I just read a great article by nationally recognized financial guru Dave Ramsey. In the article, appropriately titled, “Don’t Foreclose on Your Future,” Dave gives three sound reasons why walking away from your mortgage just isn’t a good idea. The three reasons are:

Reality #1 – Your home is an investment, and any investment—even real estate—will go up and down in value. Walking away from your mortgage now is the equivalent of selling your stock portfolio at the bottom of the market. You guarantee yourself a loss if you don’t stick with your investment until values come back up.

Reality #2 – Home values will recover. If our homeowner sticks it out and stays in his home, he’ll be back to even in five years, based on a conservative 5% rate of appreciation. In less than 20 years, his home will have doubled in value. That is wisdom!

Reality #3 – The bank is not letting you off that easily. Lenders are covered up with foreclosures, so while homeowners who walk may not hear from the bank right away, they are by no means off the hook. Some banks will pull credit reports to see who is current on their other payments to determine if a default is “strategic.” Banks will go to court to garnish wages or hijack tax refunds—whatever it takes to get what they’re owed.

You can view the whole article on Dave’s website. Dave Ramsey is a bestselling author and radio host. I have been a huge fan of his Financial Peace University program, and strongly recommend it to everyone.

There are alternatives to foreclosure. A loan modification or short sale could be possible options for you. Your local real estate professional can help you with these options. Don’t be afraid to contact your lender, either. By staying in touch with your lender, you’ll find many more options available to you.

Don’t just walk away, though. As Dave points out in Reality #3, banks can, and eventually will come after the money they lost.

Don't walk away and let your home go into foreclosure

New RESPA regulations now require additional “cooling off” periods when the HUD Settlement Statement is changed. While the intent of the changes is to protect the consumer, the changes are causing delays in the time it takes to move a home sale from the time the offer is accepted until the time the closing of escrow occurs.

The majority of the burden of these new changes falls into the laps of Mortgage Companies and banks. Starting at the time of loan application, the mortgagee (bank) provides the buyer with a Good Faith Estimate. From the time the buyer receives the GFE, the buyer has ten days to review the GFE and decide whether or not to move forward. OK, great idea, no problem.

If the costs in the settlement statement change, for any reason, the borrower must be informed in writing, and there will then be an additional “cooling off” period. If the written changes are presented face-to-face between the borrower and the buyer, then the waiting period is THREE days. If the presentation of changes is done by fax, email, mail, etc, then the wait is SEVEN days. This is for every time something changes on the HUD.

So how is this different? Lenders have always advised the borrower of when there were changes. The borrower would look at the changes, decide whether to accept them or not, and move forward. Now, because of these new RESPA changes, the borrower must wait the 3-7 day cooling off period.

To me, it’s as if the government is telling the buyer, “You’re not capable of making a mature decision about your finances, so we’re making you take a few days to think about it.” Imagine if you changed the HUD three times through the course of a transaction. The inspection costs came in higher, the seller agreed to pay more money in seller concessions,  and a second appraisal is required. You are now looking at postponing the closing by 9-21 days, plus the time it takes to do the appraisal, and/or inspection repairs.

Closings are already taking 45-60 days on average. It used to be 30 or less.

You can learn more about RESPA at the US Department of Housing and Urban Development website http://www.hud.gov

From the HUD website:

“RESPA is a HUD consumer protection statute designed to help homebuyers be better shoppers in the home buying process, and is enforced by HUD.”

“…designed to help homebuyers be better shoppers…”

Laws to help homebuyers be better shoppers. This is the part that just rubs me raw. Essentially the government is saying that the average consumer isn’t smart enough to make an educated decision, so they’re going to pass  laws to do it for you. Protecting the consumer is a noble idea, but I question if perhaps this time it’s gone a bit overboard.

Decide for yourself. Like it or not, it’s in effect, for better or for worse. Just be advised that it may take a bit longer to close your home purchase.

Over the last couple of months, the wind turbine tower project proposed for the waters of Lake Michigan off of Oceana and Mason Counties has generated a lot of debate and discourse. As Realtors, we have a vested interested to stay informed of this project, and the ramifications, good or bad, that it could have to our communities.

I recommend that all local community members familiarize themselves with the proposed projects, and do some research to understand the economic and environmental repercussions, good or bad,  that such a project could potentially have on West Michigan.

The wind turbine project is being proposed by Scandia Winds, LLC of Chanhassen, MN and its Norwegian partner, Havgul Clean Energy. Scandia Wind has dubbed the project “The Aegir Project”. They have developed an informative website for the project. To read more, visit http://www.scandiawind.com/Aegirproject.html

Suggested view of what a Wind Farm could look like.

Similiar projects are proposed in various parts of the country. To read about these projects, and see photos of other proposed projects, visit the ecopolitology blog at http://ecopolitology.org. The photo above is courtesy of ecopolitology.org.

The Industrial Wind Action Group has a site that demonstrates some of the local community members’ concern about the Aegir Project. You can view the page at http://www.windaction.org/news/25129

An article on MLive.com has generated many comments, both for and against the project. To read the article and comments go to http://www.mlive.com/news/muskegon/index.ssf/2009/12/wind-farm_developers_face_hurd.html.

Legislation has been introduced to the Michigan State House of Representatives to issue a moratorium on permitting or leasing for offshore wind energy development. Rep. Geoff Hansen (R-Hart) introduced House Bill 5671 to legally prohibit development of a project until the state has had a chance to institute oversight measures. You can review this bill at http://www.legislature.mi.gov/(S(mptgzfaeef3jy1uojajhws55))/mileg.aspx?page=GetObject&objectname=2010-HB-5761

It is my intent to provide you with the tools to form your own educated opinion on this matter. If you would like to voice your opinion to your local representatives in Government, here are some links to some local Government Officials:

Rep. Geoff Hansen (R-Hart) http://www.gophouse.com/welcome.asp?District=100

State Rep. Dan Scripps (D-Leland) http://101.housedems.com/

State Senator Gerald Van Woerkom (R-Muskegon) http://www.senate.michigan.gov/gop/senators/vanwoerkom.asp?District=34

Governor Jennifer Granholm (D-Mich) http://www.michigan.gov/gov

U.S. Senator Debbie Stabenow (D-Mich)  http://stabenow.senate.gov/

U.S Senator Carl Levin (D-Mich) http://levin.senate.gov/

U.S. Rep. Pete Hoekstra (R-Mich) http://hoekstra.house.gov/

For tips on how to effectively communicate with your government representatives, visit http://www.congress.org/communicate

Welcome to Harborview Condos in beautiful downtown Pentwater, Michigan.

Harborview Condos in downtown Pentwater, MI

Harborview Condos in downtown Pentwater, MI

Relax, and make yourself at home in one of our luxurious condominiums overlooking scenic Pentwater Lake. Watch sailboats drift by on their way to the nearby channel as they head out to Lake Michigan. Do some crowd watching as the thousands of tourists walk the streets of downtown Pentwater. Grab your towel and head down to Charles Mears State Park for a swim in Lake Michigan. Or take an afternoon charter fishing trip at the marina and try your luck on “the big lake.”

There’s always something to do in Pentwater.

Whether you’re a regular visitor to Pentwater, or this is your first time, you owe it to yourself to stop in and check out Harborview Condos. Starting at just $299,000, you can’t afford to miss this opportunity to make Pentwater your summer destination.

Our website, http://www.pentwatercondos.com will be up soon. There you’ll be able to find out more about the condos,  Pentwater, and how you can own a piece of West Michigan Paradise. In the meantime,  call or email me to schedule a showing today!

6111 N Oceana Dr Hart, MI

$159,900

This beautiful ranch home features an open floor plan in a country setting. The main floor includes a living room, dining area, and kitchen under a cathedral ceiling. Master suite includes a full bath and walk-in closet. Two bedrooms and another full bath are located on the opposite end of the home from the master suite. There are lots of closets for storage, and main floor laundry.

The home sits on an unfinished walk-out basement, and is pre-plumbed for a future bathroom. A built in egress window allows for a future basement bedroom.With 1344 square feet of finishable basement space, this could become a 2600+ sqft home with 4 beds, 3 baths, and added living areas.

The exterior is maintenance free vinyl, and since everything is new, you don’t need to fear having to replace the roof or furnace. Many of the home’s products are still covered by manufacturer’s warranties.

Back view 6111 N Oceana Dr Hart, MIThe two car attached garage includes an electric opener. Relax on the 10×12 deck and enjoy watching birds and deer. Lots of trees provide privacy. The deck has a retractable awning to provide shade on a summer day. The home sits on over 3 1/2 acres of land with lots of trees and a view of the neighboring pond.

Located just a few miles from Pentwater and Silver Lake, this home would make a great year round home or summer vacation getaway. The location is just a couple of mile from US-31, which is on the West Michigan Fall Color Tour circuit. At this new price, this one won’t last long. To see more of the home, visit http://www.timwhitehomes.com

First time home buyers may be eligible for $8000 federal tax credit when purchasing this home.