Decreased home value has been the cause of many sleepless nights for millions of Americans, who wanted nothing else but a pretty little house with a white picket fence. Well, in some cases the house is not that little, and the fence is the latest shade of a color you can not even pronounce, but it still is someone’s "home, sweet home."

Nevertheless, the matter of the fact is that too many people are overwhelmed by their mortgage payments, and refinancing directly with their mortgage company is not always an option. Not only you might not qualify, but actually getting somebody to talk to you about your options might be much harder than you have anticipated.

Fortunately, there is an alternative called Making Home Affordable, a refinance program introduced by the Obama Administration, which commits $75 billion in effort to prevent as many avoidable foreclosures as possible by loan modification or refinancing, reducing those unbearable monthly payments. The deal comes with a few requirements, but an estimated 3 to 4 million Americans will be eligible to take advantage of the plan according to its official website (http://makinghomeaffordable.gov/index.html). Some of the conditions are loan owned or guaranteed by Fannie Mae or Freddie Mac, ownership of one- to four- units home, first mortgage not exceeding 125% of the current market value of the home and regular payments being not more than 30 days late in the last 12 months.

Of course, nobody expects all of us out there to be mortgage and refinance gurus, so for the most current and detailed information on what the plan is about and the way it works, you can head right here -  http://www.financialstability.gov/docs/borrower_qa.pdf.

Most important of all, this government website states very clearly that all the help it offers is free, and there is never a fee to get assistance or information about Making Home Affordable from your lender or a HUD-approved housing counselor. Consulting with a specialist is always a good idea, but at least knowing where to turn for help works only to your advantage.

    Being already in the middle of the year, leaves perspective home owners with a little over six months, in which they can take advantage of the American Recovery and Reinvestment Act of 2009. One of the key highlights of the legislation, approved and signed by the President, is the expanded First-Time Homebuyers Tax Credit. The already insecure real estate market is less than attractive, and not surprisingly so considering the circumstances, so future buyers can very well use an incentive when making a decision whether to purchase a home this year or not. For those, making the big decision for the first time in their lives, opting out for signing on the dotted line before 1 December of 2009 can be one smart financial move.

    According to the Act, first time homeowners can be eligible for a credit of up to $8,000 with no payback requirement. The sweet deal comes with a few requirements and limitations, including the home being the principle residence of the tax payer (vacation and rental properties are excluded), certain income limits ($150,000 or less combined income for married couples, or $75,000 for other taxpayers), as well as a condition of repaying the tax credit if within 36 months of the purchase date, the home is no longer used as a principle residence.The form necessary to claim your credit can be found here http://www.irs.gov/pub/irs-pdf/f5405.pdf, and if you and your partner are not married, but you qualify, you should probably take a look at a different section, providing guidance for your specific situation http://www.irs.gov/pub/irs-drop/n-09-12.pdf.

    Whatever the situation  in your corner might be, always make sure to get the correct information about what is that you are entitled to. Most of the time you can find millions of websites, explaining what and how it is done, and at least half of them are asking for a fee for this, that or the other. The only way to assure yourself a headache-free experience is to go directly to the source, which is usually a government website. In this case more detailed information can be found at the Q&A section of the IRS website, concerning the credit http://www.irs.gov/newsroom/article/0,,id=206291,00.html

All fellow New Yorkers can probably agree with me that spring barely makes it to Manhattan. Not only the temperatures fluctuate tremendously, but living in a metropolis makes it harder to identify the natural signs of spring.

In the country, the season between winter and summer is recognizable by blooming flowers and migrating birds, but here flowers are planted overnight in front of the Rockefeller center. As for birds returning for the warmer weather, I am sure pigeons don’t count.

New York is a surprising and unusual city. So is the indication of spring – palm trees. Once the temperature starts rising, they begin their migration. One such relocation event even made it to the Times. Number 15 is a palm tree which spends the winter in Florida and the rest of the year in Flatiron. Who knew that a trendy lounge in an even trendier high rise building offers its plants a paid for vacation, but apparently it’s cheaper to send the trees south than to purchase them again the following year. Renting a space for the trees, where they can spend the winter, instead of buying new ones each year proves to be the craze here.

Rather odd is the migration we have in our concrete jungle; however, it still fulfills the purpose. If you can’t tell when spring is coming, look for the palm trees. When they start popping up on the sidewalks, waiting to be planted in a rooftop garden in your neighborhood, chances are they are coming back because the winter is over.

Vacation season is coming, and although we hate to admit it, most of us will probably have to stay local. Of course, there is nothing more romantic than a croissant and cafe au lait in the shadow of the Eiffel tower, but our own New York City isn’t any less exciting and impressive. You can get Russian pirogues in Brooklyn on your way to the beach; another treat is Chinese pastries on Canal street, just a few blocks up from Broadway, right hand side if you are facing the traffic; home made gnocchi and fresh Italian bread in Nolita, if you fancy organic food, Quartino restaurant is a personal favorite(http://nymag.com/listings/restaurant/quartino-bottega-organica/); and if the craving for that French flavor does not go away , there are plenty of French restaurants spread out from the Upper West Side to Battery Park City.

Enjoy the food, and don’t give up on your going-away plans. You just have to be a little more creative than just hopping on a plane and going around Europe. Plus you could be unpleasantly surprised that the majority of the airlines seem to be recession-proof. Where you expect to find bargains on air travel tickets, the reality is that the prices did not really plunge as expected. So the European trip is not a bad idea in general, but may be now is the time to explore our own country. The good news is that the prices of vacation rental homes have begun to drop, starting with the Poconos, PA. Just the other day, I received an email from the owner of a 4 bedrooms/2 bathrooms house. He decided to slash the price of his rental property - $75 off a weekend rental and $100 off the weekly rate (http://www.vrbo.com/75061). All in all, paying $450 for a full week away form the crowd and the screeching sound of the subway does not seem that bad at all. Besides, who knows, may be the decreasing-rental-prices trend will brush off the Hamptons too.

May be you didn’t catch up on the whole "green" hue of energy saving tips form the beginning, but now is the time to get with the program. I want to be able to say, "Hey this is the right thing to do," and get people to be energy smart, but in a not-so-perfect world saving the planet is not always enough…unfortunately!

When it comes to saving money, then things get real serious. Mortgage payments can’t be reduced. College tuitions can’t be reduced. Metro cards will most likely become even more expensive, so if you can cut down the cost of your electricity bill and at the same time decrease your carbon footprint, why not try a few things.

Have you heard of vampire power? And no, I am not talking about the tween flick "Twilight". Believe it or not, turning off your appliances does not prevent electricity from leaking. As long as they are plugged in, you are paying. According to the Grinning Planet, the cost to consumers and business for the electricity lost to vampire power in the US is estimated to be $4 billion annually. The power sucking gadgets can be found in every home. Just look around your apartment and if you have, and I am sure you do, a TV, DVD player, microwave, computer, air conditioner, printer, etc., make sure to unplug them before you go to bed. Even a cell phone charger falls into the same category, so as convenient as it might be to have it plugged all the time, somehow it just seems better receiving a smaller electric bill at the end of the month.

Hey, this is the right thing to do even for your wallet!

March 9, 2009 — We will get longer days starting on Sunday, but the days feel quite long enough already, what with the difficult economic environment. Perhaps a sun still shining for the evening commute will lend some cheer, as may, the warmer days, which will follow. At a time when things are pretty difficult, it’s at least something to look forward to. Eventually, the economy will show real signs of recovery, bringing with it any number of new challenges, not to mention a return to whatever may pass for ‘normal’ government involvement into financial markets. At present, that is well into the future, and we still have many troubles to overcome before we get there. Before that, though, we need to arrive at a point where things have stopped getting worse. Looked at in this way, it’s possible that we saw some signs of stabilization this week, but there’s no way to know how firm that ground is just yet.

As has been the case of late, mortgage rates failed to move very much, even as equity markets slumped and long-term Treasuries bounced around a bit. The overall average for 30-year fixed-rate mortgage money — Fixed-Rate Mortgage Indicator — declined by two basis points to land at 5.80%. The FRMI’s 5/1 Hybrid ARM counterpart shed three basis points to close the survey week at 5.48%, while conforming 30-year FRMs increased by a single basis point.

Certain of the economic data were as flat as the rates. Take the Institute for Supply Management manufacturing indicator, which came in at 35.8 for February, a still-awful number. It showed just a whisper of improvement over January’s 35.6 reading, but was certainly stable, if at terrible levels. That was also the case with the ISM’s non-manufacturing gauge, which eased just a little from January’s level, slipping to a 41.6 mark, a decline of 1.3 points for the month.

January’s report covering Personal Incomes reported an actual, if convoluted increase. All of the 0.4% increase — the first since September 2008 — was due to spikes in government outlays, end-of-year bonuses, and other less regular events. Still, rising incomes (at least for some) should help support the economy to a degree. Personal Consumption outlays increased by 0.6% for the month, the first positive number since last July, but even with outgo outstripping income, the nation’s rate of saving increased to a fat 5% during the month. Also lending some economic support was the small but notable surge in consumer borrowing during January. The $1.8 billion increase in loan balances may have been slight, but it was the first such increase since September 2008 and was pretty equally split between credit cards and installment debt. Not a huge surge by any means, but at least a little sign of stability.

Factory Orders did not show much sign of stabilizing during January, but they did manage to decline less than expected, for what that is worth. The 1.9% decline for the month was the best showing since last July, and represented the smallest negative number of the bunch since then, so it could be characterized as somewhat better news. What can we say about the level of auto sales? The 9.1 million (annualized) rate of sale for February is still on a downward trend, even if the decline in terms of percentage has slowed somewhat. The auto industry continues to take it on the chin, and continues to pester Congress for more taxpayer support. General Motors this week indicated it could be open to considering bankruptcy to help re-cast its obligations, and that possibility is growing. Hyundai was the only manufacturer who reported increased sales, largely due to a "buy back" program if the car’s purchaser should lose their job. Perhaps that is a concept one of the "weak three" might consider employing in order to goose sales.

Construction spending wallowed by 3.3% during January. Declining spending on residential projects (-2.9%) was joined by commercial construction (-4.3%) and pressed further downward by a falloff in public works projects (-2.3%). Cash-strapped states have no funds to promote any sort of spending except for basics like schools, but the stimulus plan should pump some money back out via transportation projects and the like before too long. Announced layoffs abated somewhat in February, according to the outplacement firm of Challenger, Gray and Christmas. The 186,350 workers who will be losing their jobs was rather fewer than the 241,749 in January, and still remains at a very elevated level, if improved somewhat. The labor market is a "lagging indicator," with job losses occurring in the months after a market or markets experience slowness. Very few firms could easily practice "preventive layoffs," and are also loath to shed experienced employees when a slowdown first happens, hoping for a short recession. When that is no longer the case, firings begin. In this way, the acceleration of layoffs which began last summer as economic skies darkened was then intensified in September when Fannie, Freddie and Lehman Bros all floundered, and exploded after October/November’s credit market shutdown. The cumulative effects of those events are only now being reflected fully and may yet have some time to run.

Weekly jobless claims rang in at 639,000 during the week ending February 28, in line with the numbers seen over the past five weeks. Continuing claims remain over five million, a strong indicator that new jobs are hard to come by for those who have lost them. Of course, that is not news to the 8.1% of American workers who are unemployed, the highest such figure in over 25 years; those unlucky souls were joined by a new group numbering some 651,000 during February. The huge job losses over the past few months — well over 2 million since November — are alarming. However, that they have been about the same level in each of the past three months — and that November’s events are falling further behind — could revive some hope that this could be the bottom for labor markets, or at least provide some reason to expect that they won’t continue to worsen from these levels. However, there’s no indicator we can point to which suggests any improvement so far. Layoffs and reductions in hours worked haven’t been enough to offset the sharp decline in demand. As a result, worker productivity has plummeted, falling by a revised -0.4% during the 4th quarter of 2008. With slumping orders, there’s apparently just little for workers on the books to do, which also drives up the labor-per-unit produced cost, now up by 5.7% for the quarter. In a different economic climate, such numbers would sound inflation alarms, but in the present situation, it suggests that, absent any pickup in demand, more layoffs are on the way.

Consumer comfort levels as measured by the ABC News/Washington Post poll were about flat. The -49 noted for the week ending March was just a tick lower than the week prior, and no trend of rising optimism seems to be coming soon. That lack of enthusiasm is well grounded: The Fed’s own survey of regional economic conditions noted that "contacts from various Districts rate the prospects for near-term improvement in economic conditions as poor, with a significant pickup not expected before late 2009 or early 2010." Overall, the document was rather bleak.

We keep looking for signs of any bottoming, let alone improvement, in the economic picture. As far as housing goes, we’d probably be happier if the weekly onslaught of new programs, offers, and market manipulations would simply stop, to give the industry some time to develop a better picture of where we are and where we need to go. However, there’s more change afoot, with new tweaking to the all-but-dead Hope for Homeowners program likely to come before long, and a ‘cram down’ bill hot on its heels. A breather would be useful to see whether the extant programs — enacted in such haste — have the desired (or any!) effects on the health of the mortgage and housing markets. After all, we’re paying for them. Hard to think that there’s any reason for mortgage rates to break strongly in one direction or another next week, so we’ll look for little change to rates again. However, what might happen over the next couple of months?

Foreclosures are sweeping the country faster than the newspapers can report them. It’s not even news anymore. Not for anything else, but seeing the “Bank owned” signs is so natural already that it becomes disturbing. Homeowners from Idaho to Georgia have the same unfortunate common denominator – fear of the next mortgage payment.

Recently a new tactic of fighting foreclosure has emerged. It’s called “Produce the note”, and it’s apparently gaining popularity since the team of Good Morning America, the ABC morning show, has picked up on it. The method of stalling the foreclosure has also been mention on CNN, and explanatory clips can be found on You Tube.

What the strategy does is assuring you that the institution suing is the owner of your mortgage. The process of producing the note in question is not exactly speedy, which ultimately buys you more time to fight back. When mortgages were bundled up, sold and resold to different investors, not all of the new owners got the necessary paperwork. Therefore many of them can not even prove their legal right to sue defaulted homeowners. Since the original copy with the customer’s signature is the one and only document, certifying the ownership of a mortgage, the lack of it takes away the bank’s right to foreclose. For more information and templates you can check http://www.consumerwarningnetwork.com/2008/06/19/produce-the-note-how-to/. Your home is indeed your castle, so don’t let it be overtaken without a fight.

Finding a rent-stabilized apartment in New York City has become harder in recent years. In the rough economic climate of today, tenants feel vulnerable about the next lease renewal, which might possibly come with a higher price tag. It seems unfair, especially when along with the landlord, everyone from Con Edison and KeySpan to the local grocery store is charging more for the offered commodities. The only constant in the bunch is your paycheck, and if you live in the uncertainty of renting a market priced home, every unexpected letter from the management becomes the bête noire of your day. The increase can rarely be avoided; however when the limitations of the amount of rent are fixed by law, the bite is a little easier to swallow.

Since the beginning of the recession rents have been plunging, but it doesn’t change the fact that New York remains among the most expensive real estate markets in the country. Many predict that in no time, the high prices can drive the middle class out of the City, but whispers of change are setting a different mood. According to the New York Times “a sweeping revision of the state regulations law that could return thousands of market-rate units to rent control" has been approved by the Assembly at Albany. If passed by the Senate, the revision will result into a lot more security for tenants, and the choice of rent-stabilized apartments will widen. The project still has a long way to go, and the road to completion is bumpy. It is something the financially drained people of the Big Apple can look forward to. May be it will give them a reason to think twice before renting that U-Haul and heading to a more affordable destination. Is the best yet to come?

With the historical Inauguration of President-elect Barack Obama less than 24 hours away, the festivities are well on the way. Even the sub-zero temperatures in the past several days could not keep people from preparing to attend the event in person. The freezing January weather is not very welcoming for an outdoor event, but to witness history in the making is quite an incentive.

If you can’t make it to the capital, and you still want to participate in the celebration, you have the unprecedented opportunity to host a Neighborhood Inaugural Ball. On a smaller scale, you can downsize to a private Inaugural party in Queens or Brooklyn, hosted in your own apartment with a few good friends. It’s a week day, but you can only organize such a party once every four years, so most likely the kind couple who lives next door wouldn’t mind the fuss. Even in pretentious and upscale vicinities like Upper East Side or Upper West Side, celebrating might be a reason for otherwise uptight neighbors to loosen their ties, kick off the Manolo Blahnicks, and enjoy one unusually noisy Tuesday evening.

Our own daily and weekly figures didn’t break the 5% mark. We were close, though, and any borrower wishing to pony up more money up front could have easily obtained a rate below 5%.

For the week, all together, we had an average of 5.11% + 0.28 points all told… and a final weekly "zero points" average of 5.17%. If we gathered prices at Freddie’s 0.7-point level we certainly also would have been below 5% this week, and well below with the MBAA’s 1.2-point statistic.

The differing methodology produces slightly different results, and regardless of any "psychological" effect, there is scant difference between the interest rates of the 5.01% Freddie reported last week and the 4.96% figure this week.

While we naturally have conforming-rate averages, we also have jumbo and so-called ‘agency jumbo’ averages too (among others). All told, these figure into an indicator we call the FRMI (Fixed-Rate Mortgage Indicator), which is reflective of the overall cost of mortgage money in the market.

Fixed-Rate Mortgage Indicator (which, we remind you, is inclusive of conforming, jumbo and ‘expanded conforming’ interest rates) slipped by just 6 basis points, landing at an average 5.66% — and all of that influence came from declining jumbo mortgage rates this week, not conforming.

We even track certain FHA rates for interested parties.

The November and December economic data continue to trickle out and are collectively living up (or down) to awful expectations. As an example, Retail Sales declined by better than two times the expected amount, easing by 2.7% during a month characterized by huge discounts and closed wallets.

Sales have been sliding for five months now, and while the December decline wasn’t the biggest of the lot, it did happen during the most important period for retailers, when a sizable percentage of the year’s profits are made. Excluding auto and gasoline sale still left a 1.5% decline, but the pain was spread around to all retail areas, regardless.

Falling prices are evident everywhere, but there doesn’t seem to be a significant risk of actual deflation in the economy, at least not yet.

Prices for goods destined for import fell by 4.7% during December, slightly less than expected, while goods destined for other shores saw aggregate reductions of 2.3%. Of course, the influence of collapsing oil and commodities prices are largely the cause for the price declines of imports, but even excluding them left a decline for the month of 1.1%.

Those falling costs of materials and products of course influences our own price pressures domestically, but also serves to influence our imbalance of trade with other nations. That trade deficit declined by a nearly a whopping $17 billion in November, as the value of imports into the US slipped by 12% while exports fell by a lesser 5.8%. The reduction in the value of petroleum imports alone accounted for nearly $13B of the total, but a need for fewer goods amid growing stockpiles accounts for the rest.

Prices here are sliding quickly as well. The Producer Price Index shed 1.9% during December, a somewhat smaller decline in costs than in November, but exclusive of volatile food and energy costs, prices actually firmed by 0.2% for the month. That was mostly the case with the Consumer Price Index too, which eased by 0.7% for December while its ‘core’ rate remained unchanged for the period. The decline in inflation pressures have been remarkable over the last few months, with the ‘core’ CPI now falling by 0.1% over the past year, when as recently as July 08 prices were climbing at a stout 5.5% annual rate. Prices all around are cooling, and indications from upstream processes indicate that this should be the case going forward for a while.

Looking back to November, we can see the slowing of demand. Collectively, business inventories managed to decline by 0.7% during the month, but sales fell far faster, and the measure of inventory levels relative to the present sales pace moved to multi-year highs. With plenty of inventory still on shelves, manufacturers won’t see many new orders coming their way anytime soon.

That being the case, the slump in Industrial Production for December was to be expected. The 2% decline was double the forecast though, with the biggest decline (-2.3%) coming in the manufacturing sector. Mining concerns chipped in with a 1.6% decline and even utility output slipped by 0.1% for the month. With nothing to produce, more of the nation’s factory floors stood idle during the month, with overall capacity utilization dipping to 73.6%, and manufacturing down to a very soft 70.1% level.

In the first non-holiday-distorted reading of the year, new claims for unemployment benefits ticked upward again, landing at 524,000 for the week ending January 10. All in all, that qualifies as "not bad" in that it would be the best non-holiday reading since late November. However, it still qualifies as terrible in its own right even if improved relative to the recent trend.

That’s not something you can say about the weekly ABC News/Washington Post poll of Consumer Comfort, which put in a third week at -49, near but just above record lows. If anything, this indicator has been largely flat for the last four weeks. While that indicator holds steady, moods measured by the University of Michigan Survey of Consumers nudged higher in the preliminary January reading, rising to 61.9 so far this month, up from December’s 60.1 mark and still moving in the right direction after November’s 55.3 nadir.

Amid all this, it’s hard to find things to be optimistic about, but low mortgage rates are serving to produce enthusiasm in at least one small (formerly very large) corner of the economy. Refinance activity remains strong and we are confident that at least some increase in home sales activity will occur as we move forward. While a refinance decision can be a near-instantaneous one, the process of deciding to buy a home — shopping and finding one, getting a contract for purchase for sale executed, and a mortgage secured — can take weeks if not months, so the impact of low rates isn’t as immediate to this market… but it does provide at least some of the impetus to move in that direction.

Mortgage rates have been pretty stable over the past couple of weeks, and there seems to be nothing on the near-term horizon which will break that flat demeanor. Figure little if any change next week.