Randy Mitchelson, of Estero, Florida, is a licensed mortgage professional with 15 years experience in financial services.

Mortgage by Randy

monthly update to our clients, colleagues, family & friends

By: Randy Mitchelson, November 2009

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In Issue 20 We Touch On:

Appraisal Rule Hurts Homeowners

Secret Behind “Positive” Economic News

Foreclosure Prevention Tool Kit

As we enter the holiday season our government is doing its best to deliver gifts in the form of packages of stimulus cash.  Since the American consumer has wised up and undertaken a strategy of paying down credit card and home equity debt and stashing any extra into savings, the government is trying to pick up the spending slack.  The fact that there are so few prudent protectors of taxpayer money in Washington is a sad state of affairs.  BREAKING NEWS:  at the time of this writing, Congress has extended the First Time Homebuyer Tax Credit which was set to expire on November 30, 2009.  The tax credit is now extended to home purchases put under contract prior to next April 30.  Homeowners who have owned their current residence for at least five years are now eligible  for a tax credit if they choose to sell their current home. We will focus more on this money saving opportunity in future newsletters.

The current newsletter and all prior newsletters are archived at the Mortgage by Randy blog. Bookmark it and share with your friends and family.  You can make your own comments and feedback as well.  Time for the news…

Mortgage Market: New Regulatory Rule Is Hurting Consumers and Home Values

The Home Valuation Code of Conduct (HVCC) was implemented on May 1, 2009. The rule was created by the New York Attorney General Andrew Cuomo as an agreement between Fannie Mae and Freddie Mac (GSEs), their new regulator the Federal Housing Finance Agency, and the NY Attorney General’s office. The intent of the rule is to reduce coercion of appraisers.  However, the rule is overreaching, and has negatively impacted consumers across the country. The HVCC was never reviewed or voted upon by Congress, has failed to follow necessary regulatory procedure, and has the following effects on our income, home values and local property taxes:

1. The HVCC increases costs for those refinancing or purchasing a home. If a consumer changes lenders while shopping for a mortgage, multiple appraisals will be needed.

2. Because lenders are picking out-of-area appraisers to conduct appraisals, the appraisals are inaccurate and are lowering home values.  This causes two negative results:  it lowers home equity value even if you are not refinancing a home and, more importantly, these appraisal inaccuracies are lowering the tax base of your community.  This requires taxpayers and voters in your area to either pay more taxes or experience reduced funds for schools, roads, and other service expenditures.

3. This single agreement, not voted on by Congress or issued by any Regulatory Agency, is costing consumers billions of dollars and making it harder than ever to refinance or purchase a home.

Personal Credit: Time For Year End Credit Report Inspection

One of the credit report strategies we coach people on is to spread out your access to free credit reports over an entire year.  All consumers are legally entitled to receive one copy of their credit report from each of the three major credit bureaus (Experian, TransUnion and Equifax) one time per year.  Reminder: this entitlement does not include free access to your credit score.  Instead of inspecting all three versions of your credit history at one time, you can check one every four months.  For those of you that already follow this strategy or even if you want to implement it now, this is a great time to do it.  The distractions of the holiday season may cause you to delay doing this so why not cross it off your “To Do List” now?  The only truly free web site that you can use to do this is www.annualcreditreport.com. Get a detailed credit analysis, including all three credit scores, and personalized action plan and consultation for only $99 by contacting me.

Economy & Financial Insights: Beware Of Happy Headlines About Economic Growth

A series of cause and effects is leading our national economic statistics to return to positive territory.  However, there is another story behind the numbers so consumers and investors should remain cautious.  Follow along with this sequence of economic facts:

Consumers have been scarred by “The Great Recession” and continue to retrench, lowering their spending and increasing their savings (including paydown of debt)…

Less spending by consumers leads to higher inventory levels for manufacturers (i.e., more washer/dryers sitting in the warehouse)….

Higher inventories force manufacturers to slow production of new goods and accelerate consolidation via mergers and closures of plants and warehouses….

Closures and mergers leads to higher unemployment….

(Here’s where it gets ironic)

Inventory levels have already been cut to the bone so manufacturers have to produce a little something.  They can do this without hiring new staff.  This small increase in production will lead to a higher Gross Domestic Product (GDP) which is the headline grabbing statistic we often hear about.  The lesson here is to not get excited about rising GDP.  Until we see a reversal in the unemployment trend our economy will continue to teeter.

Question of the Month: Where Can I Get Reliable Mortgage Help To Avoid Foreclosure?

The FDIC recently launched a new Foreclosure Prevention Initiative for consumers. For a free tool kit of valuable information on how to avoid unnecessary foreclosure, options to stay in a home and guidance on avoiding foreclosure scams, contact the FDIC at 1-877-ASK-FDIC (1-877-275-3342) or through the web at Foreclosure Prevention Tool Kit.  Available at this link is an informational tool kit that includes:

1) "Is Foreclosure Knocking at Your Door?" brochure

2) "Beware of Foreclosure Rescue Scams" brochure

3) FDIC Consumer News, Spring 2009, with articles on getting a loan modification and avoiding foreclosure "rescue" scams

4) "Your Own Home" module in the FDIC's Money Smart adult financial education curriculum

Giving Back: Supporting Our Communities – Cash Back Program For Holiday Shopping

We all know about the constantly rising costs of college.  Recent reports reveal that despite the economy, institutions of higher education continue to raise tuition rates.  You may have your own kids to plan for or you might have nieces, nephews, cousins or friends with kids.  Have you visited Upromise.com?  This service provides a way for you to turn your everyday shopping into college savings which you can assign to any child in your life.  Even people without their own kids can use Upromise.com to donate college savings to their friend’s kids.  This service is free, easy and secure.  If you have ever purchased something on the Internet you should definitely check this out.

Most of us already go online to shop at Barnes and Noble or order from 1-800 Flowers and by linking to these sites through Upromise.com you will earn these rebates.  That's it! No special codes or downloads.  There are offline earnings too like at Mobil, Staples and McDonalds.  Rebates are there for the taking at restaurants in your area and you also earn money back for buying everyday groceries at supermarkets and stores like CVS.  The list of participating stores is huge and continues to grow.

Need volunteers? Do you have a fundraising event upcoming?   Do you have a personal web site where you are raising donations for your cause?  Submit the information to randy@mortgagebyrandy.com by the 5^th day of each month and we will do our best to include your information in the next issue.

Have a wonderful Thanksgiving.  After celebrating a World Series win in New York City, including a ticker tape parade, it’s nice to be settled at home again.  We will get a rare chance to see our beloved Syracuse Orange play the Florida Gators in Tampa Dec 10 and then off to Disney for a few days of holiday magic.

Randy

Mortgage by Randy newsletter, Copyright 2009 Randy Mitchelson.  All Rights Reserved.

Randy Mitchelson is a licensed mortgage professional. All material presented herein is believed to be reliable but we cannot attest to its accuracy. All material represents the opinions of Randy Mitchelson.  Recommendations may change and readers are urged to check with their financial advisors before making any decisions. Opinions expressed in these reports may change without prior notice. Mitchelson can be reached at 239-851-6738.

________________________________________________________________________________________________________________________________________

You have permission to publish this article electronically or in print as long as the following is included:

Randy Mitchelson, of Estero, Florida, is a business professional, entrepreneur and author with over 15 years experience in financial services.  Mitchelson has served in leadership roles for Global & Fortune 500 firms like Bank of America, KeyBank and CIBC.

As a member of National Association of Mortgage Brokers, Randy has earned the Lending Integrity Seal of Approval.  He educates both individuals and groups about credit scoring by conducting personalized credit report reviews, action plans and one on one consultations. He is author of the free monthly newsletter, Mortgage by Randy as well as the Daily Dollar newsletter. A licensed mortgage professional, Mitchelson also founded Trinity Home Financing, LLC.

He is owner of Estero, Florida based National Web Leads, LLC, an internet lead generation service matching consumers with lenders for auto, cash advance and other financial products.   Through its network of partners, National Web Leads delivers innovative Web 2.0 performance marketing solutions to advertisers and affiliate marketers.

Mitchelson earned his BS and MBA at Rensselaer Polytechnic Institute in Troy, NY.  He is a founding member and Finance Chairman of the Southwest Florida Regional Technology Partnership Inc. and Vice President for the Michelle’s Angels Foundation Inc.  He is married to Susan, a Pharmacy Supervisor in the Lee Memorial Health System in Fort Myers, Florida.

Mortgage by Randy

monthly update to our clients, colleagues, family & friends

By: Randy Mitchelson, October 2009

======================================================================================================================= 

In Issue 19 We Touch On:

Obama Eases Underwater Refi Rules

Free Identity Score

Free Music Online

It must be Fall.  This week in Southwest Florida we saw our first temperature reading in five months that begins with a “6”.  That is not to brag, just a bit of reality of how hot we have had it since May.  Speaking of “hot”, the stock market has a lot of people excited.  The Dow has ballooned 50% from its 2009 lows.  Does that mean our recession is over?  HECK NO!  One has nothing to do with the other.  The economy is driven by jobs and interest rates and credit.  The stock market is driven by pure human emotion.  Another 500,000+ of our fellow Americans lost their jobs last month.  That was applauded by some politicians as a good sign since it was down from over 600,000 from previous months.  A more accurate assessment is that we are “less bad”.  When you see the kinds of statistical games our government plays with employment data, you’ll see just how silly it is to hang a hat on the figures as a sign that the worst is over.

The current newsletter and all prior newsletters are archived at the Mortgage by Randy blog. Bookmark it and share with your friends and family.  You can make your own comments and feedback as well.  Time for the news…

Mortgage Market: Rates Drop and New Obama Rules Help More Homeowners Refinance

Interest rates remain low.  30 year fixed rates are hovering around 5.00%.  While the availability of certain kinds of credit might still make getting a loan difficult, the price of that money has rarely been better. Borrowers have noticed this, too, and with the weeks-long gentle decline in rates has come increasing purchase and refinance activity. The Mortgage Bankers Association reported more than a 13% gain in purchase applications and an 18% gain for refis.

Existing homeowners that are upside down on their mortgage have new relief thanks to the Obama administration.  Homeowners that owe 25% more than their home is worth may be eligible for refinancing assistance through the expanded Housing Rescue Program. For example, if your property is worth $200,000 but you owe $250,000 or less on your first mortgage, you may be eligible.  Visit the Making Home Affordable website for more information about eligibility.

Personal Credit: Free Identity Score Service – Try It !

Identity Theft is the number one crime in the United States for the ninth year in a row.  Even your author was victim to a perpetrator earlier this year.  It can happen to anyone, anytime. My ID Score is a free service which provides you with a quick assessment of your risk profile.  It only takes a minute to complete and there is some valuable information and insights available on their web site.  Make note that in the fine print the owners of this service admit that they “may” market some credit related offers to you in the future.  However, they promise not to sell your information and they also provide an email address to which you can send an opt-out request so that you do not receive marketing offers.  Give it a try!

Several credit monitoring services are available. Check with your bank.  Free Credit Reports 360 is another source and if you would like a free seven day trial, please contact me and I’ll help you get set-up.

Get a detailed credit analysis, including all three credit scores, and personalized action plan and consultation for only $99 by contacting me.

Economy & Financial Insights: Significant Declines Continue In Consumer Debt

In the past couple of months, consumer debt has declined $15.5 billion and $21.6 billion respectively.  Our collective frugality might be bad news for retail stores and restaurants, but American consumers are spending less and banks have cut down credit card lines too.  Despite this, our country’s debt bubble continues to balloon.  In a futile attempt to stimulate our economy, the government is borrowing money faster than the printing machines can churn out the greenbacks.  At some point down the road taxpayers will feel the punishment of these government actions (higher taxes).  The Lesson here is that the more we can get our personal finances in order now, the better we will be able to absorb the tax increases and benefit cuts that will come later.

Question of the Month: The Lending Environment Seems To Be Getting Worse.  Do You Agree?

Despite government efforts to make banks flush with cash to lend, the underwriting standards remain very tight.  Loan applications that look good on paper are still slow to navigate their way to the closing table.  Lenders are increasing down payment requirements on certain types of property (example: condos).  Intense scrutiny of income, employment and appraisals makes it challenging for a lot of people to get a loan – and the low consumer confidence in our country keeps some people from considering the pursuit of a mortgage.  Even private lenders, (yes, the Tony Soprano types) are very tight with their money despite being able to charge very expensive rates and fees to compensate for their risk.  It is not all bad news however.  Certain families have been able to take advantage of deeply discounted homes to become first-time homebuyers.  These folks did the right thing over the last ten or more years.  They saved their money.  They established great credit.  Their rewards for that discipline are available now.

Giving Back: Supporting Our Communities – Nashville Artists Donating Their Music

Do you like Nashville music?  The rich history and tradition of the music industry in Nashville continues today.  Music is a powerful medium which inspires, heals, educates and sparks all kinds of emotion and reaction from listeners.  Check out over 40 inspirational tunes donated by a growing list of singer-songwriters in the free online jukebox at Michelle’s Angels.  These artists have written, recorded and/or performed with world class acts including Brooks and Dunn, Randy Travis and Faith Hill.  Enjoy.

Need volunteers? Do you have a fundraising event upcoming?   Do you have a personal web site where you are raising donations for your cause?  Submit the information to randy@mortgagebyrandy.com by the 5^th day of each month and we will do our best to include your information in the next issue.

Have a safe Halloween.  Not my favorite holiday but at least there will be extra chocolate in the house.  Off to New York City the week of November 2 for a tradeshow so all you tri-staters can drop me a line if you want to meet up.

Randy

Mortgage by Randy newsletter, Copyright 2009 Randy Mitchelson.  All Rights Reserved.

Randy Mitchelson is a licensed mortgage professional. All material presented herein is believed to be reliable but we cannot attest to its accuracy. All material represents the opinions of Randy Mitchelson.  Recommendations may change and readers are urged to check with their financial advisors before making any decisions. Opinions expressed in these reports may change without prior notice. Mitchelson can be reached at 239-851-6738.

_________________________________________________________________________________________________________________________________________

You have permission to publish this article electronically or in print as long as the following is included:

Randy Mitchelson, of Estero, Florida, is a business professional, entrepreneur and author with over 15 years experience in financial services.  Mitchelson has served in leadership roles for Global & Fortune 500 firms like Bank of America, KeyBank and CIBC.

As a member of National Association of Mortgage Brokers, Randy has earned the Lending Integrity Seal of Approval.  He educates both individuals and groups about credit scoring by conducting personalized credit report reviews, action plans and one on one consultations. He is author of the free monthly newsletter, Mortgage by Randy as well as the Daily Dollar newsletter. A licensed mortgage professional, Mitchelson also founded Trinity Home Financing, LLC.

He is owner of Estero, Florida based National Web Leads, LLC, an internet lead generation service matching consumers with lenders for auto, cash advance and other loan products.   Through its network of partners, National Web Leads delivers innovative Web 2.0 software solutions such as lead generation platforms and real time desktop widget and mobile reporting tools for lenders and internet marketers.

Mitchelson earned his BS and MBA at Rensselaer Polytechnic Institute in Troy, NY.  He is a founding member and Finance Chairman of the Southwest Florida Regional Technology Partnership Inc. and Vice President for the Michelle’s Angels Foundation Inc.  He is married to Susan, a Pharmacy Supervisor in the Lee Memorial Health System in Fort Myers, Florida.

Mortgage by Randy

monthly update to our clients, colleagues, family & friends

By: Randy Mitchelson, May 2009

====================================================================================================================== 

In Issue 14 We Touch On:

Politicians Write Bad Mortgage Legislation

Americans Put Away Credit Cards

Buying Credit Scores

April ended with another seminar and more homeowners getting educated with the latest news about the property insurance, real estate, self-directed IRA, mortgage and credit markets.  Feedback from the Estero, Florida audience was favorable and many thanks to fellow presenters Jerry Elliot (Oswald Trippe Insurance), Dina Cecere (Dina Cecere Realty), Paul Cecere (Centennial Lending Solutions) and Austin Hardy (Entrust).    On to the news….

The current newsletter and all prior newsletters are archived at the MortgageByRandy blog space. Bookmark it and share with your friends and family.  You can make your own comments and feedback as well.  Time for the news…

Mortgage Market: Politicians Endangering Consumers & Mortgage Professionals

Mortgage rates have bounced in a tight range since March and there is not anything on the horizon to make them deviate one way or the other in the short-term.  This steadiness of low rates helps make new home purchases more affordable and homeowners with adequate equity can refinance into a lower rate.  The damage caused by loose underwriting rules, overly optimistic home buyers and some shady mortgage originators is not forgotten.  New legislation continues to be debated which has the good intention of better regulating the industry.  However, there are components of several pieces of legislation which, if passed into law, will hurt consumers, small businesses and appraisers.

One example is Senate Bill 896.  This bill contains an amendment which outlaws the consumer's ability to finance, including through rate or principal, any origination fees or costs permitted.  This means that consumers will no longer be able to obtain a no point loan or no point/no closing cost loan and will be forced to bring money to the closing table!  The major ramifications of this amendment are:

1. Significantly increase consumers’ costs

If mortgage brokers can no longer occupy a competitive place in the market, consumers will be forced to other competitors, which will cause upward pressure on pricing because these entities will find themselves in a position to charge consumers even more.

2. Legislatively pick winners and losers

Consumers who are unable or unwilling to come to the table with a 20% down payment and all of their closing costs and origination fees will be forced to turn to other financial institutions that may not be local or easily accessible, or will be denied access to mortgage credit altogether.

3. Destroy small business

Mortgage brokers are small business professionals who rely on yield spread premium (YSP) as a tool to provide consumers with the no-cost mortgage loans they typically demand.

Just as the pendulum of greed and spending dominated consumer behavior a few years ago, now the pendulum swings too far in the opposite direction.  Elected officials are trying to put their own personal stamp on legislation which on the surface demonstrates to voters that they are doing something about the mortgage crisis.  Unfortunately, too many of these politicians lack the knowledge to understand the repercussions of their actions. 

Personal Credit: Take Steps to Check Credit History with All Three Credit Bureaus

Reviewing your credit history regularly is just as important as changing the batteries in your smoke detectors every six months and getting the car oil changed every 5,000 miles.  If you neglect to do these things you increase your risk for bigger problems later on.  Remember to check your credit with each of the three major credit bureaus.

"Looking at one is a useless endeavor; you need to look at all three," says Howard Dvorkin, president of Consolidated Credit Counseling Services in Fort Lauderdale, Florida. "People tend to pull one and think everything is the same on all of them. That's not normally the case."

The reports will have different information because it's a voluntary system, and creditors subscribe to whichever agency they want -- if any at all.  If you have not checked your credit history at all, then get all three reports to ensure accuracy.  Otherwise, consider looking at one of the three every four months to monitor changes.

Economy & Financial Insights: Notice Your Mailbox is Lighter These Days?

A recent study by Mintel Comperemedia revealed two significant findings.  First, Americans are using their credit cards less.   Instead, 43% of Americans are using their debit cards more often.  The second finding is that banks have reduced the number of credit card offers sent to our mailboxes.  In the first quarter of 2009, lenders cut solicitations in half (compared to 4Q 2008) in response to rising delinquencies and chargeoffs.  While the lenders save a few trees, consumers are continuing to improve spending discipline.  Although spending is a key driver of our economic growth, these behavioral changes by banks and consumers are a necessary building block to better financial health.

Question of the Month: Is it Possible to Obtain Your Score on AnnualCreditReport.com for a Fee?

First, always use AnnualCreditReport.com to access your free reports.  This is the only site where you can get the free reports guaranteed to you by law.  Television and other ads for “free” credit reports all have a catch of some sort that require you to pay money.  The law does not entitle you to free credit scores.

When you visit AnnualCreditReport.com and progress through the screens to order your free report, there will be an attempt to upsell you to purchase scores.  Typically it’s about $10 per bureau.  If you are committed to spend about $30 to acquire all 3 scores, you might want to consider getting a monthly subscription for credit monitoring which includes the scores and also provides the additional peace of mind of being notified of any changes.

Giving Back: Supporting Our Communities – Mitchelson Scholarship Foundation 

High school graduation season is upon us.  Once again, the Larry Mitchelson Scholarship Foundation will be selecting an aspiring art student to receive a cash award to help them pursue higher education.  Previous winners are profiled on the foundation web site.  As the students progress in their career they can post updates and pictures of their art work.  Your generous donations can be conveniently made securely on the foundation Facebook  page or use the mailing address on the web site.

Need volunteers? Do you have a fundraising event upcoming?   Do you have a personal web site where you are raising donations for your cause?  Submit the information to randy@mortgagebyrandy.com by the 5^th day of each month and we will do our best to include your information in the next issue.

Nashville in July!  If you love great live music, celebrating with fun people and a contributing to a great cause, join us the weekend of July 17 for a one of a kind concert at The Listening Room in downtown Nashville.  Only 200 seats are available so contact me now to reserve!

Randy

Mortgage by Randy newsletter, Copyright 2009 Randy Mitchelson.  All Rights Reserved.

Randy Mitchelson is a licensed mortgage professional. All material presented herein is believed to be reliable but we cannot attest to its accuracy. All material represents the opinions of Randy Mitchelson.  Recommendations may change and readers are urged to check with their financial advisors before making any decisions. Opinions expressed in these reports may change without prior notice. Mitchelson can be reached at 239-851-6738.

_________________________________________________________________________________________________________________________________________

You have permission to publish this article electronically or in print as long as the following is included:

Randy Mitchelson, of Estero, Florida, is a business professional, entrepreneur and author with over 15 years experience in financial services.  Mitchelson has served in leadership roles for Global & Fortune 500 firms like Bank of America, KeyBank and CIBC.

As a member of National Association of Mortgage Brokers, Randy has earned the Lending Integrity Seal of Approval.  He educates both individuals and groups about credit scoring by conducting personalized credit report reviews, action plans and one on one consultations. He is author of the free monthly newsletter, Mortgage by Randy as well as the Daily Dollar Newsletter. A licensed mortgage professional, Mitchelson also founded Trinity Home Financing, LLC.

He is owner of Estero, Florida based National Web Leads, LLC, an Internet lead generation service matching consumer finance lenders with customers.   Through its network of partners, National Web Leads delivers innovative Web 2.0 software solutions such as lead generation platforms and real time desktop widget and mobile reporting tools for lenders and internet marketers.

Mitchelson earned his BS and MBA at Rensselaer Polytechnic Institute in Troy, NY.  He is a founding member and Finance Chairman of the Southwest Florida Regional Technology Partnership Inc. and Vice President for the Michelle’s Angels Foundation Inc.  He is married to Susan, a Pharmacy Supervisor in the Lee Memorial Health System in Fort Myers, Florida.