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WASHINGTON — The Federal Reserve signaled Wednesday that a full economic recovery could take nearly three more years, and it went further than ever to assure consumers and businesses that they will be able to borrow cheaply well into the future.
The central bank said it would probably not increase its benchmark interest rate until late 2014 at the earliest — a year and a half later than it had previously said.
The new timetable showed the Fed is concerned that the recovery remains stubbornly slow. But it also thinks inflation will stay tame enough for rates to remain at record lows without igniting price increases.
Chairman Ben Bernanke cautioned that late 2014 is merely its “best guess.” The Fed can shift that plan if the economic picture changes. But he cast doubt on whether that would be necessary.
“Unless there is a substantial strengthening of the economy in the near term, it’s a pretty good guess we will be keeping rates low for some time,” he said.
The Fed has kept its key rate at a record low near zero for about three years. Its new time frame suggests the rate will stay there for roughly an additional three years.
The bank’s tepid outlook also suggests it’s prepared to do more to help the economy. One possibility is a third bond-buying program that would seek to further drive down rates on mortgages and other loans to embolden consumers and businesses to borrow and spend more.
Information obtained from the Calif. Asso. of Realtors with permission.
Article printed in the Mercury News and A.P.  Jan. 25,  2012.
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Interest Rates will Stay Low, Low, Low (marvicirealtygroup.wordpress.com)

Last year, more than two million people were turned down for home loans, according to federal data, often because the applicants didn’t meet certain lender requirements or because their applications were incomplete or otherwise problematic. With lenders’ underwriting criteria becoming more strict in recent years, it’s important buyers know the most common triggers for mortgage-loan rejection. 

Insufficient income: Lenders want to be sure borrowers can afford to make the mortgage payments. Lenders typically look for at least a two-year track record of income, which could hurt those who have changed jobs recently.
Cloudy financial picture: Generally, total debt payments, including the mortgage, cannot exceed 45 to 50 percent of a borrower’s adjusted gross monthly income. Overtime and bonuses are included only if the borrower has worked for the same employer at least two years, and has a history of receiving them.
Poor credit: Lenders typically reject applicants with FICO scores below 620.
Low appraisal: One of the predominant reasons buyers are turned down for home loans is because the appraisal on the property is too low.
Property problems: Sometimes issues turn up within a house, like a major repair or safety issue that needs to be addressed, before an application can be approved.
Information mix-ups: Approximately 12 percent of new mortgage applications were denied because of unverifiable information or incomplete credit applications, according to the Federal Financial Institutions Examination Council.

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How to Boost Your Odds of Getting Approved for a Mortgage (dailyfinance.com)
First-time buyers hit by lenders’ caution (guardian.co.uk)
How to Know if You Qualify for a House Loan (thinkup.waldenu.edu)

In understanding the market value of your property, we must deal with some factors that we have no control over.   These factors are physical qualities of your property and the competition.
* Physical qualities:
-         Location
-         Age
-         Size of House and Lot
-         Floor plan and design style
* The Competition:
-         The number of similar properties for sale
-         Their prices and financing terms
-         Physical Condition
Then there are some factors that have no effect on the current value of your property.   These factors are original price and opinions of others.
* Original Price:
-         What you originally paid for your house
-         Credits or closing costs
-         Down Payment
-         The actual Sale Price
* Opinions
-         What people say your property is worth
-         Websites that contain comparable sales

The New York Times

Program will pay homeowners to sell at a loss
In an effort to end the foreclosure crisis, the Obama administration has been trying to keep defaulting owners in their homes.  Now it will take a new approach: Paying some of them to leave.
To read the full story, please click here.

Los Angeles Times
Many borrowers in default stay put as lenders delay evictions
Despite being months behind, many strapped residents are hanging on to their homes, essentially living rent-free.  Pressure on banks to modify loans and a glut of inventory are driving the trend.
To read the full story, please click here.

The Wall Street Journal
What home sellers don’t tell buyers
As buyers ease back into the battered real-estate market, they’re often hitting a stumbling block:  Fibbing by home sellers.  Buyers should do their own due diligence and not rely on agents and sellers.

To read the full story, please click here.