debt to income ratio

If buying a condo you MUST have 70% owner occupancy ratio

NO LITIGATION – NO EXCEPTIONS

No more than 10% of the units in the project can be owned by more than 1 person

I know that is a lot to comprehend but at least if you use it as a starting point it should help you narrow down what might be possible and what definitely isn’t.  If you have more questions about Boston mortgages, please call Christina Longo at 978-886-9359 or email her at christina.longo@prospectmtg.com.

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I am a regular participant in the Bankrate.com Mortgage Rate Trend survey and this week’s survey may point you in the right direction.

The Bankrate.com survey is for conforming mortgages only. It is not specific to Cincinnati, nor does not apply to FHA mortgages, VA mortgages, jumbo mortgages, or super jumbo mortgages. For a personal rate offer, contact me directly.

Here’s the group’s 30-day prediction for mortgage rates:

• 18% predict mortgage rates will increase
• 18% predict mortgage rates will decrease
• 64% predict mortgage rates will remain unchanged

I am bucking the trend, predicting that mortgage rates will decrease over the next 30 days.

My advice not be appropriate for your individual situation and I’m not always accurate besides. Either way, here’s what I told Bankrate.com:

“Demand for dollars-denominated bonds helps rates to ease lower.”

Now, there are a lot of reasons why mortgage rates change.  Economics, politics, trends — take your pick.  Each plays an important role. But of equal importance is the value of the U.S. dollar.

The U.S. dollar matters to mortgage rates because it’s the currency in which mortgage bond investors are repaid.  When the dollar loses value, so does the value of those repayments.  Therefore, mortgage-backed securities lose their luster and rates rise in order to entice investors back.

When the dollar gains, the chain reaction flips in reverse.  And, as a result, mortgage rates fall.

The dollar should gain in the coming weeks.  The U.S. economy appears to be recovering from recession — probably faster than our global peers.  As a result, whenever there’s a perceived risk in the global economy, global cash seems to flow to the U.S. markets. To investors, it’s the safest place to be.

This partly explains why stocks and bonds have moved in the same direction of late.  The same forces that are pushing stock markets higher are helping the U.S. dollar to gain, too.  It’s causing bond prices to rise and rates to fall.

That said, markets remain volatile and rates do, too.  The global economy is in flux and there are countless outside influences for which to account.

As a loan officer, I watch mortgage-backed securities and track rates on a real-time basis.  If you’re not working with a loan officer and want to work with me, I’m never too far from my phone or my email so just reach out anytime. I’ll help you try to time a market bottom so you don’t overpay on your rate or your fees.

Or, you get more passive about it.  Watch me on Twitter: Briancav I post updates all day long

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