Rehab a Home w/HUD's 203(k) - Part 3

Definitions for Use in the 203(k) Program

A. Insurance of Advances. This refers to insurance of the 203(k) mortgage prior to the rehabilitation period. A mortgage that is a first lien on the property is eligible to be endorsed for insurance following mortgage loan closing, disbursement of the mortgage proceeds, and establishment of the Rehabilitation Escrow Account. The mortgage amount may include funds for the purchase of the property or the refinance of existing indebtedness, the costs incidental to closing the transaction, and the completion of the proposed rehabilitation. The mortgage proceeds allocated for the rehabilitation will be escrowed at closing in a Rehabilitation Escrow Account. 

B. Rehabilitation Escrow Account. When the loan is closed, the proceeds designated for the rehabilitation or improvement, including the contingency reserve, are to be placed in an interest bearing escrow account insured by the Federal Deposit Insurance Corporation (FDIC) or the National Credit Union Administration (NCUA). This account is not an escrow for the paying of real estate taxes, insurance premiums, delinquent notes, ground rents or assessments, and is not to be treated as such. The net income earned by the Rehabilitation Escrow Account must be paid to the mortgagor. The method of such payment is subject to agreement between mortgagor and mortgagee. The lender (or its agent) will release escrowed funds upon completion of the proposed rehabilitation in accordance with the Work Write-Up and the Draw Request (Form HUD-9746,A).  

C. Inspections. Performed by HUD-approved consultants/inspectors or HUD-accepted staff of the DE lender. The consultant is to use the architectural exhibits in order to make a determination of compliance or non-compliance. When the inspection is scheduled with a payment, the inspector is to indicate whether or not the work has been completed. Also, the inspector is to use the Draw Request form (Form HUD-9746-A). The first draw must not be scheduled until the lender has determined that the applicable building permits have been issued.

D. Holdback. A ten (10) percent holdback is required on each release from the Rehabilitation Escrow Account. The total of all holdbacks may be released only after a final inspection of the rehabilitation and issuance of the Final Release Notice. The lender (or its agent) may retain the holdback for a maximum of 35 calendar days, or the time period required by law to file a lien, whichever is longer, to ensure that no liens are placed on the property.
E. Contingency Reserve. At the discretion of the HUD Field Office, the cost estimate may include a contingency reserve if the existing construction is less than 30 years old, or the nature of the work is complex or extensive. For properties older than 30 years, the cost estimate must include a contingency reserve of a minimum of ten (10) percent of the cost of rehabilitation; however, the contingency reserve may not exceed twenty (20) percent where major remodeling is contemplated. If the utilities were not turned on for inspection, a minimum fifteen (15) percent is required. If the scope of work is well defined and uncomplicated, and the rehabilitation cost is less then $7500, the lender may waive the requirement for a contingency reserve.
The contingency reserve account can be used by the borrower to make additional improvements to the dwelling. A Request for Change Letter must be submitted with the applicable cost estimates. However, the change can only be accepted when the lender determines: (1) It is unlikely that any deficiency that may affect the health and safety of the property will be discovered; and (2) the mortgage will not exceed the appraised value of the property less the statutory investment requirement. If the mortgage exceeds the appraised value less the statutory investment, then the contingency reserve must be paid down on the mortgage principal. If a borrower feels that the contingency reserve will not be used and he wishes to avoid having the reserve applied to reduce the mortgage balance after issuance of the Final Release Notice, the borrower may place his own funds into the contingency reserve account. In this case, if monies are remaining in the account after the Final Release Notice is issued, the monies may be released back to the borrower.
If the mortgage is at the maximum mortgage limit for the area or for the particular type of transaction, but a contingency reserve is necessary, the contingency reserve must be placed into an escrow account from other funds of the borrower at closing. Under these circumstances, if the contingency reserve is not used, the remaining funds in the escrow account will be released to the borrower after the Final Release Notice has been issued.

F. Mortgage Payment Reserve. Funds not to exceed the amount of six (6) mortgage payments (including the mortgage insurance premium) can be included in the cost of rehabilitation to assist a mortgagor when the property is not habitable during rehabilitation. The number of mortgage payments cannot exceed the completion time frame required in the Rehabilitation Loan Agreement. The lender must make the monthly mortgage payments directly from the interest bearing reserve account. Monies remaining in the reserve account after the Final Release Notice must be applied to the mortgage principal.  

G. Approval of Non-Profit Agencies. A non-profit agency, before it can be approved as an eligible mortgagor and obtain the same mortgage amount as available to owner-occupants on Section 203(k) mortgages, must demonstrate its experience as a housing provider to HUD and meet all other requirements described in HUD Handbook 4155.1 REV-4, paragraphs 1-5. It must also be able to provide satisfactory evidence that it has the financial capacity to purchase the properties.

Maximum Mortgage Amount The mortgage amount, when added to any other existing indebtedness against the property, cannot exceed the applicable loan-to-value ratio and maximum dollar amount limitations prescribed for similar properties under Section 203(b). The down payment requirements are the same as under the Section 203(b) program. The Mortgage Payment Reserve is considered a part of the cost of rehabilitation for determining the maximum mortgage amount. Also refer to the requirements for incentives to acquire HUD-owned properties.

The form HUD-92700 (Maximum Mortgage Worksheet) must be used to determine the maximum mortgage amount.

A. Maximum Mortgage Calculation REFINANCE: Based on the lesser of:
1) The existing debt on the property before rehabilitation, plus the estimated cost of rehabilitation and allowable closing costs or 2) The lesser of the As-Is value plus rehabilitation costs or 110 percent of the After-Improved value multiplied by the appropriate LTV factor. 
 
NOTE: If the property was owned less than one year, the acquisition cost plus the documented rehabilitation costs must be used.   PURCHASE: The maximum mortgage amount is based on the lesser of 1) or 2) of the below multiplied by the appropriate LTV factor.
1) The As-is value or the purchase price of the property before rehabilitation, whichever is less, plus the estimated cost of rehabilitation or 2) 110 percent of the After-Improved value of the property. 
 
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Principal Residence (Owner-Occupant) & HUD Approved Non-Profit Organization. For purchases with 203(k) financing: the maximum mortgage amount is to be based upon the HUD estimate of value in 1) or 2) above, less the statutory investment requirement. For refinances under the 203(k) program: the maximum mortgage amount is to be based upon 97/95/90 percent of the HUD estimate of value in 1) or 2) above.    B. Cost of Rehabilitation. Expenses eligible to be included in the cost of rehabilitation are materials, labor, contingency reserve, overhead and construction profit, up to six (6) months of mortgage payments, plus expenses related to the rehabilitation such as permits, fees, inspection fees by a qualified home inspector, licenses and consultant and/or architectural/engineering fees. The cost of rehabilitation may also include the supplemental origination fee which the mortgagor is permitted to pay when the mortgage involves insurance of advances, and the discounts which the mortgagor will pay on that portion of the mortgage proceeds allocated to the rehabilitation.   C. Exemption of the Market Value Limitation. The 203(k) regulations allow for a waiver request of the market value limitation, which allows the appraiser to go outside the targeted area to obtain the value of comparable properties. Such requests must be forwarded to the Assistant Secretary of Housing-Federal Housing Commissioner at the HUD Headquarters. Requests must include documentation that the following conditions are present:
1) The property is located within an area which is subject to a community sponsored program of concentrated redevelopment or revitalization (See 24 CFR Part 220). 2) The market value loan limitation prevents the use of the program to accomplish rehabilitation in the subject area. 3) The interests of the borrower and the Secretary of HUD are adequately protected.
D. Solar Energy Increase. The mortgage is eligible for an increase of up to 20 percent in the maximum insurable mortgage amount if such an increase is necessary for the installation of solar energy equipment. The solar energy system's contribution to value will be limited by its replacement cost or by its effect on the value of the dwelling.   E. Energy Efficient Mortgage Program. Under the FHA EEM Program, a borrower can finance into the mortgage 100 percent of the cost of eligible energy efficient improvements, subject to certain dollar limitations, without an appraisal of the energy improvements and without further credit qualification of the borrower. To be eligible for inclusion into the mortgage, the energy efficient improvements must be "cost effective," i.e., the total cost of the improvements (including maintenance costs) must be less than the total present value of the energy saved over the useful life of the improvements. The cost of any improvement to the property that will increase the property's energy efficiency and that is determined to be "cost effective" is eligible for financing into the mortgage and its cost may be added to the mortgage amount up to the greater of:
1) 5 percent of the property's value (not to exceed $8000) or, 2)$4000.
"Cost effective" means that the total cost of the improvements, including any maintenance costs, is less than the total present value of the energy saved over the useful life of the energy improvement. The FHA maximum loan limit for the area may be exceeded by the cost of the energy efficient improvements. However, the entire mortgage cannot exceed 110 percent of the value of the property The cost of the energy improvements and the estimate of the energy savings must be determined based upon a physical inspection of the property by a home energy rating system (HERS) or energy consultant. For a 203(k) loan, the entire cost of the HERS or the energy consultant can be included in the mortgage. On new construction (an addition or new building on an existing foundation), the energy improvement must be over and above those required for compliance with the current FHA energy conservation standards for new construction. The estimate of the energy savings in new construction must be based upon a comparison of plans and specification of the house with the additional energy saving improvements to those of the basic house which complies with the current FHA energy conservation standards. Presently, these standards are those of the 1992 CABO Model Energy Code (MEC). The energy inspection of the property must be performed prior to completion of the work writeup and cost estimate to assure there is no duplication of work items in the mortgage. After the completion of the appraisal, the cost of the energy improvements are calculated by the lender to determine how much can be added to the mortgage amount.

Rehab a Home w/HUD's 203(k) - Part 2

Condominium Unit

The Department also permits Section 203(k) mortgages to be used for individual units in condominium projects that have been approved by FHA, the Department of Veterans Affairs, or are acceptable to FNMA under the guidelines listed below.
The 203(k) program was not intended to be a project mortgage insurance program, as large scale development has considerably more risk than individual single-family mortgage insurance. Therefore, condominium rehabilitation is subject to the following conditions:
Owner/occupant and qualified non-profit borrowers only; no investors;
 Rehabilitation is limited only to the interior of the unit. Mortgage proceeds are not to be used for the rehabilitation of exteriors or other areas which are the responsibility of the condominium association, except for the installation of firewalls in the attic for the unit;
Only the lesser of five units per condominium association, or 25 percent of the total number of units, can be undergoing rehabilitation at any one time;
The maximum mortgage amount cannot exceed 100 percent of after-improved value.
After rehabilitation is complete, the individual buildings within the condominium must not contain more than four units. By law, Section 203(k) can only be used to rehabilitate units in one-to-four unit structures. However, this does not mean that the condominium project, as a whole, can only have four units or that all individual structures must be detached.
Example: A project might consist of six buildings each containing four units, for a total of 24 units in the project and, thus, be eligible for Section 203(k). Likewise, a project could contain a row of more than four attached townhouses and be eligible for Section 203(k) because HUD considers each townhouse as one structure, provided each unit is separated by a 1 1/2 hour firewall (from foundation up to the roof).
Similar to a project with a condominium unit with a mortgage insured under Section 234(c) of the National Housing Act, the condominium project must be approved by HUD prior to the closing of any individual mortgages on the condominium units.

How the Program Can Be Used
This program can be used to accomplish rehabilitation and/or improvement of an existing one-to-four unit dwelling in one of three ways: To purchase a dwelling and the land on which the dwelling is located and rehabilitate it.
To purchase a dwelling on another site, move it onto a new foundation on the mortgaged property and rehabilitate it.
To refinance existing liens secured against the subject property and rehabilitate such a dwelling.
To purchase a dwelling and the land on which the dwelling is located and rehabilitate it, and to refinance existing indebtedness and rehabilitate such a dwelling, the mortgage must be a first lien on the property and the loan proceeds (other than rehabilitation funds) must be available before the rehabilitation begins.
To purchase a dwelling on another site, move it onto a new foundation and rehabilitate it, the mortgage must be a first lien on the property; however, loan proceeds for the moving of the house cannot be made available until the unit is attached to the new foundation.

Eligible Improvements
Luxury items and improvements are not eligible as a cost rehabilitation. However, the homeowner can use the 203(k) program to finance such items as painting, room additions, decks and other items even if the home does not need any other improvements. All health, safety and energy conservation items must be addressed prior to completing general home improvements.

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Required Improvements
All rehabilitation construction and/or additions financed with Section 203(k) mortgage proceeds must comply with the following:
A. Cost Effective Energy Conservation Standards
(1) Addition to existing structure. New construction must conform with local codes and HUD Minimum Property Standards in 24 CFR 200.926d.
(2) Rehabilitation of Existing Structure. To improve the thermal efficiency of the dwelling, the following are required:
a) Weatherstrip all doors and windows to reduce infiltration of air when existing weatherstripping is inadequate or nonexistent.
b) Caulk or seal all openings, cracks or joints in the building envelope to reduce air infiltration.
c) Insulate all openings in exterior walls where the cavity has been exposed as a result of the rehabilitation. Insulate ceiling areas where necessary
d) Adequately ventilate attic and crawl space areas. For additional information and requirements, refer to 24 CFR Part 39.

(3) Replacement Systems.
a) Heating, ventilating, and air conditioning system supply and return pipes and ducts must be insulated whenever they run through unconditioned spaces.
b) Heating systems, burners, and air conditioning systems must be carefully sized to be no greater than 15 percent oversized for the critical design, heating or cooling, except to satisfy the manufacturer's next closest nominal size.


B. Smoke Detectors. Each sleeping area must be provided with a minimum of one (1) approved, listed and labeled smoke detector installed adjacent to the sleeping area.

Determining Upon One or Two Appraisal Reports
The appraiser must provide an opinion of the After-Improved value of the subject property, and in some cases, may be directed by the lender to provide the As-is value.
In those cases for which both As-is and After-improved values are required, the valuation analysis may consist of either one or two separate appraisal reports.

The number of appraisals depends on the complexity, scope and lender review of the proposed rehabilitation and nature of the work.

A. As-is Value. A separate appraisal (Uniform Residential Appraisal Report) may be required to determine the as-is value. However, the lender may determine that an as-is appraisal is not feasible or necessary. In this instance, the lender may use the contract sales price on a purchase transaction, or the existing debt on a refinance transaction, as the as-is value, when this does not exceed a reasonable estimate of value.

Further, on a refinance transaction, when a large amount of existing debt (i.e., first and second mortgages) suggests that the borrower has little or no equity in the property, the lender must obtain a current as-is appraisal on which to base the estimated as-is value.

On a refinance, the borrower may have substantial equity in the property to assure that no further down payment is required on the new loan amount. In some cases, the borrower will not have an existing mortgage on the property. In this case, the lender should obtain some comparables from a real estate agent/ broker to estimate an approximate as-is value of the property.

Another way of establishing the as-is value is to obtain a copy of the local jurisdiction tax valuation on the property.
B. Value After Rehabilitation. The expected market value of the property is determined upon completion of the proposed rehabilitation and/or improvements.

For a HUD-owned property an as-is appraisal is not required and a DE lender may request the HUD Field Office to release the outstanding HUD Property Disposition appraisal on the property to the lender to establish the maximum mortgage for the property. The HUD appraisal will be considered acceptable for use by the lender if. (1) it is not over one year old prior to bid acceptance from HUD; and (2) the sales contract price plus the cost of rehabilitation does not exceed 110 percent of the "As Repaired Value" shown on the HUD appraisal. If the HUD appraisal is insufficient, the DE Lender may order another appraisal to assure the market value of the property will be adequate to make the purchase of the property feasible. For a HUD-property, down payment for an owner-occupant or non-profit organization is 3.5% of the accepted bid price of the property and 100 percent financing on all other costs.

Recently Acquired Properties
Homebuyers who purchase a property with cash can refinance the property using 203(k) within six (6) months of purchase, the same as if the buyer purchased the property with a 203(k) insured loan to begin with. Evidence of interim financing is not required; the mortgage calculations will be done the same as a purchase transaction. Cash back will be allowed to the borrower in this situation less any down payment and closing cost requirement for the 203(k) loan. A copy of the Sales Contract and the HUD-1 Settlement Statement must be submitted to verify the accepted bid price (as-is value) of the property and the closing date.

Architectural Exhibits
The improvements must comply with HUD's Minimum Property Standards (24 CFR 200.926d and/or HUD Handbook 4905.1) and all local codes and ordinances. The homebuyer may decide to employ an architect or a consultant to prepare the proposal. The homebuyer must provide the lender with the appropriate architectural exhibits that clearly show the scope of work to be accomplished. The following list of exhibits are recom mended, but may be modified by the local HUD Field Office as required.


A. A Plot Plan of the Site is required only if a new addition is being made to the existing structure. Show the location of the structure(s), walks, drives, streets, and other relevant details. Include finished grade elevations at the property corners and building corners. Show the required flood elevation.

B. Proposed Interior Plan of the Dwelling. Show where structural or planning changes are contemplated, including an addition to the dwelling. (An existing plan is no longer required.)

C. Work Write-up and Cost Estimate. Any format may be used for these documents, however, quantity and the cost of each item must be shown. Also include a complete description of the work for each item (where necessary). The Rehabilitation Checklist in Appendix 1 of Handbook 4240.4 REV-2 should be used to ensure all work items are considered. Transfer the costs to the Draw Request (form HUD-9746-A).

Cost estimates must include labor and materials sufficient to complete the work by a contractor. Homebuyers doing their own work cannot eliminate the cost estimate for labor, because if they cannot complete the work there must be sufficient money in the escrow account to get a subcontractor to do the work. The Work Write-up does not need to reflect the color or specific model numbers of appliances, bathroom fixtures, carpeting, etc., unless they are nonstandard units.


The consultant who prepares the work write-up and cost estimate (or an architect, engineering or home inspection service) needs to inspect the property to assure: (1) there are no rodents, dryrot, termites and other infestation; (2) there are no defects that will affect the health and safety of the occupants; (3) the adequacy of the existing structural, heating, plumbing, electrical and roofing systems; and (4) the upgrading of thermal protection (where necessary).

Rehab a Home w/HUD's 203(k) - Part 1

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Rehab a Home w/HUD's 203(k) The Federal Housing Administration (FHA), which is part of the Department of Housing and Urban Development (HUD), administers various single family mortgage insurance programs. These programs operate through FHA-approved lending institutions which submit applications to have the property appraised and have the buyer's credit approved. These lenders fund the mortgage loans which the Department insures. HUD does not make direct loans to help people buy homes.

The Section 203(k) program is the Department's primary program for the rehabilitation and repair of single family properties. As such, it is an important tool for community and neighborhood revitalization and for expanding homeownership opportunities. Since these are the primary goals of HUD, the Department believes that Section 203(k) is an important program and we intend to continue to strongly support the program and the lenders that participate in it.

Many lenders have successfully used the Section 203(k) program in partnership with state and local housing agencies and nonprofit organizations to rehabilitate properties. These lenders, along with state and local government agencies, have found ways to combine Section 203(k) with other financial resources, such as HUD's HOME, HOPE, and Community Development Block Grant Programs, to assist borrowers. Several state housing finance agencies have designed programs, specifically for use with Section 203(k) and some lenders have also used the expertise of local housing agencies and nonprofit organizations to help manage the rehabilitation processing.

The Department also believes that the Section 203(k) program is an excellent means for lenders to demonstrate their commitment to lending in lower income communities and to help meet their responsibilities under the Community Reinvestment Act (CRA). HUD is committed to increasing homeownership opportunities for families in these communities and Section 203(k) is an excellent product for use with CRA-type lending programs.

If you have questions about the 203(k) program or are interested in getting a 203(k) insured mortgage loan, we suggest that you get in touch with an FHA-approved lender in your area or the Homeownership Center in your area.

Introduction
Section 10 1 (c) (1) of the Housing and Community Development Amendments of 1978 (Public Law 95557) amends Section 203(k) of the National Housing Act (NHA). The objective of the revision is to enable HUD to promote and facilitate the restoration and preservation of the Nation's existing housing stock. The provisions of Section 203(k) are located in Chapter II of Title 24 of the Code of Federal Regulations under Section 203.50 and Sections 203.440 through 203.494. Program instructions are in HUD Handbook 4240-4. HUD Handbooks may be ordered online from The HUD Compendium or from HUDCLIPS.

203(k) - How It Is Different
Most mortgage financing plans provide only permanent financing. That is, the lender will not usually close the loan and release the mortgage proceeds unless the condition and value of the property provide adequate loan security. When rehabilitation is involved, this means that a lender typically requires the improvements to be finished before a long-term mortgage is made.

When a homebuyer wants to purchase a house in need of repair or modernization, the homebuyer usually has to obtain financing first to purchase the dwelling; additional financing to do the rehabilitation construction; and a permanent mortgage when the work is completed to pay off the interim loans with a permanent mortgage. Often the interim financing (the acquisition and construction loans) involves relatively high interest rates and short amortization periods. The Section 203(k) program was designed to address this situation. The borrower can get just one mortgage loan, at a long-term fixed (or adjustable) rate, to finance both the acquisition and the rehabilitation of the property. To provide funds for the rehabilitation, the mortgage amount is based on the projected value of the property with the work completed, taking into account the cost of the work. To minimize the risk to the mortgage lender, the mortgage loan (the maximum allowable amount) is eligible for endorsement by HUD as soon as the mortgage proceeds are disbursed and a rehabilitation escrow account is established. At this point the lender has a fully-insured mortgage loan.

Eligible Property

To be eligible, the property must be a one- to four-family dwelling that has been completed for at least one year. The number of units on the site must be acceptable according to the provisions of local zoning requirements. All newly constructed units must be attached to the existing dwelling. Cooperative units are not eligible.

Homes that have been demolished, or will be razed as part of the rehabilitation work, are eligible provided some of the existing foundation system remains in place.

In addition to typical home rehabilitation projects, this program can be used to convert a one-family dwelling to a two-, three-, or four-family dwelling. An existing multi-unit dwelling could be decreased to a one- to four-family unit.

An existing house (or modular unit) on another site can be moved onto the mortgaged property; however, release of loan proceeds for the existing structure on the non-mortgaged property is not allowed until the new foundation has been properly inspected and the dwelling has been properly placed and secured to the new foundation.

A 203(k) mortgage may be originated on a "mixed use" residential property provided: (1) The property has no greater than 25 percent (for a one story building); 33 percent (for a three story building); and 49 percent (for a two story building) of its floor area used for commercial (storefront) purposes; (2) the commercial use will not affect the health and safety of the occupants of the residential property; and (3) the rehabilitation funds will only be used for the residential functions of the dwelling and areas used to access the residential part of the property.

Utah ranked No. 2 healthiest state

Utah ranked No. 2 healthiest state
By Carrie A. Moore

Deseret News 

If you worked out, took the stairs, ate an apple or chose water over soda for lunch Tuesday, yours were among the millions of daily choices Utahns make to rank as the second healthiest state in the nation.


New data released in the United Health Foundation's 20th annual America's Health Rankings rate the Beehive State second only to Vermont in a broad measure of health and overall physical well-being. Utah ranked fifth last year, so the newest rating is a significant boost, health officials said.

The yearly report credited Utah with the lowest rates in the nation for smoking, cancer deaths, infant mortality and binge drinking, but found the availability of primary care physicians here limited compared with other areas.

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It also noted a high "geographic disparity" regarding access to health services for those in remote rural areas, and cited a low rate of funding for public health as significant health challenges.

Utah's ranking was a pleasant surprise to health officials, who often deal with both the results of poor health choices and a relatively large gap in funding for public health programs.

Utah's spending was $60 per person for public health last year, compared with a national average of $94 per person and $150 per person in Vermont.

Dr. David Sundwall, executive director of the Utah Department of Health, said he was surprised and pleased by the jump in rank.


"It's obviously a continuation of a cultural predisposition to healthy behaviors, and I'm grateful to have people living here who care about their health," he said.

Sundwall was particularly pleased that the boost "comes at a time when the state is increasingly diverse."

"We can't just say anymore that those white Mormons are healthy people," he said. "We have to assume some of these improvements are due both to public health practices and state policies," including a legislative mandate that children in Utah who meet the income guidelines qualify for government-funded health insurance.

Dr. Elizabeth Joy, a family and sports medicine physician at the University of Utah, said she was a bit surprised by Utah's high ranking as well, though "there are a lot of really good things about the lifestyle here that provide us with good health as a state."

Though Utah's rate of obesity continues to increase at about the same rate as the rest of the nation, "we have a lower rate overall and a much lower rate than some parts of the nation, especially in the Southeast," Joy said.

Sundwall said he takes no comfort in the fact that Utahns were fifth best in the nation in the percentage of obese residents, noting 23 percent of Utahns still fall into that category.

"We are not yet getting fat as fast as the rest of the nation is," he said. "However, we are on a quick track of getting there."


Health promotion will continue to be needed, particularly among young people, Joy said. She's hoping to see a bill introduced during the upcoming legislative session that will restrict the vending machine choices available in the state's middle schools.

"Fat kids and fat adolescents become fat adults," she said. "If you're fat as a kid, your risk of obesity as an adult is almost guaranteed. It's a habitual as well as a physiological change that occurs as a result of the environment our bodies are exposed to."

The report praised Utah for its efforts in preventing infant mortality, noting the state's rate has dropped by 45 percent over the 20 years the health rankings report has been published. It also noted the decreasing rate of uninsured residents.

Utah has consistently ranked among the top 10 healthiest states in the 20 years the report has been published.

21 Mind-Blowing EscapesThe Best Nature Has to Offer

From www.travelchannel.com Utah ranks #8, right between Italy and Morocco!

21 Mind-Blowing EscapesThe Best Nature Has to Offer

by Erica Walsh

For those of you who sometimes feel overwhelmed about where to go on your next vacation, this list is key. From Arizona to Zambia, all the places on this list offer eye-opening natural wonders and once-in-a-lifetime experiences sure to blow your mind.

21. Blue Lagoon, Iceland
Kicking off the countdown is Iceland's Blue Lagoon, home to the world's largest geothermal pool. The pool's saltwater gets completely renewed every 40 hours and never drops bellow 100 degrees. Visitors to the pool swear by its positive effects on the skin and the soul. Guests are also welcome to indulge in the spa's many massages and treatments offered indoors and in the lagoon's healing water.

20. Four Seasons Tented Camp, Thailand
The Golden Triangle is where Thailand, Burma and Laos meet and where the Four Seasons Tented Camp offers the ultimate jungle luxury. Fifteen elevated, freestanding accommodations allow for privacy and spectacular views of the Ruak River, Burma, the Laotian mountains and lush jungle. The resort specializes in 3- or 4-night adventures, which include an elephant trek, hiking and a river excursion.

19. Isla de Vieques, Puerto Rico
The small island of Isla de Vieques was primarily under the control of the United States Navy until 2003. Therefore it lacks crowds, tall buildings, traffic and commercialized oceanfront property. The beaches here are pristine, the green flora lush and it's located only 6 miles from San Juan. The island is home to Puerto Mosquito, which despite its name is one of the most romantic places in the world. The bright bioluminescent bay will have you feeling as if you're floating among the stars.

18. The Peninsula Hotel, Hong Kong
The Peninsula Hotel in Hong Kong offers an elite experience that makes all guests feel like royalty. The hotel opened in 1928 and is the city's only historic 5-star luxury hotel. Its spectacular vistas of the Victoria Harbour in combination with top-of-the-line amenities make this the only Hong Kong hotel for the discerning traveler.

17. Bernese Oberland, Switzerland
If cityscapes and neon lights remind you a little too much of your 9 to 5, then escape to one of the most beautiful regions of Switzerland. The Bernese Oberland captures nature at its finest: snow-capped mountain peaks, fresh air and lush rolling greens. The quaint town of Interlaken lies between Lake Thun and Lake Brienz and is only a short train ride to the beautiful ski town, Grindelwald. This magical Swiss region truly offers the best of summer and winter and is a must for outdoor enthusiasts.

16. Secret Beach, Kauai
Nestled at the base of a sheer cliff just north of Kilaua, the Secret Beach truly is one of the island's best-kept secrets. Sunbathers will have to hike down a rocky, near-vertical trail to find the magnificent stretch of sand and sea. Your effort will immediately be rewarded as cares and worries melt away in this secret Hawaiian paradise.

15. Sequoia National Park, California
Number 15 on the countdown takes us back to the continental United States and straight to a national treasure. Sequoia National Park in California is home to some of the oldest trees on the planet. Three-thousand-year-old giant Sequoias cover the park's 400,000 acres. Activities within the park vary according to season, but its majestic and awe-inspiring beauty is a constant.

14. Milford Sound, New Zealand
In New Zealand's Fiordland region, visitors are awe-struck by the scenery of Milford Sound. Tumbling waterfalls, ancient rain forests, sparkling lakes and granite peaks capture the heart and the imagination. Travelers can experience the region via kayak, on foot and by air.

13. Cinque Terre, Italy
Just south of Genoa lies Cinque Terre, a national park and protected UNESCO territory. Over time, farmers in the Cinque Terre region transformed the area's steep natural slopes into fertile terraces for the cultivation of wine. The dry stone walls guide you through a varied network of paths with beautiful views of the Mediterranean. Those who like to hike should find the Cliffside trail, which passes through 5 coastal villages.

12. Wakaya Club and Spa, Fiji
The Wakaya Club is located on Wakaya Island in Fiji, a private 2,200-acre retreat belonging to Fiji's 333 islands. Wakaya Island features serene lagoons, majestic cliffs, beautiful beaches and is encircled by a coral reef. The resort includes 10 freestanding waterfront cottage suites where guests experience unparalleled pampering. From gourmet cuisine to luxurious spa treatments, the resort provides everything you could possibly desire in one of the world's most idyllic settings.

11. Ski Dubai, United Arab Emirates
Dubai is the fastest-growing city in the world and quickly becoming a place where anything is possible; proof of this is the creation of a man-made indoor ski slope. Ski Dubai has 5 runs varying in difficulty, a free-style zone and a family-friendly Snow Park. Don't worry about packing your skis or parkas -- both are available for rent at the one-of-a-kind desert ski mountain.

10. Volcanoes National Park, Hawaii
Two of the world's most active volcanoes sit inside Hawaii's Volcanoes National Park. There are many ways to experience the power of these natural wonders -- scenic drives, hikes and ranger-led tours being the most popular.

9. Marrakech, Morocco
In Morocco's historical Marrakech is the notorious Jamaa El Fna marketplace. Here, storytellers, shopkeepers and snake charmers vie for your attention while you enjoy traditional foods like escargot and couscous. You truly will feel as though you've entered another world, tantalizing to the senses.

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8. Monument Valley, Utah
The continental United States are back on the countdown at number 8. Monument Valley in Utah has been the setting for more Western movies than any other site in the US. Its iconic sandstone formations and the Four Corners Monument are unforgettable and absolutely breathtaking in person.

7. Venice, Italy
The city of Venice conjures images of stunning architecture, artistic masterpieces and incomparable wine and cuisine. Get lost in the St. Mark's Basilica and St. Mark's Square; experience the sites and sounds of the Venice Carnival; and walk across the Rialto Bridge.

6. Singita Lebombo, South Africa
At the Singita Lebombo Lodge, travelers experience the perfect combination of luxury accommodation and safari adventure. The resorts 15 suites all include indoor and outdoor showers and private terraces where you can sleep under the stars. During the day, explore the African wilds accompanied by an experienced guide and tracker.

5. Jellyfish Lake, Palau
Palau truly is one of the world's most beautiful tropical paradises. Located 500 miles from the Philippines, the island is famous for Jellyfish Lake. Here, a special species of jellyfish has been trapped in the lake and, over time, they've lost their ability to sting. A unique and unforgettable swimming and diving adventure, it earned the number 5 spot on our countdown.

4. Santorini, Greece
Santorini, Greece, is located in the Cyclades of the Aegean Sea and has one of the most beautiful landscapes in the world. The villages are built on cliffs and overlook a submerged volcano. Those who visit Santorini flock to Oia, a town offering stunning views of the sunset.

3. Grand Canyon, Arizona
Carved by the mighty Colorado River, the Grand Canyon is an unbelievable chasm that cuts 5,000 feet into the earth's crust. The canyon is 277 miles long, up to 18 miles wide and over one mile deep. Its vista is mesmerizing and awe-inspiring.

2. Zambezi River Rafting, Zambia
From a mighty river in America to another in Zambia, only the truly brave of heart risk whitewater-rafting on the Zambezi River. The river is classified as a high-volume, pool-drop river and floods between February and the end of June. At times, the volume is 4 times that of the Colorado River, so make sure you're prepared before running the Zambezi.

1. Angkor Wat, Cambodia
Angkor Wat is one of the most important archaeological sites in Southeast Asia. Another UNESCO-protected location, it contains the remains of the different capitals of the Khmer Empire, including the Temple of Angkor Wat and the Bayon Temple. Marvel at this jaw-dropping and eye-opening historical preservation.

Ten Questions on the Volatile Housing Market

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Ten Questions on the Volatile Housing Market


Lower Prices Have Spurred Home Sales, but Looming Foreclosures and High Unemployment Are Clouding the Outlook

By JAMES R. HAGERTY (The Wall Street Journal)


The U.S. housing market has been in a slump for the past four years. When will it ever end?

In recent years, real estate has proven as jittery and unreliable as any other market. The average U.S. home price nearly doubled between January 2000 and April 2006, according to the First American LoanPerformance index. Since then, the average has fallen about 30%. The drop has been 53% in the Las Vegas metropolitan area and 39% in Miami, where about a quarter of all households with mortgages are behind on their payments or in foreclosure. The value of your home might be determined more by whether the neighbors keep their jobs than whether the house has ample light and closet space.

Here is a guide to navigating a fractured and volatile market:

1. Is the housing market getting better?
It has shown some signs of healing this year, but the much-touted recovery is tentative and fragile.
Home sales have increased from the severely depressed levels of 2008. The inventory of unsold homes listed for sale also is down. Bidding wars are breaking out for foreclosed homes in the sorts of neighborhoods (near jobs and decent schools) that attract both first-time buyers and investors seeking rental properties.
But more than 6.7 million U.S. households with mortgages, or about 13%, are behind on their payments or are in the foreclosure process, according to the Mortgage Bankers Association. Eventually, many of them will lose those homes, sending more supply onto the market. Unemployment has continued to rise, and the housing market is unlikely to show a sustained recovery until job growth resumes.
While the supply of middle-class homes on the market has declined somewhat, it remains ample in most places. And there is a huge glut of high-end houses for sale in many areas. That means prices of high-end homes might still have a long way to fall.

2. When will housing bottom out?
There probably won't be any clear turning point. Monthly indicators, such as home sales and prices, tend to bounce erratically from month to month, making it hard to discern the underlying trend. And the housing bust will end at different times in different places. House prices already might have bottomed out in the coveted Virginia suburbs with short commutes into Washington, D.C., for instance. But it probably will be years before all of the unsold condos find buyers in parts of Florida.

Generalizations about states or metropolitan areas don't say much about what is happening in your neighborhood. In Summit, N.J., known for good schools and an easy, 45-minute train commute to Manhattan, the median home price in September was up 1.2% from a year earlier, according to Otteau Valuation Group, an appraisal company. In Atlantic City, N.J., which suffers from too much speculative building of condominiums and weak demand for vacation homes, the median price is down about 12% from a year ago.

3. What signals should I watch to determine whether my local market is improving?
One way to get a sense of supply is to ask a good local real estate agent for stats on how many homes are listed for sale in your town and how many months it would take at the current sales rate to absorb that supply. Anything over about six months generally is considered high, meaning that sellers might have to cut prices. Another way to get a sense of a neighborhood's health is to count the number of for-sale signs and vacant houses. If there are more than a couple vacant homes in a block, that might be a bad sign, particularly if no one is taking care of them.

The supply of homes listed for sale has fallen very sharply in some areas. But the supply is likely to balloon again in many areas with a renewed surge in foreclosures. Many local newspapers provide information on foreclosure filings.

Demand depends heavily on the job market. The U.S. Bureau of Labor Statistics provides unemployment rates by metropolitan area. In September, they ranged from 2.9% in Bismarck, N.D., to 30% in El Centro, Calif. State and local agencies provide job-market data, too. Celia Chen, a housing economist at Moody's Economy.com, says help-wanted signs can be a useful local indicator; if you start seeing more of them around your neighborhood, that is a sign that business in your area could be starting to recover.

4. How can I figure out the value of my home?
You never know for sure what a home will fetch until you put it on the market, and then it is partly a matter of luck. Will the eager buyer who shares your taste in home style and neighborhood show up on day one or day 200?

Some Web sites -- including Zillow.com, HomeGain.com and Cyberhomes.com -- provide estimates of individual home values. These estimates are largely based on recent sales of nearby homes, and in some cases they are wildly off the mark. But they often provide a ballpark idea of a home's value.

You might come closer to the real value by talking to a local agent and looking at recent prices for homes that you know are very similar to yours. If you want to be more scientific and don't mind paying a few hundred dollars, hire a professional appraiser.

5. Does it matter whether I'm "under water"?
At least you have plenty of company. About 20% of owners of single-family homes with mortgages owe more than the current estimated value of their homes, according to Zillow.com.
If you can afford your monthly payment and don't need to move soon, that might not be a big problem. But it is hard, and sometimes impossible, to refinance a mortgage if you are under water, and you will take a bath if you have to sell the home now. Some people who can afford to make their monthly mortgage payments are deciding it doesn't make sense to do so because they don't expect their home values ever to recover to past peaks, and they could rent similar houses for much lower monthly costs.

6. If I lose my home to foreclosure, how long will it take to repair my credit record?
It probably will be three to five years before you can qualify for a home mortgage insured by the government, depending on your circumstances, and that assumes you have re-established a record for paying your bills on time. The foreclosure will remain a blot on your credit record for seven years, likely raising your interest costs even if you do get another loan. If you pay bills on time, keep your credit-card balances low and don't apply for too many cards, you can make a "slow, gradual improvement" in your credit score, says Tom Quinn, a vice president at Fair Isaac Corp., which provides tools for analyzing credit records.

7. If I'm renting, is now a good time to buy a house?
It may well be. Prices in most areas are well below their peaks, even if they haven't hit bottom. Don't kid yourself that you can time the bottom of the market perfectly. But don't feel any pressure to buy in a hurry, because the supply of housing is likely to remain ample for years in many areas.
Generally, it doesn't make sense to buy unless you expect to remain in the house for at least four or five years, because the transaction costs -- including commissions for real estate agents and mortgage fees -- are heavy.

But now is clearly a good time to rent. Many landlords need tenants badly. The national apartment-vacancy rate in the third quarter was 7.8%, the highest in 23 years, according to Reis Inc., a New York research firm. So landlords are cutting rents and offering such sweeteners as free flat-screen televisions or several months of free rent to retain or attract tenants. Some owners of condos will "cut their throats to get some kind of rental income to cover part of their expenses," says Jack McCabe, a real estate consultant in Deerfield Beach, Fla.

8. Can I get a tax credit if I buy a home now?
Under an expanded and extended program approved by Congress earlier this month, tax credits are available to many people who buy or sign a contract to buy a principal residence by April 30 and complete the purchase by June 30. The tax credit is up to $8,000 for first-time home buyers and $6,500 for people who already have owned a home for at least five consecutive years during the previous eight years. The credit is available for individual taxpayers with annual incomes of up to $145,000 or joint filers with incomes up to $245,000.

9. Can I get a mortgage on attractive terms?
Only if you have a good credit record, a moderate amount of debt in relation to your income and the ability to fully document your income. That last requirement is fairly easy for people who work for a salary and have had the same employer for more than two years, but it can be tough for self-employed people with incomes that vary substantially from year to year.

A borrower with a strong credit score of 740 or higher (on the scale of 300 to 850) and the ability to make a down payment of at least 20% could get an interest rate of about 5% with no origination fees on a 30-year fixed-rate mortgage, says Lou Barnes, a mortgage banker in Boulder, Colo. But if your credit score is 680, the rate jumps to about 5.5%.

People who can't make a down payment of at least 20% generally are being funneled into loans insured by the Federal Housing Administration. That means paying extra fees for the FHA insurance.

Borrowing costs are steeper at the high end of the housing market. For so-called jumbo loans -- those above $729,750 in areas with the highest housing costs or $417,000 in places with the lowest costs -- interest rates on 30-year fixed-rate mortgages last week averaged 5.95%, according to HSH Associates, a financial publisher.

10. Should I invest in foreclosed homes?
Probably not. A lot of investors chase these properties, and only the most experienced know how to deal with all of the pitfalls. Homes auctioned at trustee or sheriff sales are sold on an as-is basis, and there is no provision for an inspection before you take ownership. If after buying you find out that termites have been treating the floor joists as an all-you-can-eat buffet, that is your problem. You must pay for the full price within a day or two, so you need a lot of cash or access to special short-term loans for investors that come with interest rates of around 18%. This is a pursuit best left to people with a lot of time, nerve, cash and knowledge of the local market.

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***Keep in mind that a home that is short sold is NOT the same as a foreclosure***
A short sale is a sale of real estate in which the sale proceeds fall short of the balance owed on the property's loan. It often occurs when a borrower cannot pay the mortgage loan on their property, but the lender decides that selling the property at a moderate loss is better than pressing the current debtor. Both parties consent to the short sale process, because it allows them to avoid foreclosure, which involves hefty fees for the bank and poorer credit report outcomes for the borrower.

______________________________________________

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Utah - Quality of Life

Overview

Residents of Utah enjoy an invigorating four-season climate, a moderate cost of living, high quality education, excellent health care, and outstanding cultural and recreational opportunities.

These economic, social and cultural advantages make Utah a very desirable place to live.

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Highlights

Utah's cost of living falls below national levels for most indicators.

The median sales price of a home in Salt Lake County in April 2008 was $235,000. Utah homes sales have been impacted by the national mortgage problems, but continue to be fairly strong.

Salt Lake County Parks and Recreation provides various activities for citizens of all ages, including a Jr. Jazz program.

Residents of the state enjoy lower disease rates and longer life expectancies.

Utah's culture emphasizes a family and community lifestyle. Thirty-nine states have higher violent crime rates than Utah.

Utah's professional sports teams include the Utah Jazz of the NBA, the Salt Lake Bees of Triple A baseball, the Utah Grizzlies Hockey club of the International Hockey League, and the REAL Salt Lake, Major League Soccer.

Utah is home to the U.S. National Ski Team.

The dry, powdery snow found at Utah's 14 Alpine ski resorts is considered to be the "greatest snow on earth".

Utah arts enthusiasts enjoy a unique mix of performing arts groups, including the Utah Symphony, Ballet West, the Utah Opera Company, the Utah Shakespearean Festival and the Mormon Tabernacle Choir, and modern dance.

Utah has five national parks: Arches, Canyonlands, Zion, Bryce and Capitol Reef.

Salt Lake also provides a variety of unique and enjoyable restaurants, clubs, and bars.

What is a CDPE?

What is a CDPE?

The prospect of foreclosure can be financially and emotionally devastating, and often homeowners proceed without guidance of any kind. The developers of the CDPE Designation believe that the best course of action for a homeowner in distress is to speak with a well-informed, licensed real estate professional. They have the tools needed to help homeowners find the best solution for their situation. Often, when other options have been exhausted, CDPEs can help homeowners avoid foreclosure through the efficient execution of a short sale.
While enduring financial difficulties is challenging for any family, the process of finding a qualified real estate professional should not be. Selecting an agent with the CDPE Designation ensures you are dealing with a professional trained to address your specific needs. A Certified Distressed Property Expert® is a real estate professional with specific understanding of the complex issues confronting the real estate industry, and the foreclosure avoidance options available to homeowners. Through comprehensive training and experience, CDPEs are able to provide solutions for homeowners facing hardships in today’s market, specifically short sales.

CDPEs don’t merely assist in selling properties, they serve and help save their clients in need.

What You Need to Bring to Settlement…

What You Need to Bring to Settlement…
Settlement customs vary widely. Your best bet is to consult with your agent and attorney about who is expected to bring what items to settlement. Most items will be sent ahead by your Sales Associate or arranged by the settlement attorney or escrow agent.

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Items needed at settlement:


A Copy of your Real Estate Purchase Agreement and all Addenda.

A Copy of your Good Faith Estimate provided to you by your lender.

Certified Funds for the amount that your lender has required (certified bank check, money order, cash). If you are not sure of how much to bring simply call your lender or your agent.

Proof of Identification for each person signing on the home/loan(s). Usually your Driver’s License works best.

If you are signing on behalf of another individual you must bring a copy of the Power of Attorney Document.


Any additional lender required item(s). Your lender will have notified you of any additional items.

3 Must Have Qualifications for a Short Sale

3 Must Have Qualifications for a Short Sale

While the misconceptions of what qualifies a seller for a
short sale are many, the reality is actually very simple.
Following is an explanation of the three major items that
banks will be looking for to consider a seller for a short sale. While
there will be much more information required, this is an excellent
place to start. A seller who does not meet all three of these
thresholds will not qualify.

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1. Financial Hardship

First and foremost a lender will want to see that your client is
experiencing a ‘financial hardship’. A financial hardship is a verifiable
issue that has caused your client to miss payments or have financial
difficulties.

Financial hardships can be issues such as:

• Mortgage Payment Adjustment
• Job Loss
• Too Much Debt
• Business Failure

A simple definition for ‘financial hardship’ is:
A material change in-between the day the mortgage was signed
and today that has affected the borrower’s ability to pay.

2. Monthly Shortfall
Almost every lender will want to see that a potential short sale
client cannot afford to pay their mortgage. The way that this is
demonstrated is on a financial worksheet that is essentially a
monthly profit and loss statement. While this may sound difficult in
reality determining whether a client has a monthly shortfall or not is
actually relatively easy.
The equation is:
Total Monthly Income – Total Monthly Expense = Monthly Shortfall
If your client does not have a monthly short fall but will have one
soon due to a payment increase or pending layoff, etc. then they
still can qualify for a short sale as long as this issue is verifiable.

3. Insolvency
In order to qualify for a short sale, your client cannot have the
means to pay down his mortgage. This means that the mortgage
company wants to see that your client owes more
than he has in cash (know as being insolvent). Your
client does not however have to be completely
broke—this is a common misconception, the lender
will want to see that over time the borrower will not
be able to pay their obligation.

Alex Charfen, Co-Founder of the Distressed Property Insitute