Fannie Mae eliminates "declining market" downpayment.

Starting June 1, mortgage applicants who are underwritten by Fannie Mae's automated system online will qualify for 3% minimum down payments, wherever the property is located.

Borrowers whose applications require "manual" underwriting will pay 5% minimum down payments.

Under Fannie Mae's prior system, applicants buying in designated declining markets had to contribute 5% extra in upfront equity compared with borrowers in nondeclining market areas.

Freddie Mac's policy, which never employed a list of areas designated as declining, relied instead on lenders to flag applications using appraisal data or home price indexes. Freddie's policy also required 5% higher equity contributions upfront.

Critics, including the National Association of Realtors and consumer advocacy groups, had charged that Fannie Mae's policy served to further depress sales and real estate values in areas tainted as declining.

They also argued that many metropolitan markets experiencing price decreases contain sub-markets performing relatively well, and they do not deserve to be underwritten as high risk.

Fannie Mae's and Freddie Mac's policy switches should open the door to some additional low-down-payment mortgages -- and home sales -- in local areas once tagged as declining.

However, without the participation of private mortgage insurers, who report solely to stock market investors rather than to Congress, many borrowers will likely have to turn to the Federal Housing Administration, which accepts 3% down, does not have declining markets restrictions and whose loans can be purchased by Fannie Mae and Freddie Mac.

Source: Washington Post c/o NAR

Tips for Painting the Exterior of Your House

A great exterior paint job should make passersby think, “What a lovely home.” But if you get it wrong, people who drive by will wonder, “What were they thinking?”

If you are are considering a fresh coat of paint on the outside of your home, you may want to take some advice from color consultant Paul Helmer. He offers these suggestions for painting various parts of the home:
• The roof. Think of the roof as one noticeable piece of color. The steeper the pitch, the more noticeable the roof is. If the roof is a light-colored composite, don’t choose a dark color for the house or it will look like the roof is trying to fly away. Use a color wheel to find pleasing shades.
• Exterior stone, brick or metal. Orange-tinted bricks look better with warm tones. Rose-tinted bricks are enhanced by cool tones. Repeat shutters or trim colors whenever possible.
• Vinyl windows or siding. Don’t paint the windows white and the house a deep color, otherwise, your house will look like a whitewall tire.
• Landscape artfully. Don’t plant shrubbery that looks ghastly against your house. For instance Burgundy-leaved shrubs clash with a yellowish-green house.
• Respect the neighbors. Don’t paint your home a color that either matches or clashes with the house next door.