Buying a home won’t get much cheaper
By Les Christie @CNNMoney May 3, 2012
Several housing experts are predicting that this year will be the last chance for homebuyers to cash in on the weak housing market.
NEW YORK (CNNMoney) — Buying a home may never get any cheaper than this. Several housing experts are predicting that this year will be the last chance for bargain hunters to cash in on the best deals of the weak housing market.
With home prices down 34% nationally since 2006 and mortgage rates at historic lows, homes have never been more affordable — but it won’t stay this way for much longer.
Stuart Hoffman, chief economist for PNC Financial Services (PNC, Fortune 500), said he expects home prices to flatten out by the third quarter and start climbing by next year.
A number of factors will help bolster the housing market, he said, including a decline in the number of foreclosures and continued job growth. In addition, homebuyers will have better access to mortgages as they get their finances in order and improve their credit scores.
Some economists, like Trulia’s Jed Kolko, expect home prices to pick up even more quickly. Trulia’s data shows that the national average for asking prices already increased 1.4% in the first quarter of 2012, compared with the last three months of 2011.
“This is a strong indicator that we will start seeing home price indexes, like the S&P/Case-Shiller, start to report home price increases this summer,” he said.
Prospective homebuyers who’ve been sitting on the fence shouldn’t worry if they aren’t quite ready to make the leap. Analysts are predicting that the initial price gains will be modest, at least, in most markets.
Hoffman, for example, is forecasting a 2% increase in 2013 compared with 2012. Meanwhile David Stiff, chief economist for Fiserv, predicts that prices will turn in the last quarter of 2012 and will rise 4.2% for the 12 months through September 2013.
Foreclosures start to fade. One major factor that will drive the trend is the cooling of the foreclosure crisis. Stan Humphries, chief economist for Zillow, said that the percentage of mortgage loans 90 days or more late, a good predictor of future foreclosures, is “falling fast.”
That percentage dropped 15% year-over-year to 3.1% through the end of 2011, according to the Mortgage Bankers Association. And the decline is accelerating: More than 70% of the decline came in the last three months of the year.
Before things slow down, however, buyers should brace themselves for a temporary spike in the number of foreclosures as banks start expediting the processing of hundreds of thousands foreclosures that were stuck in the system following the robo-signing scandal. That backlog should move more quickly now that new guidelines for processing foreclosures have been outlined in the $26 billion foreclosure settlement.
Many of the bank-owned properties currently coming out of the foreclosure pipeline are being snapped up by investors who are fixing them up and renting them out — often to those who were displaced by the foreclosure of their own home. That has helped to lift prices on foreclosed properties, according to Alex Villacorte, the director of analytics for Clear Capital, which specializes in housing market valuations.
“That could have a significant impact on the market overall in terms of providing a rising floor to home values,” he said.
In some markets hit hard by foreclosures, the turnaround in prices is already underway. Phoenix recorded an 8.4% jump in home prices during the three months ended April 30, compared with the three months ended January 31, according to Clear Capital.
“It’s crazy,” said Tanya Marchiol, founder of Team Investments, a Phoenix real estate investing firm. “Stuff I was selling six months ago for $60,000 to $80,000 is now $90,000 to $110,000.”
Miami saw a 4.6% increase quarter-over-quarter through April, and Tampa, Fla., was up 4.4%, according to Clear Capital.
Goodbye 3.8% mortgage. In addition to home prices, mortgages could also move higher.
Mortgage rates have been at or near historic lows for much of the past six months. The average interest rate for a 30-year, fixed-rate mortgage has not topped 4.5% since July 2011 and this week, it hit 3.84%, a new low.
But rates aren’t expected to remain at these record-low levels much longer. As the economy continues to recover, rates will move higher, said Doug Lebda, CEO of LendingTree, the online lending site. Although, he said, they will “stay very reasonable.”
The Mortgage Bankers Association is forecasting that the 30-year fixed will hit 4.5% by the end of the year.
Greater demand for loans will help fuel the increase, according to Lebda.
Even though mortgage rates have been cheap, borrowing for home purchases has been sluggish. The Mortgage Bankers Association estimates that homebuyers will take out mortgage loans totaling about $415 billion this year, an increase of less than 3% compared with 2011. Next year, however, it forecasts that amount will almost double to $706 billion.
As housing markets stabilize and prices stop falling, homebuyers will be even more confident about buying, said Humphries.
“People can now see the light at the end of the tunnel,” he said. “And that can be enough to get them off the fence.”
Esteemed Judgment, Debt Attorney Abel L. Pierre Joins The Credit Repair Experts at Better Qualified
PRLog (Press Release) – Apr 30, 2012 -
NEW YORK, NY— Over the past several years, Better Qualified, LLC has developed a proven track record within the credit restoration and Identity Theft services industry. Better Qualified’s unyielding dedication to their customers and integrity has truly set the bar for the industry as a whole. Earlier this month, Better Qualified has raised that bar. In an effort to continuously provide stellar service to their clients, Better Qualified has secured the commitment from prominent debt consultant Abel L. Pierre.
When it comes to credit scores, credit reporting, and debt, Abel L. Pierre has his ear to the ground. A former adjunct professor of law, Abel L. Pierre regularly speaks to community groups, houses of worship and tenant associations regarding a myriad of debt issues from consumer lawsuits, credit reporting problems, foreclosure defense, and debt collection harassment. When a person complains about a unique issue, Mr. Pierre doesn’t just tell them to go to court, he goes with them. Mr. Pierre walks into court with a decade of legal experience as a licensed attorney. Mr. Pierre has recovered monetary awards on behalf of his clients, who have suffered the calamities of the burden of debt.
“We have been providing a great service to our clients and they were happy with our results for the past 6 years but, we realized that having an attorney working for our clients makes us even better,” says CEO Paul Oster. “Abel is an industry expert and his knowledge and expertise should help improve our client’s credit scores so, they can get better interest rates for mortgages, credit cards, insurance premiums, etc”. Mr. Pierre said in response, “Better Qualified’s great reputation speaks for itself. I am eager to help them provide the kind of service to their client’s that some companies only claim to deliver. All too often, you need someone with unique insight and experience into the myriad of laws that debt burdened clients deals with. That’s what I bring to the table.”
Background:
Founded in 2006, Better Qualified has become a leader in credit restoration and identity theft resolution services. Better Qualified is headquartered in Eatontown, New Jersey, with licensees across the country.
Since founded, Better Qualified has maintained an excellent track record of success and offers a 100% money back guarantee. The business has an A rating from the Better Business Bureau.
Contact:
Abel L. Pierre, Esq.
Law Office of Abel L. Pierre
Attorney-at-
Better Qualified, LLC
19 Christopher Way
Eatontown, NJ 07724
Tel: (732) 203-7377
Email: info@betterqualified.com
More consumers have near-perfect FICO credit score
By Pamela Yip
Many consumers are now in the top range of 800-850 of the FICO credit score, which is used by many lenders to determine creditworthiness, according to FICO Labs.
The company said 18.3 percent of consumers have a FICO score in that coveted range, the highest level since October 2008. The FICO score ranges from 300 to 850.
However, the number of consumers with a FICO score between 700-799 hasn’t rebounded, indicating that consumer credit health isn’t yet back to its pre-recessionlevel, FICO researchers said.
The percentage of consumers – 15.5 percent — in the 700-749 range is the lowest that FICO has seen since the company began tracking this information in 2005
And the percentage of consumers – 19.4 percent — falling between 750-799 is the lowest that FICO has seen since April 2009.
“There has been a clear shift,” said Rachel Bell of FICO Labs. “Many consumers have moved into the top tier of the FICO score range by redoubling their efforts to maintain an excellent credit profile. Other people have fallen into lower tiers, most likely due to the financial stress that many households have been feeling.”
Despite this shift, more than half of Americans with a FICO score in the U.S. are between 700-850, “which means they have managed their credit well despite the economic downturn,” she said.
The research by FICO Labs was conducted on a national sample of 10 million consumer credit profiles as of last October.
Identity Theft Tops List of Tax Scams
CNBC Senior Correspondent
For Angela Beasley of Miami, tax time seemed especially promising this year. After doing her taxes with Intuit’s popular TurboTax software, she found she was due a refund of nearly $5,000.
Anxious to get the money as quickly as possible, she paid the extra fee to file her return electronically. Then, she clicked “send.” After a delay, she said, an unusual message popped up on her screen:
“Your transmission didn’t go through,” it said. “A tax return with the same Social Security number has already been submitted — in other words, it appears you’re trying to e-file the same return twice.”
She says she was not quite sure what had happened until she went to work the next day and learned that many of her co-workers had had the same experience.
Beasley and her colleagues are among the nearly half-million taxpayers since 2008 who have been victims of identity theft.
“It feels like you have no control over what can happen with your finances or your personal information. Like you have no control over anything and that anything can happen to you,” Beasley said.
With most returns now filed electronically, all it takes is a Social Security number to file a return and claim a refund. And since many companies that provide electronic filing services offer instant refunds in the form of debit cards, fraudsters can be spending the money within days.
The IRS puts identity theft at the top of its “Dirty Dozen Tax Scams” for 2012. As of January, the agency had active identity theft cases in 22 states, and said its fraud filters caught 262,000 fake returns in 2011 compared with just 49,000 in 2010. But authorities know it is just the tip of the iceberg.
In Tampa, Fla., one of the earliest places where the fraud showed up, authorities say drug dealers and other hardened criminals have turned to tax identity theft instead because it is so easy, is far less risky, and, they apparently think, victimless.
“I’ve never seen individuals involved in a specific type of a crime that so readily admit what they’re doing. They don’t see anything wrong with it. Taking the government’s money is not wrong in their eyes,” said Tampa Police Chief Jane Castor, whose department has made several big arrests, including a sweep last fall dubbed “Operation Rainmaker,” in cooperation with the U.S. Secret Service and Postal Inspectors.
The operation netted 49 arrests, and authorities say it intercepted $100 million in proceeds from the fraud. But Castor says since then, the fraud has only grown.
“We thought that Operation Rainmaker may have slowed this down somewhat, but all indications are it is worse this year, 2012, than it was last year,” Castor said.
Nationwide figures appear to bear that out. The Federal Trade Commission, which is the main U.S. agency monitoring identity theft, says complaints in the category that includes tax refunds have doubled in the past two years.
On this tax day in New York, Manhattan District Attorney Cyrus Vance Jr. announced the indictment of a dozen defendants who allegedly set up a fake job placement web site in order to get Social Security numbers and other identifying information from some 300 victims. They are accused of using that information to obtain more than $450,000 in refunds from the IRS.
By targeting the unemployed, authorities allege, the defendants were able to garner a pool of individuals less likely to have earned income to report to the IRS. That way, returns filed in their names were less likely to raise suspicion.
Elsewhere, authorities have found “cheat sheets” in jails, where criminals share information about where to get Social Security numbers and how to best pull off the fraud.
For victims like Angela Beasley, finding out that her electronic tax form would not go through has been only the beginning of a long and frustrating ordeal.
She says she started with the IRS, which told her to file a return by mail, along with Form 14039, an identity theft affidavit. Then, she says, she was told to call the police.
“I called my local police office, they directed me to call another local police office. I called them and they said, ‘No we don’t take those reports, we don’t report that particular identity theft because it’s so rampant and it’s happened to so many people,’ that they’re overwhelmed and they can’t even deal with it, just call the IRS. But the IRS then asks you if you have a police report,” Beasley said.
Beasley says she has been told it can take anywhere from six months to two years to get her refund back. But that is just the first of her concerns.
“If I made $50,000 and this person has submitted a record to the IRS that I’m making $75,000 a year and threw me into another tax bracket … if I was applying for a student loan or maybe discounted health care this could probably affect me,” she said.
Beasley has channeled her frustration into a blog, “Hacked by TurboTax,” though she acknowledges TurboTax is not to blame for her situation — something a TurboTax spokeswoman is quick to point out as well.
“The blog title is clearly misleading,” Colleen Gatlin wrote in an e-mail to CNBC. “TurboTax has not been hacked nor have identities been stolen from TurboTax at any time.”
Nonetheless, she said, the company is working closely with the IRS to detect and prevent fraud in the face of a “marked increase” in the activity this year.
Castor says it is up to the IRS to tighten its systems. “We can’t investigate our way out of this,” the Tampa Police Chief said.
The IRS says it is working on it. “The IRS takes this issue very seriously and we continue to expand on our screening process in order to stop fraudulent returns and protect innocent taxpayers,” the agency said in a statement.
The agency says it stopped $1.4 billion in refunds from being sent to identity thieves last year, and it is working to speed up the process of resolving cases, a situation complicated by strict privacy laws surrounding tax returns.
The main federal agency dealing with identity theft is the Federal Trade Commission. But by law, the IRS is prohibited from sharing information about individual tax returns — fraudulent or not — with the FTC.
Legislation pending in Congress would toughen penalties for tax return identity theft and broaden the definition of victims, but protect your online identities. Guard your Social Security number, and beware of so-called “phishing” scams, where criminals attempt to access your personal information through official-looking e-mails.
The IRS has posted a list of tips here.
Tell us your story! E-mail us: investigationsinc@cnbc.com
Credit history helps shape insurance premiums, but relationship between credit and claims a bit murky
George Altman, Capital Bureau
MONTGOMERY, Alabama — Is a storm more likely to damage your home if you are late paying credit card bills? Most insurance companies think so, and they charge accordingly, according to industry experts.
Spokesmen for State Farm Insurance Cos., the state’s largest property insurer, said that the company’s statistical models demonstrate a clear link between elements of a person’s credit report and the risk that he represents in homeowners and auto policies.
“The fact that the correlation exists is beyond dispute,” said State Farm’s Dick Luedke.
The tie between credit history and insurance claims is strong for auto, fire and theft insurance, Luedke said. It even exists, to a lesser extent, for catastrophic damage from hurricanes or tornadoes, he added.
When asked how those could be related, he said, “We would admit that that is not totally clear.”
Some aren’t buying it.
“I don’t know how many of you all know how your credit score, your FICO score, plays into purchases of insurance, but it is abused, and it needs to be addressed,” Carl Schneider, vice president of Mobile-based Schneider Insurance Agency Inc., told the governor’s insurance commission last week.
The Alabama Department of Insurance is considering action to address the situation, whether by state law or department-issued regulation, according to Charles Angell, acting deputy insurance commissioner.
“It’s totally common. Certainly every large insurance company does it, for both automobile and homeowners insurance,” Angell said.
The FICO credit score is a number between 300 and 850. A higher number indicates a better credit history. The score is based on several factors, including how much credit a person has available, how much is currently borrowed, how many credit accounts a person has, how many late payments the person has made, how many accounts are in collections, how long of a credit history a person has, and how recently the person sought additional credit.
Luedke said that State Farm doesn’t consider a person’s FICO score but instead uses certain elements of the credit report to create a different score. That number is based particularly on the number of late payments that a person has made, the number of accounts a person has in collections, and the number of credit accounts a person has, he said.
Luedke declined to estimate how much of a difference that credit history can make on the total cost of a State Farm premium. Schneider said he has seen credit alter premiums as much as 200-300 percent for some companies.
Representatives of Alabama’s second- and third-largest property insurers, Alfa Mutual Group and Allstate Corp., did not respond to questions about their use of credit information in policy premiums.
Angell agreed that there is a “very strong statistical correlation” between credit history and some types of insurance perils, such as fire. But he described the connection between credit and catastrophic wind risk as “slight.”
Currently, insurers combine all property insurance risks to come up with the premium, so credit history is lumped in with all of the perils. That’s what Angell wants to change.
“We would like to see the wind premiums shown separately, calculated separately, on a policy from the nonwind premiums,” he said. “We would like to see credit scoring applied appropriately to the two pieces, or maybe not applied at all to the wind piece.”
Angell hopes that the Legislature will establish such a requirement. Otherwise, the department could write its own regulation, he said, although there is a downside to that approach. “The industry could take us to court,” Angell said.
Additionally, a change in state law is more permanent than a department-issued regulation, which can come or go at the desires of the insurance commissioner.
Angell and State Farm spokesman Roszell Gadson both said that it often helps consumers for insurers to consider credit history.
“If someone has a very good credit score, but they live in a high-risk area, for instance, then there’s going to be a benefit for them,” Gadson said.
Does a Good Credit Score Mean Cheaper Car Insurance?
It’s no secret that nowadays your credit score is almost as important as your social security number, but can having a good credit score lead to cheaper car insurance? Although insurance providers may not willingly divulge the information on exactly how your deductibles and premiums are calculated, but it’s almost a guarantee that your current credit score is thrown in the equation.
Why you may ask? Instead of using your FICO score, insurers examine what’s referred to as an “insurance score” to determine whether or not you’ll be a potential risk for filing claims – a lower credit score, according to some experts in the industry, means that a customer with a low credit score will be a higher risk than those with higher digits. Ultimately, cheaper car insurance premiums do depend on your current credit score.
Affordable Car Insurance and Good Credit Scores
The recent statistics from a study conducted by CarInsurance.com are promising for individuals with credit scores of 750 save on average $783 each year on lower car insurance. The 40% of customers with a credit score over 750 can expect to save almost $23,000 on cheaper auto insurance costs over the span of an adult lifetime.
For teen drivers between the ages of 16-24, credit scores aren’t really significant in factoring cheaper auto insurance because the majority of teens don’t yet have established credit; however consider the following statistics for teens with established credit:
• Credit scores above 750 pay an average of $2,515/yr
• Credit scores between 650-749 pay an average of $2,387/yr
• Credit scores between 500-649 pay an average of $2,692/yr
• No credit pay an average of $4,191
Young adults between the ages of 25-34 with credit scores over 750 and a clean driving record qualify for lower vehicle insurance and pay an average of $1,155 annually, compared to $1,938 to the same population with credit scores below the magical 750. Other statistics revealed the average driver between the ages of 25-34 with:
• Credit scores between 650-749 pay an average of $1,658/yr
• Credit scores between 500-649 pay an average of $2,023/yr
• No credit pays an average of $2,182/yr.
Ways to Boost Your Credit Score to Become Eligible for Cheaper Car Insurance
Even if your current credit score is less than perfect, there are ways to improve your credit to take advantage of lower vehicle insurance premiums.
• Routinely check your credit score from the 3 major credit reporting agencies
• Immediately report any errors.
• Always make payments on time.
• Never allow coverage to lapse.
• Establish credit in your name.
• Don’t hesitate to compare insurance quotes; doing so doesn’t affect your insurance score.
Remember that maintaining a good driving record as well as a credit score of 750 or above are the most effective ways to enjoy the benefits of lower auto insurance! While it may take some effort on your part to be responsible, consider cheaper car insurance premiums a well-worth investment into your future!
Related Links to Cheap Car Insurance
Better Qualified Helps Toy Drive Become A Success
Christmas got a little better for a number of families this year with the help of Better Qualified and other businesses. The 2011 Help Across America toy drive’s success is evident by the smiles on the faces of the children.
To Find Out More About Help Across America visit their site at www.helpacrossamerica.com/ or call 973-298-0809
Credit Scoring: A Consumer’s Perspective
It is no secret that insurance companies use the credit scores of individuals as one tool in the approval/disapproval process and in establishing premiums.
Most courts allow this process as long as the scoring is uniformly applied to all insureds and is consistent with the purposes of the individual state’s insurance code. But just because credit scoring is legal does not make it right.
Insurers contend that there is a clear correlation between credit scores and the risk of loss; that is, the lower the credit score, the more likely that the insured will file a claim. This may be statistically correct, but I wonder if insurers take into consideration the fact that the credit-scoring companies often make mistakes. And, what is even worse, the credit-scoring companies don’t admit mistakes or when they do, it takes months and even years to make the corrections.
That is not going to help any potential insured get coverage when it is needed.
Insurers want to attract and retain low-risk customers since this is a way to make a profit, but many state insurance codes have the express purpose of making insurance available and affordable for everyone. Turning away a potential customer or charging the customer prohibitively high premiums because of some anonymous crowd of pencil-pushers using subjective standards does not seem to me to be living up to that express (and grand) purpose.
Plus, I just find it irritating that these credit-scoring agencies have so much power over the daily lives and operations of citizens (and even countries as the effect of the downgrading of the U.S. credit rating shows).
Now, before anyone thinks I am complaining because I have a low credit score, the fact is that I don’t. And I realize that an insurer needs to make a profit to continue in business.
But credit scoring still seems to me to be a crude, unfair, overly subjective way to set underwriting standards. There has to be a better way to establish the insurance-worthiness of a potential customer.
Those in the insurance business are intelligent people, and ignoring credit scores or at least downgrading their importance when it comes to the approval/disapproval process and establishing premiums cannot be that hard a task.
David D. Thamann
David D. Thamann, JD, CPCU, ARM, is managing editor for FC&S Online.
NJ Credit Repair Company Helps Consumers Fix Credit in About Six Months
Better Qualified, a leading NJ credit repair company, can help restore personal and business credit in as little as six months.
According to Better Qualified, many consumers have erroneous information on their credit report that is hurting their score. The Public Interest Research Group (PIRG) conducted an independent study and found that 79% of credit reports surveyed contained either serious errors or other mistakes of some kind. These mistakes can cost consumers hundreds or even thousands a year.
The Freedom Package from Better Qualified has been the credit repair solution many have been looking for. This package consists of a comprehensive six-month program that includes NJ credit repair services, identity theft resolution, education services and much more. This popular program has helped thousands of consumers with bad credit and the company’s superior customer service has earned them an “A” rating with the Better Business Bureau.
Better Qualified’s superior customer service is evident online, where many have given the NJ credit repair company top ratings.
NJ Credit Repair testimonials
Jason W. writes “Better Qualified found mistakes on my credit report and began cleaning negative marks immediately. At that time they also suggested that I take initiative with their help to separate my personal credit and business credit so that I would not have future complications. A year later my credit score has risen and my business credit is established with multiple creditors. I highly recommend that everyone use Better Qualified for your personal credit and if you own a business. You will not regret it.”
Jeff V, an employee at a mortgage firm in NJ, praised Better Qualified for helping his client with his tarnished credit score. Jeff writes, “On behalf of myself and my client, we wish to thank you for successfully getting his credit score from 644 to 688 in under 45 days. By getting his score up, we were able to avoid the 1.5% add-on for a credit score under 649 and get him a 4.25% rate…essentially leading him to $4,861 in savings and $57 savings every month. You guys are the best and I’ll be sure to refer anyone else I know to you!”
Additional Better Qualified testimonials can be found online: http://betterqualified.com/testimonials/
Better Qualified takes a time tested, legal approach to restoring bad credit. The NJ credit repair company will challenge all disputable information on a credit report and will work to have any erroneous information deleted.
To learn more about their services call (888) 533-8138.
Background:
Founded in 2006, Better Qualified has become a leader in credit restoration and identity theft resolution services. Better Qualified is headquartered in Eatontown, New Jersey, with licensees across the country.
Since founded, Better Qualified has maintained an excellent track record of success and offers a 100% money back guarantee. The business has an “A” rating from the Better Business Bureau.
