Archive for July, 2009
Beyond The Headlines
July 17th, 2009 categories: Buyer's Advice, Seller's Advice
C.A.R. Mortgage Update
This week’s C.A.R. Mortgage Update contains information about FHA mortgages, mortgage rates, jumbo loans, foreclosure scams, and mortgage modifications.
The appeal of 3.5% Down: FHA mortgages increase in popularity
A recent survey by Zillow.com found that more than one-third of buyers do not plan to make down payments larger than 10 percent, while nearly one-fifth do not plan to issue a down payment. Since loans insured by the Federal Housing Administration (FHA) only require a 3.5 percent down payment, these loans have risen in popularity among buyers.
Last month, the share of applications for government-insured mortgages rose to its highest level since November 1990, accounting for nearly 36 percent of all mortgage applications, according to the Mortgage Bankers Association. In 2005, the share of government-insured mortgages stood at less than 6 percent.
To read the full story, please click here:
http://blogs.wsj.com/developments/2009/07/10/the-appeal-of-35-down-fha-mortgages-increase-in-popularity
To view additional articles, please visit the following:
Mortgage rates drop for third week; 30-year at 5.14%
To read the full story, please click here:
http://www.usatoday.com/money/economy/housing/2009-07-16-mortgage-rates_N.htm
Upscale home sales lag as jumbo loans are hard to get
To read the full story, please click here:
http://www.usatoday.com/money/economy/housing/2009-07-14-sales-jumbo-loans_N.htm
Foreclosure scams targeted in U.S., state and local crackdown
To read the full story, please click here:
http://www.latimes.com/business/la-fi-foreclosure-scams16-2009jul16,0,1422452.story
Mortgage firms prodded to modify more loans
To read the full story, please click here:
http://online.wsj.com/article/SB124718320592520315.html
Loan modification efforts helping few troubled homeowners
To read the full story, please click here:
http://www.mercurynews.com/realestatenews/ci_12789161
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CNN
How to find your best place to live
The current economic situation has brought out many home buyers and also has caused some to relocate for new jobs. Finding the right home and one that has the best chance of holding or increasing in value can be challenging; however, real estate experts say that areas where homes retain their values best in tough times tend to have certain factors in common.
MAKING SENSE OF THE STORY FOR CONSUMERS
Since real estate markets are local and vary neighborhood to neighborhood, home buyers should work with REALTORS® who are familiar with the areas in which the buyers are interested. REALTORS® can help narrow down the number of properties to those that meet the buyers’ requirement.
During the height of the market, many home buyers only could afford to purchase in the exurbs. However, long commutes and high gas bills also can take their toll on homeowners. According to Ken Shuman at Trulia.com, homes more than 40 miles outside city centers generally have declined in value the most. For example, Shuman says that homes in Antioch (45 miles from San Francisco) lost 37 percent of their value in the past 12 months, while those in Walnut Creek (25 miles away) declined 18 percent.
Towns where zoning regulations make it more difficult to build have experienced smaller prices declines than towns that experienced huge building booms in recent years. “Prices are more likely to go higher if you can’t expand supply,” says Daniel McCue, research analyst the Harvard University Joint Center for Housing Studies. Towns nestled against barriers such as large lakes or protected wetlands also usually limit expansion.
Buyers can call the town or county planning office and ask how many acres of vacant land are in town, how much of it is zoned for residences, and the maximum number of homes that can be built. Requesting a copy of the town’s master plan also should tell buyers how much the housing stock is set to expand in the next 10 years.
Homes in towns with stores, banks, and movie theaters are more likely to hold value than those that are nearly all residential, as people like to live near these services and jobs, and provide the town a stronger tax base to fund public service items, such as police.
To read the full story, please click here:
http://money.cnn.com/magazines/moneymag/moneymag_archive/2009/08/01/105837635/index.htm?postver
sion=200907151
San Jose Mercury News
Foreclosures in Silicon Valley continue to climb
To read the full story, please click here:
http://www.mercurynews.com/business/ci_12834550
The Wall Street Journal
Home prices play big role in Americans’ decision to move
To read the full story, please click here:
http://blogs.wsj.com/economics/2009/07/14/home-prices-play-big-role-in-americans-decision-to-move/
The Los Angeles Times
Many underwater homeowners are deliberately walking away from mortgages
To read the full story, please click here:
http://www.latimes.com/classified/realestate/news/la-fi-harney12-2009jul12,0,3674775.story
Bloomberg
U.S. economy: Consumer sentiment falls on job losses
To read the full story, please click here:
http://www.bloomberg.com/apps/news?pid=20601087&sid=aV3l4MNlohIs
BusinessWeek
Southern California Homes Sales Rise Again
To read the full story, please click here:
http://www.businessweek.com/the_thread/hotproperty/archives/2009/07/southern_califo_2.html
What you should know about the market
The U.S. Dept. of Housing and Urban Development (HUD) offers an online guide to preventing foreclosure. The guide provides consumers with information such as how to contact a housing counselor; when and how to talk to their lender; how to find foreclosure resources; tips on avoiding foreclosure and foreclosure scams, as well as information for consumers who cannot keep their home.
The guide to preventing foreclosure can be accessed by visiting
http://www.hud.gov/foreclosure/
As credit underwriting guidelines tighten and down payment requirements increase, some home buyers – especially first-time home buyers – are finding it more difficult to qualify for a mortgage loan offered by a traditional financial institution. One viable option for some first-time home buyers, or those with challenged credit, is to apply for a home loan with the Federal Housing Administration (FHA). These loans are mortgages issued by a private lender but insured by the FHA. They often require smaller down payments and offer fixed-rate or adjustable-rate loans. However, not all home buyers will qualify. The FHA requires verification of income and assets along with a full home appraisal. While consumers with credit scores a low as 580 may qualify, home buyers should contact an FHA lender for an accurate assessment of their situation and ability to qualify.
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C.A.R. Mortgage Update
July 2nd, 2009 categories: Buyer's Advice
This week’s C.A.R. Mortgage Update contains information about finding a home loan, reverse mortgages, FHA loans, and current mortgage rates.
Best way to find a home loan
During the height of the real estate market, most borrowers who applied for a mortgage received one. However, in today’s lending environment, consumers should be more cautious about where they apply for a loan and from which Web sites they receive quotes.
Borrowers should be cautious about sites that request a Social Security number and address upfront. The site may pull the consumer’s credit report, which could have a negative impact on their FICO score should they not apply for the mortgage.
It’s also important that consumers ensure that all fees are clearly disclosed on a site’s rate quote. Otherwise they may be surprised when receiving the paperwork from the lender. Borrowers who are unsure of which type of mortgage is best for them and their situation should contact a mortgage broker. Those in the market for a jumbo loan or financing an investment property may best be served by working with an experienced broker.
To read the full story, please click here:
http://money.cnn.com/2009/06/29/real_estate/home_mortgages.moneymag/index.htm?postversion=2009062903
To view additional articles, please visit the following:
Reverse mortgages for home purchases
To read the full story, please click here:
http://www.nytimes.com/2009/06/28/realestate/28mort.html?ref=realestate
F.H.A. loans help sales
To read the full story, please click here:
http://www.nytimes.com/2009/06/28/realestate/28post.html?ref=realestate
U.S. mortgage rates drop to 5.32%, Freddie Mac says
To read the full story, please click here:
http://www.bloomberg.com/apps/news?pid=20601213&sid=a5WJtkeFK5yU
Searching for a bottom in the housing market
With consumer confidence rising in May to its highest level in eight months, housing starts increasing more than 17 percent in May compared with the previous month, and sales of existing homes climbing 2.9 percent in April nationwide, it appears that the housing market may be stabilizing.
KEEP THIS IN MIND
• Although sales of existing, single-family homes rose 35.2 percent in May in California, compared with a year ago, the median price declined 30.4 percent. Some industry analysts predict that as specialized adjustable-rate mortgages, known as option ARMS and Alt-A mortgages, reset over the next 18 to 24 months, prices could decline further before stabilizing.
• “We are seeing strong buying activity, particularly in those boom and bust markets, where prices have declined significantly. Buyers are coming in and fighting over properties – there is multiple bidding in California and Florida,” says Lawrence Yun, chief economist with the NATIONAL ASSOCIATION OF REALTORS®.
• Sales of existing homes are soaring as many investors and first-time buyers purchase distressed properties. Yun estimates that about 50 percent of current sales involve distressed properties, and he expects the trend to continue as foreclosures rise in the months ahead.
• Although some economists predict home prices will continue to decline in the coming months, California’s median home price rose for the third consecutive month in May, posting the largest monthly increase on record for the month of May.
• Some buyers are trying to time the bottom of the market and purchase once it appears that prices are consistently and steadily rising. Many housing forecasters advise against this approach as buyers should not view their homes solely as investment opportunities. Historically, the average annual rate of return on a home lived in for five years or more is nearly 12 percent, based on data C.A.R. has collected over the last 40 years.
To read the full story, please click here:
In Other News…
The Wall Street Journal
McMansions out of favor, for now
To read the full story, please click here:
http://online.wsj.com/article/SB124630276617469437.html
The Los Angeles Times
Home prices post 18.1% annual drop, but market appears to be stabilizing
To read the full story, please click here:
http://www.latimes.com/business/la-fi-homes1-2009jul01,0,793187.story
The Mercury News
Not paying the mortgage, yet stuck with the keys
To read the full story, please click here:
http://www.mercurynews.com/realestatenews/ci_12682822
The Los Angeles Times
No end to foreclosures is in sight
To read the full story, please click here:
http://www.latimes.com/classified/realestate/news/la-fi-blog28-2009jun28,0,2866475.story
The Wall Street Journal
Unemployment vexes foreclosure plan
To read the full story, please click here:
http://online.wsj.com/article/SB124597797525957807.html
Reuters
U.S. pending home sales rise 0.1 percent in May
To read the full story, please click here:
http://www.reuters.com/article/ousiv/idUSTRE56038Q20090701
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HOA Assistance Program
July 2nd, 2009 categories: Buyer's Advice
The Pacific West Association of REALTORS® Charity Foundation is helping first-time home buyers with the HOA Assistance Program to provide HOA dues for up to one year to first time home buyers!
HOA's
“Oftentimes, HOA dues can present a barrier to first time buyers. We are proud to have raised enough money to include an HOA dues assistance program this year, in addition to the down payment assistance grants that we will award,” said Michael DeLeon, President of the PWR Charity Foundation Board.
Applications for first time buyer programs.
>> Click Here for More Info on HOA Assistance Program
>> Click Here for More Info on Down Payment Assistance Program
Criteria:
- Income level (2 buyers) $111,600 for Orange County & and $90,960 for Los Angeles County.
- Purchase price is $350,000 for Orange and Los Angeles Counties.
- Buyers must contribute 1% of the sales price from their own pocket.
- Has not owned a home within the past 3 years.
- Credit score of 620 +.
- Approved from a direct lender
- Minimum five-year fixed-rate, full documentation (no stated income) loan.
- Buyer must be represented by a PWR REALTOR® member who has contributed to the PWR Charity Foundation in 2009.
- Must be located within PWR’s jurisdiction.
- Short-sales excluded
- Property and Home Owners Association must meet agency standards and pass review of PWR Underwriters (occupancy ratios apply, pending litigation, leased land,
- insufficient reserves not allowed) Condos & True Pud’s.
Jurisdictions Include:
Central/Northern Orange County and the Southeast Los Angeles County.
Anaheim/Anaheim Hills, Brea, Buena Park, Cypress, Fullerton, Garden Grove, La Habra/La Habra Heights, La Mirada, La Palma, Lakewood, Long Beach, Los Alamitos, Norwalk, Orange, Pico Rivera, Placentia, Rossmoor, Santa Ana, Seal Beach, Signal Hill, Stanton, Tustin, Villa Park, Westminster, Whittier, and Yorba Linda.
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Trade in Your Piece of Junk
July 2nd, 2009 categories: Buyer's Advice, Green Events, Neighborhood and City events/highlights, Restaurants, Seller's Advice
Obama signed into law a great new program that the (NHTSA) National Highway Traffic Safety Administration has named (CARS) the Car Allowance Rebate 
System. This is a government program that helps you purchase a new, more fuel efficient vehicle when you trade in a less fuel efficient vehicle. See the Frequently Asked Questions for more details.
Criteria:
- Your vehicle must be less than 25 years old.
- Only purchase or leases of new vehicles qualify
- Trade-in vehicles must get 18 or less MPG (some pick-up trucks, cargo vans have different criteria)
- Must be registered and insured continuously for the full year preceding the trade-in.
- You don’t need a voucher; dealers will apply a credit at purchase.
- The program runs through Nov 1, 2009 or when the funds are exhausted, whichever comes first. First come first served
- The vehicle that you are trading in will be destroyed. The value you negotiate with the dealer should not exceed its scrap value. The law requires the dealer to disclose to you and estimate of the scrap value when trading in your vehicle.
Beginning date is around July 23. See Program Rollout
How their guarding against fraud during the program? Click here for more information.
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C.A.R Mortgage Updates
July 1st, 2009 categories: Buyer's Advice, Seller's Advice
To read the full story, please click here:
To view additional articles, please visit the following:
Weakness in mortgage refinancing
To read the full story, please click here:
http://online.wsj.com/article/SB124508720715715781.html
http://www.mercurynews.com/realestatenews/ci_12603922
California housing market shows pockets of recovery
A surge in home sales that started in some of California’s more affordable inland areas has begun to spread to several more expensive coastal areas, another indicator that the state’s real estate market may be in recovery mode.
KEEP THIS IN MIND
- Many homes in the lower end of the market are receiving multiple offers, with some prospective buyers bidding well above asking prices. Inventory levels for homes priced under $500,000 stood at 3.2 months in May 2009, compared with 9.4 months in May 2008.
- Some buyers, especially those in historically higher-priced markets such as the San Francisco Bay Area, are newly optimistic about buying homes and are realizing that the combination of low interest rates, favorable home prices, and first-time home buyer tax credits may not realign for many years.
- Some housing economists caution against interpreting signs of increased sales activity as meaning the market has bottomed. Interest rates on 30-year, fixed-rate prime mortgages have risen above 5 percent in recent weeks and could continue to increase as fears of inflation impact interest rates. Additionally, the federal tax credit for first-time home buyers is scheduled to end November 30, which may remove the incentive to purchase.
- Although the median price in the state has risen for four consecutive months, prices in some higher-income neighborhoods still are declining. Some agents say that declining prices in these neighborhoods are a reflection of borrowers’ problems getting jumbo mortgages to make purchases.
To read the full story, please click here:
http://online.wsj.com/article/SB124545407944432853.html
The Los Angeles Times
Forecast for California: gradual clearing
To read the full story, please click here:
http://www.latimes.com/business/la-fi-cal-econ18-2009jun18,0,6354615.story
The Sacramento Bee
Leading economic indicators up more than expected
To read the full story, please click here:
http://www.sacbee.com/830/story/1957522.html
CNN
$6 billion available to buy foreclosed homes
To read the full story, please click here:
http://money.cnn.com/2009/06/23/real_estate/money_for_foreclosures/index.htm?postversion=2009062312
The Sacramento Bee
Sacramento area misses move-up home buyers—they’re staying put
To read the full story, please click here:
http://www.sacbee.com/business/story/1959684.htm
San Francisco Chronicle
Appeal assessment if you think it’s too high
To read the full story, please click here:
http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2009/06/21/BUGJ18ABE8.DTL&type=business
Reuters
Echo boomers a lifeline for embattled U.S. housing
To read the full story, please click here:
http://www.reuters.com/article/smallBusinessNews/idUSTRE55L0AO20090622
The Los Angeles Times
Home resales in U.S. rise 2.4% in May to 4.77 million rate
To read the full story, please click here:
http://www.latimes.com/business/la-fi-homesales-wire24-2009jun24,0,2268595.story
Bloomberg
Housing eludes recovery as job losses, foreclosures climb
To read the full story, please click here:
http://www.bloomberg.com/apps/news?pid=20601213&sid=aw.NN1SqL7xk
What you should know about the market…
• Buyers who are having difficulty arranging financing or coming up with a down payment
may want to consider rent-to-own or lease-options. Generally, these deals require buyers to pay
extra amounts of rent each month, in addition to the normal market-rate rent, plus up-front fees
of approximately 5 percent of the purchase price. The owner keeps the regular rent, but the
additional payments are used to buy down the price of the home. While rent-to-own options
may be a viable choice for some buyers, most real estate experts recommend buyers and
sellers work with attorneys experienced in drafting lease-option agreements.
• Although rent-to-own options enable buyers to walk away from the deal for a variety of
reasons, including deciding the home or neighborhood isn’t a good fit; one drawback is that by
walking away, buyers agree to forfeit the up-front fees and the additional monthly rent they’ve
been paying. Additionally, at the end of the term, if the buyer still is unable to secure financing
they also may have to forfeit the money.
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