New rules coming soon
Beginning Oct. 1, new rules adopted by the Federal Reserve will go into effect, requiring greater diligence on the part of mortgage lenders and brokers who issue high-cost loans for borrowers with less than favorable credit.  The interest rates on these loans are at least 1.5 percentage points greater than the average prime mortgage rate. The regulations, which were finalized in July 2008, prohibit lenders from making a high-cost mortgage without verifying that a borrower could repay the loan in the conventional way, and not through a foreclosure sale.
Read more: NYTimes

Seeking real estate bargains?  Try looking at the high end
Buyers hoping to purchase deeply discounted homes may want to consider purchasing homes in the high end—especially those priced $2 million or more.  In some cases, buyers may be able to command even lower prices on these homes, as financing continues to be a challenge for buyers of luxury homes.
Read more: WSJ Online

FHA will tighten credit standards
Although the Federal Housing Administration (FHA) has confirmed that as of Sept. 30 it will fall short of its legal requirement to maintain supplementary reserves of 2 percent of the loans it insures, FHA Commissioner David Stevens says that it will not be seeking a taxpayer bailout.
Read more: WSJ Online

Want the home buyer tax credit? Don’t shop for furniture
With the deadline on the first-time home buyer tax credit looming, plenty of buyers are under contract and looking to close before Nov. 30.  Excited to move into a new home, some of these first-timers start hitting the stores shopping for new furniture, appliances, or curtains.  Big mistake.
Read more: Blogs WSJ

Homeowners who “strategically default” on loans a growing problem
Research using a massive sample of 24 million individual credit files has found that homeowners with high scores when they apply for a loan are 50% more likely to “strategically default”—abruptly and intentionally pull the plug and abandon the mortgage—compared with lower-scoring borrowers.
Read More: LATimes

$30 billion home loan time bomb set for 2010
Next year, many option ARM payments will begin to readjust, slamming borrowers with dramatically higher monthly mortgage bills.  Analysts say that could unleash the next big wave of foreclosures—and home-loan data show that the risky loans were heavily used in the Bay Area.
Read More: SFGate

Short sales spread across real estate market, leaving frustration in their wake
As more homeowners find themselves underwater — owing more on their mortgage than their home is currently worth — and unable to make the monthly mortgage payments, many are turning to short sales, which allow a homeowner to sell their home for less than owed on the mortgage.  Short sales can be a win-win situation for all parties, because they enable home buyers to purchase properties in desirable neighborhoods and at favorable prices.
Read more: Chicago Tribune

New home sales rise for 5th straight month
Sales of newly constructed homes rose for the fifth straight month in August, a government report said Wednesday.
Read more: Money CNN

Study: Housing more affordable for “move up” buyer
According to a study by Coldwell Banker, 2,200 square-foot-homes with four bedrooms, 2 ½ baths and attached garages are becoming more affordable.  About a third of the markets in the survey boast an average price below $200,000, the highest number in the past five years.
Read more: Sac Bee