The Importance of Home Inspection

There are several reasons to inspect a home before purchasing.

• Safety -A home inspection can protect you, the buyer, from any safety issues like carbon monoxide, radon and mold, which is quite common in foreclosed and short sale properties.

• Option to Withdraw -Anyone who can recall a popular Tom Hanks flick, The Money Pit knows that a quality home inspection prior to purchase could save you thousands of dollars (not to mention your sanity). As soon as the deed is transferred, you no longer have the option to walk.

• Important Negotiating Tool -Not only does a home inspection report provide the buyer peace of mind, it also presents an opportunity for the buyer to request repairs, a price reduction, or even a credit from the seller.

• Forecast Future Costs -A home inspector can often times approximate the installation age of major systems and appliance in your home, such as the roof, heating, cooling and the water heater. Knowing the shelf life of certain systems and appliances can potentially save you thousands of dollars down the road.

Should Banks Maintain Foreclosed Homes?

See our own Neena Vlamis interviewed on Fox News speaking to this hot topic.

Should Banks Maintain Foreclosed Homes?: MyFoxCHICAGO.com

How do I know if the Investment Fund is on the right track?

I have been asked a lot lately: "How do I know if the funds I've picked are on the right track?"

The answer is to review the performance of the fund with its "benchmark index".  If it has diverged substantially in the wrong direction immediately call your financial advisor. If you don't have a financial planner please contact me so that I can give you a reliable referral. 

What Does 25 Percent PMI Coverage Actually Mean

Question?   What does 25 percent PMI coverage actually mean
Answer:  25 percent coverage actually means that the MI company will pay out 25 percent of the loan amount and total expenses to the lender when a property goes into foreclosure (the file is of course scrubbed for fraud first)
The average MI paid claim is 51,000 dollars.

The government is looking to get rid of Fannie Mae and Freddie Mac. What? And go back to real common sense underwriting????

Fannie Mae and Freddie Mac are publicly traded companies.

Fannie Mae (the Federal National Mortgage Association) and Freddie Mac (the Federal Home Loan Mortgage Corp.) were taken over by the government in 2008 after billions of dollars in losses and years of mismanagement.

Fannie was created as a federal agency in 1938 and chartered by Congress in 1968, followed by Freddie in 1970, to increase access to home loans. But they also are publicly traded corporations and -- before their taxpayer bail out -- had a duty to maximize shareholder return.

Those two, divergent missions were criticized as a "fundamentally flawed" business model by the Financial Crisis Inquiry Commission, which was created by Congress to examine the causes of the economic crisis that began in 2007.

Fannie and Freddie loosened underwriting standards leading up to the financial crisis, buying and guaranteeing riskier loans and ramping up purchases of mortgage-backed securities to please Wall Street analysts and "ensure generous compensation for their executives and employees," the commission determined.

With the housing market in turmoil in 2007 and 2008, Fannie and Freddie reported billions of dollars in losses. They were placed in conservatorship under the Federal Housing Finance Agency in September 2008. Since then, the Treasury Department has provided $169 billion to cover their losses (with re payments the net cost to taxpayers is $141 billion). The total could rise to $363 billion, the FHFA said. Other estimates put the total closer to $390 billion.

Still, senior executives at the mortgage giants continue to receive multimillion-dollar salaries. The top six executives received a combined $35 million in compensation over 2009 and 2010.

They are paid as if they are risk takers when really the government is taking the risk!

Fannie and Freddie's future is uncertain right now.

The Obama administration and Republicans in Congress agree that Fannie and Freddie should be. In housing. abolished. In February, President Barack Obama proposed gradually phasing them.