PARAMOUNT MORTGAGE - LENDER'S BLOG

Paramount Mortgage Acquires Pinnacle Financial Services, Inc.

ST. LOUIS, MO – Paramount Mortgage Company, Inc., announced today the acquisition of Pinnacle Financial Services, Inc., a Chesterfield, MO mortgage banking firm. Pinnacle Financial Services has operated in Missouri for eight years and its primary business involved residential and commercial real estate financing. Pinnacle was licensed to underwrite mortgages in seven states and will broaden Paramount’s sales into additional markets.

Pinnacle Financial was a 35 person firm and employed 19 loan officers and 16 support personnel. All Pinnacle sales and support personnel will make the transition to Paramount Mortgage Company increasing the firm’s staff from 41 to 76 employees. No layoffs are planned at either company. The firm will continue to add additional personnel in the coming months to support increased sales and future expansion of operations.

Paramount will maintain the former Pinnacle Financial Services’ offices at 16052 Swingley Ridge Rd., Suite 200, Chesterfield, MO 63017, main phone: 636-812-4663. Sales activities will continue from that office through October of this year under the Paramount Mortgage name. The office will continue to serve the western St. Louis counties including St. Charles County.

In making the acquisition announcement, Paramount Mortgage President, H. John Frank, Jr., stated, “We started talks earlier this year with Pinnacle’s president Todd Solomon to determine if their company would be a good fit for Paramount. It is important to us, as we continue to expand in this volatile housing market, to add experienced and competent professionals to our growing operation. We anticipate the Pinnacle team will strengthen our company immeasurably.” Former Pinnacle president Todd Solomon will join Paramount Mortgage as a member of executive management.

Paramount’s acquisition of Pinnacle Financial Services comes just three months after opening a new Mortgage Banking office in Bellevue, Washington, a suburb of Seattle.

There has never been a better time to buy!

Lately, consumers have been receiving an over-whelming amount of information from the media, ranging from tax credits and credit crunches, to economic woes and stimulus packages. All this information can be very confusing, especially to those individuals and/or families who are asking, “Is it time to buy my first home?” Unequivocally, this is the best time – ever- for qualifying first-time homebuyers to take advantage of what is happening in the housing and finance markets. There is a unique window open right now for first-time homebuyers that needs to be taken advantage of before it closes; and, it will close at some point on or before December 1 of this year. Allow me to explain further.

There are three market conditions present in our St. Louis area that make now, better than ever, the best time to purchase a home. First, there is a large variety of homes in inventory, with great values to choose from, ranging from new and existing homes to those homes that may be in foreclosure. To help you find the right home for you and/or your family, be sure to contact your local REALTOR, who can expertly guide you through the home buying process.

The next reason is the federal tax credit. First time homebuyers (which also include anyone that has not owned a home in the past three years) qualify for up to an $8,000 true tax credit. This means that whatever your refund is – add up to $8,000. It is that simple. Please check with a tax advisor since income and sales price is a factor; but the reality of this is that the government is going to give you up to $8,000. Homes purchased between January 1 and December 1 of this year is eligible. Unlike last year’s $7,500 tax credit, this does not have to repaid over 15- years.

However, the icing on the cake- besides the great selection, good values and free government money (no repayment required) - is the historic low interest rates! Mortgage bankers and financial institutions do have money to lend at great rates. With that in mind, what are lenders looking at to qualify home loan applicants?

Lenders are looking at the same criteria they always have. Stable, verifiable income is checked and established. Credit history is examined. The collateral of the home is assessed through a thorough property appraisal. Customers are also required to have at least 3.5% of the sales price of the home as a down payment. Veterans can still obtain 100% financing through a Veterans Administration (VA) home loan. The debt to income ratio (how much of the gross monthly income is going out to pay bills) is closely examined to ensure customers are not overextended.

These conditions existing at one time are unprecedented. There has never been a better time to buy. The window is open now, so take advantage. Ensure your personal success by working with professionals you can trust. Members of the St. Louis Association of REALTORS and the Mortgage Bankers Association of St. Louis have long track records of working successfully and ethically with the community members.

Information provided by Ruth E. Battle, Past President, Mortgage Bankers Association of St. Louis, Past Affiliate Chairman and Affiliate member of the St. Louis Association of REALTORS.

St. Louis Real Estate Market in 2009

What kind of market will St. Louis Realtors face as they ramp up for the spring and summer home buying season? In our part two of Elizabeth Weintraub’s 2009 market predictions article for About.com, we continue looking ahead through 2009.

Sellers will shun loan modification programs in favor of short sales – Upside-down home sellers may try to modify their existing loans but those efforts will be met with roadblocks as lenders exhaust other options. The loan modification process will be cumbersome and riddled with conflicting demands within the same banks. Many sellers will turn to a short sale or walk away rather than try to deal directly with banks. Real estate agents who specialize in short sales will see an uptick of business.

Banks will pursue foreclosure options over loan modifications – Banks will find it is easier and less expensive to foreclose than to attempt loan modifications. It is probable that banks will decide it is more profitable for them to foreclose than to rewrite a loan. In that event, banks will prefer to make loans to new borrowers who meet rigid standards. As a result, the number of foreclosures will continue to rise. Many 5/1 ARMs will begin to adjust during 2009 and 2010, causing more foreclosures. But consumers won't see many of those foreclosed homes show up in MLS, (Multiple Listing Service) which will artificially reduce inventory.

Rental rates will increase as demand increases – Surging numbers of home owners will lose their homes in 2009, which will turn former home owners into tenants. Some home owners will walk away from their residences, deciding that home ownership is not worth the aggravation, and return to living in rentals. Because new construction will be at a standstill, existing inventory will serve as shelter. There will be fewer rental homes available than the demand will dictate which will put upward pressure on rental rates. Sellers who are unwilling to take a hit on their sales prices will put their homes on the market as rentals, but that won't provide enough inventory to fulfill demand.

Bank will rent out REOs – In an effort to drive up housing prices, banks will slowly release their REO inventory to the market and price those homes at 5% to 20% under comparable sales. Banks will be under great pressure to cut losses and increase revenue. Although state charters prohibit banks from renting out bank-owned homes, banks will find a way to work around this prohibition. By transferring title from bank-owned homes into holding companies, banks may find a loophole that will allow them to rent out homes instead of putting them on the market. This maneuver will let banks receive income while waiting for the market to turn around.

Link: 2009 Predictions

BREAKING NEWS: FHA Loan Limits Increased

Once they were out, but now they're back in. The economic recovery bill has raised FHA loan limits. The new limits for St. Louis and the surrounding metro area are:

One-family:	$281,250
Two-family:	$360,050
Three-Family:	$435,200
Four-family:	$540,850

First time's a charm in 2009
The $8,000 First-Time Homebuyer Tax Credit

By Amy Hoak, Market Watch

Unlike the last year's $7,500 tax credit for first-time homebuyers, the new $8,000 credit outlined in the American Recovery and Reinvestment Act of 2009 does not have to be paid back.

Want your money this year? The credit can be claimed on a homebuyer's 2008 or 2009 tax return. Tax returns for 2008 are due by April 15. If you've already filed, you have the option of amending your 2008 return to get the credit sooner.

"For first-time home buyers, this special feature can put money in their pockets right now rather than waiting another year to claim the tax credit," said IRS Commissioner Doug Shulman, in a February 25th news release. "This important change gives qualifying home buyers cash they do not have to pay back."

The new program applies to homes purchased on or after January 1, 2009 and before December 1, 2009. Buyers can claim 10% of the purchase price, up to $8,000, or $4,000 for married individuals filing separately, according to the IRS' web site.

The credit starts to phase out for those whose adjusted gross income exceeds $75,000 ($150,000 for joint filers.) The home must be their main residence and a homeowner cannot have owned a home in the previous 36 months to qualify as a first-time homebuyer. Selling the home within three years triggers an entire recapture of the credit at the time of sale.

The IRS has posted a revised version of the form required to claim the credit, Form 5405, on IRS.gov. Visit IRS.gov's first-time home buyer page.

Paramount in the news

Paramount personnel continue to share their industry knowledge and expertise with the local St. Louis media. Executive Vice President, David Griege, was recently engaged by KSDK's TV reporter Casey Nolan as an on-air expert.  Nolan's story about the $75 billion Homeowner Affordability and Stability Plan focused on St. Louisans dangerously close to foreclosure.

The federal plan is designed to help lower mortgage payments to approximately one-third of the at-risk homeowner's monthly income and keep millions in their homes. But for financially troubled homeowners like Janice Cole, featured in the story and within days of foreclosure, time is running out.

For homeowners "who are not paying on time, and they can reduce your payments to make it easier for you, you might be eligible," offered Griege. For some, relief may arrive too late. See the entire streaming video interviews online at KSDK's web site here.

Link: First time's a charm