If you are wondering who qualifies for the government program for mortgage help, you can now check online.

The Obama administration introduced a Web site on Thursday to help troubled homeowners find out if they’re eligible for any relief under its loan modification or refinancing programs.    MakingHomeAffordable.gov

Rates on 30-year mortgages plunged this week to the lowest level since January, and may fall further after the Federal Reserve launched a new effort to prop up the flailing housing market.

Mortgage finance giant Freddie Mac said Thursday that average rates on 30-year fixed-rate mortgages dropped to 4.98 percent this week, down from 5.03 percent last week.

Read article by Alan Zibel

Mortgage rates are dropping thanks to news that the Federal Reserve will buy another $750 billion in mortage backed securities. Read the press release here.

Bottom line: good news for those in a position to buy a home in the Seattle area.

Finally, it appears some people may start “paying” for the ridiculous amount of fraud that took place in the real estate and mortgage industry over the last few years.

ING Bank, the nation’s second-largest thrift, has filed an unusual racketeering lawsuit in federal court, alleging a criminal conspiracy by a local escrow agent, a mortgage broker and 10 couples to defraud the bank of at least $6 million through falsified mortgages 

By Sanjay Bhatt  Seattle Times staff reporter

The bank alleges the conspiracy was led by Bellevue criminal-defense attorney Jacob Korn of Emerald City Escrow, and loan originator Alla Sobol, of Nationwide Home Lending. (It’s not affiliated with Nationwide Lending Corp. or Nationwide Mutual Insurance, large, out-of-state corporations.)

Sobol is listed in state records as the sole officer for Nationwide Home Lending, though it appears she employed others, according to court records.

According to the suit, Korn and Sobol duped the bank into funding loans based on inflated property appraisals and took excessive fees out of those loan proceeds at closing.

In one deal, the bank loaned a borrower $935,000 to buy a Tacoma house for $1.35 million – a house that, according to the real-estate Web site Zillow, is valued higher than 99 percent of homes in its ZIP code. Nationwide Home Lending was paid nearly $30,000 in fees on that loan.

It received a total of nearly $130,000 on all nine loans, according to the suit.

To keep these fraudulently gained fees out of creditors’ reach, Alla Sobol, head of the mortgage brokerage, and David Sobol, an officer of the escrow company, formed a family limited partnership in February 2007, the bank alleges.

Korn, who has denied any wrongdoing, had no comment on the suit.

Leslie Drake, an attorney for the Sobols and Nationwide Home Lending, declined to comment on the allegations.

To make the scheme work, the bank alleges, Korn and Alla Sobol conspired with appraiser Eric Perrigo and his Redmond company, Appraisals Unlimited, to provide inflated property appraisals that would support at least eight of the loans.

Perrigo, who is not yet a named defendant in the racketeering case, was shielded from ING’s lawsuit because he and his wife declared bankruptcy last fall. Last Tuesday, the bankruptcy court gave ING permission to pursue Perrigo in its suit.

Perrigo denied any wrongdoing. He said he was a victim of identity theft, and that a trainee appraiser who worked for him used his electronic signature to certify reports without his knowledge.

The state Department of Licensing, which oversees appraisers, says it has nine open investigations of Perrigo in connection with complaints received in 2007 and 2008.

The state Department of Financial Institutions says it investigated Perrigo’s allegation of identity theft and didn’t find sufficient evidence to take action.

The bank also alleges that on at least three loan applications, Viktor Mokhnach and his auto shop, Euro and Exotic Garage, of Woodinville, provided falsified paperwork to support borrowers’ income and employment statements.

According to the suit, two borrowers were listed separately as financial directors of the auto shop with six-figure incomes. In fact, the bank states, one is a house painter whose income is far lower and the other is a housewife.

Through his attorney, Mokhnach denied any wrongdoing.

Freddie Mac Monthly Average Rate & Points for 30 Year Fixed Rate Mortgages

~Freddie Mac

Last week many of you received my real estate newsletter.  In it I had some of the programs that are coming out of the Obama stimulus plan.  I received many inquiries as to what a “cramdown” was, based on this section:

Foreclosure Relief
Those who are “upside-down” on their mortgages (owing more than the property’s value) will have the opportunity to refinance into low rates currently available. For those who have less than 20% equity and owe up to 5% more than the home’s value, a conforming loan program will soon be available for those who have been responsible and maintained payments/credit worthiness. Other loan modification programs will also soon become available that could offer the ability to “cram-down” the principal balance owed.

Well here it is:

A “cramdown”  allows bankruptcy judges to alter the terms of a mortgage if no other options remain for homeowners, this can be the length of term (40 year amortization versus 30 year), interest rate or principle balance.

Here is a good article that talks to other apsects of mortgage rewrites.

“A climbing wall, tire swing… and in the back it even has a slide so you can pretend to be the Dow Jones Index”  (Thanks Stephen Colbert).

This Sunday I have two great open houses.  The first is a gorgeous “studs out” remodel of a 1914 Craftsman in Phinney Ridge.  Completed to maintain the era details yet provide maximum energy efficiency.  Finished with a Four Star Built Green rating.  The home will be open from 1:00 to 5:00.  A definate must see.  Offered at $787,000.  120 N 77th Street, Seattle

Just 1.5 Blocks from Green Lake I will be at a new construction townhouse.  Offering a rare floorplan with three bedrooms up.  In addition it has 2.5 baths, high end finishes and over 1600 square feet.  Open 1:00 to 4:00.  Offered at just $499,950.  436A NE Maple Leaf Place, Seattle

See you there.

Don’t forget to Spring forward this weekend.

Did you know?

Benjamin Franklin first suggested Daylight Saving Time in 1784 to conserve lamp oil.  But, it was not until World War I that it was adopted by several counties in Europe that initially rejected the idea.

In case you hadn’t noticed over the last two years, Daylight Savings Time now begins earlier and runs longer.  The extra time that we enjoy is actually the result of the Energy Policy Act, which President Bush signed into law in 2005 and went into effect in 2007.  The Act changed the start date of Daylight Savings Time to the second Sunday in March – three weeks earlier.  It also moved the end date out one week to the first Sunday in November.

Read more facts on Daylight Savings Time…

Yeah!  Longer days & Spring is coming!

As the housing market gets tougher FSBO (For Sale By Owner) or the “Unrepresented Seller” model of home sales are falling.  Many real estate companies (most internet based) popped up during the housing run.  But now that it takes more than just putting a sign in the yard to sell a home, it would appear Sellers are finding they need experienced, full time representation.  Here is the article from Fortune Small Business:

By Ian Mount
February 10, 2009: 9:01 AM ET

(Fortune Small Business) — Not long ago, for sale by owner (FSBO) Web sites were heralded as a fresh entrepreneurial wave that was going to upend the staid real estate industry. In 2006 real estate sales “unassisted” by a broker accounted for 20% of sales made, says Steve Murray, editor and owner of Real Trends, a market research firm in Castle Rock, Colo.

Then the bubble burst. During the past four years, David Zwiefelhofer, who designs FSBO Web sites and sells them to real estate entrepreneurs, has sold about 50 regional FSBO sites through his company, FSBOWebsite.com. Only 30 to 35 are still operating.

“I used to get a phone call a day from people interested in FSBO Web sites,” Zwiefelhofer says. “Now it’s maybe one call a week.”

So were FSBO sites just flashes in the pan? Murray says that with properties harder to sell these days, sellers are returning to brokers for professional marketing help, causing the unassisted slice of the market to slip to around 15%. But he expects the FSBO market to bounce back – eventually.