BIG RETAILERS GAP, INC., WILLIAMS-SONOMA, ANN TAYLOR SUCCESSFULLY NEGOTIATING SIZABLE MALL RENT CONCESSIONS!
As the economy continues weak in many parts of the U.S., and retail sales continue to slide downward, many of the largest retailers are using favorable language in their mall and shopping center leases to renegotiate their store rents. Savings to these big chains could be substantial!
Reported in today's Wall Street Journal by Elizabeth Homes, Vanessa O'Connell, and Kris Hudson, Many retailers are exercising benefits provided by "contenancy clauses," common in many retail store leases. This language lets tenants receive considerable rent reductions, or even terminate their leases, if important tenants in a shopping center close down and leave.
The Chico's Apparel Store chain says it has saved over $8 Million by employing contenancy clauses in its store leases. Charming Shoppes, Inc, which operates Ladies Apparel Stores Lane Bryant and Fashion Bug, figures to save about $10 Million in 2009 in negotiated rent relief using the same provisions.
Often, a mall operator in breach of it's contenancy promise allows the retailer to cut its rent, in some cases, by 50% or more until the departing major tenant is replaced. Many leases allow other tenants to terminate their leases and leave themselves if no acceptable new store tenants are found in a typical one-year grace period.
At a time when many mall and shopping center operators are struggling to stay afloat among record vacancies, clever retailers are using their contenancy clauses to negotiate multi-year reductions in rent, sometimes in exchange for agreeing to extend their lease terms.
For retail stores, rent is among its biggest expenses, often accounting for up to 12% of the store's gross annual revenue. Rents are typically a fixed cost - they don't usually go down as sales do. Declining sales this year may push the rent/gross sales percentage to upwards of 13% this year, according to estimates by Citigroup.
For Chino's, rent as a percentage of sales revenue increased to 10% in 2008, versus 7% in 2006.
Mall and shopping center operators today are suffering through prolonged revenue drops themselves during the current U.S. Recession. According to Reis, Inc., a research company specializing in commercial real estate trends, the average lease rate at non-enclosed shopping centers and strip centers (excluding enclosed malls) in the top 77 U.S. Metro Markets declined for the fifth consecutive quarter during the Second Quarter, 2009. That is the longest string of quarterly declines since Reis began its research in 1980.
In enclosed shopping malls, average store rents fell for the third consecutive quarter during the Second Quarter of this year. Store vacancies have also reached near-historic high levels, as 27 major retail chains, including Linens 'n Things, Circuit City, and The Sharper Image, have filled for bankruptcy within the last year, then liquidated their assets and fled their retail stores.
Even long-time retail fixtures Blockbuster and Starbucks have been aggressively pursuing contenancy clauses and other lease concession provisions in search of monthly rental savings.
Store failures trigger reduced rents across the center, or canceled leases, greater vacancies, and, at the extreme, virtual retail ghost towns in some malls and strip centers.
DEAN MOSS & DEAN'S TEAM CHICAGO
IL ONE OF 32 STATES WHERE 25% OR MORE OF ADULTS ARE SERIOUSLY OVERWEIGHT!
It's a disturbing trend with long-ranging health implications - not only across the State of Illinois, but in the majority of other U.S. States as well.
According to a study by the Centers for Disease Control and Prevention released yesterday, one out of every four adults in Illinois is what they consider to be statistically obese - those with a Body Mass Index, a ratio of weight to height, in excess of 30%.
Unfortunately, the obesity trend is not headed in the right direction, as reported in the Chicago Tribune Triage Blog yesterday, by Reporter Judith Graham. In 1989, no U.S. State had more than a 15% adult obesity rate, using the benchmark. In 1991, four states exceeded the average BMI mark.
Indiana and Kentucky exceeded the 20% obesity mark in 1996, while Mississippi was the first state where more than 25% of its adult residents were considered overweight eight years ago. In 2005, Mississippi, along with Louisiana and West Virgina, passed the 30% obesity threshold.
As a state, IL is far from the most obese, but the trend toward adult obesity here has been growing at an alarming rate.
According to historic CDC statistics, fewer than 10% of adults in Illinois were considered obese in 1985. By 1987, the percentage of those obese across the state grew to as much as 14%. Seven years later, the estimated obesity percentage statewide ballooned to as much as 19 percent. Today, CDC estimates that as many as 29% of Illinoisans could be in the range of statistically-defined obesity.
When you consider that being considerably overweight increases your chances to contract heart disease, diabetes, and other significant ailments, an overweight populous increases overall health care expenses. One study by the Federal Agency for Healthcare Research and Quality calculates that health care expenses for overweight adults increased to over $303 Billion in 2006, up 80% from the estimated $166.7 Billion expenditure five years earlier.
Younger people, many of whom do not exercise nearly enough, and also gorge on far-too-much unhealthy, fast foods, account for a considerable portion of the obese establishment here in IL. In research released last week, the Trust for Public Health released a study showing that nearly 21% of young people across Illinois are overweight - many, seriously so.
Graham's post offers a link to U.S. Weight Trends, released by the CDC.
DEAN MOSS & DEAN'S TEAM CHICAGO
OLD TOWN
Now I'm definitely one to really like my fun Chicago tours. So imagine my surprise and excitement at learning there will be a new tour of the city by none other than The Second City.
The Neighborhood Tour will kick off on July 19th with times on Wednesdays and Sundays. Not only will there be education, but also lots of humor about The Second City alumni.
To read more, click here.
LAKEVIEW
Are you a reggae fan? If so, then you'll be glad to hear that King Yellowman is going to be at the Wild Hare this weekend.
Yellowman is known as the artist who helped bridge the gap between Bob Marley's music and the modern forms you hear today from artists like Buju Banton and Beenie Man.
To read more about this legend, click here.
LOOP
Sears Tower gives new meaning to "don't go over the ledge" with its latest attraction. Yep, it's called The Ledge.
Essentially you can go to the observation deck and then step out into a glass enclosure. You will see nothing below your feet and finally know what it would have been like to be one of the guys who helped build this amazing structure.
To read all about it, click here.
GOLD COAST
It's date night and your babysitter came down with the "flu," aka last minute concert tickets. You had the entire evening planned, but now you've got to make some last minute changes.
Lucky for you, you've made reservations at Seasons restaurant. Starting tomorrow night and every Thursday through September 3, Seasons has launched its promotion "Dine without Whine." The kids get their own experience (with a licensed babysitter) while you get to enjoy your date.
To read more, click here.
NAPERVILLE
Have you ever wanted to run with the bulls in Pamplona? Well now you can, kind of.
It's the next best thing, a commemoration to the Running with the Bulls at local restaurants throughout the Chicagoland area. One of the restaurants, Meson Sabika in Naperville, will feature special tapas from the Pamplona region of Spain.
To read more about the other restaurants celebrating this festival, click here.
CATHY MALLERS & DEAN'S TEAM CHICAGO
I received a great e-mail recently telling me all the ways you could use a dryer sheet around the house. Although some of them seemed far-fetched, like wiping off soap scum with a wet sheet, many sound like they would work.
Most of the good ideas involve using the deodorant properties of dryer sheets.
- Place a sheet in the bottom of all the garbage cans in the house, keeps things fresh.
- Slide a sheet in your lingerie drawer. Change every week.
- Throw a sheet into the vacuum bag.
- Put them in empty suitcases before storing, do the same for camping gear
Many uses also involve the anti-static properties of dryer sheets.
- Wipe off your TV or computer screen with a used sheet, it will eliminate static and also keep dust off.
- Use sheets to clean cat hair off fabric.
- Clean venetian blinds, at the same time prevent dust from settling back.
- Clean sawdust from projects or sanding.
Let me know if you have another use.
KATHLEEN WEAVER-ZECH & DEAN'S TEAM CHICAGO
Good Morning!
Simply walking away from your home and mortgage! This is often triggered by a severe drop in a home's market value, often leaving the owner considerably negative in home value versus outstanding mortgage amount. This process is often referred to as "being underwater."
But can today's homebuyers handle the moral and ethical questions of walking away from their home? Attitudes seem to be changing, and the answers might surprise you! See our post today at BlogChicagoHomes.com.
Here's our updated Chicago IL Real Estate Stats Pack for Monday Morning, July 6th.
Communities and clients we serve, reside, or plan to reside, include the Chicago Neighborhoods of The Chicago Loop, The Gold Coast, River North, Lincoln Park, Lakeview, Uptown, Edgewater, North Center, Lincoln Square, Albany Park, Ravenswood, Wicker Park, and Bucktown.
Also, these Great Chicago Neighborhoods: Logan Square, Rogers Park , West Ridge, Portage Park, Jefferson Park, Norwood Park, Sauganash, Edgebrook, and Edison Park. Plus All Chicago Suburbs.
SINGLE FAMILY, CONDOS, AND SMALL MULTI-UNIT PROPERTIES - NORTH SIDE OF CHICAGO, NORTH OF ADDISON STREET, WEST OF ASHLAND AVENUE
ACTV LISTINGS JUST SOLD CLOSED EXPIRED
w/e July 6th 4,188 47 91 82
w/e June 28th 4,239 68 77 32
% CHANGE -1.2% -30.9% +28.2% +156.3%
CLOSED PROPERTIES DATA
AVG SALE PRICE AVG DAYS ON MKT TOTAL VOLUME
w/e July 6th $252,762 191 DAYS $23,001,342
w/e June 28th $288,439 202 DAYS $22,209,803
% CHANGE -12.4% -5.4% +3.6%
THEORETICAL TIME TO CLEAR EXISTING INVENTORY (ABSORPTION RATE) -
w/e July 6th - LAST 12 MOS - 16.06 LAST 6 MOS - 17.78 LAST 3 MOS - 14.12
w/e June 28th - LAST 12 MOS - 16.24 LAST 6 MOS - 18.54 LAST 3 MOS - 14.57
PERCENT OF HOMES SELLING IN 180 DAYS -
w/e July 6th - 28.91% (UNSOLD - 71.09%)
w/e June 28th - 28.18% (UNSOLD - 71.82%)
SOURCE: MIDWEST REAL ESTATE DATA LLC, AREA MARKET SURVEY DATA
OBSERVATIONS
Despite the wild numbers swings common at the end of the month, especially mid-year at June 30th, there are some encouraging statistics this week.
For the second week in a row, Active Listings have fallen a bit, and Closed Sales were up. Are buyers finally beginning to clear out homes-for-sale inventory, especially properties in distress? Not so fast folks - properties Pending Sale fell nearly 31% last week, in the North and Northwest Side of Chicago Areas we serve frequently.
Average Sales Price is down, but so is Average Market Time, although the Market Time number still remains very high here. Sales Volume - up a bit over last week.
Absorption Rate - the theoretical time to clear existing homes-for-sale inventory, continues to improve, week after week, although it is still at a painful 14.12 months! The percentage of homes sell within a normal six-month marketing time frame improved slightly this past week.
Here are archived annual Chicago Neighborhood Statistics, including Units Sold and Price Trends Data, for 1995 through 2008 courtesy of The Chicago Association of Realtors.
In addition, here is an Interactive Median Price Heat Map, from the Chicago Tribune Real Estate Section, covering Every Chicago Neighborhood. View the map for links to maps for Chicago Suburbs. It is updated as new data becomes available.
RATE & MARKET WATCH
According to Bankrate.com statistics, average 30-Year Fixed Rate Mortgages returned to drop mode last week - average rates fell by 0.10%. They ended the week at 5.70%, for the week ending July 1st. One year ago, the Average 30-Year Fixed Rate was 6.53%.
Big News This Week - The Obama Administration expanded the number of potential underwater homeowners who will be eligible for his Making Housing Affordable Program.
Previously, homeowners with Fannie Mae or Freddie Mac-based loans had to have a mortgage balance of no more than 105% of the home's current market value. Changes to the program increase this number to 125% of the home's current value.
This important modification could spark refinance activity, especially among those homeowners in the hard-hit housing states of Nevada, California, Arizona, and Florida. See Holden Lewis' post via Bankrate.com for more potentially far-reaching mortgage news from the past week -
For daily news, hot information, and trends, view our Real Estate Update newsletter, via our Web Center - dean-team.com.
Call our Team TODAY to get detailed Real Estate Trends in any Chicago Neighborhood or Suburb,
DEAN MOSS & DEAN'S TEAM CHICAGO
HIGHLAND PARK IL PROGRAM ALSO MAKES LOCAL HOUSING AFFORDABLE FOR SOME OF THOSE WHO WORK THERE!
The Chicago Suburb of Highland Park IL. North Shore, along Lake Michigan. Some pretty expensive homes - Basketball Great Michael Jordan lives here! The median home price in this tony suburb, just under $500,000!
Now, however, the village is getting acknowledged for making affordable housing available to certain employees who work in this exclusive suburb, but otherwise wouldn't be able to afford to live here. See an article by Mary Ellen Podmolik in last Friday's Chicago Tribune for more info.
Started roughly six years ago, the Highland Park Community Land Trust has renovated some local townhouses - including 30 at the Hyacinth Place Townhouse Development - and offered them for sale to qualifying community residents - including health care workers, teachers, and certain city employees.
The townhomes feature three bedrooms, 2 1/2 baths, two-car garages, geothermal heating, bamboo flooring, and a "green-friendly" wind turbine that provides common area electricity. Each of the units appraised for $365,000 each, but they were sold for between $165,000 and $239,000. Only one unit remains available for purchase.
How does the Village of Highland Park do this?
The trust retains ownership of the underlying land, and leases the land to the homeowners for $25 per month.
When an owner decides to move, he or she can either sell the home back to the land trust, or market it to another qualifying buyer. A special formula keeps the price of the home or townhouse affordable.
Under this model, the seller shares in appreciation of the property. If there is depreciation, the seller's losses are not as great as they purchased the home for a discounted price to begin with.
There are other breaks for homeowners as well - property taxes are lower, and the buyers are not required to obtain Private Mortgage Insurance on their property.
Continued interest in the program remains high, as homeowner advocacy groups keep trying to find ways for renters to instead own, without getting themselves in over their heads. It also may be just the jumpstart some need to acquire their home affordably, and quickly building home equity and appreciation.
The neighboring community of Evanston IL also has a similar Land Trust. There are two in the City of Chicago, including one serving the far-less-affluent Chicago Neighborhood of West Humboldt Park. Each have enjoyed success.
DEAN MOSS & DEAN'S TEAM CHICAGO
Under their Land Trust, they offer houses and townhouses at up to 65% under market price, depending on the buyer's median household income
AVERAGE IL STATEWIDE INCREASE - 13%!
Wages have gone down! Home Prices have gone down! Even the price of some groceries, especially at Jewel Food Stores across Chicago, have gone down!
But homeowners insurance rates, across Illinois, are, on average, going up, as State Farm Insurance of Downstate Bloomington IL announced an average premium increase of 13% for policyholders here, according to a Chicago Tribune story by Reporter Becky Yeark.
State Farm is the leading home insurer not only in IL, but across the U.S. The company insures roughly one-third of all residential properties nationwide. But come August first for new policyholders, October 1st for those renewing an existing policy, rates will rise!
Individual premium increases will vary from individual to individual, says the insurer. Specific coverage plans and deductible levels will dictate the actual premium a homeowner will end up paying.
On the flip side, State Farm is actually increasing the discount it gives to those who have both a homeowner's policy and an auto insurance policy with the company. This multiple-policy discount could increase from its current 17% level, to an average of 20%.
The insurance giant was quick to point out, however, that overall homeowners insurance rates have actually fallen by 4.1% over the past five years. Average rates have see-sawed, up and down, since 2004.
Don't insure your home with State Farm? You're likely not immune to the rate increases. Across IL, competitor Allstate Insurance of Northbrook IL earlier announced a statewide increase in average homeowners insurance premiums.
DEAN MOSS & DEAN'S TEAM CHICAGO
SHOULD THEIR HOME FALL IN VALUE TO 50% OF MORTGAGE BALANCE OR LESS, ONE IN SIX WOULD WALK AWAY - SURVEY!
Is it ever simply OK to walk away from your home, and the responsibility of mortgage payments, if its value drops below the mortgage amount you owe?
According to a new survey just completed by the Northwestern University Kellogg School of Management, as reported by Mary Umberger in last Sunday's Chicago Tribune, the answer many gave might surprise you. And it seems dependent on how much a home borrower might owe compared to the home's current market value.
Most people do think walking away from a mortgage is walking away from a serious contract, and a big financial responsibility, and is morally wrong. In the survey, 80% of all respondents simply picking up and leaving a mortgaged home is wrong.
However, many of these same respondents said they would themselves walk away - under what they consider to be "extreme conditions."
Today, many experts estimate that between 20 and 30% of all homes with a mortgage are worth less than the outstanding amount of the loan - a situation commonly referred to as being "underwater" on your house. Many are severely underwater, with home values 50% or less than the outstanding mortgage balance.
For those still able to afford to keep up with their mortgage payments, but significantly underwater, many have come to believe continuing to make mortgage payments on a property worth so much less that what is owed makes no sense. Some have resorted to "jingle mail," a new term coined for those who return their house keys to the lender, rather than continuing paying an underwater mortgage.
In many locations across the U.S., especially in places hardest hit by recent severe housing price declines - parts of California, Arizona, Nevada, and Florida, for example - the stigma attached to the walk-away behavior has softened as foreclosure has hit closer and closer to them. When your close friends and neighbors start walking away, many conjecture, it might not be as morally offensive as they once thought.
Paola Sapienza of Northwestern University, collaborating with University of Chicago Professor Luigi Zingales and European University Institute of Florence, Italy, estimates as many as 25% of all underwater mortgage defaults are not precipitated by personal economic calamity, such as a job loss, a divorce, or an illness. Rather, they are triggered by the realization by the homeowner that it just might make better business sense to simply walk away, instead of making continued payments on an asset likely to continue to decline in value.
The researchers view such action as the moral equivalent of lying to your bank - that's the root issue these underwater owners are contemplating.
Another question - "How will the parents' decision to walk from a home impact how the children would likely make similar decisions down the road?"
That question will likely take a very long time to answer!
DEAN MOSS & DEAN'S TEAM CHICAGO
Yes Twitter is one of the most prolific sites out there these days. You can send short messages, similar to a text message from your cell phone, to keep those in your circle up to date on what's happening with you.
Over the 4th of July holiday (July 5th to be exact), Twitter suspended a good majority of accounts with no real rhyme or reason. The suspensions affected accounts that were both large and small.
There is no official explanation from Twitter, however, several consumers are stating that there was a "spam cloud." No one really knows what that means. All consumers know is that their Twitter accounts are being affected and they don't like it.
There is some speculation that those who use an auto-follow service have had the most hits. There will probably be more "thoughts" from the general public as time goes by. Suffice to say that this was very surprising to most Tweeters this weekend and Twitter has been extremely responsive to those who have legal accounts.
To read more, click here.
CATHY MALLERS & DEAN'S TEAM CHICAGO
Here's a quick snapshot guide of some of this July 4th Holiday Weekend's "goings on" around the Chicago land area.
If you haven't had a chance yet to get over to the Taste of Chicago, it wraps up this Sunday over at 100 E. Congress Parkway. Click here for hours, food ticket prices, music schedule and more.
The 17th annual African-Caribbean International Festival of Life is this weekend as well. Located at 5500 S. Cottage Grove, this Washington Park/ Woodlawn neighborhood festival features two stages of live music along with food vendors, exhibits, games and much more. Click here for prices, hours, music schedule and more.
On a smaller scale, what would the 4th be without B&BQ? Head on over to the Bull & Bear, located in the River North neighborhood at 431 N. Wells St. for some of Chef David Blonsky's BBQ grillings at their sidewalk patio - The BullPen! Click here for menu, hours and drink specials as well.
Finally, for all you fireworks enthusiasts (please leave it to the professionals), here's a run down of displays being offered --
Friday, July 3rd:
Independence Eve Fireworks, Grant Park, 300 S. Columbus Drive. Warning - more than a million spectators attend this display yearly!
A little less crowded are the following Shoreline Sightseeing Cruises - "Architecture-Fireworks Cruise", "Sunset Fireworks Cruise" and the "Independence Eve Fireworks Cruise". Click here for hours, prices and more.
There's also the Mercury July 3 Fireworks Cruise sponsored by Chicago's Skyline Cruiseline where you bring your own food and drink (no glass, please). Click here for hours, prices and more.
A few suburban locations are hosting their displays on July 3rd as well -
Arlington Heights Fireworks, Arlington Park Racecourse, 2200 W. Euclid. Click here for more information.
Aurora Fireworks, Aurora Central Catholic High School, 1255 N. Edgelawn Drive. Click here for more information.
Saturday, July 4th:
4th of July Fireworks at Navy Pier, 600 E. Grand Avenue.
4th of July Fireworks Cruise, Shoreline Sightseeing Cruises, located next to Navy Pier.
And finally, the July 4th suburban displays -
Evanston Fireworks, Dawes Park, 1700 Sheridan Road. Daytime activities are provided with a parade along Central Street at 2:00 p.m.
Naperville Fireworks, Knoch Park, 700 S. West Street. Presented as part of the Naperville Ribfest.
Oakbrook Terrace Fireworks, Terrace View Park, 1 Parkview Plaza. It's a community celebration with food, live music, carnival rides and more.
HOPE YOU ALL HAVE A "BANG" THIS 4TH OF JULY!!
SUE MOSS & DEAN'S TEAM CHICAGO
THE CHICAGO IL REAL ESTATE MARKET, AND OTHER THINGS CHICAGO, FROM THE POINT OF VIEW OF A LITTLE WHITE DOG!
Good Morning, you dogs!
These days, my own scan each morning of the Business Pages in The Chicago Tribune and The Wall Street Journal often reveal a sliver of opportunity for hope in the Rebound of the Real Estate Market in Chicago.
But other key indicators leave me a bit distressed!
Yesterday, in The Wall Street Journal, in a story by reporter Kelly Evans, The latest Standard & Poors/Case-Shiller Index of Home Prices in 20 of the largest U.S. Cities shows a bit of price stabilization in April.
To be sure, the average indexed home price fell two months ago - the latest month for which the index has been calculated - by an average 0.6% across the U.S. - an improvement from the more marked 2.2% decline of March, 2009.
Here in Chicago, however the year-over -year Index Decline, between April, 2008 and April, 2009 was a record 18.7%. This was not by any means the worst falloff of Metro Markets Surveyed across the country. The Phoenix Metro Area suffered and Index Decline of 35.3% year over year, Las Vegas - 32.2%, and Detroit, - 25.4%.
But still-declining prices here point up the fact true recovery of the Chicago Real Estate Market may still be a ways off.
For me, as a dog, however, another statistic is far more troubling.
As reported in today's Chicago Tribune, by Reporter Jeannine Aversa, the Unemployment Rate, and, it's sister, less reviewed indicator, the Underemployment Rate - remain high, and are likely to increase over the coming months, according to many experts.
Across the U.S. in June, employers shed 467,000 paid positions - far more than the projected 363,000 monthly job losses economists were projecting for last month. That represents a 45% increase in lost jobs compared to May. It leaves the U.S. Jobless Rate, according to the Department of Labor, at 9.5% - a 26-year high!
A far more telling statistic these days, however, is what many call the "Underemployment Rate". This figure includes those who tried looking for new jobs, but have since given up their search. It also includes those who have accepted, at least temporarily, jobs beneath their level of expertise and training, or those who are working fewer hours, or are working part-time as opposed to full-time.
This Underemployment Rate has been estimated at 16.5% for the month of June - the highest such rate on record in over 15 years!
One 58-year-old former non-profit director in Florida felt forced to accept a job - any job - in order to make ends meet. She feels as if she has started a new career, at a time in her life when she should instead be planning for retirement.
Another telling, somewhat depressing unemployment statistic - the length of the time without a job. Today, 29% of the unemployed in the U.S. have been out of work six months or longer, the highest such percentage since the end of World War II.
Further, Average Weekly Earnings fell by roughly $2.00 per week in June, to $611.49. That's the lowest number in 11 months, and the first month-over-month decrease since last March.
In Washington, Federal Reserve Board Chairman Ben Bernanke, and several other economists, predict the recession will end by late this year. It is already the longest U.S. Recession in over 60 years. In total, the U.S. Economy has lost 6.5 Million jobs since the beginning of 2008, and an estimated 15 Million Employable Individuals were out of work last month.
Taken together, you dogs, these numbers still do not paint a rosy picture for Real Estate Recovery, here in Chicago, and elsewhere. As my Human Dad, Dean's Team Chicago Leader Dean Moss, says -
"If someone on Friday thinks they might lose their jobs the following Monday, that intervening weekend will not be spent searching for a new home."
No matter the moderation in home prices according to the Case-Shiller Index, being jobless, or merely the FEAR of becoming jobless, will always have a chilling effect on potential economic turnaround.
But let's all cross our paws and hope for improvement - soon!
YOUR ACE REPORTER ON FOUR PAWS,
BUDDY HOLLY MOSS & DEAN'S TEAM CHICAGO
NEW REGULATION Z EARLY DISCLOSURE LAWS TAKE EFFECT JULY 30TH!
Have you ever sat down at the closing table when buying your new home, and found that many of the mortgage loan terms - including your interest rate and fees - have increased from what you calculated they would be?
Over the years, I can identify dozens of closings here in Chicago.
Buyer clients represented by our Team were taken aback by heavy loan processing fees, increased origination fees, and, in some cases, higher interest rates than were originally disclosed in the Federally-Required Good Faith Estimate, provided shortly after the original loan application was completed. Amidst the dozens of papers that need to be signed at a home closing, the buyers often begrudgingly agreed to the new, less-favorable terms.
Effective July 30, 2009, this can't happen anymore! (See the FDIC Website for a summary of the changes, as explained in Federal Institution Letter FIL-26-2009).
Approved enhancements to Regulation Z - the Federal Truth-In-Lending Disclosure Law - take effect later that month that require extensive early disclosure of revised loan terms, far in advance of closing. If changes occur too close to the pre-scheduled closing time, the closing would need to be delayed to allow for proper advance notice of the changes in terms.
The changes apply to mortgage loans on most primary and secondary residences, and would impact both first and second mortgage liens. The main requirements -
- The Loan Process, including ordering of the appraisal, must not begin before the borrower provides written agreement of all loan terms.
- No Loan Application Fees, with the exception of a reasonable charge for the initial credit check, can be assessed until proper initial disclosure is made, and accepted by borrower signature.
- After the Truth-In-Lending Disclosure is provided to the borrower, a mandatory 7 Business Day Waiting Period is required before closing can occur.
- Re-disclosure is required should the borrower's interest rate increase by 1/8% or more from the initial quote (1/4% or greater on an Adjustable Rate Mortgage, or ARM). The resulting revised Truth-In-Lending (TIL) Statement requires a minimum 3-Day Waiting Period (6 Days if sent by mail, rather than delivered in-person).
Late changes in terms, and the resultant closing delays as required by the new law, might delay many moves, and add stress to an already-stressful home purchase process.
DEAN MOSS & DEAN'S TEAM CHICAGO
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Property information
Fourth of July in Chicago has a slew of events happening. We've chose a few favorites that really highlight not only the holiday but also the neighborhoods that celebrate them.
NORWOOD PARK
Sometimes finding independence has nothing to do with coming to the United States, but going home. That's what Stephanie Andersen-Samayoa found when she relocated from Chicago to El Salvador.
The family's abandoned coffee plantation needed to be reclaimed, the debris cleared and the hacienda returned to its natural glory. Andersen-Samayoa took a leave of absence from work, followed by an extended leave and finally packed her things and moved to El Salvador.
Now you can purchase Finca Los Angeles coffee from her ex-husband, Bill Dugan, at Fish Guy Market, 4423 N. Elson. To read more, click here.
LINCOLN PARK
This weekend is time for the all the 4th of July festivities. Not to be outdone by the holiday is the 8th Annual White Party, which is sponsored by Tommy Z Productions.
The party is going to be at the club Religion, 720 N. Wells. To read more, click here.
LOOP
Fireworks happen twice over the weekend from the Loop area. If you are looking to watch the ‘works from Grant Park on Friday or Navy Pier on Saturday, you can head out to The Terrace at Trump, located on the 16th floor of Trump Tower. To read more, click here.
Not to be outdone, West Loop location Market is also opening up their rooftop to view the fireworks. To read more, click here.
LINCOLN SQUARE
Not to be outdone by the 8th Annual White Party, Lincoln Square's Provenance Food & Wine hosts free wine tastings every Thursday evening. Get your holiday weekend started with a tasting of wines from around the world.
To read more, click here.
EVANSTON
The City of Evanston has an entire website dedicated to its 4th of July festivities. The city is going all out again this year with a parade, concert and fireworks.
The Palatine Concert Band will be back again this year playing our favorite patriotic music and much more from 7:30 pm to 9:10 pm. The parade starts at 2:00 pm. The fireworks will start off Clark Street Beach immediately after the concert.
To read more about all the festivities being offered, click here.
CATHY MALLERS & DEAN'S TEAM CHICAGO
CONTINUOUS STATE-TO-LAKE MICHIGAN RIVERSIDE WALKWAY TO BE COMPLETE BY END OF SUMMER, 2009!
Roughly a century ago, Chicago Visionary Architect Daniel Burnham envisioned one large, beautiful stretch of public recreational parkland along the Chicago Shore of Lake Michigan, reaching from North to South across the city. Such Big Plans were thought unworkable in the early 19th Century, when polluting industry lined the Chicago Lakefront, and Lakefront parks were small and scattered.
But the vision remained, and is largely enjoyed in 2009.
In the early 1960's, an earlier Chicago Mayor Daley, Richard J., father of the Current Chicago Mayor Richard M. Daley, saw a day when downtown office workers could spend their lunch hours relaxing along the Chicago River, and perhaps enjoy a little fishing on every weekend.
At the time of his prognostication, the Downtown Chicago stretches of the banks of the Chicago River were far less than attractive, smelly, almost desolate places. The river itself - heavily polluted, barely supporting aquatic life.
The Chicago River today? Well . . . it's getting there, but still has a ways to go before Old Man Daley's vision comes close to reality.
In the June 27th Chicago Tribune Cityscapes Blog, Reporter Blair Kamin chronicles that development of a Chicago Riverwalk has gained speed in the last decade. Where sterile gray docks and unsightly weeds grew just two decades ago, swanky restaurants and winding riverside walkways now predominate. As soon as the end of July, the Chicago Riverwalk will extend between State Street, just north of The Chicago Loop, eastward to Lake Michigan.
The project includes see-through stainless steel and glass railings at the water's edge, concrete benches, and, further east, boulders to relax on, restaurant tables protected by umbrellas, a three-tiered walkway in front of the new Trump Tower, at Wabash Avenue, just north of the Chicago River, and spectacular, stylized canopies that cover the new Chicago Riverwalk under each bridge crossing, serving double duty as protection from falling debris dropped by pedestrians on the level above.
Important additional enhancements, including the much-ballyhooed, 150-story Chicago Spire, as well as a new DuSable Park near the Lake Michigan end of the Riverwalk, have stalled due to the recessionary economy. But, true to Daniel Burnham's Plan of Chicago inspiration of one hundred years ago, ambitious ideas for future Riverwalk development are indeed being contemplated.
Plans call for further extension of the Chicago Riverwalk east of State Street, to Lake Street near Wacker Drive. Architectural Firm Skidmore, Owings, & Merrill will be presenting their own long term plan for a nearly 1.3 Mile Long walk along the Chicago River, to include four distinct "identity districts", and a new, beautiful green space, created by landfill extending as much as 50 feet into the water, at the confluence of the North and South Branches of the Chicago River.
Current plans call for development of the South Bank of the Chicago River in Downtown Chicago, where land is predominantly under public control. Most of the North Bank is privately owned, and major redevelopment projects by these private owners is seen unlikely until the Chicago Economy once again begins to rebound.
One day, however, if the River Visionaries are proven out, those walking on the banks of the Chicago River will enjoy peaceful urban vistas each summertime day and night, without scenes of trash-strewn neglected docks, and uninterrupted, boring concrete gray.
DEAN MOSS & DEAN'S TEAM CHICAGO
