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Welcome to the chat, Ward 8. I hope you're right on both counts! Anyone else thinking along the same lines?

Many people have been frustrated when dealing with the banks, but you should try.  Keep in mind that if you walk away in Virginia, the bank can go after you for the difference between what it collects for the house in a foreclosure sale and what you owe on the mortgage.   

You might talk with your lender and a real estate agent about the prospects for the lender agreeing to a short sale. If you go that route, be sure the lender agrees not to come after you for the unpaid deficiency.

If you're really thinking like a long-term investor, you can't be too concerned about what will happen to prices in the next few months. Depending on the neighborhood, you may have missed the bottom already. Market timing is exceedingly difficult with real estate! Long term investors look at their initial investment and monthly cash flow to decide if they can really stick with it for the long-term appreciation they desire. That goes for the house you live in, too.

Well it certainly seems like it should affect the market. What we don't know is whether it will be positive or negative -- and when it might happen. If traffic is as nightmare-ish as some predict, my GUESS is there could be a negative effect on nearby housing--at least at first.  Freelance writer Kimberly Lankford, who wrote the story on military buyers for the Mega issue, told me some are expecting relocations nearer to locations gaining BRAC headcounts to happen around 2012-2013, as locals get fed up with traffic and relocate closer to their new base. Anyone else with ideas on this?

They are perennially two of D.C.'s most popular neighborhoods, but there's no way to reliably predict what will happen to prices over coming weeks. I will point you to some great--and interactive!-- statistical information, just updated with data through the 4th quarter of 2010, for DC-area jurisdictions. Check it out here.  

I'm told that lenders have to make any necessary corrections within 60 days.  But you should be aware of which costs can shift and which can't.  Those are listed on page 3 of the GFE form. Here's a link.

There's also a settlement booklet you may want to look at. Here's a link.

If none of these resources are of use, you should direct your questions to:   U.S. Deparmtment of Housing and Urban Development, RESPA office, 451 7th Street, SW, Washington, DC 20410 

Good luck!  

If you're really pressed to close on this loan (meaning that you're approaching a deadline to close the deal) then  demand to receive a copy of the actual HUD-1 settlement sheet the day before closing. (Ask in advance!) Go over it closely and challenge any numbers that look askew. Make the clock tick for the lender just as it's ticking for you.  Sounds like you have a good grasp of what the costs SHOULD be; make sure the lender gets on board and performs.

I wouldn't be surprised if owners are holding on to their properties because they figure that the extraordinarily awful Tysons traffic, snarled by Rte. 7 & Chain Bridge road construction, Metro construction AND Beltway hot- lane construction make it a less-than optimal time to market their home. (I got stuck on the Beltway for an hour at midnight recently. Do I sound bitter?) Certainly the planners are trying to make Tysons a residential draw as part of their mixed-use development. Stay tuned -- we have a story coming up on this topic soon. And by all means, chatters, weigh in!

These types of cuts could be a big deal for the Washington area market. Federal workers and defense contractors tend to have the types of high-paying jobs that fuel demand for homes. If a big chunk of them disappear, the area's housing market would suffer.   

Well that's the big question for the DC area, isn't it? After all, if the economists tell us our market held up better/recovered faster than most others because of govt'  & defense spending, a cutback ought to harm our market as well, wouldn't you think. However, we'll have to see how it all plays out. Spending cuts might actually affect out-of-town entities more. (ie the folks building the weapons, fighting the forest fires). It certainly bears watching though.

It's hard to say. Take a look at what's on the market now, similar to your home in terms of location, bedrooms, bathrooms, garages, etc. Are the prices higher than your appraisal? Watch to see if they're forced to lower their asking prices.

Looking for two years? Seems to me you aren't a very serious buyer, especially if you've seen price reductions and haven't made a deal. Will there be price reductions this spring? I don't know. But it sounds to me like you're waiting for prices to increase--which only guarantees that you miss the bottom.

I never heard that one -- and it is NOT true. Good remodeling does increase your home's value, but in practically all instances you recoup LESS than you spent. The exceptions may be for when you repair something the whole market sees as a deficiency, such as a 3-bedroom house with only one bathroom.  The best source of info out there comes from Builder magazine. They have a great interactive feature here:

Maybe you can tout that tough security in your ads? And if your agent isn't doing so already, post ads on Craigslist and neighborhood bulletin boards and Web sites. With luck, better weekend weather might bring more lookers. And what does your agent have to say about the price?

Thanks for chiming in, Real Estate lawyer. Seriously ... paying a lawyer for this type of help may be just the thing to keep your deal from blowing up.

Oh, my fluttering heart. An "older, lower-priced home less than $1 million." (Welcome to DC, any out-of-town chatters.) You may get a good response to your N. Arlington home (usually a popular neighborhood). But, please, unless you have lots 'o cash in the bank to cover double mortgage payments, SELL first before you buy. Even if you have to relocate to a temp rental, it's the much more fiscally sound approach. Dina -- want to chime in on the mortgage aspects of this?

You're in luck. The lower-priced homes seem to be the only ones that are moving. That's because the "jumbo" loans often needed to purchase larger homes have pretty tough lending requirments -- such as 30 percent down payments and excellent credit scores.  These jumbo loans are not backed by the federal government. Come Oct. 1, the maximum loan limit for jumbos is scheduled to drop to $625,500 from $729,750.  So that could hurt the higher-priced home markets too.

It seems both Republicans and the Democratic  administration agree that Fannie/Freddie should be eliminated. When both sides agree, that tells me something will happen.  But when? Neither side is willing to take it head on while the housing market is in such a fragile state. If anything happens, it will probably take five to seven years.  I do think there will be requirements for larger down payments but no one is touching FHA, which offers low down payment loans.  

Fannie and Freddie have always had a weird heritage. Created by Congress for a public purpose--but owned by stockholders and expected to return a profit to them. I can't begin to predict what will happen, but to this housing/economics junkie it will be fascinating to watch how the government tries to accomplish the public purpose--equitable access to credit for housing and at least some standards for mortgage terms and quality--in a post Fannie/Freddie world.

Have you talked to any real estate agents about the price? Is it even listed? Your bird-in-the-hand offer might be low. And, of course, do you WANT to move? What can you afford? Talk to a couple of agents if you haven't already.

Yay yourself! I'm afraid this is a one-off chat, but with any luck we may reappear at least occasionally. About your rental. Someone is going to have to manage your rental; check out the costs they charge, and whether you can find a trusted, experienced person to help you manage it. First, however, check out the landlord laws for DC. There's a lot involved.  And do some rental shopping on Craigslist, washingtonpost.com and elsewhere to get an idea of what you can get for rent. Good luck.

I wouldn't agree that prices are based on speculation. That was true during the frothiest (to quote Mr. Greenspan) part of the boom. But the effects of supply and demand have not gone away. An individual buyer can feel confident when s/he finds a home that will be reasonably  suitable for, say 10 years, and that they can afford--maybe stretching the budget A LITTLE at first, but realistically over that long term.

Thanks for the 2 cents!

Thanks, chatter.

The impacts are set to take place soon. The FHA is raising the premiums on the loans it backs by a quarter of a percentage point in April. The maximum loan limits for jumbo loans are set to drop in October from $729,750 to $625,500.  There's talk of down payment requirements going up gradually for loans backed by Fannie, Freddie and the FHA.  So basically, mortgage costs are rising.  Much further down the line, if Fannie and Freddie disappear, the future of the 30-year fixed rate loan will come into question. There are all sorts of risks to lenders for holding onto these pre-payable loans for the long haul. So some may choose not to offer them or they may raise the costs of those loans, at least that's what some housing experts are arguing.

Thanks -- I've missed this chat, too! And thanks for the good idea. Anyone who'd like to chime in on that can contact me at razzie@washpost.com

Eat the $40k, rent it out or stay put. Seriously, I don't see a lot of alternatives. Does anyone else?

There is a new "short refinancing" program available through the Federal Housing Administration tailored for borrowers who are underwater but on-time with their mortgages.  You should check it out if you decide not to rent.

See my reply to a similar post above. Any one else with ideas on this?

I respectfully disagree. We repeatedly cover this story.

That's  exactly what I want to know!!

I think Zillow is better than it used to be, and it's a good tool for general information. For an actual buying/selling transaction, you need more tailored information. A thorough market analysis by one (or a couple) of real estate agents, your own good sense, and eventually an appraisal will help address the condition question. Good luck.

Not to worry.  Even though the administration wants to scale back the government's role, a proposal it submitted to Congress recently specifically states that FHA (and its low down payment loans) will not go away.  The down payment requirements may rise a bit though -- maybe up to 5 percent. But there's no telling when or if that will happen.  

Well, agents have a tendency to say things are priced to sell. What was your estimate of the condos' values? If you want one of them, get the bidding started. Remember...they're called "asking" prices.

Thank you, DC -- and to other chatters w/similar comments. You have a great weekend, too. Oh...and I'm starting to tweet. Training wheels still on that, but if you're interested, I'm @erazzi.

Well said.

Please check out the interactive Post housing link I posted earlier. A good print map will be in Saturday's paper, too.

Start where you always must start: Your own budget. Do your best estimate of what you can really afford on housing (including utilities, taxes, repairs, furnishing, etc.) Look at your downpayment cash (keeping some $ in reserve for emergencies -- and to please lenders). Then shop. Buy where you'd like to live, where the commuting options are decent. (Best if there are alternate ways to work, ie drive/bike/Metro.) And do some exploring.

Glad to see you, too. Five years? I'd ignore the market for now. Plan neighborhood bbq's; tree-planting parties, etc. Get involved and help build up your neighborhood. That pays all kinds of dividends -- could even help you sell someday, too.

Oh, I don't see how it would be a conflict. Don't give yourself top billing on newsletter advertisements or anything. Be up-front with your other board members about your plans. Good luck.

Appraisal is different from tax assessment. And 2009 is different from 2011. Look at the other government assessments for comparable homes in your city. Get as apples to apples as possible. If yours is out of line, appeal. Your tax assessor's office can guide you on the process.

Thanks for the 2 cents.

Thanks, chatter.

I've been hearing the same thing in certain "hot" neighborhoods, basically the ones close in to the District. Further out (in Prince William County for instance), I hear that cash investors are snapping up the lower-priced homes pretty quickly.

Thanks for that.