A few thoughts for President Obama

On Monday night October 6, I sat in on a radio economic round table (listen) hosted by WIBC's Steve Simpson with a number of individuals who are far more versed at the bigger picture than I am. Denny Smith, a co founder of the Mutual Fund Store in Indianapolis; Linda Conti, vice president of wealth management of David A. Noyes company, business writer John Ketzenberger of the Indianapolis Star, Dr. Catherine Bonser-Neal of IU's Kelley School of business and yours truly were voicing our opinions on all things economic on 93.1 WIBC, Indianapolis. From the inside I must say it was a fascinating discussion. The summary of it all which I hope our next president hears through the noise that he will be bombarded with is this:

Don't raise taxes.

Don't raise taxes anywhere on anyone at any time during your first term if you hope to have a second. I understand you feel that high earning individuals should pay more. This is not a philosophical plea. This is factual, empirical, statistical, uncomfortable.

Don't raise taxes.

We can argue all day long about why we're in the mess we're in but one of the opinions that came through loud and clear last night from this very wise group of people for whomever the next president is was:

Don't raise taxes or you may crush our economy.

Senator Obama many people liken you to another charismatic leader we once had, John Kennedy. President Kennedy made a historic speech to the New York economic club in 1962 that still resonates today. His major point was this:

"The final and best means of strengthening demand among consumers and business is to reduce the burden on private income and the deterrents to private initiative which are imposed by our present tax system — and this administration pledged itself last summer to an across-the-board, top-to-bottom cut in personal and corporate income taxes"

Please take a moment and read the entire text of one of the more prolific economic speeches ever delivered in our country. Senator Obama despite your desire to raise taxes as you've stated, we can only hope you will defer to the greater good of our populace and at the very least keep things where they are. There's going to be a LOT of pain over the next several months. Let's not add to it.

Questions? Comments? Donations? Greg@GregCooper.com or 317.848.GREG (4734)

Creating Legacies.....The Village of Byron

There are those rare opportunities in my business of real estate where I get to be a part of something truly special. The Village of Byron is one of those unique opportunities in my daily work that digresses from the normal challenges of excessive oversupply, sub prime mortgage messes, diminishing equity and the constant drip of bad news about housing from the national media.

Byron is a concept that is long overdue. It's a concept that combines incredibly affordable investment, quality family time to rejunivate relationships and the chance to be a part of a true legacy. In the early days of lakes Wawasee, Sweetwater and others in Indiana, few realized what they would become today. An enjoyable place to spend weekend time with those closest to us yet still not quite a complete concept in their own right. What thoughtful people are looking for today is a place for people to invest in their families, themselves and the future value of a concept that would yield incalcuable memories and long term benefits. The Village of Byron is becoming that type of location.
Byron is located about an hour west of Indianapolis on Lake Waveland in very close proximity to Turkey Run State Park. It's nestled on a beautiful stretch of rolling hills along a pristine waterfront. Byron's setting provides picturesque views that would no doubt have inspired James Whitcomb Riley's awe at the beauty of his home state.

When the likes of Wawasee and Sweetwater were created, there was little thought given to how the community would develop around them, how certain homes and lifestyles would blend with others and how each of these would affect the overall quality of life and value of property there. The Village of Byron successfully combines all of these elements into what will no doubt become a landmark Indiana community. Byron not only has the forethought of design to allow family and friends to interact and enjoy each other along and on the water, but also to create a community rich in design and quality craftsmanship.

From the soaring ceilings and abundant sunlight that streams in through the Sycamores to the quiet quality of construction that's found in every room, few other locations in the country let alone our state are offering what's found here. In every residence you may see gleaming wide plank hardwood floors, slate, tile and granite as well as wood work reminding one of the days when master craftsmen treated new homes as their personal work of art.

Wide interior expanses for group gatherings, wrap around porches to enjoy sunsets on the water and bunk houses and lofts that will help the next generation to begin building their frienships for years to come are all here.

As the Spring and Summer prepare to descend on Indiana, it would be well worth your time to take a casual drive to a place where we all can find endless warm days and magnificent workmanship and design. The Midwest's next great waterfront community is coming to life in Indiana and it truly is The Village of Byron. A printable map will help you find your way or you can just call or email me for directions at the contact points below. Here's to a great summer on a great stretch of property that's literally in our own backyards.

Greg@GregCooper.com or by phone at 317.848.GREG (4734)

Let's get green. Tis the season for shortish men with elf like grins. Yes, it's the season for celebrations of all things Irish. In Indianapolis most kids want to be Peyton Manning. Mine wants to be Michael Flatly. In March, that can be viewed as a noble goal given the month. Right now, yes we're thinking green but there is more than one reason to do that. The obvious is that in a few days we'll collectively come out of our cabin fever, pour a green adult beverage and watch our community celebrate St. Patty's Day. The eight year old in my house got a bit of a jump on it with his Irish dancing recital at the Warren Performing Arts Center. Hard to believe that in Indianapolis, home of the almost no significant cultural diversity (insert tounge in cheek here), there can be such an outstanding dance troupe, but there is. They won't be the only ones dancing or thinking green this month, however. Our good friend Federal Reserve Chairmam Bernake will be dancing a monetary jig as well, but with far more significant consequences. Chairmen Bernake will be guiding the Fed into another significant decsion on how far to lower interest rates again. There seems to be a common belief that it will be at least 50 basis points but some feel we could see a 3/4 point reduction. As sure as I stand here on my soap box had they been paying any attention last summer they could have avoided this. Since no one was listening, we're playing catch up on the rate front, no doubt with some painful national affect.

Bernake spoke recently about the current foreclosure problem. Battling a dangerous wave of home foreclosures,Bernanke called Tuesday (3/5) for additional relief and urged lenders to help distressed owners by lowering the amount of their loans. "This situation calls for a vigorous response," Bernanke said in a speech to a banking group meeting in Orlando, Fla. Even with some relief efforts under way by industry and government, foreclosures and late payments on home mortgages are likely to rise "for a while longer," Bernanke warned. Rising foreclosures threaten to worsen the problems in the housing market and for the national economy, which many fear is on the verge of a recession or in one already. Gee, do ya think?.

While the national issues remain top of mind, real estate remains a microeconomic, local issue. In Indianapolis that still means people are making incredible buys on property. Who has the courage to make those decisions now and who will regret not being a part of the value growth over the next several years remains to be seen. Meanwhile I'll be pouring myself a cold one in all of your honor and hoping for a better 2nd, 3rd and 4th quarters of 2008. Keep your shaleilee dry and your spirits up because friends, we're all going to need it.....

Contact....questions......donations:
Greg@gregcooper.com or 317-848-GREG (4734)

Paybacks are a .......................Necessity!

The 2007 upgrade cost versus return value numbers are out and they both reflect a strong indication of where good money is spent to increase the worth of your home and what type of immediate dollar amount they yield. As one may imagine, these vary in certain parts of the country. Specific exterior projects returned a higher recovery rate in the Pacific Northwest if they were based on eco friendly products but also because the northwest saw one of the best real estate overall value trends in the nation. While the South, Midwest and West saw decreases in overall value, the Pacific Northwest saw modest gains as did NY, NJ and Connecticut. The cost recuouped also varied by condition of the rest of the house, the value of similar homes nearby and the values in the overall community. Further, the value of return also differentiated on whether a cost was a replacement or an addition.

Nationally, most of the projects that saw the best dollar for dollar returns were exterior in nature with the exception being a minor kitchen remodel. Home office remodels, on the other end, have never returned more than 58% of their investment value in the decade plus of the survey information. On the positive side, wood deck additions recovered over 85% of their cost nationally and kitchen remodels actually returned nearly 88% of their investment.

To pinpoint the returns for the Midwest, we looked at Indiana, Illinois, Ohio, Wisconsin and Michigan. The best returns for projects were lower than the national numbers but were no doubt skewed by the decline in the overall market. In the midwest region minor kitchen remodels returned over 78% of cost immediatly while deck additions returned over 72% of their outlay. Master suite remodels returned 63% of their cost in the five state region.

In other remodels, the cost versus returns were as follows: attic to bedroom conversion - 71%; Basement remodel - 62%; Bathroom remodel - 52%. Addition returns in the midwest were as follows: Sunroom - 53%; 2nd story addition - 65%; extra garage bay addtion - 57%; full bath addtions - 59%.

One other significant factor of note....the upscale home return numbers were different in some cases based on the specific amenity. Decks, master suites and fiber cement siding replacement all returned 3-5% more per project than on the median priced homes.

While this discussion is always helpful in deciding what to spend money on in your home, we also remind our clients that the most important factor is 'quality of life' when determining how to allocate our financial resources on your real estate investments. If it makes you happy AND you intend to stay in your home for an addtional period, the return on monies spent is always more intangible in a positive way.

Questions? Comments? Greg@GregCooper.com or 317.848.GREG (4734)

SEEING THE BIGGER PICTURE.....For those of us involved in the Real Estate business, it's more than a trite metaphor. Just as this view from inside the new Lucas Oil Stadium in Indianapolis frames a distant image of downtown Indy, we must look far into the future to see the business in perspective as well.

There's little doubt that our country and more locally our region and city are being affected by challenges in the housing market. Excessive supply, marginal economic growth, subprime mortgage defaults and property taxes all are contributing to our current real estate stagnation. Unlike the early 1980's when the overriding factor was interest rates in the upper teens, this troublesome market has little to do with excessive mortgage numbers. There has been in a sense a perfect storm of issues in our local market across Indianapolis. All of the above factors have forced the housing market into a slowdown. The only real question now is when will we see the up side of the trough?

Again, unlike the early '80's, there are potential home buyers in the marketplace actively looking at real estate as an investment. The first time home buyer market has moved steadily forward in 2007 with sales in the 1st time purchaser market remaining relatively strong. For that prototypical initial home buyer, it's been a simple question of 'how much down and how much a month.' While a higher than normal supply and overall stagnation has slowed their decision process, they still have moved into the market and made acquisitions. They don't care about a quarter of point extra in interest from 18 months ago. In the historical sense, interest rates are still incredibly low. That fact is the reason first time buyers have continued to seek the American Dream.

The issues of property taxes, over supply and recent foreclosures have been an enormous burden on the resale market for both seller and buyer. Those individuals have a home to sell, seen their equity slip, watched other properties in their areas fall into foreclosure and overall values fall. Then consider the effect of slightly higher interest rates for those move up purchasers. If they must look at 1 1/2 times the the value of their current property in order to be motivated enough to move, the end result is much harder to reach. With higher rates, in many cases mortgagees could be facing double the monthly house payments to actually make a move to a better home. Simple economics dictate a much lower success rate for that equation.

So where is it all leading us? I recently had a prospective home buyer who had viewed dozens of properties tell me he was waiting for the market to hit bottom before he actually bought. As I shared with him, virutally NO ONE actually buys at the very bottom. Like the stock market, most who want to buy at the bottom in real estate usually end up doing so when the market has in fact turned and is on it's way up. That risk carries with it the potential that long term interest rates will have turned as well and are higher than they are as the market nears the bottom on it's way down. Much of where our current real estate market exists now is psychlogical and in fact has been hugely influenced by the media. The day is coming when some positive news eminates from the media regarding the real estate market. When that happens we'll see a mini stampede to buy property from the current pent up demand. It won't drive prices up 20% locally in a year like one of the coastal markets but it will result in unquestionable equity growth for those that purchase now in Indianapolis.

AS always.....contact me at 317.848.GREG (4734) or Greg@GregCooper.com

FALLING... The sales rate for previously owned single-family homes dropped to its lowest level in about 10 years, and the price of resale single-family homes, condos and co-ops dropped 4.2 percent year-over-year in September, the National Association of Realtors reported today. The trade group also reported that the for-sale inventory of single-family homes reached 10.2 months in September, which was the highest level since February 1988 when it was 10.3 months.

The inventory is a measure of how many months it would take to exhaust the for-sale supply of resale single-family homes at the current sales rate. Total housing inventory, for single-family homes, condos and co-ops reached 10.5 months in September, which is up 43.5 percent compared to a 7.3-month inventory in September 2006. The seasonally adjusted annual rate of existing single-family, condo and co-op sales dropped to 5.04 million in September, down 19.1 percent compared to September 2006 and down 4 percent compared to Wall Street expectations of a 5.25 million rate. The adjusted annual rate is a projection of a monthly sales total over a 12-month period, adjusted to account for seasonal fluctuations in sales activity. It was the lowest rate for combined resale single-family and condo/co-op sales since the National Association of Realtors began reporting the property types together in 1999. The September single-family rate of 4.38 million was the lowest since January 1998, when it was 4.18 million.

The median sales price of existing homes dropped 4.2 percent to $211,700 and the average sales price dropped 3.2 percent to $257,800 in September compared to the same month last year, the Realtor group reported. It was the largest year-over-year drop in the monthly median price since October 2006 when the median price fell 4.3 percent.

Mortgage-market problems disrupted sales and prices, the National Association of Realtors reported, though prices rose in the Northeast and Midwest.
Existing-home sales for the third quarter reached an annual rate of 5.42 million, slightly higher than the group's expectations of a 5.38 million annual rate for that quarter.

SO....what's it all mean? Many of us in the real estate industry have October 31 marked on our calenders for reasons other than Halloween. It's the day of the next Federal Reserve meeting and most likely the day we'll see another interest rate cut. The only issue now is whether it's 25 or 50 basis points (1/4 or 1/2 reduction in the prime). Since major economic recessions have routinely followed significant downward trends in the housing market, one could make a good case for a half point reduction. All eyes will be on the Fed Governor's meeting on 10/31. Whatever they decide will be a major factor in our country's economy in 2008.

Here's another thing it means: The pent up demand for homes is getting pushed closer and closer to the edge of action. There will come a day soon when moderating prices and falling rates will shove the indecisive buyer back into the market. Whether that's in the 1st quarter of '08 or beyond are still to be determined. When it happens, those that have bought real estate in the trough that we're in now will be very pleased by their decisions.

AS ALWAYS you can reach me at 317.848.GREG (4734)
or Greg@GregCooper.com

Does the media have ANYTHING good to say about Real Estate?

I was recently interviewed about Indianapolis Real Estate by CNN Money for a November publication date. In having many dealings with the media in the past I've learned that you must have your facts 100% straight and present them in a clear and concise way. In essence it's like a politician speaking to the press which frankly isn't much of a surprise anymore. Business has boiled down to politics in many cases anyway. The questions that were asked were inflamatory and certainly had a direction. "Why has Indianapolis' equity growth become so anemic?" "Isn't it a terrible time to buy real estate in Indianapolis?" "Doesn't being the most affordable major city in America for homes become a disadvantage at some point?" I must admit I had to laugh at that last one. Frankly since Jim Cramer went on his tirade about Indiana real estate on the Today Show a couple of weeks ago I was surprised I hadn't gotten these questions sooner.

Cramer is the loud mouthed media darling who blathers away every night on his 'Mad Money' show on CNBC. Cramer pontificates on everything from stocks to real estate in his holier than thou mode of making every minor financial detail a looming crash and burn. He's taken the trouble to appear twice on The Today Show with Matt Lauer and both times has been less than generous to Indiana real estate investors. Most recently he was on with the National Assocaition of Realtors president who calmly and politely recited statistics while Cramer rolled his eyes like a teenager being questioned about their 3000 text messages in a month. Cramer's job is to stir up, create controvers and exacorbate the obvious to develop television ratings. What he either fails to understand or could care less about (more likely) is that people's liveliehoods can rise and fall with the headlines he creates.

Look it's no secret what I do for a living so that being said I do have an opinion that does have some degree of bias. Post disclosure, here's what I believe to be true based on many, many outside observations of our real estate market in it's current state. It's what I said to the CNN Money reporters and numerous other media pundits over the last several months:

"Those individuals who purchase real estate in the Indianapolis market in the next several months will look back on it as one of the best financial decisions of their lives."

There are those who are more optimistic than I am and have offered those opinions freely. Moody's Financial has repeatedly listed Indianapolis as one of the top five cities poised for a huge financial rebound in it's housing market. At the top of their list:

1. Dallas-Fort Worth (through 1st Q 2009) - Growth rate: 6.4 percent

2. Indianapolis
Growth rate (through 1st Q 2009): 6.3 percent

"Indianapolis is riding a few trends that are bringing about an early recovery in its real estate market. While Indiana's capital city did join in the housing boom this decade, prices didn't reach the stratosphere. Indianapolis still suffered through the downturn, though: Building permits for new homes dropped 30 percent from their peak in 2005. But the housing market hit bottom earlier here than in most parts of the country - during the last quarter of 2006. Now, with the local economy poised to grow faster than the national average over the next two years, house prices are projected to post a respectable gain."

For those naysayers, and there are many, mark this time down. Let's have this talk again in 24 to 36 months. Let's have it again in 60 months. Time will indeed tell if hysterical television talk show hosts or sound economic decisions will rule the day in our real estate market.

QUESTIONS? COMMENTS?
greg@gregcooper.com
317.848.GREG (4734)

Art in the streets....
Scenes from the Carmel, Indiana International Arts Festival 9.22.07.

The festival started Saturday morning with a Chinese Dragon Dance and parade. Over 200 vendors exhibited and sold their art from paintings to sculpture. There were musical stages and great food served througout the weekend. This was the festival's 10th year and 2nd since moving back into Carmel's Arts and Design District.














Random thoughts for the week actually related to the real estate business....

The Interest Rate cut has NOT yet helped everyday mortgage rates to a significant degree. The short explanation is that there are far too many other factors pushing rates up right now for it to help. If inflation stays in check, look for another potential 1/4 point rate cut next month when the Fed meets again.

Indianapolis August Home Sales stats are in.....and it's not good news. The 11 county metropolitan area sales were down over 18% with Hamilton County getting hit the hardest with a 21% drop from a year ago. Prices have moderated and it is a great time for someone looking in the long term to make a tremendous purchase.

Nationally the numbers aren't as statistically bleak but still very disconcerting. New-homes sales tumbled in August to the lowest level in seven years, a stark sign that the credit crunch is aggravating an already painful housing slump. Sales of new homes dropped by 8.3 percent in August from July, the Commerce Department reported Thursday, driving down sales to a seasonally adjusted annual rate of 795,000 units. That was the lowest level since June 2000, when sales clocked in at a pace of 793,000.

Covering old ground but....IF YOU ARE A HOME SELLER you must ask yourself two critical questions:

1) Do I have the motivation to sell? Are you willing to moderate your price to meet the demand of the market?

2) Am I willing to recognize the equity I'll be building on my new home as a result of the slow market? Those moving up now should see great value growth in their new purchase as a result of buying in a challenged market.


As always you can email me with questions at GREG@GREGCOOPER.COM or call me @ 317-848-GREG (4734).

You just never know who you'll run into at the Starbucks in Carmel, Indiana.

As I walked across the parking lot to my car, I vaguely recognized the figure standing about 20 feet away. While he was slouched and shaking a bit from his illness, Muhammed Ali was as pleasant and approachable as any public person could be. Having no shame about interrupting his day, I walked up and introduced myself. He smiled and graciously agreed to a picture. His wife was inside getting coffee as they traveled from their home in Michigan to Lousiville on a family matter. We took several photos of which this is the only one that I actually look reasonable enough to post (scary thought). Muhammed playfully put his fist to my chin and smiled for the first one, then realizing I had the 'you've just met an international icon' stupid grin on my face, I retreated to a very basic side by side. As we did this a bus load of High School students stopped nearby and began to pile out. Several of the teen agers recongized him and came over as to visit. As he began the first of numerous new photo ops while being hugged by the cute 17 year old females, he looked at me and in a whisper said "Can't disappoint my fans." His huge grin told the rest of the story. I laughed out loud, thanked him again, and backed away. Even though his body is failing him...his mind is still there in full force.

Random thoughts actually pertaining to the real estate business......

1) Interest rates are coming down. Look for the Fed Chief Bernacke to lower rates at least a quarter discount point next week and maybe as much as a half to combat the national housing market problems. Between the rates falling and the lower demand/increasing inventory, there are great buys to be made in the housing market right now.

2) Two critical questions every home seller must ask themselves in order to successfully navigate the market. First do you NEED to sell? If you don't have the stomach the adjust your price to meet the sliding market, you should give serious thought to postponing your move. Having said that, if you're a move up buyer, the timing is still good. If your current home is worth 3% less than a year ago but you'll buy something else up the price ladder at a less value also, you will still be pleased with your decision over the long haul. That's what real estate is now....a long term investment. Flippers had best be following the CYA strategy in this market because it's tricky.

Secondly, as a seller do you have the equity to sell? If you bought a home a year ago with little down, you probably don't have the position to sell in this market. Reconsider your timing or the possibility of leasing the home if the risk is acceptable.

We have acutally had to decline certain potential homes to sell with people who wanted to list with us because they were simply not in a postion to recognize a sale in our current market. If someone bought two years ago at the peak of the market and has their home mortgaged above what they actually paid for it, we probably can't help them and yes, you cannot believe how often this occurs.

On that note, a recent title company survey on the closings they conducted across the USA in 2006 revealed some startling data. Of all of the closings, over 38% were done with ZERO money down by the purchasers. That means that most of those buyers were upside down in the equity in their homes from the day they closed. Is there any wonder why we have the delinquency rates we do right now relative to mortagages? Is it any surprise that lending criteria will get tighter as the next 12 to 18 months rolls by?

What you see is not always what you get. Online home shopping presents its own unique set of challenges.

It's so easy to shop online for just about anything these days. You can use Google, Froogle, Yahoo, or any of the shopping search engines to find everything from recliners to shoes, airlines tickets to t-shirts. More than 85 percent of home buyers start their search for a house online as well. The only problem is that things on the Internet are not always what they seem.

That's not such a big deal when it comes to a $60 pair of shoes. But it can be quite problematic when you're talking about a house priced at $350,000. Based on the e-mail I've received over the last couple of years, I've come up with a list of six mistakes home buyers make when shopping online for real estate, and the mortgage they need to pay for it:

Mistake #1: The house you see online is the house you get.If you saw a house advertised on television, you'd wonder exactly what you were buying for your money. But find a house online and that skepticism goes away. Some buyers feel confident enough to make an offer for a home they've seen only online.
What's that about? If I was writing the description for a property I was trying to sell, I'd make sure it sounded as fabulous as possible. The only point of writing that description would be to get a prospective buyer through the door. So when you see a photo of a house online that looks interesting make an appointment to see the property in person. That way, you'll know what you're buying is real.

Mistake #2: A beautiful photo, virtual tour or video means the house is in perfect condition.There are things you can see in a photo, virtual tour or video -- and then there's everything you can't see. Clearly visible is the décor. But the structural and overall physical condition of the property may not be as apparent. Don't assume that a fresh coat of paint is simply covering a dingier coat of paint. Instead, when you walk through the property, keep your eye out for red flags, such as water stains, bad smells, a freshly painted basement (which could be hiding mold or moisture stains), doors that don't shut, and cracks bigger than 1/8 inch wide.

Mistake #3: Assuming the neighborhood is as nice as the video tour.If a seller has created a video or taken a series of snapshots of the exterior of the home, it's possible you'll get a feel for what the neighborhood is like. Again, don't assume that what you're seeing is real. Savvy buyers will spend time walking the streets of a neighborhood, getting to know the housing stock, local store owners, recreational opportunities and schools. There's no substitute for using a little shoe leather.

Mistake #4: Believing that a fabulous Web site means you're dealing with reputable professionals (agent, title company, lawyer, home inspector, etc.).
It takes about $50 and a few hours to put up a fairly impressive-looking Web site. Maybe the company behind that Web site is reputable -- and maybe it isn't. But if you just go by the graphics and design of the Web site without checking to see who the folks are behind the beautiful pictures, you won't know who you're dealing with.
Whether you're looking for a real estate agent, title company, real estate attorney, home inspector or other player in the real estate industry, you should take the time to do your due diligence and find out everything you can about the individual and the company he or she works for. Real estate agents, brokers, attorneys and title agents are all licensed by the state. You can start with the agency or department that licenses these professionals in your state, and then use an Internet search engine to dig up more information, such as complaints or lawsuits that have been filed against the company or individual. Don't forget to pay a visit to the professional's office. You can tell a lot about someone depending on where they work, and how long they've been in business.

Mistake #5: Believing a written description of a property or neighborhood is accurate if you read the same thing in enough places.
It doesn't matter how many times you read the same description of a property, you won't know it's real until you've been there and seen it in person. Remember, just because an agent says the condo has a "lake view" doesn't mean you'll have a full water view. It might mean that if you stick your neck out the window and turn, you'll see a sliver of water.

Mistake #6: Believing the interest rate you'll get at the closing is the same that you've seen online.
One of the most popular mortgage scams is the "bait and switch," and it's even easier to get away with it on the Internet. Here's how it works: You'll see a great interest rate online and when you call to follow up, you'll be told either that the rate has expired (at which point the lender will try to sell you on a more expensive loan) or that you've qualified for it. If you've "qualified" for the rate, you'd better check your mortgage documents thoroughly at the closing to make sure the rate you thought you were offered is actually the rate that is on the papers you're signing. Once you sign the papers, it's a lot harder to get the lender to live up to his or her initial mortgage commitment. (Of course, you'll have a stronger case if you have that rate quote in writing.)

The hits just keep on coming. A tight market still means incredible opportunity in Indiana.....

While the foreclosure rate has edged up, what it really translates into is great values that will pay off significantly in years ahead.


From the Indianapolis Star August 21, 2007:

Manufacturing-related job losses are playing a big role fueling Indiana's foreclosure rate, which now ranks among the highest in the nation, experts say.

Indiana, Ohio and Michigan have all been hit hard by cutbacks and plant closings, and together the three states account for 20 percent of the nation's home foreclosures. Many of those workers affected were homeowners.
"If you have economic problems and little equity to fall back on, it all feeds on itself," Tom Dinwiddie, a spokesman for the Indiana Bankers Association, told The Times of Munster.
Peter Novak of the Greater Northwest Indiana Association of Realtors said the fallout of yearslong subprime lending is being felt both locally and nationally. Analysts estimate nearly 2 million adjustable rate mortgages will reset to higher rates nationwide in the next year or so.
Indiana has one of the highest homeownership rates -- about 75 percent -- but it also has the second-highest foreclosure inventory rate.
Novak said some home buyers think they will be able to afford a house through an adjustable rate mortgage, but when the rates increase some are unprepared for the larger bills.
"An adjustable rate is cheaper the first years so homeowners hope their personal outlook will be better in the future and unfortunately that's hardly true. Lots of time they're in the same situation and probably worse," he said.
Low rates of appreciation on real estate values coupled with affordable housing and high loan-to-value loan ratios also are major factors in Indiana's high foreclosure rate, Novak said.
Indiana ranked 44th in the most recent measure of one-year price growth by the Office of Federal Housing Enterprise Oversight. Hoosiers also use more down payment assistance programs, which reduce or eliminate cash down payments.
Home buyers need to be smart about what they can afford, Pamela Stalling, executive director of the Consumer Credit Counseling Service of Northwest Indiana.
"The reality is we need jobs to keep people in these homes," Stalling said. "And they need to be educated on making wise decisions about if they can afford it now or years down the line."