Tag Archives: Scottsdale Real Estate

9 Arizona cities among top places in U.S. to retire

Arizona as a whole is one of the 10 most tax-friendly states for retirees, according to Kiplinger.

Jack Stark (left), 73, and James Badami, 83, both of Sun City West, ride stationary bikes at the Palm Ridge Recreation Center. AARP projects that by 2040, the state will see a 300 percent increase in residents ages 85 or older, and these residents are healthier and like to stay active.(Photo: Tom Tingle/The Republic)

Jack Stark (left), 73, and James Badami, 83, both of Sun City West, ride stationary bikes at the Palm Ridge Recreation Center. AARP projects that by 2040, the state will see a 300 percent increase in residents ages 85 or older, and these residents are healthier and like to stay active.(Photo: Tom Tingle/The Republic)

As the number of retirees climbs nationwide, people beginning a new stage of life might want to consider living in the West Valley.

Long known for communities like Sun City and Sun City West, other parts of the West Valley are attracting attention as options for retirees. Peoria and Glendale recently were ranked in the top-50 best places to retire in the country, with Peoria coming in at No. 10.

The cities were among nine in Arizona on the list created by WalletHub, a financial-planning website for consumers and small-business owners. The 150 largest cities in the U.S. were analyzed and rated based on 25 retirement-related concerns, including housing affordability, recreational activities offered to seniors, quality of health care and other retirement issues.

According to the U.S. census, 15.4 percent of people living in Arizona are 65 years or older, a proportion slightly larger than the national average.

RELATED : Retirees can expect mild cost-of-living adjustment

Arizona as a whole is one of the 10 most tax-friendly states for retirees, according to Kiplinger, a Washington, D.C.-based business and finance-advice publication. Social Security retirement benefits received under Title II of the Social Security Act are exempt from taxable income, there are no state property taxes or inheritance taxes and personal income taxes are low compared with other states.

Additionally, annual rainfall and the high number of sunny days appeals to many from places pestered by gloomy winter weather.

John Sefton, Peoria’s community services director, said retirees in Peoria find a wide selection of activities targeted to them.

“We’ve done a good job at providing a diverse array of accessible programs,” he said. “It’s also about giving back to the community. Retirees are looking for that.”

Programs include Silver Sneakers, which encourages seniors to stay active.

Additionally, Sefton said the city’s recreational amenities reflect a changing retirement community.

“We know our retirees are younger and healthier than ever before,” he said. “They’ve got a great quality of life because of our health focus.”

Sefton said the Peoria Sports Complex and the city’s 10 miles of paved trails are popular among active retirees.

AARP projects that by 2040, the state will see a 300 percent increase in residents ages 85 or older. The group also found seniors in Arizona have lower rates of high blood pressure, obesity, smoking and diabetes than the nation’s average rates.

Whole communities already cater to retirees and other active adults. Sun City West near Peoria houses 30,000 residents. It has four recreational centers, seven golf courses and a 30-lane bowling alley. Local grocery stores, banks and restaurants also are clustered throughout the community.

Robbie Combes, 69, has lived in Sun City West for seven years. She moved from Florida and works as the community’s visitor center coordinator. Despite Florida’s reputation as a destination for retirees, Combes visited Sun City West and chose to move to Arizona.

“I needed a change,” Combes said. “It’s so friendly and you can do anything. I don’t even have to go outside the community if I don’t want to.”

Sun City West has more than 100 clubs with a range of interests. There’s an automotive restoration club, bocce club and a club for line dancing among others. Combes said she focuses her interests on bocce ball, tennis and volunteering at the library.

“It’s very comfortable, convenient and safe,” she said. “And, you can’t beat the weather.”

Dorothy Rucker, 81, has lived in Sun City West for 20 years and volunteers at the front office. She said she initially had no interest in living in the community, but eventually changed her mind.

“I thought only old people lived there,” she said. “I didn’t think I was one of those! But I’m thrilled and wouldn’t want to be anywhere else.”

She said she enjoys community theater productions well as various charity events.

“Some of our residents are very talented,” Rucker said. “People are very active in helping other people.”

The rankings

Wallethub.com ranks the best places to retire:

1. Tampa, Fla.

2. Grand Prairie, Texas.

3. Orlando, Fla.

4. St. Petersburg, Fla.

5. Scottsdale.

6. Overland Park, Kan.

7. Port St. Lucie, Fla.

8. Cape Coral, Fla.

9. Plano, Texas.

10. Peoria

Others in Arizona

18. Tempe.

21. Mesa.

24. Tucson.

26. Gilbert.

31. Chandler.

36. Glendale.

48. Phoenix.

Article Courtesy of AZCentral.com

3 Industry Trends to Watch This Fall

webhead_Boulders_smlThe housing market is expected to heat up this fall, despite buyers showing greater signs of being conservative in their home purchases.

Bankrate.com recently highlighted some of the following trends to watch this fall in the nation’s real estate market:

1. An overall pick up in housing activity. Low inventories of homes for sale in many markets have been blamed for cooling the summer months more than expected. However, more inventories are hitting U.S. markets, which could unleash some pent-up demand among buyers.

At the end of August, housing inventory was at 2.31 million existing homes available for sale, which represents a 5.5-month supply of homes, according to the National Association of REALTORS®. That’s 4.5 percent higher than a year ago.

When buyers have greater options in their home shopping, they may be more likely to finally jump off the sidelines, says Jonathan Corr, president and chief operating officer for Ellie Mae. “The housing market is going to be a function of the economy,” Corr says. “I think we are going to see steady growth in the coming months.”

2. Buyers are more cautious. In what most housing experts describe as a “seller’s market,” buyers are showing signs of getting more conservative with their spending, Pava Leyrer, director of training for Northern Mortgage Services in Grandville, Mich., told Bankrate.com. “They are sticking to their budgets,” she says.

The past housing crisis has prompted buyers – particularly the younger generation — to be more cautious, as they’ve learned that home prices don’t always appreciate. The younger generation views a house as a place to live and not the great investment that their parents once considered, says Daren Blomquist, vice president at RealtyTrac. Forty percent of the millennial generation believe buying a home is a safe investment with great potential, compared to about 50 percent of boomers, according to a survey by Fannie Mae National Housing Survey.

3. Mortgage rates will climb – really. Housing experts warned that mortgage rates would rise this year, but those forecasts have largely been wrong to this point. However, the Mortgage Bankers Association expects the 30-year fixed-rate mortgage to start its climb to 4.5 percent by the fourth quarter, and continue to gradually climb and reach 5 percent by mid-2015. That’s prompted some lenders and real estate professionals to urge their buyers to lock in a mortgage rate now, while they are still at yearly lows.

Article Courtesy of REALTOR® Magazine.

The Best Ways to Buy Your First Scottsdale Home

Scottsdale real estateBut all of the choices and decisions you have to make can be overwhelming. Determining location, selecting the size and style of your Scottsdale home, figuring out how to obtain financing, and deciding what features to look for are just some of the tasks to tackle when buying your first home. Here are some tips to simplify the process and make it easier on you.

Determine How Much You Can Afford

Before you start looking for a Scottsdale home, determine how much house you can afford to buy and get pre-approved for a loan. You don’t want to spend countless hours and even days or months looking at Scottsdale homes for sale in a price range that you can’t realistically afford. It’s best to determine at the outset how much house you can afford and how much of a down payment you will need to pay so that you can save time and get the best deal possible. Armed with this knowledge, you will know what kinds of houses you can look at and in what locations. If you need to come up with more of a down payment than you had originally estimated, knowing that upfront will give you extra time to save while looking for houses in your price range. Ask your real estate agent or broker for a referral to a lending institution or mortgage broker to get this process started.

Having a preapproval letter in hand is a must and will help any offers you make on a home go straight to the top of the list. If you have to wait to get a preapproval letter before you can make an offer, you may miss out on the Scottsdale home of your dreams, especially in a hot market. If you submit a preapproval letter with your offer, you won’t miss out on any opportunities.

Think of your current needs and anticipate your needs five and ten years down the road

inspirational leadership

For many first time homebuyers, this means you should think about what your needs will be when you add a child to your family. A two-bedroom home may suit you and your spouse now, but three years from now, a two-bedroom home may seem cramped and unlivable. Add more than one child, and even a three bedroom home can feel tight. A more urbane setting is just right for you and your spouse now, but when you have a child you might be more interested in having a yard and living in a great school district.

Also, consider the possibility that one or more of your parents may come to live with you in their elder years. For them, a separate living space within your home would be ideal. To accommodate that situation, you will want a bedroom on the first floor or that is easily accessible for someone with disabilities or who has a hard time getting up and down stairs.

Think About Resale Potential

Most people only live in their first Scottsdale home for five to seven years before selling and moving on. When choosing your first home, think of what would be appealing to other buyers five to seven years from now. A big playscape may be appealing to you for your children, but they will quickly outgrow it and it may be a potential roadblock for you selling your home in the future. Other buyers see that play structure as a huge eyesore that needs to be removed.

Don’t Expect Perfection

List the things your Scottsdale house must have (e.g. three bedrooms) and the things that it would be nice to have, but that aren’t necessities (pool). Chances are with your first home; you won’t be able to get everything you want at a price you can afford. Make sure your needs and wants for your first home are aligned with those of your spouse. If you both have realistic goals for buying your first home, it will be a satisfying and enjoyable experience rather than a stressful one.

~ Alice Seger Proski ~

 

 

Scottsdale Real Estate – Living Solo in Scottsdale

More and more people are choosing to live solo or find themselves living alone because of life circumstances, like divorce or death. The number of young people choosing to live alone is ever increasing and the demand for housing for singletons is on the rise. In addition, more and more seniors are living independently longer than ever before.

When considering Scottsdale real estate, even if you live by yourself, you will never feel alone, because every day the city offers something new for its residents and visitors to experience. Located adjacent to Phoenix, Scottsdale is a city filled with enough adventures to last a lifetime.

Beautiful Scottsdale Golf

Golf

Scottsdale is home to some of the best golf courses in the country. With the numerous Scottsdale golf clubs and courses in the area, you will have no trouble finding a league (or more than one league) to join to keep your golf game top notch and to meet other golf lovers. Indeed, a golf lover could spend every single day of the week golfing in Scottsdale and never get bored with the courses.

Nature & Physical Activities

In addition, the desert near Scottsdale is ripe for exploring. For people who love to hike and immerse themselves in nature, Scottsdale is the place to be. You will find countless parks and preserves to explore on your own, with your dog, or as part of a guided tour. There’s also horseback riding and river rafting for the more adventurous nature lovers. If you’d rather exercise in an indoor setting, there are numerous gyms and clubs to join in the Scottsdale area so that you can maintain your physical fitness and meet new people.

Spas, Shopping, Art, & Food

TheSanctuarySpaSanctuaryCamelbackMountain_PhoenizScottsdaleArizona_Spa_Style_creditTheSanctuarySpaSanctuaryCamelbackMountainThe spas in Scottsdale are world-class and will ease your stress and make you feel relaxed and rejuvenated. In addition, the Downtown Scottsdale and Old Town Scottsdale areas have enough events, shops, and food offerings to allow you to explore and see new things every day. The Scottsdale Arts District has over 100 galleries and on Thursday nights host ArtWalk for people to experience art as they stroll the streets. Foodies will love the variety of restaurants and food offerings in Scottsdale.

People

People from all walks of life make their way to Scottsdale for the amazing culture, weather, and smorgasbord of things to do. No matter where you are from, you can find someone else from your home state or country in living in Scottsdale. In addition, Scottsdale is close to major airports and is easily accessible, which is especially great when you have family members who want to visit you or for when you want to check in with family living elsewhere. A quick cab ride to the airport and you’re off.

The Scottsdale real estate market has a lot to offer people living solo, from stand-alone traditional residential homes to condominiums. Many condominium communities in Scottsdale are extremely friendly and their residents make each other feel like members of the same family rather than just a neighbor. In addition, condominium living comes with the perks of not having to maintain a yard or deal with exterior home issues. When you’re living solo, you deserve ease of living and the Scottsdale real estate market has excellent options to serve you.

~ Alice Seger Proski ~

 

 

Why is it still hard to get a Scottsdale home loan?

Scottsdale Home LoansIt’s been six years since the stock market crash of 2008. Since then the economy in the U.S. slowly has been improving. Jobs are coming back. Locally, Scottsdale real estate prices are on the rise. So why is it still hard to get a Scottsdale home loan?

In an attempt to prevent what happened leading up to the financial crisis in 2008, new regulations and policies were put into place regarding financing to purchase property and homes. Lenders today want more than your W-2’s and a tax return. You may be asked to provide voluminous amounts of financial information to get a loan. This is especially so if you are self-employed or own a business. Securing all of this information can drag out the Scottsdale home loan process and cause people who, ten years ago, would have been able to obtain financing without a problem, to be declined for a home loan.

What you can do when you run into financing problems:

  • First, to increase the chance you will be provided a Scottsdale real estate loan from a lending institution, get your paperwork in order. Ask in advance of the loan application process what documentation your lending institution will need to process a loan application and provide financing. Gather all of that information before you apply for a loan and it will make the process much quicker. You might also learn in this process that you may have to wait a while before you will qualify for traditional financing. If you haven’t been at your job for very long or if you just started a business, you may need to wait one or more years before you will qualify.
  • Pay as much in cash as possible. If you make as big of a down payment as possible, you won’t need to borrow as much. That way you won’t have to meet the requirements necessary to borrow more money.
  • Get creative about how you go about financing. If you have chosen a home you want to purchase, offer to pay for the Scottsdale home through seller financing. If the seller doesn’t need all of the cash up front for the purchase of the home, you can pay them for the house on time. Generally, seller financing is beneficial to both parties to such a transaction. The seller receives interest payments from the buyer on the sale of the home, which are usually higher than they could receive if they had the asset in a savings, money market, mutual funds, or other investment account. It is beneficial for the buyers because they don’t have to meet the strict requirements of lending institutions in order to finance the purchase of a home.
  • In this same vein, as a buyer, you could also borrow part or the entire purchase price from a friend or family member. The person or people you borrow from will make more money in interest than they would if that money was in a traditional savings or investment account, usually upwards of 5%.
  • Another alternative is to have someone else with a very good credit history and financial backing, co-sign for the loan. Typically, this would be a parent or other close family member who trusts that you will make the installment payments to the lender in a timely manner. When someone co-signs for a loan, they are making themselves 100% liable for repayment of the money. That’s a big request to make of someone, but if they want to see you get into a home and start moving forward, they may be willing to help you out.

~ Alice Seger Proski ~

Scottsdale Home Renovations for Maximum ROI

Scottsdale HomeIf you are thinking about making some improvements or renovations to your Scottsdale home, it makes sense to tackle the projects that will give you the most bang for your buck. By investing in certain renovations now, when you sell your home or want to obtain financing, you can get a great return on your investment.

To get the maximum ROI for your home renovations in the Scottsdale real estate market, focus on these projects.

Windows

scottsdale homes, beautiful windowsReplacing windows can be a relatively low-maintenance Scottsdale home improvement project to take on. With the right contractor, it’s a quick project that can pack a lot of punch. How do windows give you a return on your investment? First, if you replace old windows with energy efficient ones, you will save money on your energy expenses to heat and cool your Scottsdale home. In addition, depending on the applicable tax provisions in place when you do the replacement, you may be eligible for a tax break for replacing windows. Lastly, new windows give a home an instant facelift and add to its curb appeal, which can help you sell it faster and for a higher price.

Beautiful Scottsdale Home Bathroom

Bathrooms

Remodeling a dated bathroom can quickly increase the value of your Scottsdale home. Updating a bathroom can be done relatively inexpensively because you can do some of the work yourself, like painting and adding light fixtures. Use quality materials in spa-like colors, such as beige, olive, and slate, and your bathroom will impress appraisers and potential buyers, alike. Bathrooms are often of the first rooms that people look to redo when they purchase a home, and if you make your home turnkey for a potential buyer, you can demand top dollar for your house.

Scottsdale House Interior

Kitchen

For many families, the kitchen is the busiest room in their Scottsdale house and it’s where they spend the most time. For that reason, it’s often the first thing potential buyers want to see when checking out a home. Remodeling an entire kitchen is a big task, but by doing so you should see a return on your money, plus some, when you sell your home. If you are looking to refinance, improving your kitchen can increase your home’s appraised value. Be sure to choose quality materials and hire professionals to do the job right. Buy the best appliances you can afford. Keep in mind that a kitchen is not a place to cut corners if you want a great return on your investment.

Decks & Patios

BYOB from Zen to ZanyAdding a deck, patio, or great outdoor space can increase the value of your Scottsdale real estate property for a relatively low cost. An inviting deck or patio creates extra living space and adds a room for entertaining and relaxing. You can go basic by using wood materials or go more high-end with synthetic wood materials, or have a stamped or pressed concrete patio installed. Even a basic wood deck done in an elegant way impacts the value of your home in a big way with only a small monetary investment. If you’re handy, this is a project you can tackle yourself. Potential buyers will be drawn to the extra space a great outdoor living area provides and will be willing to shell out extra cash for that added bonus.

Nationwide adds small parcel to its big Gilbert development

Columbus, Ohio-based Nationwide Realty Investors wants to develop as much as 3 million square feet of office space and 500,000 square feet of retail space and hotels.

Gilbert DevelopmentThe acquisition of the ExxonMobil land at the corner of Pecos and Gilbert roads adds to the 250 acres slated for the Rivulon development. Maricopa County Assessor’s Office documents show ExxonMobil claimed the parcel to Nationwide for $10. The oil giant previously sold some other land at the development, according to the Vizzda.com real estate information service. The project is off Loop 202 in the East Valley.

Wellness company Isagenix International LLC is slated to occupy a three-story, 150,000-square-foot office building. A 125,000-square-foot speculative office building is also slated for construction, along with an LA Fitness building.

Speculative office building and large-scale developments are not a common sight in the post-meltdown commercial real estate market. Nationwide Realty is an arm of Nationwide Insurance. It is also the developer of the Gainey Ranch Corporate Center in Scottsdale.

Article Courtesy of Biz Journals

Market Report for Scottsdale Real Estate

Price Increases Continue to Slow

Meanwhile, closed sales, pending sales and active listings have all decreased for the past four months.

Historically, closed sales have dropped in July from June since 2009. This July, though, saw the fewest number of sales in July since July 2008.

8-26-14 The_Scottsdale_Phoenix_Real_Estate_Market_Trends_Report_-_2014-08-26_12.19.06

July Market Statistics

Year-Over-Year

  • Median home prices increased by 4.8% year-over-year to $220,000 from $210,000.
  • The average home sales price rose by 3.7% year-over-year to $276,727 from $266,814.
  • Home sales fell by 15.5% year-over-year to 5,253 from 6,213.
  • Total inventory* rose 15.4% year-over-year to 23,667 from 20,512.
  • Sales price vs. list price ratio fell by 1.2% year-over-year to 97.8% from 98.9%.
  • The average days on market rose by 43.4% year-over-year to 60 from 42.

Compared To Last Month

  • Median home prices improved by 1.0% to $220,000 from $217,750.
  • The average home sales price fell by 1.8% to $276,727 from $281,820.
  • Home sales down by 6.4% to 5,253 from 5,610.
  • Total inventory* dropped 4% to 23,667 from 24,645.
  • Sales price vs. list price ratio dropped by 0.1% to 97.8% from 97.9%.
  • The average days on market increased by 4.6% to 60 from 58.

Condominiums

Year-Over-Year

  • Median condo prices increased by 4.2% year-over-year to $125,000 from $120,000.
  • The average condo sales price dropped by 0.1% year-over-year to $151,405 from $151,486.
  • Condo sales fell by 9.1% year-over-year to 740 from 814.
  • Total inventory* rose 7.9% year-over-year to 3,696 from 3,424.
  • Sales price vs. list price ratio fell by 0.9% year-over-year to 96.6% from 97.5%.
  • The average days on market rose by 15.5% year-over-year to 68 from 59.

Compared To Last Month

  • Median condo prices slipped by 0.0% to $125,000 from $125,000.
  • The average condo sales price fell by 6.9% to $151,405 from $162,683.
  • Condo sales down by 8.5% to 740 from 809.
  • Total inventory* dropped 3.8% to 3,696 from 3,841.
  • Sales price vs. list price ratio dropped by 0.0% to 96.6% from 96.6%.
  • The average days on market increased by 7.3% to 68 from 63.

* Total inventory includes active and pending listings.

Mortgage Rate Outlook

Credit Conditions Easing, For Some

August 8, 2014 — HSH.com’s broad-market mortgage tracker — our weekly Fixed-Rate Mortgage Indicator (FRMI) — found that the overall average rate for 30-year fixed-rate mortgages increased by a single basis points (0.01%) back to 4.23. The FRMI’s 15-year companion remained unchanged for the week, holding steady at an average rate of 3.47%. Popular FHA-backed 30-year FRMs saw a one basis point decline, slipping back to 3.93%, as these fully-insured offerings continue to beat conforming 30-year FRMs by almost a quarter percentage point. Finally, the overall 5/1 Hybrid ARM eased by two basis points, closing HSH’s survey week at 3.12%, a value achieved in three of the last five weeks.

According to the Federal Reserve’s survey of Senior Loan Officers, it is becoming somewhat easier to get a mortgage loan. In the Fed’s latest survey, about a quarter of respondents reported that their institution had loosened underwriting standards for “prime” mortgages, defined as those with FICOs above 740 and meeting typical down payment and documentation requirements. This was a marked upswing from previous quarters.

It’s a fair bet that this change is more a signal of slack business than of altruism by lenders, since the fall off in refinance activity last year left only a slow housing market to serve this year. In order to keep business flowing, some lenders (mostly large banks) have begun to remove the additional “overlays” for credit score minimums, down payments and other items added onto upstream requirements from upstream guarantors or purchasers of loans. Having been increased in recent years, these basic underlying standards for conforming and FHA loans remain unchanged, so for many borrowers the loosening is arguably a marginal one.

However, for loans directly originated for their books, banks have great leeway as to those terms and conditions. Since much of this portfolio activity is in the form of jumbo mortgages and certain other product, like ARMs, it’s likely that this is where the greatest amount of loosening is happening. These loans may still feature some stiff restrictions, but it still counts as “loosening” if a lender only requires a 20% down payment rather than 25% for a $800,000 loan, or will write that loan at a 750 FICO instead of 760.

Foreclosure Statistics

Notices of sale, which set the date and time of an auction, and serve as the homeowner’s final notice before sale, in Maricopa County rose 6.6% in June from May. They were down 36.4% year-over-year.

After the filing of a Notice of Trustee Sale, there are three possible outcomes. First, the sale can be cancelled for reasons that include a successful loan modification or short sale, a filing error, or a legal requirement to re-file the notice after extended postponements.

Alternatively, if the property is taken to sale, the bank will place the opening bid. If a third party, typically an investor, bids more than the bank’s opening bid, the property will be sold to the third party; if not, it will go back to the bank.

Cancellations were down 11.8% month-over-month, and they were down 55.7% year-over-year. There were 576 cancellations in June.

Properties going back to the bank rose 1.8% from May. Year-over-year, they were down 34.2%. There were 277 properties that went back to the bank in June.

The total number of properties scheduled for sale fell 0.9% from May, and they were down 46.8% year-over-year.

The total number of properties owned by banks was down 3.8% month over month, and they were down 13.3% year-over-year to about 4,607.

For further details and a city-by-city breakdown of foreclosure statistics, go to: http://www.propertyradar.com/trends/arizona/maricopa.

Maricopa County Stats At A Glance

Year-Over-Year

  • Median home prices increased by 4.8% year-over-year to $220,000 from $210,000.
  • The average home sales price rose by 3.7% year-over-year to $276,727 from $266,814.
  • Home sales fell by 15.5% year-over-year to 5,253 from 6,213.
  • Active listings rose 15.4% year-over-year to 23,667 from 20,512.
  • Sales price vs. list price ratio fell by 1.2% year-over-year to 97.8% from 98.9%.
  • The average days on market rose by 43.4% year-over-year to 60 from 42.

Compared To Last Month

  • Median home prices improved by 1.0% to $220,000 from $217,750.
  • The average home sales price fell by 1.8% to $276,727 from $281,820.
  • Home sales Down by 6.4% to 5,253 from 5,610.
  • Active listings dropped 4% to 23,667 from 24,645.
  • Sales price vs. list price ratio dropped by 0.1% to 97.8% from 97.9%.
  • The average days on market increased by 4.6% to 60 from 58.

FICO Scoring Changes May Help More Qualify for Mortgages

FICO

 

FICO recently told lenders their high credit score “cutoffs” were stricter than necessary, and urged lenders to consider lowering minimum score requirements.

 

The changes include reducing the toll that overdue medical bills can take on credit scores, as well as removing other past penalties from consumers who have paid off debts that had been assigned to collection agencies. A consumer whose only major delinquency comes from an unpaid medical bill could see their credit score rise by 25 points due to the changes.

The changes come after a recent Consumer Financial Protection Bureau study, which found that both paid and unpaid medical debts were unfairly penalizing consumers’ credit ratings. An estimated 64 million Americans have a medical collection item on their credit reports, according to Nick Clements of Magnify Money, a personal finance site.

The FICO changes will go into effect this fall, but borrowers may have to wait a year or more until they see the impact of the changes in their scores, lenders say.

The changes may help consumers with blemished past credit histories or high medical debts qualify for mortgages more easily. Consumers with higher scores also might qualify for a lower rate, housing experts say.

“In recent years the [credit score requirement] has been dialed so tightly that only fairly upper-tier consumers were able to qualify for a loan,” says Lawrence Yun, National Association of REALTORS®’ chief economist. “We’re looking at people who are currently being denied potentially being offered a mortgage because of this.”

In June, the average FICO score for a closed mortgage was 728, a drop from 742 a year prior, according to data from Ellie Mae, a company that processes mortgage applications for lenders. FICO scores range from 300 to 850.

Borrowers with higher FICO scores can usually expect to pay less in interest on a loan. A borrower with a FICO score of 675 may nab a 4.75 percent interest rate on a 30-year fixed-rate mortgage, which would be about $2,086 a month in payments on a $400,000 loan, according to Informa Research Services. In comparison, a borrower with a 700 FICO score may qualify for a rate of 4.212 percent, which could drop the monthly payment to $1,959 and bring a $127 savings.

The credit scoring changes will not remove any unpaid debts from a credit report, so some lenders may still be able to factor that information into their lending decision.

“This move will ultimately make a real difference in the lives of millions of Americans, who have been shut out of the housing market or forced to pay higher mortgage interest rates because of flawed credit scores,” Steve Brown, NAR’s president, said in a statement. “Since the housing crash, overly restrictive lending has been the greatest obstacle to home ownership. NAR will continue to support efforts to broaden access to credit for qualified homebuyers.”

In other news, two of the big national credit bureaus Experian and TransUnion recently reported they’ve added verified rental payment data into credit files, which will be used to compute a consumers’ score when applying for a mortgage. A recent TransUnion study showed that the inclusion of rental data could raise some consumers’ scores. For example, nearly 20 percent of renters’ scores rose by 10 points or more after just one month.

Source: “New FICO Criteria Could Help Borrowers,” Los Angeles Times (Aug. 8. 2014) and “Experian, TransUnion Start Adding Rent Payment Data to Credit Profiles,” Los Angeles Times (Aug. 10, 2014)

Destination Hotels acquires contract for Scottsdale Resort and Conference Center

scottsdaleresort1 600xx1500-1000-0-0

 

The Colorado-based hotel management company announced Friday that it has acquired the contract to operate the 326-room Scottsdale resort. It features a spa, is surrounded by two golf courses and offers more than 80,000 square feet of meeting space.

It is the third Phoenix-area property among the more than 40 hotels and resorts in the Destination portfolio, joining the Tempe Mission Palms and the Royal Palms Resort and Spa.

Destination officials promptly announced plans as well to undertake a series of renovations to the property, including development of a lobby bar and restaurant, revival of the resort’s existing restaurant and revitalization of its pools and amenities.

“We are thrilled to expand our distinctive collection further in the Phoenix market,” said Jamie Sabatier, Destination president and COO.

Article courtesy of Biz Journals