**Greetings from Branon A. Edwards and Jelena Panfilova Edwards from
Coldwell Banker in sunny South Florida!

Some of our customers and investors have expressed concern about
rising interest rates. (Some of us remember when new mortgage loans
were 18%.) In an effort to keep you informed and provide you with
options, we have included a recent article that speaks to this issue.
To view our previous newsletters, click here:
http://finance.groups.yahoo.com/group/miamirealty/messages

Of course, if you or anyone you know is considering buying or selling
real estate in Florida, please let us know. We will be happy to
contact them directly. We consider referrals to be the most sincere
compliment that we can receive from our customers - THANK YOU! You
can also direct them to our extensive website at:
http://www.scubahh.com

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WE ARE CURRENTLY ACCEPTING NEW PROPERTY LISTINGS!
Thinking about selling your property?
Check out our Written Seller's Guarantee:
http://www.scubahh.com/guarantee.htm

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CONGRATULATIONS

We would like to send our congratulations to Richard of Miami for
reserving a great preconstruction unit in The Plaza on Brickell, a
luxury high-rise that will be located in the heart of the Brickell
Financial District. Both towers are nearly sold out.

We would like to send our congratulations again to Richard of Miami
for buying a fantastic preconstruction unit in Beach Club 2, a luxury
high-rise that will be located beachfront in Hallandale Beach. Only a
few select units remain.

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WHAT TO DO WHEN MORTGAGE RATES ARE RISING
Source: www.HSH.com (HSH Associates)

We've enjoyed basement-level interest rates for a while, but now rates
are rising -- and no one knows if the era of low mortgage rates is
over. If you're at the mercy of rising rates, you still have options
to keep your rates and payments low. Here are seven things you need to
know when rates are rising (or have risen); you might be able to help
yourself to some savings. (Revised 5/25/04)

First: don't panic.
Mortgage rates are notoriously fickle, following the whims of the bond
market. While it's true that interest rates rise much more quickly
than they fall, even a sharp jump in one day or week can be erased
over the next week or two. The current 30-year fixed rate mortgage
(http://www.hsh.com/statrel.html), now just over 6% (as we write
this), still ranks among the low points of the past several years.
Plus, keep in mind that even a one-half percent rise (from 5.5% to 6%)
is only a $32/month increase for a $100,000 loan -- and since most of
your early payments are tax-deductible interest, you'll recoup some of
that on April 15.

Pay down your ARM.
If you have an ARM which will be subject to higher interest rates in
the months (or years) ahead, you can offset the at least some of the
effect of higher interest rates by having them apply against a smaller
loan balance. For example, a $100,000 5/1 Hybrid ARM at 5% will have a
remaining balance of $91,829 at the 61st month. If the rate should
rise to 6%, your payment would leap from $537 to $592. However, if you
had paid down the loan by an additional $50 per month for the first
five years, your balance at the time of adjustment would be $88,829 --
and your monthly payment would only rise to $572. Send an extra $100
per month during that time and your payment lifts only to $553. (Note:
to keep your payment the same at 6% as it was at 5%, you would need to
have paid the loan balance down to $83,319 -- about a $142-per-month
prepayment pace). Of course, every additional dollar in principle you
send today is one where no interest will be charged tomorrow, so don't
wait.

Consider another loan product.
Today's mortgage market features a wide array of products, from
long-term fixed rate (FRM) to short term adjustable rate (ARM). If a
6% 30-year FRM might bust your budget, a 5/1 'Hybrid' ARM will fit the
bill. These have a fixed interest rate for the first five years at
more than a full percent below the 30-year fixed. That way, you get in
at a rate you can afford -- but after that, your rate (and payments)
will change annually, so keep an eye on rates and watch for chances to
refinance into a real FRM. Or, possibly, into another hybrid ARM;
they're also available in 3/1, 7/1, and 10/1 flavors. The longer the
fixed period, however, the lesser the interest rate savings.

What about a '2-1' buydown?
Buydowns are among the oldest loan gimmicks around. You start with an
interest rate that is about two percentage points below the market
rate for the first year. After that, the rate steps up by 1% in the
second year, then rises again by 1% a final time for the 3-30-years.
The catch: The final interest rate usually ends up about one-half
percent above today's rates. So, rather than getting 6% today, you get
4.5% in the first year, 5.5% in year two, then 6.5% for the remainder
of the loan. Of course, you could refi before that happens if rates go
your way.

Pay more points to lower the rate.
You can pay additional discount points to lower the interest rate.
Each point will cost you 1% of the loan amount, so it's not a cheap
option -- but each point you pay should lower your interest rate
between 1/8% and 1/4%, depending upon the product you choose. For
example: you pay two points ($2,000 on a $100K loan) to lower that 6%
rate to 5.5%. You'll reduce your payment by $32 per month, so you'll
break even in about 5 years.

You'll probably need some spare cash (say, in a rainy-day fund) to do
this -- but the lender may let you instead add the cost to the amount
you're borrowing, especially if it's a refinance.

Take a shorter commitment period.
One of the lesser-known facets of mortgage pricing (rates) is that
lenders offer a wide variety of commitment periods, ranging from 30
days to 60 days and even longer. The committment period is simply the
time expected to close the loan, and mortgage lenders often quote an
"average" one, like 45 days. If your paperwork is in order, and if
your credit record is good, you might be able to close your loan in
only 30 days. As a reward, your rate will be slightly lower as a
result of the shorter commitment period. This may be worth asking
about as lenders get less busy, since closing times may be starting to
get shorter again.

Offset the rise in rates with a bigger downpayment.
You can still keep your monthly costs down if you can afford more
upfront. That $100,000 mortgage at 5.50% has a monthly payment of
$567.78; with a 6% rate, you'll only be able to borrow $94,701, which
means you'll need to come up with an additional $6,300 to keep your
payment level. If you're cashing stocks to generate your downpayment
anyway, you might consider this option.

Get a "floatdown" option.
Think rates might be lower by the time you close, but are too afraid
to let your rate really "float"? A floatdown option may be the best of
both worlds. You can pay a small fee (one-eighth to one-quarter point
is common) to have access to lower rates if they fall during your
commitment period. Another method sets limits of how high or low your
rate can travel during the commitment period, but you may start at a
rate that is higher than market to start with (i.e. 6.125% with a
floatdown option to 5.75% versus 6% with no floatdown option).

Try a "Second Mortgage" instead.
In some circumstances, you might find a local bank, thrift or credit
union offering Home Equity Loans at very attractive rates, which you
may be able to use to replace your first mortgage. Lenders usually
write these loans for their own portfolios, meaning that there are
wide ranges of rates in most markets, so you'll need to shop around.
Of course, most equity loans aren't made with terms of 30 years, but
are usually available in 10 and 15- year flavors, so if you started
with a 15-year loan, or if you're deep into your mortgage -- more than
ten years in -- you can possibly replace your exising loan at a lower
rate or even shorten the term a little with no real rise in monthly
payment. Be wary of using a home equity line, though, especially if
you think you'll be in this mortgage for a long time. As these are
variable rate products, usually tied to the Prime rate
(http://www.hsh.com/idxhst.html), the prospect of higher interest
rates in the years ahead makes this a viable option for "holding
periods" of three years or less.

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LOOKING FOR A GREAT MORTGAGE RATE, AN INTEREST-ONLY LOAN, OR
NO-DOCUMENTATION LOANS?
Guaranteed to beat any other lender's price and give you same-day loan
approval!
Call Coldwell Banker Mortgage at 1-888-240-2236

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As always, thank you for the opportunity to earn your business. We
look forward to helping you sell your current property or to find your
next home.

All the best,

--Branon A. Edwards, Licensed Florida Realtor®
--Jelena Panfilova Edwards, Licensed Florida Real Estate Agent

Branon Direct: 786-417-4910
mailto:Branon@...?subject=NEWSLETTER-CONTACT

Jelena Direct: 786-417-4911
mailto:Jelena@...?subject=NEWSLETTER-CONTACT

Our Private Fax: 786-524-5747

VISIT OUR WEBSITE:
http://www.ScubAHH.com

---- Office Information ----

Coldwell Banker® Residential Real Estate, Inc.
328 Crandon Blvd, Suite 127
Key Biscayne, FL 33149 USA