“ME” or “I” — Always use “me” following a proposition, as in:  “for me”.  Extra words trip us up, such as “for my company and I” and should be “for my company and me”.  “NAUSEOUS” or ” NAUSEATED”.  First is something sickening to contemplate and 2nd is how you feel.  COMMAS FOR CLARITY.  An example:  “let’s eat my friend” is not the same invitation as “Let’s eat, my friend”.  “AFFECT” or “EFFECT”  Think using these words as verbs and you’ll use them correctly as nouns.  To “affect” means to influence it and “effect” is to cause it.  If the result of something, it’s an “effect”.  Many many more!  From Margie Fisher, PrimeLending in Tyler.

Part 1 talks about QM or Qualified Mortgage loans and now we are into QRM or QUALIFIED RESIDENTIAL MORTGAGE standards.  The rules are stringent enough to protect consumers from unscrupulous lending practices while still creating new opportunities for private capital to re-establish itself as part of a robust  and competitive mortgage market.  NO 20-30% down payments that were going to take place in 2011.  NAR or National Association of Realtors have pushed for lenders to make QM and QRM loans to qualified buyers with a lesser down payment.  VA loans are often made with little or no down payment and small number of foreclosures.  THESE GUIDELINES SHOULD PRODUCE SOLID LOANS!

QM – QUALIFIED MORTGAGE LOANS AND ABILITY TO REPAY.  (1)  3% points and fees cap for loan amounts greater than $100,000.  (2)  maximum debt-to-income ratio of 43%.  (3)  no negatives features such as negative amortization, balloon payments & interest only.  (4)  maximum 30-year loan term.  WHAT IS ABILITY TO REPAY?  (a)  income and asset verification, (b)  employment, (c)  monthly mortgage payments, including subordinate liens, (d)  all monthly mortgage-related debt, such as taxes, insurance, etc., (e)  verification of all monthly debts and liabilities, including alimony and child support, (f) DTI or residual income, (g)  credit history.  MORE IN A DAY OR SO!

Home prices nationally increased 8.4% during the same period, but easy to explain.  Texas did not have the severe slump that other states had.  These figures are from the Federal Housing Finance Agency and their latest Price Index (HPI).  OUR GROWTH IS FROM A STRONGER BASE according to Dr. Jim Gaines, economist at the Real Estate Center at A&M.  Houston-The Woodland-Sugar Land had the largest one-year increase at 10.31%, following by Austin-Round Rock at 10.08% and Dallas-Plano-Irving at 9.73%.

this index assumes a 20% down payment and a 25% ratio of principle and interest payment to income.  So if you gross $4,000 per month, then your monthly payment should not EXCEED $1,000 per month.  The rise in loan rates from a year ago mean roughly $12 extra in a monthly mortgage payment from a month ago and $79 more than a year ago.  While incomes continue to rise, they are not keeping pace with home price gains & mortgage rate increases from a year ago.  This slight easing of affordability is welcomed for potential buyers, but uncertainly remains.  The Federal Reserve has committed to pushing rates higher as needed to stanch inflation as the economy improves.  The Fed has a tricky balancing act ahead!!

(3)  WHAT DO I NEED TO KNOW ABOUT THIS NEIGHBORHOOD THAT I’M NOT ASKING?  WHAT IS NOT OBVIOUS?  A competent real estate agent can tell you about schools, views, local shops, etc.  That agent can (a) share the colorful commentary about the past and present history and residents of the neighborhood, (b)  connecting you with former clients who live there and even, (c) telling you a deeper history of the home values in the neighborhood that might be evident from comps, with the context of various homes they have worked with in the area.  (4)  ARE THERE ANY COMMON ISSUES YOU FREQUENTLY SEE WITH HOMES IN THAT AREA?  Inspectors may know the topography, soils, climate and environmental factors that can impact homes in an area or on a given street over time.  What the inspector says can help you feel secure in your choice.  GOOD NEIGHBORHOOD SELECTING AHEAD!

(1)  WHAT DO PEOPLE AROUND HERE LIKE TO DO IN THEIR SPARE TIME?  Get chatty and friendly with future neighbors while you are viewing a home.  Do they know that the neighbors down the block exercise each a.m. at the local gym and you like that?  Or are they active in local schools?  (2)  WHAT DO YOU WANT YOUR FAMILY’S ECOSYSTEM TO LOOK AND FEEL LIKE?  That “right ecosystem”  is your neighborhood.  Do you want the children to walk to school or convenient to the freeway or neighbors who have just as much pride of ownership in their homes as you do?  MORE TO COME TOMORROW.

(6)  XERISCAPE YOUR LANDSCAPE – conserve water by planting drought-proof plants and/or installing a rainwater system to get you through the dry months.  (7)  CONSERVE ENERGY – upgrade insulation and seal gaps around windows and doors.  Turn the thermostat  down a few degrees at night.  (8)  SAVE WITH SOLAR – install solar panels for swimming pools & pre-warming the household hot water supply. (8)  GO GREEN TO CLEAN – reduce indoor air pollution by using all-natural cleaning products.  (10)  CHOOSE NATURAL AND RENEWABLE – use natural fibers like wool or cotton for carpeting, window treatments and textiles and sustainable woods like bamboo for flooring.

Popular in Europe and allows older parents to live close to a child – in the backyard in their own GRANNY POD.  Some companies can build a 257 to 588 square foot home for $42,000 to $83,000 (Florida prices) with living, bedroom, bath, kitchen and place for washer/dryer.  Of course iF space available in the larger home for facilities like this, then could be less expensive.  This living arrangement is popular in Europe and other areas of the world.  The “granny pod” could be a more affordable option that provides privacy, security and peace of mind for all parties.  Monthly fees for assisted-living facilities was about $3,300 in 2012.  This arrangement give the older parent or parents their own SPACE, SAFETY AND SECURITY.

Renovating your home?  Here are a few ideas.  (1)  switch on ENERGY EFFICIENT LIGHTING – upgrade your lighting with energy efficient LED or compact flourescent lights.  (2)  get the DROP ON DRIPS – fix or replace leaky faucets.  One drop per second can waste as much as 10 gallons of water each week.  (3)  go LOW-FLOW – upgrade to low-flow toilets and showers to reduce water consumption.  (4)  become a FAN OF FANS – in cooler weather, use clockwise rotation to push down warm air that rises to the ceiling and reverse in warmer weather.  (5)REUSE, RECYCLE & REPURPOSE – use reclaimed building materials instead of buying new and look for ways to repurpose old materials, such as buying from the Habitat Resale Store.  MORE COMING TOMORROW.