States take steps to cut GHG emissions

By Marcie Geffner - Partnership for Sustainable Communities

A number of U.S. states have begun to use transportation and land-use policies and projects to reduce greenhouse gas (GHG) emissions in an effort to combat climate change. California's climate change program is among the most ambitious overall, but other states have made at least a small start.

Connecticut, Massachusetts, New York, Oregon, and Washington may well take the top honors, judging by a national survey that found nearly 600 state-level programs that could cut GHG emissions in the areas of climate, energy, transportation, and building. Boos and hisses might greet such states as Alabama, Mississippi, Nebraska, South Dakota, and Tennessee, which, based on the survey, appear to be nearly oblivious to or decidedly uninterested in these issues.

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How much is your home worth?

Marcie Geffner -

Homebuyers and sellers may be on opposite sides of a home sale, but they have one dilemma in common: They both need to sort through a thicket of prices and valuations to figure out how much a home is really worth.

The holy grail of these prices and valuations is market value, which refers to the price at which a typical seller would be willing to sell the home and a typical buyer would be willing to buy it, according to Leslie Sellers, owner of Leslie Sellers & Associates, an appraisal firm in Knoxville, Tenn.

But while market value is the "goal" or "standard" buyers and sellers would like to ascertain, this amount may be quasi-mythical as it's not necessarily equal to either the appraised value, as determined by a certified appraiser, or the sales price, which refers to the price at which the property was sold.

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Fed says economy is 'leveling out'

By Marcie Geffner -

The U.S. economic recession may not be over yet, but there are some signs that the situation may be improving, according to the Federal Reserve. That improvement — and the Fed’s plan to keep interest rates low for the time being — are good news for borrowers.

“Economic activity is leveling out,” the Fed suggested in its Aug. 12 statement, and what’s more, this “leveling out” can been seen throughout different sectors of the economy. The Fed noted signs of economic improvement for the financial markets, households and businesses.

“Conditions in financial markets have improved further in recent weeks. Household spending has continued to show signs of stabilizing….Businesses are still cutting back on fixed investment and staffing but are making progress in bringing inventory stocks into better alignment with sales,” the Fed reported.

Economic Outlook Improved, But Uncertain
Despite those favorable trends, not all is rosy in the U.S. economy and much of the outlook is still uncertain.

For instance, consumer spending accounts for a large share of U.S. economic activity. It appears that consumers have loosened the reins on spending, but whether that inclination will be temporary or sustained is not yet known.

Similarly, businesses have reduced the cost of large inventories of unsold products, but whether that will help them return to profitability or only shrink their losses remains to be seen.

Indeed, economic activity may “remain weak for a time,” the Fed warned. Given that expectation, the Fed still plans to continue its current policies to promote economic recovery and ward off inflation, which the Fed predicted would “remain subdued for some time.”

Interest rates still low
The Fed’s policy of very low interest rates hasn’t changed. The Fed decided to keep its target range for the federal funds rate, a bank interest rate, at just zero to 0.25 percent, the lowest possible level. The Fed also said that it still believes economic conditions will warrant “exceptionally low levels of the federal funds rate for an extended period.”

Although the Fed sets a target for the federal funds rate, the Fed doesn’t set rates that consumers pay on auto loans, mortgages, credit cards or other consumer debts. Those interest rates can — and do — fluctuate daily due to a variety of factors.

© 2009 LendingTree, LLC. This story, "Federal Reserve says economy is leveling out," is reprinted by the author with written permission of LendingTree, LLC.

Economy up, interest rates down

Marcie Geffner -

All systems were go for borrowers this week as interest rates dropped again and the U.S. economy showed new signs of recovery.

The average interest rate on 30-year fixed-rate mortgages was just 5.0 percent during the week that ended Sept. 24, 2009, according to Freddie Mac's weekly survey. The average interest rate on 15-year fixed-rate mortgages was just 4.46 percent, the lowest since Freddie Mac began to track this rate in 1991, and the average interest rate on five-year hybrid adjustable-rate mortgages (ARMs) was even lower at just 4.51 percent.

“Mortgage rates held relatively steady at three-month lows this week,” said Freddie Mac Chief Economist Frank Nothaft.

Fed policies keep interest rates low
Meanwhile, the Federal Reserve reported that economic activity has picked up. In a Sept. 23 statement, the Fed said that financial markets have improved, home sales have increased, household spending seems to be stabilizing and businesses have continued to make progress toward aligning inventory levels with sales.

The Fed also said it will keep the benchmark federal funds rate at just zero to 0.25 percent and continue other policies that have helped to support mortgage lending and home sales.

"Economic conditions are likely to warrant exceptionally low levels of the federal funds rate for an extended period," the Fed said.

The Fed doesn't set rates borrowers pay for mortgages, auto loans or credit cards. But bank rates set by the Fed strongly influence the general direction of interest rates on those types of consumer loans. The Fed's current actions, policies and outlook mean borrowers could continue to see low interest rates for some time.

More new mortgages, more home sales
Low interest rates and better economic conditions have prompted a surge in applications to get new home loans, according to the Mortgage Bankers Association. Applications to refinance or to purchase a home with a government-insured mortgage were especially strong.

Home sales softened slightly in August, but only after four months of dramatic increases, according to the National Association of Realtors. If the pace so far this year continues, approximately 5.1 million homes will be sold.

Altogether, low interest rates, a stronger economy and strengthening home sales are good news for borrowers looking to buy a new home or refinance an existing mortgage.

© 2009 LendingTree, LLC. This story, "Economy up, interest rates down," is reprinted by the author with written permission of LendingTree, LLC.

Home appraisals: What you should know

By Marcie Geffner -

If you’re shopping for a loan to buy a home or refinance your mortgage, you may already know that a home appraisal is almost always required before a loan can close. But if you’re like many other borrowers, you might not know much about appraisals or why they’re so important.

Appraisals have been a hot topic in recent months due to new rules that have changed how lenders and mortgage brokers order appraisals for certain types of loans. The new rules are spelled out in the Home Valuation of Code of Conduct (HVCC), which became effective May 1, 2009.

What is an appraisal?
Technically, a real estate appraisal is an opinion of a property’s value prepared by a licensed real estate appraiser. Each property is unique, so appraisers rely on their expertise and information they’ve gathered about the neighborhood, the property and sales prices of other comparable properties.

Appraisals are supposed to be unbiased and free from the influence of anyone’s opinion of the home’s value. The new rules have placed greater restrictions on attempts to unduly influence appraisers.

Who pays for the appraisal?
Borrowers usually pay for a home appraisal upfront or during the loan application process since the appraisal must be completed before the lender will approve the loan. Under the new rules, borrowers who switch to a different lender during the loan process, as sometimes happens, may have to pay for another appraisal to satisfy the new lender. Even though the borrower pays the appraiser’s fee through the lender, the appraiser typically is independent and not an employee of the lender.

The main purpose of an appraisal is to help the lender assess the value of the property and decide whether to approve the loan. That’s why a new appraisal typically is required for a loan refinance as well as a home purchase.

Is an appraisal the same as a home inspection?
Another common misconception is that a home appraisal is the same as a home inspection. Appraisers do consider the condition of the home and may note any major problems, but their observations aren’t a substitute for a home inspection. Home buyers should always get an inspection of the home

© 2009 LendingTree, LLC. This story, "Home appraisals: What you should known" is reprinted by the author with written permission of LendingTree, LLC.

Buyers capitalize on home comps

By Marcie Geffner -

Home sellers typically rely on information about recent sales of nearby homes to figure out how much their own home might be worth. But home buyers also can use this data, commonly called "comparable sales" or "comps," to decide how much to offer for a home.

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