the wasserblawg

My brother, a corporate lawyer, used to carry a bag of lapel buttons with him in his attache. When one of his deals took an odd turn, he would whip one out and offer it to his opposing counsel. They bore the legend "thank you, for turning a routine transaction into a bizarre ritual" I've coveted those buttons for years. Just imagine how many I'd have to print, if I could only find a way to meet the mortgage underwriters my clients are subjected to. If there were ever an industry that specialized in the bizarre, could anyone do better than the mortgage underwriters? In the past four days, I have seen A lender demand a sales contract be modified to exclude the seller's bar stools from the transaction A lender assert that Fannie Mae guidelines require a 6 unit condo association hire a lawyer to give a written opinion that the association meets all FHA guidelines and is properly organized Another lender refuse to consider the rental income generated by a four flat und...

Most recent news relating to the costs home buyers must pay has been bad. Its not only getting harder to obtain the mortgage financing, its getting more expensive to do so. Finally, some good news for at least some of us. The Feds have finally gotten around to extending the income tax deductability of private mortgage insurance (PMI) through 2010. The tax deduction is available to mortgagors (1) of a personal residence and a non-rental second home, (2) that originated after January 1, 2007. (3) for the purchase or refinance, provided that the loan amount did not exceed the acquisition loan amount . (4) BUT ONLY IF your family may earns no more than $100,000 per year. If your family’s income is over $109,000, the PMI deduction will not apply. The deduction is reduced by 10% for each additional $1,000 of household income, in between. hey - its better than nothing!

Real Estate Agent Peter Fugiel's 2008 market outlook report for the Chicago area sets out a pretty thorough analysis of the local market conditions. On the whole, a pretty positive assessment and an interesting read. American real estate is still right up there with other high demand world markets. American real estate, like oil, scarce commodities, fine art, and an American college education, are all still in wide demand. The full report is available on my web site .

Matt Carter of Inman Real Estate News reports today that the bad news seems to be getting worse for home buyers; not only is getting harder to qualify for mortgage loan, the costs of those loans are going to rise next March . The cost of private mortgage insurance -- required by most lenders on loans with less than a 20 percent down payment -- is going up, even for borrowers with credit scores considered well above subprime. Government-chartered mortgage financers Fannie Mae and Freddie Mac have increased surcharges for borrowers with credit scores below 680, well above the 620 threshold sometimes used to define subprime borrowers, and will require down payments of at least 5 percent on all loans in "declining markets." New flow business pricing announced in November by Fannie and Freddie create new surcharges on most loans purchased after March 1 for borrowers with credit scores below 680. The surcharges range from 0.75 percent for borrowers with FICO scores between 660 a...

John Vogel, Jr . of Dartmouth's Tuck School of Business explains the sub-prime lending market and the roots of its collapse.

According to this morning's Belleville News-Democrat , Attorney General Lisa Madigan has launched an investigation into Countrywide's business practices. Other lenders may be next as the probe continues. The inquiry focuses on why people who appear to us to not be able to afford the loans they're in were able to get those loans and how Countrywide, the nations biggest mortgage lender may have contributed to that. The AG is looking at how loans were originated, funded and sold "all the way up the line." stay tuned for details!

For years, and with very few exceptions, home sellers in Chicago have had to prove at closing that their municipal water & sewer bills were paid in full. Naturally, the City of Chicago's Department of Water Management has charged a modest fee to produce the required certification. Effective December 17, 2007 , that fee will increase from $25 to $50. The new requirement will also apply to condominiums, a practice that was discontinued back in 2004, when the department was plagued by certain irregularities (scandals) and the volume of closings caused massive delays in getting such certifications processed. There has been very little publicity about this change so I expect that more than a few closings are going to be delayed or skewered as uninformed condo sellers and their lawyers scramble to obtain the necessary paperwork. Making things worse, I understand that there have been several recent departmental layoffs so do not be surprised when you re-acquaint yourself with those n...