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Orange County Register
Distressed home sales rising Pending home sales rose in February, as did the share of distressed properties sold, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) reported this week. MAKING SENSE OF THE STORY
• Pending home sales in California increased in February, according to C.A.R.’s Pending Home Sales Index (PHSI)*. The index was 112.1 in February, rising 20.6 percent from January’s revised index of 93.0, based on contracts signed in February. The index was down 1.6 percent from February 2010, when the presence of housing tax credits played a strong role in home sales. Pending home sales are forward-looking indicators of future home sales activity, providing information on the future direction of the market, according to C.A.R.
• “The increase in pending sales is typical for this time of year, as we usually see a seasonal improvement in the spring,” said C.A.R. President Beth L. Peerce.
• The total share of all distressed property types sold statewide increased in February to 56 percent, up from 54 percent in January and up from 55 percent in February 2010. Non-distressed sales made up the remaining share at 44 percent in February, down from 46 percent in January and down from 45 percent in February 2010.
• The statewide share of short sales increased to 23 percent in February, up from 22 percent in January and up from 19 percent in February 2010. Read the full story:
http://mortgage.ocregister.com/2011/03/24/distressed-home-sales-rising/43621/
In Other News…
San Francisco Chronicle
Rates on 30-year fixed mortgage rises to 4.81 percent
Fixed mortgage rates edged up this week, but even 30-year rates below 5 percent have done little to boost home sales. Read the full story:
http://www.sfgate.com/cgi-bin/article.cgi?f=/n/a/2011/03/24/national/a070117D54.DTL&type=business The Wall Street Journal
Housing inventory increases, listing prices fall
Nationally, the inventory of unsold homes on multiple-listing services increased by 0.6 percent in February from one month prior. Over the past year, inventory is up by 13 percent, according to Move Inc. Read the full story:
http://blogs.wsj.com/developments/2011/03/23/housing-inventory-increases-listing-prices-fall/
Los Angeles Times
Home resales fall 9.6 percent in February and prices are near 9-year low
Sales of previously owned homes dropped 9.6 percent in February and prices fell to their lowest level since 2002, reflecting a continued slump in the U.S. real estate market. Read the full story:
http://www.latimes.com/business/la-fi-home-sales-20110321,0,7438761.story The New York Times
More borrowers are opting for adjustable-rate mortgages
In the years since the financial crisis, adjustable-rate mortgages, or ARMs, with their low initial interest rates that changed over time, have been considered riskier than fixed-rate loans and shunned by most buyers. But these days more people are being persuaded to give the loans a try. Read the full story:
http://www.nytimes.com/2011/03/20/realestate/20Mortgages.html?_r=1&ref=realestate
CNN Money
New home sales tumble to record low New home sales fell 16.9 percent in February, to the lowest level since the government began keeping records in 1963, as the reeling housing market failed to generate any momentum. Read the full story:
http://money.cnn.com/2011/03/23/real_estate/new_home_sales/index.htm?hpt=T2 Mercury News
Are buyers turning away from new homes in weak markets? A new home, the dream of many would-be buyers, makes less and less financial sense in many places. A wave of foreclosures has driven down the cost of previously occupied homes and made them even more of a comparative bargain. By contrast, new homes have become more expensive. Read the full story:
http://www.mercurynews.com/real-estate/ci_17674400 Yahoo Real Estate
Mortgage mod test becomes clearer Mortgage borrowers who are turned down for loan modifications may now get additional information that could help them understand why they didn't qualify under the so-called "HAMP test." Read the full story:
http://finance.yahoo.com/news/Mortgage-mod-test-becomes-brn-3851250881.html?x=0&.v=1&.pf=real-estate&mod=pf-real-estate
What you should know about the market
• Buying a home can be time consuming. One way to save time is by organizing all the necessary documents most lenders require, such as those that prove employment and income. Typically, lenders want two recent pay stubs, two years of tax returns, bank statements, proof of assets, such as 401(k) and trusts, and debts, such as credit card statements. Documents are especially important for borrowers who are self-employed.
• Even if a home purchase is months or years away, having good credit history is essential. A few points on a FICO score can mean the difference between a higher or lower interest rate offered on a mortgage loan.
• Borrowers also are advised to monitor home-lending rates. Every Thursday, Freddie Mac officials calculate average mortgage rates by compiling rates from lenders across the U.S. on Monday through Wednesday. Rates can be found at freddiemac.com/pmms |
Pasadena Star News
Home prices drop in February
Following three months of sales gains, California home sales posted a weaker-than-expected performance and declined in February, according to data from the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.). The statewide median price of an existing, single-family detached home sold in California also declined in February.
MAKING SENSE OF THE STORY
• Closed escrow sales of existing, single-family detached homes in California totaled a seasonally adjusted annualized rate of 497,660 in February, according to information collected by C.A.R. from more than 90 local REALTOR® associations and MLSs statewide.
• February’s sales were down 9 percent from January’s revised pace of 547,080 units, and down 4 percent from the 518,390 sales pace recorded in February 2010. The statewide sales figure represents what would be the total number of homes sold during 2011 if sales maintained the February pace throughout the year. It is adjusted to account for seasonal factors that typically influence home sales.
• The median price of an existing, single-family detached home sold in California in February declined 2.8 percent to $271,320, from a revised $279,140 in January, and was down 2.5 percent from the $278,190 median price recorded for February 2010. The February 2011 median price was the lowest since May 2009, when it was $263,440.
• “The market pulled back in February, following three months of sales gains, when the ramifications of the robo-signing delays from last fall pushed sales into the period from November of last year to January,” said C.A.R. Vice President and Chief Economist Leslie Appleton-Young. “February’s sales drop indicates the effects of the foreclosure freeze are diminishing, and the market is returning to a more moderate sales pace.”
• C.A.R. has posted median prices, unsold inventory stats, sales figures, time on market data, and more by county and region.
To view this information, visit:
http://www.car.org/newsstand/newsreleases/feb2011salesprice/
Read the full story:
http://www.pasadenastarnews.com/business/ci_17619755
In Other News… San Francisco Chronicle
Average rate on 15-year mortgage dips below 4 percent
Fixed mortgage rates tumbled this week and the 15-year loan dipped below 4 percent for the first time in three months.
Read the full story
http://www.sfgate.com/cgi-bin/article.cgi?f=/n/a/2011/03/17/national/a070205D58.DTL
The New York Times
A red flag on reverse mortgages
It is the saddest of paradoxes: A government-backed financial maneuver intended to free up extra money for struggling older people turns out to have left some widows and widowers on the brink of foreclosure.
Read the full story
http://www.nytimes.com/2011/03/12/your-money/12money.html?ref=realestate
Los Angeles Times
Home improvements can be funded but options are limited
The home-improvement sector, already benefiting from spending on rehabilitating foreclosed properties, can be expected to get an even larger boost in the coming months from owners who have deferred maintenance during the recession, and newly minted empty nesters who want to turn bedrooms into home offices.
Read the full story
http://www.latimes.com/business/realestate/la-fi-lew-20110313,0,7006590.story
The New York Times
More loan-modification options for the “underwater”
Struggling homeowners who owe more on their mortgages than their properties are worth have had few options to restructure their loans, but that may soon be changing for a few of them.
Read the full story:
http://www.nytimes.com/2011/03/13/realestate/13Mortgages.html?ref=realestate
Los Angeles Times
Passing the test on canceled mortgage debt has tax rewards
With hundreds of thousands of homeowners having negotiated loan modifications or short sales or been foreclosed upon during the past year, the Internal Revenue Service has issued fresh guidance on how to handle canceled mortgage debt in the upcoming tax season.
Read the full story:
http://www.latimes.com/business/realestate/la-fi-harney-20110313,0,6669801.story
The New York Times
A swift deal may not be a sound one
One crucial reason the nation’s mortgage industry ran itself – and the entire nation – off the rails was its obsession with speed. Mortgage had to be approved chop-chop, loans pooled instantly. When it came to foreclosure, well, the quicker the better. So it is disturbing that the same need for speed is at work in the bank settlement being devised by state attorneys general relating to improper loan-servicing and foreclosure practices.
Read the full story:
http://www.nytimes.com/2011/03/13/business/13gret.html?ref=realestate
Los Angeles Times
Bank of America offers mortgage relief for military
Bank of America, the nation’s largest bank, announced new initiatives intended to keep military families from losing their homes to foreclosure.
Read the full story:
http://latimesblogs.latimes.com/money_co/2011/03/bank-of-america-will-take-further-steps-for-military-families-facing-foreclosure.html
What you should know about the market
• As home prices decline, mortgage rates rise, and more uncertainty about the housing market abounds, more would-be home buyers are opting for rentals. However, new costs associated with renting – not to mention the increase in rents – is making renting less than the bargain it appears.
• For former homeowners, renting often means living in a smaller space – which means larger furniture and non-essential items often end up in storage. At one popular storage facility, the popular 100-square foot unit can cost up to $270 per month, depending on location.
• Anecdotal evidence suggests that more landlords are requiring tenants to sign up for renter’s insurance, according to the Insurance Information Institute. A typical policy covers a tenant’s possessions and pays for hotel stays and additional living expenses in the event a rental is destroyed or seriously damaged. Premiums usually range between $100 and $300 per year, and vary based on location and amount of coverage. |
The Wall Street Journal
Five signs that say “buy”
Home buyers sitting on the fence wondering if now is the right time to buy should consider five factors when making this decision: Jobs, recent sales activity, construction, mortgage availability, and anecdotal evidence. Each of these issues can help consumers make the best choice for their situation and financial circumstance.
MAKING SENSE OF THE STORY
• Jobs: Although many areas of the country were deeply impacted by the recession, some areas were less affected by job loss. If employment stability is a concern, prospective buyers should review job-growth data from the U.S. Bureau of Labor Statistics at www.bls.gov. The data provided by the Bureau is approximately one month old and shows the direction of the local economy.
• Recent Sales Activity: Housing inventory and sales volume should be taken into consideration while house hunting. A large inventory of homes with few actual transactions can be a negative indicator. On the other hand, if inventory is falling and transactions are rising, that is a good sign. In January, the CALIFORNIA ASSOCIATION OF REALTORS®’ Unsold Inventory Index stood at 6.7 months, up from 5 months in December 2010, but down from 5.7 months in January 2010. The index indicates the number of months needed to deplete the supply of homes on the market at the current sales rate.
• Construction: Staying up-to-date on the number of building permits issued for local builders is useful for gauging builder sentiment and the future of housing activity. The California Building Industry Association recently announced that California homebuilders pulled 2,920 total housing permits in January, registering a 5-percent decline compared with a year ago and a 56-percent decline compared with December. However, the Construction Industry Research Board is projecting 62,000 total permits will be pulled in 2011, an increase of 38 percent compared with 2010’s total of 44,893 permits.
• Mortgage Availability: Home buyers hoping to be approved for a mortgage should monitor local lending patterns. Following the financial crisis, most national banks tightened lending standards; however, some local banks haven’t been impacted as much as large lenders and are more willing to lend, even for higher-priced homes.
• Anecdotal Evidence: Although buyers can access home listings online, one of the best ways to monitor the local housing market is to work with a REALTOR® and gather intelligence using their expertise and guidance.
Read the full story:
http://online.wsj.com/article/SB10001424052748703905404576164720668195108.html?mod=WSJ_RealEstate_LeftTopNews
In Other News…
Los Angeles Times
IRS eases rules on property liens for delinquent taxpayers
The Internal Revenue Service says it’s trying to help people who are struggling to pay delinquent tax bills, so it’s reducing the number of property liens and easing rules for small businesses to enter into installment agreements.
Read the full story:
http://www.latimes.com/business/la-fi-irs-20110224,0,5872629.story
The New York Times
FHA to raise insurance premiums
Federal Housing Administration mortgages, the government-insured loans that have surged in popularity in recent years, will be getting more expensive this spring.
Read the full story:
http://www.nytimes.com/2011/02/27/realestate/27mort.html?_r=1&ref=realestate
The Wall Street Journal
Why 2011 may be the end of the housing crash
There might finally be some good news this year about the nation’s dismal housing market. Or, at least, the bad news could stop.
Read the full story:
http://online.wsj.com/article/SB10001424052748703796504576168822497423738.html?mod=WSJ_hpp_sections_personalfinance
The Wall Street Journal
Getting a mortgage before the door shuts
If you have been sitting on the fence trying to decide whether to buy a new house or refinance a mortgage, you should act soon. New loans are starting to get costlier.
Read the full story:
http://online.wsj.com/article/SB10001424052748704520504576162632959543492.html?mod=WSJ_RealEstate_LeftTopNews
The Wall Street Journal
Only one in four got mortgage relief
Just one in four of the 2.7 million homeowners who sought to participate in the Obama administration’s signature mortgage assistance program have succeeded in getting their monthly payments reduced.
Read the full story:
http://online.wsj.com/article/SB10001424052748704692904576166982594828812.html?mod=WSJ_RealEstate_LeftTopNews
The Wall Street Journal
Regulators push 20 percent down payments on homes
Banking regulators are pushing for mortgage-lending rules that require homeowners to make minimum 20 percent down payments on loans classified as lower-risk, according to people familiar with the matter.
Read the full story:
http://online.wsj.com/article/SB10001424052748703409904576175050116997530.html?mod=WSJ_RealEstate_LeftTopNews
The Mercury News
California program offers rebates for making energy-efficient improvements
A new statewide program will give homeowners rebates worth up to $4,000 if they make significant energy-efficient improvements to their houses.
Read the full story:
http://www.mercurynews.com/business/ci_17504980
The Wall Street Journal
Survey: Gloomy views persist on housing, economy
The number of Americans who believe that buying a home is a safe investment continues to fall, according to a new survey on housing attitudes from Fannie Mae.
Read the full story:
http://blogs.wsj.com/developments/2011/02/28/survey-gloomy-views-persist-on-housing-economy/
What you should know about the market
• The U.S. mortgage-lending landscape has changed from the height of the real estate cycle, when many lenders generously offered zero-interest terms and no-down payment loans. Now, the situation is much different. Most lenders have more stringent lending guidelines, and now require more documentation from borrowers.
• Mortgage rates are near historic lows, hovering around 5 percent. However, it’s unclear how long such rates will last, as rates are heavily affected by many factors, including the future of government-backed lenders Fannie Mae and Freddie Mac.
• Lenders have increased the amount of documentation borrowers must provide to obtain a mortgage, such as documentation of income. Processing times also have increased, making it particularly difficult for self-employed borrowers who have trouble providing proof of income. |
The Wall Street Journal
Banks push home buyers to put down more cash
Many economists and housing analysts blame lax lending standards – including no-down payment, no-document loans – for contributing to the challenges in the current real estate cycle. As a result, most lending institutions have increased minimum down payment requirements. Now, a new proposal by the Obama administration calls for gradually raising down payments to a minimum of 10 percent on conventional loans – those that can be bought or guaranteed by Fannie Mae and Freddie Mac.
MAKING SENSE OF THE STORY
• Banks have found that larger down payments discourage delinquencies by increasing the buyers’ exposure to loss and reducing the impact of declining prices. According to a study by the Federal Reserve Bank of St. Louis, buyers who made smaller down payments were more likely to default during “unfavorable economic circumstances, such as a housing market slowdown or job loss.”
• A recent analysis showed the median down payment in nine major U.S. cities rose to 22 percent last year on properties purchased with conventional mortgages. That percentage doubled in three years and represents the highest median down payment since the data were first tracked in 1997.
• Higher borrowing costs and larger down payments could cause housing prices to decline further, analysts say. For now, borrowers who can’t afford such amounts are turning to alternative programs, such as loans for veterans or those backed by the Federal Housing Administration. Some industry experts say this has created a nonconventional mortgage market for riskier borrowers and those who don’t qualify for conventional loans.
Read the full story:
http://online.wsj.com/article/SB10001424052748703312904576146532935600542.html?mod=WSJ_hp_LEFTTopStories
In Other News…
CNN Money
30 percent of mortgages are underwater
Home prices dropped 2.6 percent nationwide during the last three months of 2010, pushing more borrowers underwater, according to a quarterly real estate market survey from Zillow.com.
Read the full story:
http://money.cnn.com/2011/02/09/real_estate/underwater_mortgages_rising/index.htm
San Diego Union-Tribune
Will Millennials reinvigorate the U.S. housing recovery?
Millennials, those between18-34, will drive America’s housing recovery as prices have generally become more affordable and mortgage rates are still historically low, said Pete Flint, CEO of real estate website Trulia.com.
Read the full story:
http://www.signonsandiego.com/news/2011/feb/09/will-millennials-reinvigorate-us-housing-recovery
San Francisco Chronicle
Foreclosures raise U.S. economic stress The nation’s economic stress inched up in December because higher foreclosures outweighed lower unemployment, according to The Associated Press’ monthly analysis.
Read the full story:
http://www.sfgate.com/cgi-bin/article.cgi?f=/n/a/2011/02/08/financial/f031330S84.DTL
The New York Times
Calculating the annual percentage rate
The lending industry has tried to make it easier for borrowers to understand the true cost of a mortgage by disclosing both its interest rate and its annual percentage rate, or A.P.R. But consumers may often wonder which figure they should focus on when buying or refinancing a property.
Read the full story:
http://www.nytimes.com/2011/02/13/realestate/mortgages/13mortgages.html?_r=1&ref=realestate
CNN Money
Foreclosures are falling – but it’s a fake out
Foreclosure filings plunged in January, but don’t shake those pom-poms yet. It’s strictly a fake out.
Read the full story:
http://money.cnn.com/2011/02/10/real_estate/foreclosure_filings_fall/index.htm
Los Angeles Times
Rising construction costs could boost new-home prices soon
With interest rates near rock-bottom levels, most people realize it’s only a matter of time before loan costs start to rise. After all, what comes down in the mortgage world always has a way of going up.
Read the full story:
http://www.latimes.com/business/realestate/la-fi-lew-20110213,0,6809981.story
CNN Money
Home sales grow, aided by more stable prices
Home sales volume rose sharply in the final three months of 2010, aided by more stable prices on a year-over-year basis, a real estate industry group reported last week.
Read the full story:
http://money.cnn.com/2011/02/10/real_estate/realtors_home_prices/index.htm
Los Angeles Times
Federal Housing Agency backs off proposal to ban transfer fees
Thousands of homeowner associations and condominiums around the country just sidestepped a potentially costly problem: A federal agency this month backed off its controversial plan that would have made obtaining mortgages in their communities much more difficult, and would have dried up a key source of revenue that associations use to pay for improvements and property maintenance.
Read the full story:
http://www.latimes.com/business/realestate/la-fi-harney-20110213,0,6473192.story
What you should know about the market…
• When preparing for the purchase of a house, there are several items buyers must think about, such as their main priorities. Buyers should determine whether it’s more important to live in a particular type of home, such as a single family home with a garage, or in a particular neighborhood.
• Some neighborhoods hold value more than others during a housing downturn. Buyers can work with a knowledgeable REALTOR® to find a neighborhood that meets their needs as well as one where home values are stabilizing or rising.
• Once a buyer finds a home he want to make an offer on, he should be sure not to make a low-ball offer. Some sellers are willing to negotiate and others are not. Working with a REALTOR® can help ensure the buyer is dealt with fairly and guided through the process.
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CNN Money
Should you pay off the house?
An increasing number of homeowners are considering paying off their mortgage early. While paying off debt generally is a sound strategy, homeowners also are aware that mortgage interest is tax-deductible, so paying off a mortgage early may not be in the best interest for all homeowners.
MAKING SENSE OF THE STORY
• Homeowners with credit card debt, and those who aren’t contributing the maximum amount to a 401(k), are advised to make those the first priority. It is also important that homeowners have at least six months’ worth of living expenses in cash.
• Retirees, and those close to retirement, who are contemplating a lump-sum payoff, need to ensure they have enough liquid savings to handle emergencies and unexpected medical expenses.
• Homeowners planning to move to a larger home or downsize to a smaller one within five years are not advised to put extra money toward a mortgage.
• Those who itemize deductions on a tax return can figure out the amount of money saved on mortgage interest by multiplying the mortgage interest paid last year by their tax rate (federal plus state). For example, a couple in the 28 percent tax bracket, with a $200,000 loan at 5 percent, will save $2,781 in taxes the first year of a loan. It’s important to remember that tax savings decline further into the life of the loan, as more money is applied toward the principal.
• For many retirees, and those nearing retirement, who are close to the end of the mortgage, the interest deduction may not be considerable enough to avoid paying off the loan, especially since retirees often end up in a lower tax bracket.
Read the full story:
http://money.cnn.com/2011/02/22/pf/saving/pay_off_mortgage.moneymag/index.htm
In Other News…
Ventura County Star
Pending home sales up in California
In California, pending home sales were up in January, giving a hopeful outlook for future sales, according to the CALIFORNIA ASSOCIATION OF REALTORS®.
Read the full story:
http://www.vcstar.com/news/2011/feb/23/investors-scoop-up-foreclosed-properties-pending/
USA Today
Builders offer MPG-like home efficiency labels
Just as cards are sold with miles-per-gallon labels, more new homes this year will sport labels estimating monthly energy bills.
Read the full story:
http://content.usatoday.com/communities/greenhouse/post/2011/02/kb-builders-mpg-like-home-labels/1?loc=interstitialskip
CNN Money
ARMs helped sink the economy – now they’re back
After accounting for nearly 70 percent of all mortgages issued during the boom, adjustable-rate mortgages vanished during the bust, totaling just 3 percent of the market in 2009. Now, they make up 5 percent of all mortgages issued, and Freddie Mac predicts 10 percent by December.
Read the full story:
http://money.cnn.com/2011/02/14/real_estate/adjustable_rate_mortgages_rise/index.htm
Chicago Tribune
Experian adds rent payments to credit reports
Renters who need to build their credit histories are getting a leg up from a major credit reporting agency.
Read the full story:
http://chicagobreakingbusiness.com/2011/02/experian-adds-rent-payments-to-credit-reports.html.
MSNBC
U.S. consumer confidence hits three-year high
The Consumer Confidence Index rose to 70.4 this month, up from 64.8 in January, as Americans expressed more optimism about their income prospects and the direction the economy is headed, a private research group reported Tuesday.
Read the full story:
http://www.msnbc.msn.com/id/41716407/ns/business-stocks_and_economy/
San Francisco Chronicle
Mortgages in foreclosure process hit record
A record share of U.S. mortgages were in the foreclosure process at the end of 2010, matching the all-time high, as lenders and servicers delayed home seizures to investigate charges of improper documentation.
Read the full story:
http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2011/02/18/BUR91HP6D5.DTL&type=business
The New York Times
New Fed rule for mortgage brokers
Starting April 1, under a new compensation rule from the Federal Reserve, borrowers who get their mortgages through brokers will most likely pay less for their services and must be offered the lowest possible interest rate and fees for which they qualify.
Read the full story:
http://www.nytimes.com/2011/02/20/realestate/20mort.html?_r=1&ref=realestate
CNN Money
Home prices near 2009 lows
National home prices fell 4.1 percent during the last three months of 2010, compared with 12 months earlier, according to the latest report from the S&P/Case-Shiller home price index.
Read the full story:
http://money.cnn.com/2011/02/22/real_estate/december_home_prices/index.htm?hpt=T2
Talking Points …
• When shopping for a mortgage, some home buyers shy away from getting multiple loan quotes, fearing their credit will be impacted when multiple parties check their credit within a short period of time. However, consumers have 30 consecutive days in which multiple pulls of a credit score, or “rate shopping,” won’t affect a credit score. With that in mind, buyers should take advantage of the 30-day window and get as many loan quotes as possible to determine and secure the best rates and terms.
• There are two main types of mortgages: Adjustable-rate mortgages and fixed-rate mortgages. It’s critical borrowers are aware of each option and choose the one that best suits their situation. The most important factor in selecting a loan type is the length of time the borrower plans to remain in the home.
• Adjustable-rate mortgages (ARMs) have fixed rates for a short period, usually three, five, or seven years, and then readjust. ARMs are considered riskier because the interest rate and payments can increase when the loan adjusts. Fixed-rate mortgages have an interest rate that stays constant throughout the period of the loan.
• Both fixed- and adjustable-rate loans allow borrowers to select various repayment periods. The most common term is 30 years, but if a borrower can afford the higher monthly payments of 20- or 15-year terms loan, they will save money with the lower rate and quicker payoff period.
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New York Times
Online mortgage shopping made easier The vast amount of information available online about mortgages – such as interest rates, loan benchmarks, prepayment penalties, and the like – can cause home buyers to feel confused and overwhelmed when shopping for a mortgage. Most surprisingly, a recent survey found that only 61 percent of homeowners surveyed said they comparison shopped for a mortgage, and 39 percent said they took out a home loan based on just one quote.
MAKING SENSE OF THE STORY
• Resulting from consumer feedback about lending Web sites being unhelpful or difficult to navigate, some of the nation’s leading mortgage sites have responded by working to become more consumer-friendly. The revamped sites allow borrowers to not only browse lender rates and terms, but also learn about market trends and read comments from other loan shoppers.
• One of the challenges borrowers have, according to Keith T. Gumbinger, the vice president of HSH Association, is that while there is plenty of mortgage information available, consumers often have difficulty understanding the technical aspects of a mortgage, such as when an adjustable rate mortgage actually adjusts, and when a prepayment penalty applies.
• One site, LendingTree, allows consumers to browse quotes from various lenders, read an array of industry articles, use research tools and calculators, and peruse consumer-generated ratings and reviews of lenders. In December, the company created an online feature in which borrowers can post a mortgage-related question to be answered by a LendingTree loan specialist.
• Online direct lender, Quicken Loans, offers an expanding number of customer-written reviews on buying and refinancing. Beginning in March, consumers can download Quicken Loan’s iPhone app and track when appraisals come in, closing dates are set, and when other time-sensitive hurdles in the home-buying process are reached.
• Some major lenders also are making changes, including Bank of America, which offers articles and tools specifically for first-time buyers, and another set for more experienced borrowers.
• Of course, borrowers also can forgo the online aspect of mortgage shopping, and instead work with an experienced mortgage broker who can help guide the buyer through the process, including locking in the best rates available for their situation.
Read the full story
http://www.nytimes.com/2011/02/06/realestate/mortgages/06mort.html?ref=realestate
In Other News…
Wall Street Journal
Cash buyers lift housing
Buyers in markets around the U.S. are snapping up homes in all-cash deals, betting that prices are at or near bottom and breathing life into some of the nation’s most battered housing markets.
Read the full story:
http://online.wsj.com/article/SB10001424052748704570104576124502975117950.html?mod=WSJ_hp_LEFTWhatsNewsCollection
San Francisco Chronicle
Bank payment policy keeps some from mortgage aid
Some California homeowners are finding that bank policies are preventing them from participating in the new Keep Your Home California program, which provides up to $3,000 a month in mortgage payments to qualified, unemployed homeowners in California.
Read the full story:
http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2011/02/08/BU7R1HJT69.DTL&tsp=1
The Wall Street Journal
Home affordability returns to pre-bubble levels
Home affordability returned to pre-bubble levels in a growing number of U.S. markets over the past year as price declines laid the groundwork for a housing recovery. Read the full story:
http://online.wsj.com/article/SB10001424052748703313304576132291585938656.html?mod=WSJ_RealEstate_LEADTopNews
CNBC
Managing a potential flood of foreclosures
REO inventory is rising. Four million seriously delinquent loans, out of 50 million first mortgage loans, and, according to Economist Mark Zandi, there are still over 600,000 properties in REO, which will only put more pressure on prices when they come to market.
Read the full story:
http://www.cnbc.com/id/41412751
The Wall Street Journal
Survey: Mortgage process has become too confusing A new survey shows that Americans’ confusion over mortgage applications has become one of the most challenging aspects of buying a home today.
Read the full story:
http://blogs.wsj.com/developments/2011/02/08/survey-mortgage-process-has-become-too-confusing/
The New York Times
Housing bubbles are few and far between
What’s the outlook for home prices over the next decade? It’s not easy to tell.
Read the full story:
http://www.nytimes.com/2011/02/06/business/06view.html?ref=realestate
The Washington Post
Housing finance changes likely to mean less government backing for some buyers
The Obama administration is likely to recommend reducing the size of mortgages eligible for government backing, according to current and former officials, a move that could make getting a home loan in high-prices areas more expensive.
Read the full story:
http://www.washingtonpost.com/wp-dyn/content/article/2011/02/03/AR2011020307205.html?hpid=topnews
USA Today
Can you claim the home buyer tax credit?
If you bought a home last year, you may be eligible for a tax credit of up to $8,000 when you file your 2010 tax return. But before you start shopping, make sure you qualify.
Read the full story:
http://www.usatoday.com/money/perfi/taxes/2011-02-04-personalfinance04_ST_N.htm?loc=interstitialskip
What you should know about the market
• Getting a mortgage is a complex, time-consuming process that is generally one of the most significant events in one’s life. Because of this, there are several potential pitfalls borrowers should avoid.
• Applying for new credit and a mortgage simultaneously is never recommended. Anytime a borrower applies for new credit, the borrower is seen as a greater credit risk, at least initially. If the borrower also applies for a credit card or auto loan around the same time as applying for a mortgage, the borrower’s credit score might get dinged enough to increase the interest rate applied to the loan, or disqualify the borrower altogether. Borrowers should first apply for a mortgage, then apply for other consumers loans after the mortgage has been funded.
• Another mistake some borrowers make is failing to look at the total housing payment. A mortgage payment consists of principal, interest, taxes, and insurance (PITI). Commonly, some prospective home buyers forget to factor in the property taxes and insurance premium into the overall mortgage budget. |
USA Today
Fees for home mortgages increase For the first time since 2009, Fannie Mae and Freddie Mac are raising risk fees charged to lenders on loans they buy for resale to investors. Fannie and Freddie also are adding risk fees to more loans offered to borrowers with exemplary credit. Although lenders could absorb the cost, most are expected to add the fees to loan costs. MAKING SENSE OF THE STORY
• To avoid a fee or to receive a discount, most borrowers will need FICO scores of 740 or better and down payments of at least 25 percent.
• The fee increases likely will affect most loans with terms longer than 15 years that are sent to Freddie beginning March 1, and to Fannie beginning April 1.
• The most notable aspect of the fee increase is that the fees are being added to more loans to borrowers with higher credit scores. With few exceptions, risk fees previously hadn’t applied to borrowers with FICO scores of 740 or higher. Read the full story:
http://www.usatoday.com/money/economy/housing/2011-02-02-mortgages02_ST_N.htm
In Other News…
Mercury News
Five steps to first-time buyer happiness
The first step in the home-buying process is to find out what you can afford to pay for a house, condo, or co-op. Read the full story:
http://www.mercurynews.com/real-estate/ci_17218091
CNN Money
2011 housing market will be pancake flat
Housing markets will remain flat, flat, flat in 2011, according to forecasts from the Mortgage Bankers Association. Read the full story:
http://money.cnn.com/2011/01/26/real_estate/flat_housing_market/index.htm
The New York Times
Curbing closing costs
Borrowers have some weapons for keeping closing costs down, the result of recent guidelines requiring lenders to disclose certain fees, but perhaps the most underutilized consumer tool simply involves old-fashioned haggling. Read the full story:
http://www.nytimes.com/2011/01/30/realestate/30mort.html?ref=realestate
The Wall Street Journal
Home prices sink further
Home values are falling at an accelerating rate in many cities across the U.S. Read the full story:
http://online.wsj.com/article/SB10001424052748704680604576110442537531026.html?mod=WSJ_RealEstate_LeftTopNews
The Wall Street Journal
Boom’s homeownership gains lost The meltdown of the U.S. mortgage market and rising foreclosures have wiped out more homeowners than were created in the 2000-07 housing boom, some industry watchers say, the latest indication of the severity of the housing bust. Read the full story:
http://online.wsj.com/article/SB10001424052748704254304576116402472968150.html?mod=WSJ_RealEstate_RIGHTTopCarousel
The Wall Street Journal
Banks boost home-loan relief
As the federal government’s flagship mortgage-modification program comes under scrutiny for failing to meet its goal of helping three to four million troubled homeowners, state-level efforts to boost modifications appear to be picking up momentum. Read the full story:
http://online.wsj.com/article/SB10001424052748703439504576116300411004710.html?mod=WSJ_RealEstate_LeftTopNews
The New York Times
U.S. home prices slump again, hitting new lows
A new slide in housing prices has begun in earnest, with averages in major cities across the country falling to their lowest point in many years. Read the full story:
http://www.nytimes.com/2011/01/26/business/economy/26econ.html?ref=realestate
Los Angeles Times
Agency warns banks of foreclosure protection for military personnel
The new Consumer Financial Protection Bureau warned banks not to violate laws that protect active-duty military personnel from home foreclosures and high interest rates. Read the full story:
http://www.latimes.com/business/la-fi-military-foreclosure-20110202,0,7541419.story
MSNBC.com
Banks repossessed 1 million homes last year – and 2011 will be worse The bleakest year in foreclosure crisis has only just begun. Read the full story:
http://www.msnbc.msn.com/id/41051419/ns/business-real_estate/
What you should know about the market
• An increasing number of state and local governments are now offering “down payment assistance programs,” grants, or low- and no-interest loans to first-time buyers or those who haven’t owned a house in a few years.
• One such program offered in California is the California Housing Finance Agency’s “School Facility Fee Down Payment Assistance Program.” First-time buyers, or buyers who haven’t owned a property for at least three years, who purchase a newly constructed single-family home or condo can receive a grant for $5,180 on average for down payment, closing costs, or to pay for mortgage costs.
• Income restrictions on the School Facility Fee Down Payment Assistance Program vary by county, with Santa Clara County being the most generous at up to $12,200 for a family of four.
• An additional benefit of the School Facility Fee Down Payment Assistance Program is that the grant is forgiven for buyers who remain in the home for at least three years. |
Los Angeles Business Journal
California home sales hit seven-month high in December
California home sales rose in December, posting their highest level since May, according to a report from the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.), as the inventory of unsold homes dwindled. MAKING SENSE OF THE STORY
• Closed escrow sales of existing, single-family detached homes in California totaled a seasonally adjusted annualized rate of 520,680 units in December, according to information collected by C.A.R. from more than 90 local REALTOR® associations statewide. December’s sales were up 5.9 percent from November’s revised pace of 491,590 units, but were down 6.8 percent from the revised 558,840 sales pace recorded in December 2009. The statewide sales figure is adjusted to account for seasonal factors that typically influence home sales.
• Following three consecutive monthly declines, the median price of an existing, single-family detached home sold in California increased 1.7 percent from a revised $296,690 in November but was down 1.6 percent from the revised $306,860 median price recorded for the same period a year ago.
• “December’s sales increase reflects buyers taking advantage of rock bottom interest rates and improved affordability since the first half of the year, when prices were higher,” said C.A.R. President Beth L. Peerce. “Most of December’s sales opened escrow in October and November. Rates hit their absolute lowest in October but began edging higher in November, prompting buyers to get off the fence,” she said.
• For more about the California housing market, watch a video of C.A.R. Chief Economist Leslie Appleton-Young as she discusses highlights of the December sales and price report. Read the full story:
http://www.bizjournals.com/losangeles/news/2011/01/21/california-home-sales-hit-7-month-high.html
In Other News…
CNN Money
Shadow inventory threatens housing recovery
There is a growing glut of foreclosed homes threatening to hit the market over the next couple of years, potentially delaying any recovery. Read the full story:
http://money.cnn.com/2011/01/20/real_estate/shadow_inventory_rise/index.htm
The New York Times
More transparency for variable-rate loans
Changes to the Truth in Lending Act have helped make loan documents more understandable for many borrowers, but some people with more complicated, fluctuating mortgages may still struggle to grasp all the terms. Read the full story:
http://www.nytimes.com/2011/01/23/realestate/mortgages/23mort.html?_r=1&ref=your-money
The Washington Post
Housing policy and the gay community
The Dept. of Housing and Urban Development is taking steps to ensure gays and lesbians don’t face discrimination when applying for federal housing assistance. Read the full story:
http://www.washingtonpost.com/wp-dyn/content/article/2011/01/23/AR2011012303404.html
USA Today
Poll: Hiring plans top layoffs by most in 12 years
Industry economists say the U.S. economic recovery is gaining strength, with more firms expressing positive hiring plans than in over a decade. Read the full story:
http://www.usatoday.com/money/economy/2011-01-24-nabe-survey_N.htm?loc=interstitialskip
The Washington Post
Federal officials studying how to protect housing market
Federal official took steps last week to attempt to reduce the likelihood of a second financial crisis caused in large part by large declines in the housing market. Read the full story:
http://online.wsj.com/article/SB10001424052748704482704576071984006994652.html?mod=WSJ_RealEstate_LeftTopNews
The Wall Street Journal
JP Morgan admits wrongful military foreclosures
J.P. Morgan Chase & Co. admitted that it wrongly foreclosed on 14 active-service military families and overcharged thousands more on their mortgages, a continuing internal bank review has found. Read the full story:
http://online.wsj.com/article/SB10001424052748704678004576090224257754378.html?KEYWORDS=
JP+Morgan+admits+wrongful+military+foreclosures
The New York Times
U.S. housing starts slowed sharply in December
Groundbreaking on new homes fell more than expected in December to its lowest in over a year, suggesting the battered housing sector remained a roadblock to a recovery Read the full story:
http://www.nytimes.com/2011/01/20/business/economy/20econ.html?ref=economy
DSNews.com
Study finds California mortgage applicants have highest credit scores
California mortgage applicants have the highest average credit scores in the nation, according to a state-by-state study conducted by Mortgage Marvel, a nationwide online mortgage-shopping service. The average credit score in California is 755, a full 20 points higher than the national average. Read the full story:
http://www.dsnews.com/articles/study-finds-california-mortgage-applicants-have-highest-credit-scores-2011-01-19
What you should know about the market:
• Before you sign on the dotted line for that apartment or home whose great price you just can't pass up, make sure you've figured out how your new location is going to fit into your life. It might just end up costing you more in commute costs as affordable housing moves from the urban cores to the suburbs.
• A new study by the Center for Neighborhood Technology has found that a growing number of communities that are considered affordable aren't quite so affordable when transportation costs are factored in to the median income.
• Its analysis of 377 metropolitan areas, which includes 161,000 neighborhoods and 80 percent of the U.S. population, found that even though seven out of 10 U.S. communities are considered affordable, that number decreases to two in five -- or 39 percent -- when transportation costs are included in the mix.
• Housing is considered affordable if it costs less than 30 percent of household income, and the analysis ups that to 45 percent when transportation costs are added in.
• But considering that transportation is the second-largest household expense next to housing, it often costs more than the allotted 15 percent of the budget.
• The Center for Neighborhood Technology actually found that the portion of household income most people spend ranges from 12 percent in walkable communities with sidewalks, nearby stores, and public transportation to 32 percent for those who have no option but to drive long distances to get anywhere.
• When communities have few transportation options and require driving long distances for basic necessities, already stressed household budgets are very vulnerable to spikes in gas prices and rising transportation costs," said Scott Bernstein, president and founder. |
Smart Money
Real Estate: Finally a good investment?
The housing market still looks pretty bleak: There were a record 1 million foreclosures last year, home prices are still falling in many regions, and the number of "underwater" properties is at a record high.
And things don't look much better in other areas of real estate. The number of construction jobs continues to decline, even as other parts of the economy have added jobs. And mortgage rates have moved higher as long-term Treasury yields have backed up during the past few months. Basically, the real estate market remains a mess.
Real estate encompasses a wide range of markets – homes, apartments, hospitals, office buildings, strip malls, dormitories and other properties. But for our purposes, let's focus on residential real estate, or homes. Here are four reasons to think residential real estate might represent a bargain – with one big caveat. KEEP THIS IN MIND
• Everyone hates homes - When the housing market is in the doldrums, people tend to avoid thinking about the value of their home. Sellers complain they’re not getting offers and buyers bemoan the strict lending requirements. However, prospective buyers should be contrarian and take advantage of a down housing market.
• Smart people are buying real estate - A prominent hedge-fund manager said in a speech last fall: “If you don’t own a home, buy one. If you own a home, buy another one, and if you own two homes, buy a third and lend your relatives the money to buy a home.” He believes that interest rates and home prices will rise this year, so real estate bargains won’t last much longer.
• Real estate performs well during inflation – Convention says Treasury Inflation Protected Securities, commodities, and real estate do well in an inflationary environment. Real estate performed well during the period in the 1970s, when persistent inflation and high unemployment occurred.
• Demand may be coming back - Job creation and getting people employed are the two major factors in the housing rebound. There’s much debate about when the job market will recovery. Optimists say the recovery will happen this year, while pessimists say it won’t happen for several years. Read the full story:
http://www.smartmoney.com/personal-finance/real-estate/-1295050347411/
In Other News...
CNN
Existing home sales jump 12 percent
Sales of existing homes jumped in December, marking the fifth month of gains in the past six months, based on an industry report released Thursday. Read the full story
http://money.cnn.com/2011/01/20/real_estate/existing_home_sales/index.htm
NY Times
When mortgage rate locks expire
As mortgage rates have edged higher, many borrowers have been locking in loan rates for a home purchase or refinancing. Read the full story
http://www.nytimes.com/2011/01/09/realestate/mortgages/09mort.html?_r=1&ref=realestate USA Today
2011’s green homes to be cheaper, smarter, tighter
What will be the top 2011 trends in green building? A non-profit research group expects green homes will become increasingly affordable, smart, and energy-efficient -- all trends that Green
House agrees are likely. Read full story:
http://content.usatoday.com/communities/greenhouse/post/2011/01/2011-green-buillding-trends/1 The Wall Street Journal
Market for vacation homes is on the rise
Sales in many vacation communities across the U.S. soared last year to levels not seen since boom times, driven by deep discounts, cash purchases, and buyers' rising stock portfolios. Read the full story:
http://online.wsj.com/article/SB10001424052748704482704576071984006994652.html?mod=WSJ_RealEstate_LeftTopNews
USA Today
Credit scores get easier to track down and less secretive
You may be a pillar of your community, admired by your colleagues and beloved by friends and family, but if you have a mediocre credit score, you probably won't be able to get a decent interest
rate on a car loan, mortgage, or credit card. Read the full story:
http://www.usatoday.com/money/perfi/columnist/block/2011-01-11-yourmoney11_ST_N.htm\ San Francisco Chronicle
CalHFA mortgage aid program for jobless begins
On Monday, more than two months behind schedule, the California Housing Finance Agency will begin taking applications for a federally funded program that will give some unemployed homeowners up to $18,000 each over six months to pay their mortgage. Read the full story
http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2011/01/09/BU4N1H5FOR.DTL Los Angeles Times
Home seizures by banksdecline in state
Fewer Californians grappled with foreclosure last year, bucking a national trend and giving homeowners fresh hope that the state's housing market could be on the mend. Read the full story
http://www.latimes.com/business/la-fi-foreclosures-20110113,0,6804237.story Sacramento Bee
The “Big One” might be a flood
California has more risk of catastrophic storms than any other region in the country – even the Southern hurricane states, according to a new study released Thursday. Read the full story
http://www.sacbee.com/2011/01/14/3323275/the-big-one-might-be-a-flood.html CNN Money
1 million homes repossessed in 2011
Foreclosures were at a record high in 2010, and more than 1 million people lost their homes, even as notices started leveling off during the end year. Read the full story
http://money.cnn.com/2011/01/13/real_estate/foreclosures_2010/index.htm
What you should know about the market:
• Historical data from the National Association of Realtors (and adjusted for inflation by Businessweek.com) show that in 18 of the 25 largest metro areas in the U.S., the value of homes purchased in 1990 had increased by 2010, often by double digits. And this in a year when real estate prices around the country have softened since their peak in 2006. These houses would have been worth even more a few years ago. • In an analysis of the country's 25 largest metro areas, Businessweek.com found that the Portland, Ore., area had the largest real price gain since 1990, with the median sale price in this year's third quarter ($242,100) up about 85 percent over 1990, in inflation-adjusted terms. Home prices in the Denver, Baltimore, and Seattle areas also made gains of more than 50 percent in that period. • Yet in some other markets where homeownership skyrocketed during the housing boom, inflation-adjusted prices have fallen so dramatically that they are now below 1990 levels. Real prices in the Atlanta metro, for instance, are down about 21 percent compared with 2 years ago, and in Sacramento they are down 19 percent. • After recovery from the housing bust, home prices are expected to settle into a price-growth trends that's slightly higher than inflation over the long term. So in that sense, housing is still a long-term investment with a positive yield. |
The New York Times
A little-known strategy for cutting mortgage payments Homeowners looking to lower their monthly mortgage payments and reduce their interest rate may be able to do so without refinancing. A little-known strategy called recasting or re-amortization is available through some mortgage lenders and servicers, and eliminates the hefty fees and daunting credit requirements of refinancing. KEEP THIS IN MIND • Re-amortization requires borrowers pay off a lump sum of the principal amount on the mortgage and asking to have the monthly payments reset according to the original interest rate and loan terms. The lump sum reduces the principal, so the new monthly payments decrease slightly and interest paid over the life of the loan is reduced. • Lenders typically charge an administrative fee of $150 or more to re-amortize a mortgage; however, borrowers are not required to pay closing costs or submit to another credit check. • Re-amortizing works well for homeowners unable to qualify for refinancing, especially those who are self employed or have low poor credit. • Homeowners consider re-amortizing their mortgage should be aware that some lenders require a minimum amount to be paid toward the principal in the lump sum. JPMorgan Chase, for example, charges a $150 fee and requires a minimum $5,000 payment toward the principal. • Another challenge is finding a lender, or loan servicer, that offers re-amortizing. JPMorgan Chase and Bank of America exclude loans backed by the Federal Housing Administration and Dept. of Veterans Affairs, and loans that were sold off and securitized may also need investor approval. Read the full story:
http://www.nytimes.com/2011/01/02/realestate/mortgages/02Mort.html?_r=1&ref=realestate
In Other News...
Los Angeles Times
Foreclosure ruling could be setback for banks The highest court in Massachusetts agreed with a lower court ruling that two home foreclosures were invalid and found that lenders Wells Fargo Bank and US Bank had failed to prove they owned the mortgages. Read the full story:
http://www.latimes.com/business/la-fi-foreclosure-ruling-20110107,0,7857552.story The Wall Street Journal
The reverse mortgage gets a makeover A reverse mortgage has long been considered a loan of last resort because of its high fees. Now, a new type of reverse mortgage is attracting the attention of more-affluent borrowers eager to extract cash from their homes. But older homeowners - and adult children who advise them - need to be aware of the new trade-offs. Read the full story:
http://online.wsj.com/article/SB10001424052748703808704576061703405555630.html?mod=WSJ_RealEstate_LeftTopNews Yahoo! Finance
Resolutions for home sellers in 2011 If your New Year's resolution involves selling a home in 2011, you've got some work to do: There's lots of inventory out there and in a buyer's market, getting an offer on a home can be challenging. Read the full story:
http://finance.yahoo.com/real-estate/article/111704/resolutions-for-home-sellers-in-2011 San Diego Union-Tribune
Do you have enough homeowner's insurance? Some homeowners wonder if they should lower their homeowner insurance amounts given the decline in home prices. Read the full story:
http://www.signonsandiego.com/news/2011/jan/08/intricacies-homeowner-insurance
Los Angeles Times
Water-line insurance could be money down the drain
A study says cities where home prices have fallen the most - including Riverside, San Bernardino, and Fresno - could suffer long-term deterioration similar to that of the Rust Belt. Read the full story:
http://www.latimes.com/business/la-fi-lazarus-20110104,0,639053.column The Wall Street Journal
Explaining the (stingier) energy tax credit Homeowners who make energy-efficient improvements to their houses can still get a break from Uncle Sam next year, but the payback will be smaller and there are several catches that could shut out some taxpayers altogether. Read the full story:
http://blogs.smartmoney.com/tax/2011/01/06/explaining-the-stingier-energy-tax-credit/ Los Angeles Times
Changes are likely for FHA insurance refunds Homeowners who trade in loans insured by the Federal Housing Administration could be in for a big payday, and not just in the form of a lower interest rate and correspondingly lower payments. Read the full story:
http://www.latimes.com/business/realestate/la-fi-lew-20110109,0,6875521.story Los Angeles Times
Fannie Mae is jacking up mortgage fees Potential home buyers who have high credit scores and hefty down payments may be surprised that even they are being targeted for higher "risk-based" fees. Read the full story:
http://www.latimes.com/business/realestate/la-fi-harney-20110109,0,6538732.story
What you should know about the market • First-time buyers planning to make the shift from renter to homeowner this year should begin preparations as early as possible. Prior to starting the home-buying process, potential buyers should make sure they are ready to buy a home where they will live for three to five years or longer, since it can take that long to build equity in a home and recoup investment costs. • The first step a home buyer should take in the home-buying process is to check their credit score. Lenders base mortgage qualification on a variety of factors, including income and assets, the borrower's debt-to-income ratio, pattern of savings, and job stability. However, the most important factor is the credit score. Lenders tie the interest rate the borrower pays to the credit score, so borrowers with a credit score of 720 and sometimes 740 and above are the only ones who will pay the lowest mortgage rates. Borrowers with a credit score below 620 may not qualify for a mortgage at all until they can improve their score. • A lender tells the borrower how much they can borrow, but each potential homeowner should create a simple budget for themselves with income and spending to determine how much they are willing to spend on housing payments. Financial experts recommend that homeowners spend a maximum of about 30 percent of their gross monthly income on principal, interest, homeowners insurance, and taxes. Included in the budget should be approximately 1 percent of the home price for condo or homeowner association fees and maintenance costs. |
Los Angeles Times
When will housing come back in California? Five experts offer their views Although the steep decline of home prices in California ended in spring 2009, the weakness in the housing market after the expiration of federal tax credits for home buyers last year has led to some speculation as to whether the recovery is sustainable. Five experts, including Leslie Appleton-Young, the chief economist for the CALIFORNIA ASSOCIATION OF REALTORS®, were asked to provide their view on the state of real estate and what they think is needed to get the housing market moving again. KEEP THIS IN MIND • In terms of home prices, the experts differed slightly with the majority predicting that home prices will remain flat throughout 2011. Ms. Appleton-Young predicts home prices will rise 2 percent this year, while a foreclosure expert predicts housing prices to decline 5 percent in 2011. • According to Ms. Appleton-Young, there is little chance of home prices returning to their previous peak levels anytime soon. "We are in a slow-moving recovery with prices stabilized at the moderate and low end," she said. "We are still seeing price attrition and price softening at the upper ends of the market." • California's recovery will hinge on location, according to Richard Green, director of the USC Lusk Center for Real Estate. Areas between El Centro and Sacramento likely will not see a return to peak prices for a long time. However, places like La Jolla, Laguna, Huntington Beach, Atherton, Palo Alto, the city of San Francisco, and Marin County could experience a return to their peak prices within the next five years, according to Mr. Green. • Foreclosure expert Bruce Norris of the Norris Group believes the market is being artificially boosted by government programs and is set to fall further this year. Mr. Norris believes the demand for housing is most-needed for a sustainable recovery. • California's coastal markets will make a return once the job market improves, according to Emile Haddad, chief executive at FivePoint Communities Inc. In turn, that will lift consumer confidence. However, California's inland areas are more likely to lag behind, and builders will have to reconsider the kind of product they offer in certain places. Read the full story:
http://www.latimes.com/business/realestate/la-fi-cover-housing-recovery-20110102,0,3428634.story
In Other News... American Banker
Shortcomings? A Jan. 6, 2011, American Banker article states that members of the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) has created a task force to examine the shortcomings of the U.S. Treasury Department's Home Affordable Foreclosure Alternatives program and why fewer than 400 successful HAFA transactions had been completed nationwide through the end of September.
The article cites a letter C.A.R. sent to Treasury Secretary Tim Geitner last month identifying servicers as being the cause for the dearth of short sales. "Servicers are ignoring HAFA guidelines altogether," C.A.R. President Beth Peerce wrote in the letter. She said countless consumers have lost deals, primarily because servicers take so long to review and approve short sales that potential buyers gave up or walked away from the deal. Read the full letter
http://www.car.org/media/pdf/C.A.R._HAFA___Short_Sale_Comment_Letter_12-10.pdf CNBC.com U.S. consumer bankruptcies hit 5-year high in 2010 The number of U.S. consumers who filed for bankruptcy protection in 2010 was the highest in five years, and the figure could rise as Americans struggle with excess debt in an uncertain economy, a report issued Monday said. Read the full story:
http://www.cnbc.com/id/40895714 The Wall Street Journal House appraisals under fire Home appraisals, which were blamed for being too generous during the housing boom, are now being criticized by some homeowners for being too stingy, preventing them from refinancing or borrowing against their houses. Read the full story:
http://online.wsj.com/article/SB10001424052970204204004576049974087536438.html?mod=WSJ_RealEstate_LeftTopNews
MSNBC.com
Home prices are down, so why not insurance?
If you're a homeowner, chances are your house is worth less than it was five years ago. But you could still be paying more to insure it. Read the full story:
http://www.msnbc.msn.com/id/40845420/ns/business-real_estate/ Los Angeles Times
Housing bust creates new kind of declining city
A study says cities where home prices have fallen the most - including Riverside, San Bernardino, and Fresno - could suffer long-term deterioration similar to that of the Rust Belt. Read the full story:
http://www.latimes.com/news/local/la-fi-ghost-towns-20110106,0,3388283.story Press Enterprise
Proposed lending changes alleged to harm elderly Changes in home lending rules proposed by the Federal Reserve Board could encourage predatory lending against the elderly, according to consumer advocacy groups. Read the full story: http://blogs.pe.com/business/2011/01/proposed-lending-changes-alleg.html CNN Money Kiss 4 percent mortgage rates goodbye The era of near 4 percent mortgage rates has ended after a quick rate rise since early November. But some industry experts think that may be a good thing for the flagging housing market. Read the full story:
http://money.cnn.com/2010/12/30/real_estate/mortgage_rate_spurt/index.htm?source=cnn_bin&hpt=Sbin San Diego Union-Tribune
Federal Reserve: U.S. housing market is still weak
The U.S. residential market likely will weaken further as home sales, prices, and demand remain low, said members of a Federal Reserve committee in meeting minutes released this week. Read the full story:
http://www.signonsandiego.com/news/2011/jan/05/federal-reserve-us-housing-market-still-weak/
What you should know about the market • As the new year gets underway, there are four housing issues consumers should keep a close eye on: Jobs, foreclosure delays, Washington, and lending standards and rates. • Jobs: If the job market improves, the demand for housing picks up, and many other challenges facing the housing market can more easily take care of themselves. However, if it doesn't, home prices will decline further, and more homeowners will fall underwater. • Foreclosure delays: In September 2010, some of the nation's largest lenders suspended foreclosures due to potentially fraudulent document-handling procedures. Regulators and state prosecutors have launched a series of reviews, and investigations could shed more light on abuses, such as misapplied or excessive fees by servicers, their attorneys, or other third-party vendors. If foreclosures are more difficult and expensive to process, banks and investors could step up bulk sales of loans or foreclosure alternatives such as short sales. • Washington: This month, the Obama administration is set to issue an initial set of recommendations for how to remake Fannie Mae, Freddie Mac, and the broader mortgage market. Meanwhile, regulators also are writing new rules on provisions outlined in the Dodd-Frank Act that will clarify how banks must retain some of the risk on loans that are bundled and sold off as securities and define what constitutes a "qualified residential mortgage" that is exempt from such rules. • Lending standards and rates: The government continues to dominate the mortgage-lending landscape, with more than nine in 10 new loans backed by Fannie Mae, Freddie Mac, or government agencies such as the Federal Housing Administration. While some analysts have raised red flags over the FHA's finances and say that loans with 3.5 percent down payments are leading the agency to take on too much risk, others worry about tighter lending standards that could further pinch demand. |
Los Angeles Times
Refinancing now could be better than waiting for mortgage rates to drop further
Mortgage rates on 30-year, fixed rate loans are hovering near the lowest level on record since 1951. While some home buyers are putting their home purchases on hold hoping rates will go even lower, many industry experts are advising homeowners with rates in the upper 4 percent range to refinance. KEEP THIS IN MIND
• Homeowners with rates in the upper four percent range are likely to benefit from refinancing, according to Peter Ogilvie, president of First Residential Mortgage Corp. in Santa Cruz, Calif. He says refinancing to a lower rate often produces monthly savings, as long as the borrower can qualify under today’s industry credit guidelines and loan-to-value underwriting standards.
• Some homeowners also may be good candidates for no-cost refinancing, where the title, escrow, and lender closing charges either are added to the mortgage principal balance or paid for over time with a slightly higher rate. The upsides to this option are reduced monthly payments, improved cash flow, and no outset of dollars at settlement.
• Borrowers who want to become debt-free faster and can afford it, ought to consider refinancing out of a 30-year term loan into a 15-year term. Fifteen-year mortgages carry lower rates than 30-year loans, but their faster amortization schedules require higher monthly payments.
• When considering whether refinancing is the best option, consumers are advised to take into account all of the fees associated with the refinance and decide if the money saved is worth the cost of the refinance. Read the full story:
http://www.latimes.com/business/realestate/la-fi-harney-20101114,0,6276584.story
In Other News…
The Washington Post
States, mortgage lenders in talks over funds for borrowers in foreclosure mess State attorneys general and the country’s biggest lenders are negotiating to create a nationwide fund to compensate borrowers who can prove they lost their home in an improper foreclosure, state and industry officials said. Read the full story:
http://www.washingtonpost.com/wp-dyn/content/article/2010/11/16/AR2010111607100.html
The New York Times
Mortgage preapproval is harder to get
When properly done, mortgage preapproval can speed up the purchase process by providing a rigorous assessment of the maximum amount a buyer can afford to borrow, based on a formal credit check and verification of income and assets. Read the full story:
http://www.nytimes.com/2010/11/14/realestate/mortgages/14Mort.html?_r=1&ref=realestate
The Sacramento Bee
First-time home buyer index rises slightly
The CALIFORNIA ASSOCIATION OF REALTORS®’ First-time Buyer Housing Affordability Index released Monday said the percentage of buyers who could afford to purchase an entry-level home in California stood at 66 percent in the third quarter, up from 65 percent in the second quarter and 64 percent in last year’s third quarter. Read the full story:
http://www.sacbee.com/2010/11/17/3191095/first-time-homebuyer-index-rises.html
Los Angeles Times
Home seizures decline 9 percent in October
Lenders repossessed 9 percent fewer homes in October, an indication that the foreclosure freezes put in place by several major banks could be slowing the record pace of home seizures this year, if only temporarily. Read the full story:
http://www.latimes.com/business/la-fi-foreclosure-20101111,0,1857948.story
San Diego Union-Tribune
California consumers have the nation’s best credit scores, according to a study by CreditKarma.com. Read the full story:
http://www.signonsandiego.com/news/2010/nov/10/california-consumers-have-nations-highest-credit-s/
CNN Money
Home prices expected to slide another 8 percent
The robo-signing controversy is just another issue that the already sluggish housing market didn’t need – but most analysts do not think it will have far-reaching impact. Read the full story:
http://money.cnn.com/2010/11/01/real_estate/housing_market_state/index.htm
Los Angeles Times
Shared homeownership could mean paying your neighbors’ bills
For those who have a lot of cash or can get credit, this could be an ideal time to buy a house – the foreclosure crisis has pushed prices down and interest rates are way low. Read the full story:
http://www.latimes.com/business/la-fi-perfin-20101107,0,921835.column
The New York Times
At legal fringe, empty houses go to the needy In a sign of the odd ingenuity that has grown from the real estate collapse, a businessman in Florida is banking on an 1869 Florida statute that says the bundle of properties he has seized will be his if the owners do not claim them within seven years. Read the full story:
http://www.nytimes.com/2010/11/09/us/09foreclosure.html?_r=1&scp=1&sq=%22At%20legal%20fringe,%20empty%20houses%20go%20to%20the%20needy%22&st=cse
What you should know about the market
• The CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) this week issued its third quarter First-time Buyer Housing Affordability Index (FTB-HAI), which indicates the percentage of households in California who could afford an entry-level home in the state during that period.
• The percentage of first-time buyers who could afford to purchase an entry-level home in California stood at 66 percent in the third quarter of 2010, according to C.A.R.’s FTB-HAI. In the second quarter of 2010, the Index was a revised 65 percent and was 64 percent in the third quarter of 2009.
• First-time buyers, who tend to purchase homes equal to 85 percent of the prevailing median price, needed to earn a minimum annual income of $42,300 to qualify for an entry-level home of $266,620 during the third quarter of 2010. The monthly payment, including taxes and insurance, was $1,410, assuming a 10 percent down payment and an adjustable effective interest rate of 3.66.
• At 85 percent, the High Desert region was the most affordable area in the state. The San Francisco Bay region was the least affordable in the state at 51 percent, followed by the Santa Barbara area and the Santa Clara County regions, both at 53 percent.
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The Wall Street Journal
The jumbo-mortgage comeback
Smaller and regional lenders are issuing more new jumbo loans and doing more refinancings, which could help bolster home sales in some areas. KEEP THIS IN MIND
• Jumbo mortgages are mortgages deemed “too big” to be sold by lenders to government-supported agencies such as Fannie Mae and Freddie Mac.
• The loan limit of a jumbo mortgage varies depending on location. In high-cost areas, including many areas in California, jumbo loans are generally considered those that exceed $729,750. In other areas, the jumbo loan limit usually is capped at $417,000.
• Some borrowers applying for jumbo mortgages are finding the processing time at larger lenders can be as long as four months, while some smaller institutions can process a jumbo mortgage as quickly as 30 to 60 days.
• Additionally, borrowers seeking jumbo mortgages for condos or vacation properties also may be better served using a local lender or contacting a mortgage specialist, as many large lenders have reduced their lending activity.
• With jumbo mortgages, borrowers still need excellent credit profiles and must provide complete documentation and verification of income. Down payments of 20 percent to 40 percent also tend to be required for a jumbo mortgage. Read the full story:
http://online.wsj.com/article/SB10001424052748704506404575592741466524972.html?mod=WSJ_hpp_sections_personalfinance
In Other News…
The New York Times
Paying off a mortgage Paying off a mortgage or even paying down the balance early might seem enticing to most borrowers. There’s the big savings in interest payments and the freed-up cash flow that can result, not to mention the emotional benefit of wiping out what for most people is the largest financial commitment of a lifetime. Read the full story:
http://www.nytimes.com/2010/11/07/realestate/mortgages/07mort.html?_r=1&ref=realestate Los Angeles Times
Federal Reserve’s proposed home appraisal rules may not prevent inaccurate valuations
You may have missed it, but the Federal Reserve proposed far-reaching new rules Oct. 18 that could affect home real estate appraisals – and millions of owners’ equity holdings – nationwide. Read the full story:
http://www.latimes.com/business/realestate/la-fi-harney-20101031,0,6145510.story SmartMoney
Do you have to repay your home buyer credit?
If you claimed a federal income tax credit for a 2008 home purchase, you’ll probably have to pay it back over 15 years, starting with your 2010 Form 1040 (due next April). In contrast, if you claimed a credit for a 2009 or 2010 purchase, you probably won’t have to pay it back. Read the full story:
http://www.smartmoney.com/personal-finance/taxes/do-you-have-to-repay-your-homebuyer-credit/ Los Angeles Times
A tale of two housing busts: Why is California recovering and Florida still struggling?
California and Florida had a lot in common during the housing industry’s last cycle. But in the last year or so, California’s housing market has begun recovering, while Florida’s remains on the critical list. Read the full story:
http://www.latimes.com/business/realestate/la-fi-foreclosure-states-20101105,0,4031207.story?page=1
The Wall Street Journal
Foreclosure mess slowed September home sales
U.S. pending home sales slipped for the first time in three months in September as foreclosure moratoriums slowed sales. Read the full story:
http://blogs.wsj.com/developments/2010/11/05/foreclosure-mess-slowed-september-home-sales/ Los Angeles Times
Fannie Mae opens center to help distressed homeowners Housing finance giant Fannie Mae has opened a center devoted to helping distressed homeowners in the Los Angeles area. Read the full story:
http://www.latimes.com/business/realestate/la-fi-fannie-mae-20101110,0,1008337.story CNN Money
Fed: Small banks crack down on mortgage lending
Even with interest rates at historic lows, you might still have a hard time getting a mortgage: Small banks have tightened standards when it comes to lending to home buyers, according to a survey issued Monday. Read the full story:
http://money.cnn.com/2010/11/08/news/economy/banking_lending/index.htm The New York Times
More closing jitters The final weeks before a mortgage closing can be nerve-racking for any borrower, but new guidelines from Fannie Mae calling for an 11th-hour inspection of finances may mean even more headaches. Read the full story:
http://www.nytimes.com/2010/10/31/realestate/31mort.html?_r=1&ref=realestate
What you should know about the market
• The recent nationwide foreclosure moratorium brought about a new term used to describe people who sign documents without carefully reading them: robosigning. Although robosigning described bank employees who signed off on thousands of documents without reviewing them, they’re not the only ones blindly signing documents they haven’t thoroughly read. Consumers often do the same thing.
• It is especially important that consumers don’t “robosign” on a new mortgage. When reviewing loan documents, consumers are advised to search for two particular terms: A prepayment penalty and the margin rate on adjustable mortgages.
• A prepayment penalty – a fee for paying off a mortgage early – ranges from 1 percent to 3 percent of the total mortgage amount. Consumers who find this clause in their mortgage note and weren’t told about it are advised to ask to have it removed during the loan application process.
• For borrowers with adjustable-rate mortgages (ARM), consumers should check how their rate will adjust after the first few years. The adjustment is based, in part, on the profit the lender makes when it sells the loan to an investor, which is called the “margin rate.” Buyers can find the margin rate on the second page of their mortgage note. If the number is higher than 3 percent, consumers should question the margin rate. Reasonable rates generally are considered to be in the 2.5 to 3 percent range. 
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The Sacramento Bee
California expects mortgage-aid program to begin in weeks
The California Housing Finance Agency (CalHFA) reported this week that its “Keep Your Home California” program will be delayed because of logistical issues with the program. The program was scheduled to begin Monday, Nov. 1
KEEP THIS IN MIND
• The “Keep Your Home California” program is a $1.83 billion government aid program that will pay down loan balances and provide monthly cash assistance to struggling California homeowners.
• One of the logistical complications that has caused the delay is the fact that Fannie Mae and Freddie Mac last week instructed their loan servicers to participate in the program, dramatically increasing the number of potentially eligible homeowners.
• Funded with federal money, the program offers four different types of cash assistance for an estimated 100,000 low- to moderate-income California homeowners. Additionally, eligible borrowers must have endured some sort of loss of income.
• The two primary forms of aid include $875 million dedicated toward unemployed Californians who need help making their monthly payments, and $790 million to be used to directly reduce mortgage loan balances.
• Although the program has been delayed for several weeks, homeowners struggling to make their mortgage payments are advised to not wait for assistance programs to begin before contacting their servicer or lender. Instead, homeowners should begin working with their lender or servicer at the first sign of difficulty.
• More information about the “Keep Your Home California” program can be found at www.keepyourhomecalifornia.org. A toll-free hotline soon will be established. Read the full story:
http://www.sacbee.com/2010/11/02/3151100/california-expects-mortgage-aid.html
In Other News… CNN Money
Three ways low mortgage rates can work for you Just when it looked like mortgage rates couldn’t fall any further, they did. So what’s in it for you? A lot, potentially. Read the full story:
http://money.cnn.com/2010/11/02/real_estate/make_low_rates_work.moneymag/index.htm San Francisco Chronicle
Home ownership stays at lowest level in a decade.
The nation’s homeownership rate remained at its lowest in more than a decade, hampered by a rise in foreclosures and weak demand for housing. Read the full story:
http://www.sfgate.com/cgi-bin/article.cgi?f=/n/a/2010/11/02/national/w080228D90.DTL SmartMoney Should you refinance if you’re over 50?
With interest rates near record lows, refinancing has never looked so tempting – especially for people nearing retirement, who’d love some extra cash to pad their diminished savings. But for homeowners over 50, there’s more to consider than just a lower rate. Read the full story:
http://www.smartmoney.com/personal-finance/real-estate/should-you-refi-over-50/ The Wall Street Journal
Refinance in under a year? Maybe
Low mortgage rates have some homeowners considering refinancing, even if it has been less than a year since they last refinanced or bought their home. Read the full story:
http://online.wsj.com/article/SB10001424052748704865104575588560217191720.html?mod=WSJ_hp_MIDDLENexttoWhatsNewsForth
Los Angeles Times
Foreclosure activity up across most U.S. metro areas
The foreclosure crisis intensified across a majority of large U.S. metropolitan areas this summer, with Chicago and Seattle – cities outside of the states that have shouldered the worst of the housing downturn – seeing a sharp increase in foreclosure warnings. Read the full story:
http://www.latimes.com/business/la-fiw-foreclosure-20101028,0,6074148.story The Wall Street Journal
Mortgage Bankers push housing recovery to 2012 Last week, the nation’s mortgage bankers released a report saying that they expect the housing market to continue limping along into next year. Things could pick up, they say, in 2012. Read the full story:
http://blogs.wsj.com/developments/2010/10/26/mortgage-bankers-push-housing-recovery-to-2012/ Los Angeles Times
Wide variation seen in mortgage servicers’ performance
Data suggest a wide variation in how well the firms handle such things as dealing with delinquent homeowners and negotiating loan modifications. Read the full story:
http://www.latimes.com/business/la-fi-mortgage-servicers-20101028,0,5446511.story Sacramento Bee
$8.3 million available in Cash for Appliances California’s Cash for Appliances program had about $8.3 million in rebate funds remaining as of last week. Read the full story:
http://www.sacbee.com/2010/10/29/3141950/83-million-available-in-cash-for.html
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The New York Times The price of a “no-cost” loan
Some home buyers who may be concerned about paying high closing costs might be tempted “zero-cost” or “no-cost” loan option, which requires no cash outlay, but typically adds a half percentage point to the rate. However, some financial consultants say these loans tend beneficial to buyers planning to have the loan for less than five years. KEEP THIS IN MIND
• One of the primary differences between a no-cost loan and similar loans is that no-loans do not tack on closing costs to the balance, but instead increase the rate. • With no-cost loans, third-party fees including the appraisal, credit report, title insurance,
recording, and the use of a mortgage broker are paid by the lender. The fees, including amount the broker is being paid, are disclosed on the closing statement. • Home buyers who bypass a broker and work directly with a lender may encounter transparency, as loan officers are not required to disclose the amount the bank is on the loan. • Borrowers weighing their loan options are advised to use a mortgage amortization
calculator to compare the costs for a conventional loan compared with a no-cost Federal Reserve provides an amortization calculator on its Web site at www.federalreserve.gov
Read the full story:
http://www.nytimes.com/2010/10/24/realestate/24mort.html?ref=realestate
In Other News…
Los Angeles Times Signs of foreclosure paperwork problems were missed, FDIC chief says Regulators should have foreseen a wave of suspect foreclosure paperwork coming, a key official admitted Monday as federal banking agencies said they had launched their own in-depth review of
the issue. Read the full story:
http://www.latimes.com/business/la-fi-foreclosures-bernanke-20101026,0,2802043.story
Orange County Business Journal
Stand-alone home prices move above $500,000 mark. The median price of an existing Orange County home moved back above the $500,000 mark in
September, while the pace of sales remained sluggish the CALIFORNIA ASSOCIATION OF REALTORS® reported Friday. Read the full story:
http://www.ocbj.com/news/2010/oct/22/stand-alone-home-prices-move-above-500000-mark/
CNN Money Obama mortgage mods slow, hitting nearly 500,000. The government’s main foreclosure-rescue program continues to show signs of slowing progress,
according to a federal report released Monday. Read the full story:
http://money.cnn.com/2010/10/25/real_estate/HAMP/index.htm
The New York Times Short sales revisited as foreclosures are revived Bank of America and GMAC are firing up their formidable foreclosure machines again, after a brief
pause. Read the full story:
http://www.nytimes.com/2010/10/25/business/25short.html?_r=1&ref=realestate
San Francisco Chronicle Refinancing rush helps banks amid foreclosure mess. A rush by U.S. homeowners to refinance at near record-low interest rates marks a rare bright spot for the mortgage industry, under attack for choking the economy with shoddy loans and botched foreclosures. Read the full story:
http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2010/10/26/BUKB1G1NEU.DTL The New York Times Foreclosures had errors, bank finds. Even as Bank of America begins to restart foreclosure proceedings in 23 states on Monday, the bank confirmed that it had discovered errors, including incorrect data and misspelled names, in the paperwork it had reviewed. Read the full story:
http://www.nytimes.com/2010/10/25/business/25foreclosure.html?ref=realestate Los Angeles Times Your credit score is constantly changing. It also varies depending on which of the three main credit repositories you check. Each has a different scoring formula and different information in its files. Read the full story:
http://www.latimes.com/business/realestate/la-fi-lew-20101024,0,6547837.story CNN Money Existing home sales on the rise. Existing home sales climbed for the second month in a row in September, fueling some hope that a housing recovery is underway. Read the full story:
http://money.cnn.com/2010/10/25/news/economy/existing_home_sales/index.htm?hpt=T2
What you should know about the market • The median price of an existing, single-family detached home sold in California during September was $309,900, down 2.7 percent from August’s $318,660 median price, but up 4.5 percent from the $296,610 median price recorded for the same period a year ago, according to the CALIFORNIA ASSOCIATION OF REALTORS®’ (C.A.R.) September sales and price report. September also marked 11 consecutive months of year-over-year price gains. • C.A.R.’s report also showed that, contrary to the national picture, the housing supply in California has been below normal throughout 2010. C.A.R.’s Unsold Inventory Index for existing, single-family detached homes remained relatively unchanged in September at 6.2 months but was up from the 4.5 months recorded in September 2009. The index was 6.1 months in August. The index indicates the number of months needed to deplete the supply of homes on the market at the current sales rate.
Brought to you by the CALIFORNIA ASSOCIATION OF REALTORS® |
The New York Times A little-known loan program for fixer-uppers
Home buyers thinking of purchasing a distressed property in need of repair, but who are concerned that the cost of the repairs could drain their savings account may qualify for the Federal Housing Administration's (FHA) 203(k) rehabilitation program. KEEP THIS IN MIND • The FHA's 203(k) rehabilitation program provides loans for covering renovation costs as well as the purchase price of the primary residence. Investors are not eligible for this program. Additionally, similar to traditional FHA loan programs, the rehab program allows for a down payment of as little as 3.5 percent. • A common misperception about the program is that the house needs to be unlivable. Realistically, the property just needs to be outdated, according to a lender familiar with the program. The property "just has to appraise below market value and then at market value with the repairs." • Improvements deemed "luxury" are ineligible; however, the program has a wide range of definitions for "repairs" and "modernization." Covered repairs include items such as a new roof or heating system, as well as decorative changes, like replacing vinyl with ceramic tile on the kitchen floor or painting the interior. • In addition to putting down at least 3.5 percent of the current value of the property, buyers also must use a HUD-approved lender, appraiser, and a contractor approved by the lender for the repairs. One list of approved businesses can be found at 203kcontractors.com. • Borrowers considering the FHA rehab loan program should be aware that loan rates typically run around a percentage point higher than conventional loans, and come in 15- to 30-year terms, either fixed or adjustable. Additional paperwork for inspection, appraisal, title updating, and the like can increase closing costs by $1,000 or more higher than the average. • For additional information about the FHA 203(k) rehabilitation program, please visit: http://www.hud.gov/offices/hsg/sfh/203k/203kabou.cfm. Read the full story:
http://www.nytimes.com/2010/10/17/realestate/mortgages/17mort.html?_r=1&ref=realestate
In Other News... Los Angeles Times Mortgage rates edge higher after three weeks of declines
Fixed rates on home loans edged higher this week after three weeks of declines, Freddie Mac said in its latest survey. Read the full story:
http://latimesblogs.latimes.com/money_co/2010/10/mortgage-rates-edge-higher-freddie-mac-says.html
Mercury News So you bought a foreclosed home. Now what?
It seemed too good to be true: You bought a house in foreclosure at a fraction of the former price. Maybe you even knocked out a wall or two and remodeled with all the money you saved. But now thousands of foreclosures around the country may be invalid because of bank paperwork problems. Should you worry? Read the full story:
http://www.mercurynews.com/real-estate-news/ci_16351182
Los Angeles Times Mortgage database's murky legal status adds another wrinkle to foreclosure mess
Major banks and mortgage lenders are coming down with another legal headache in their efforts to seize properties from homeowners in default. Read the full story:
http://www.latimes.com/business/la-fi-mortgage-foreclosure-20101021,0,4933760.story
SmartMoney Credit scores: How 720 became the new 680
Until recently, a credit score of 680 was something to be proud of. It meant you paid most of your bills on time, got dinged when you went shopping for a refi, but in general, had a solid enough record to get a loan at the best rates. Read the full story:
http://www.smartmoney.com/personal-finance/debt/credit-scores-what-you-need-now/
Mercury News Foreclosure mess: Federal agencies probing banks, White House says The White House says federal agencies are investigating allegations of widespread errors in foreclosure documents. Read the full story:
http://www.mercurynews.com/breaking-news/ci_16377126
What you should know about the market • Potential home buyers still waiting on the sidelines for home prices or interest rates to decline further might want to consider that conditions for buying a home are better today than at any time in recent history. • The average rate for a 30-year, fixed-rate mortgage for the week ending Oct. 21 was 4.21 percent and 3.64 percent for a 15-year-fixed, according to Freddie Mac. By comparison, the average 30-year-fixed mortgage was 5.09 percent in January and approximately 6 percent two years ago. • In August, the median price of an existing, single-family home in California was $318,600. At this week's 4.21 percent rate for a 30-year-fixed mortgage, the monthly principal and interest payment on a median-priced home in California would be $1,555 - likely the same or possibly less than the amount paid monthly in rent. Brought to you by the CALIFORNIA ASSOCIATION OF REALTORS® |
Los Angeles Times
California to join multistate inquiry of foreclosures by banks In late September and early October several major lending institutions began voluntarily halting foreclosures in select states while they reviewed their foreclosure processes. This action is in response to findings that questioned whether some lenders/servicers were following the correct procedures to foreclose on a property. KEEP THIS IN MIND
• To date, Bank of America is the only lender that has extended its foreclosure moratorium to California, where the vast majority of foreclosures are conducted without a court order.
• Non-judicial foreclosures in California, however, do have legal requirements that lenders must follow. For example, California law requires that lenders for certain mortgage loans made between Jan. 1, 2003, and Dec. 31, 2007, attempt to make contact with borrowers to discuss options for avoiding foreclosure at least 30 days before filing a notice of default. Lenders also must sign a declaration in the notice of default stating that they tried to contact the borrower, made contact with the borrower, or fall within an exception (such as a bankruptcy filing). • This halting of foreclosures is a voluntary action taken on the part of these lenders/servicers and has not been mandated by either the states or the federal government. The participating lenders and servicers believe their internal review processes should take anywhere from a few weeks to 30 days to complete.
• It is important to note that Bank of America is temporarily suspending foreclosure sales, but not necessarily halting its actions during other stages of the foreclosure process. Read the full story:
http://www.latimes.com/business/realestate/la-fi-foreclosure-20101013,0,6850348.story
In Other News… CNN Money
Unemployed? Get a federal loan to pay your mortgage Unemployed and can’t pay your mortgage? You soon can apply for a no-interest government loan for up to $50,000 to pay your mortgage and cover your arrears. The loan, which can offer assistance for up to two years, will be forgiven if the homeowner stays in the house for five years. Read the full story:
http://money.cnn.com/2010/10/05/news/economy/unemployed_mortgage_help/index.htm The Wall Street Journal
HUD’s Donovan: National foreclosure moratorium risks ‘going too far’
The Obama administration’s top housing official on Monday said that a national foreclosure moratorium to correct flawed legal filings risked exacerbating the mortgage crisis. Read the full story:
http://blogs.wsj.com/developments/2010/10/12/huds-donovan-national-foreclosure-moratorium-risks-going-too-far/ San Francisco Chronicle
Banks seize 288,000 homes in Q3, but challenges await Lenders seized more U.S. homes this summer than in any three-month stretch since the housing market began to bust in 2006. But many of the foreclosures may be challenged in court later because of allegations that banks evicted people without reading the documents. Read the full story:
http://www.sfgate.com/cgi-bin/article.cgi?f=/n/a/2010/10/13/financial/f210144D21.DTL
Los Angeles Times
Fannie-Freddie add-on fees put damper on refis
With mortgage rates at unprecedented lows, why are more people not taking advantage of them to refinance or buy houses? Read the full story:
http://www.latimes.com/business/realestate/la-fi-harney-20101010,0,5817827.story San Francisco Chronicle
Mortgage rates hit decades-low of 4.19 percent Rates on 30-year mortgages fell this week to 4.19 percent, the lowest level in decades. They were pushed down by lower Treasury bond yields. Read the full story:
http://www.sfgate.com/cgi-bin/article.cgi?f=/n/a/2010/10/14/financial/f071201D81.DTL&tsp=1
What you should know about the market
• As the warm summer days begin to turn into cool fall and winter nights, many homeowners will find their electricity bills have increased as they try to keep their homes warm. To help lower the cost of heating a home this winter, homeowners can weatherstrip their homes. According to the U.S. Dept. of Energy, there are many kinds of weatherstripping products on the market. Since each product is designed to work in a different area of the home, homeowners should read product packaging carefully to determine if it is best suited for windows or doors, as well as indoor or outdoor use. • Another tip for “winterizing” a home is to get a furnace or heating system inspection, which most professionals recommend homeowners do at least once a year. An inspection of the working parts can ensure that the house has heat when needed and can prevent costly repairs in the future. Brought to you by the CALIFORNIA ASSOCIATION OF REALTORS® |
SmartMoney Magazine How to buy a home at a $100,000 discount With nearly 150,000 foreclosed homes on their books, Fannie Mae and Freddie Mac are trying to pare down their growing inventory of repossessed properties, in turn providing home buyers with tremendous purchasing opportunities.
MAKING SENSE OF THE STORY FOR CONSUMERS
• An analysis by SmartMoney magazine found that home buyers could save $100,000 on the price of a home by purchasing a foreclosed home owned by Fannie Mae or Freddie Mac as opposed to a similar fair-market property just a few blocks away. • Fannie Mae’s homebuying program, which requires down payments as low as 3 percent on 30-year mortgages also can help buyers save money. However, buyers should note, smaller down payments generally translate into higher monthly mortgage payments. • Another bonus to purchasing a Fannie Mae-owned home, the company doesn’t require private mortgage insurance, which most lenders require for buyers who put down less than 20 percent. • Unlike many foreclosed properties, which usually require many repairs, Fannie and Freddie generally repair items such as leaky roofs and damaged electrical work, and often handle small projects like replacing appliances that are broken or missing, replacing old carpet, or fixing damages left by the former owners or vandals. Additionally, Fannie Mae’s properties come with an optional mortgage that includes extra financing up to $30,000 for repairs and improvements. • Buyers of Freddie Mac homes who plan to be owner-occupants –those who plan to live in the home and not use it as an investment property—have the advantage of viewing properties 15 days earlier than investors who often pay all cash and buy up foreclosed properties before owner-occupants have a chance to view them. Read the full story:
http://www.smartmoney.com/personal-finance/real-estate/tips-on-buying-a-home-at-a-100-000-discount/?page=all#
In Other News… Wall Street Journal
No-interest mortgages? No chance
Imagine financing a home purchase with a no-interest mortgage. You probably never would want move again. Read the full story:
http://online.wsj.com/article/SB10001424052748704791004575519913915143970.html?mod=WSJ_RealEstate_LeftTopNews CNN Money
Home prices up, but growth rate slowees
Home prices have risen for five straight months, but the rate of growth has slowed, according to industry report released Tuesday.
Read the full story:
http://money.cnn.com/2010/09/28/real_estate/July_home_prices/index.htm?hpt=T2 LosAngeles Times Consumer confidence falls to lowest level since February
September consumer confidence sagged to its lowest levels since February, driven by deteriorating labor market and business conditions, according to a private report released Tuesday. Read the full story:
http://www.latimes.com/business/la-fiw-consumer-confidence-0100929,0,3084951.story Sacramento Bee Fannie Mae offers housing aid to military families
Mortgage giant Fannie Mae plans to give military families a break on their home loan payments they are struggling because of the death or injury of a service member. Read the full story:
http://www.sacbee.com/2010/09/27/3059660/fannie-mae-offers-housing-aid.html CNN 22 percent of private mortgage mods redefault
Banks have been ramping up their mortgage modifications, helping out troubled borrowers who can’t qualify for President Obama’s foreclosure-prevention program. Too bad these homeowners redefault at more than twice the rate. Read the full story:
http://money.cnn.com/2010/09/24/news/economy/Mortgage_modifications_redefaults/index.htm
Orange County Register One in three unlikely to qualify for a mortgage
Nearly a third of Americans are unlikely to qualify for a mortgage because their credit scores are too low, making homeownership out of the question for many, according to an analysis by Zillow.com.
Read the full story:
http://mortgage.ocregister.com/2010/09/27/1-in-3-cant-qualify-for-a-mortgage/37964/ San Diego Union-Tribune Downsizing is booming smaller homes are trendy again as baby boomers look to shed excess room and recession makes large homes too costly. Read the full story:
http://www.signonsandiego.com/news/2010/sep/25/downsizing-is-booming/ CNN
No mortgage mods for many of the jobless
Unemployed homeowners cannot count jobless benefits as income when applying for mortgage modifications if they have loans backed by Fannie Mae. That could greatly limit their ability to get a long-term reduction in their monthly payments. Read the full story:
http://money.cnn.com/2010/09/22/news/economy/foreclosure_prevention/index.htm
Talking Points • As the traditional home-buying season comes to an end, some home buyers may think that less competition in the market means it will be easier to get approved for a home loan. Although the house-hunting climate may be favorable, buyers still must have excellent credit scores to receive the best mortgage rates. • Just like home buyers purchasing homes during the traditional buying season, those who buy homes during the off-season also need to be confident in their income streams and their ability to meet their monthly mortgage obligations.
Brought to you by the CALIFORNIA ASSOCIATION OF REALTORS® |
Sacramento Bee
California home sales drop in August compared with last year
The median home price of an existing, single-family home in California rose 1.2 percent compared with July and 8.6 percent from a year ago, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) reported this week. Following two months of consecutive month-over-month declines, California home sales edged up 1.8 percent in August compared with July, but were down 14.9 percent compared with August 2009. KEEP THIS IN MIND
• According to C.A.R. President Steve Goddard, home buyers who are waiting on the sidelines should consider the opportunities available in today’s market. Favorable home prices and interest rates at or near historic lows make housing affordability the best in recent years. Anyone who is in a position to buy a home should do so before either of these key factors rise. • The statewide median home price posted its 10th consecutive year-over-year gain in August, according to C.A.R.’s report. The median price of an existing, single-family detached home sold in California during August 2010 was $318,660, an 8.6 percent increase from the revised $293,400 median price recorded in August 2009. The August 2010 median price was up 1.2 percent compared with July’s $314,850 median price.
• C.A.R. Chief Economist Leslie Appleton-Young says California’s housing market is transitioning from the conclusion of the federal home buyer tax credit and that home sales are strongest in the higher-price range. The strength in the upper-end market combined with inventory levels that are higher, but still lean by average, has led to home prices holding steady. • To hear more from Ms. Appleton-Young, please visit
http://videos.car.org/mediavault.html?menuID=1&flvID=10. Read the full story:
http://www.sacbee.com/2010/09/22/3048464/california-home-sales-drop-in.html
In Other News…
Los Angeles Times
Debate might give new life to mortgage cramdown legislation If there is a term that strikes fear in the hearts residential lenders everywhere, it is “cramdown.” Lenders dread the judicial procedure that erases a portion of a borrower’s mortgage because the house, which is the underlying security or collateral for the loan, is worth less than what is owed on it. Read the full story:
http://www.latimes.com/business/realestate/la-fi-lew-20100919,0,251792.story Bloomberg
U.S. home prices fell 3.3 percent in July from year earlier
U.S. home prices dropped 3.3 percent in July from a year earlier, the eighth consecutive decline, as foreclosed properties flooded the market. Read the full story:
http://www.bloomberg.com/news/2010-09-22/home-prices-in-u-s-fell-3-3-in-july-from-year-earlier-fhfa-index-shows.html The Wall Street Journal
Refinancing: Who can you trust? With mortgage rates falling to record lows this summer and the housing market showing signs of a pulse, refinancing activity is perking up. It’s too bad that so many people are relying on oversimplified advice and bad numbers to decide when to pull the trigger. Read the full story: http://online.wsj.com/article/SB10001424052748704652104575494190518195172.html?mod=WSJ_RealEstate_LeftTopNews Los Angeles Times FHA may slash upfront costs of some reverse mortgages The Federal Housing Administration isn’t talking publicly about it, but the agency may be getting ready to cut the upfront costs of reverse mortgages for some borrowers. Read the full story:
http://www.latimes.com/business/realestate/la-fi-reverse-mort-20100919,0,5678747.story
CNN A housing rebound? Yes, it’s possible Despite continued discouraging data from the real estate sector, a few bullish arguments are beginning to emerge. One MIT economist even believes that demand for new homes exceeds residential construction. Read the full story:
http://finance.fortune.cnn.com/2010/09/17/a-housing-rebound-yes-its-possible/ San Diego Union-Tribune
Most oppose walking away from mortgage A majority of Americans believe it is “unacceptable” for homeowners to stop paying mortgage payments and walk away from their homes, says a Pew Research Center survey. Read the full story:
http://www.signonsandiego.com/news/2010/sep/15/most-oppose-walking-away-mortgage/ Los Angeles Times
Shorter-term mortgages make sense for some people, not for others
Loans that must be paid off in 15 or 20 years instead of the standard 30 have benefits, but there may be better ways to invest your cash. Read the full story:
http://www.latimes.com/business/la-fi-perfin-20100919,0,2494709.column CNN
Foreclosure rates hold steady
The foreclosure crisis has entered a new phase: The number of properties entering the foreclosure process has dropped, and now nearly matches the number of repossessions. Read the full story:
http://money.cnn.com/2010/09/16/real_estate/steady_foreclosure_rates/index.htm?hpt=T2
What you should know about the market
• Some homeowners may attempt to make home improvements on their own, without the proper permits and/or skill set. When it comes time to sell the house, buyers likely will use that to their advantage when negotiating. To avoid this, many real estate professionals advise homeowners to hire licensed contractors and to do due diligence to ensure the proper permits have been approved by the city, county, or others who may need to approve the project. • When it comes time to hire a licensed contractor, homeowners may opt to search online. Sites that are driven by consumer ratings often will be the best bet because consumers can see what other homeowners say about the contractor and his/her quality of work. However, consumers should beware of sites with anonymous postings and advertisements that appear in search results that look like positive ratings. |
Patrick Canavan Prudential CA Realty J D Power and Associates
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For the second time in three years, Prudential achieves distinction among full service real estate firms Prudential Real Estate ranks highest among home sellers that use full service real estate firms according to the J.D. Power and Associates 2010 Home Buyer/Seller Satisfaction StudySM. This is the second time in the past three years that Prudential has been recognized with this important distinction—most recently in 2008. In addition to ranking highest overall among home sellers, Prudential also achieves the highest scores in the study for the Agent/Salesperson factor and Real Estate Company Marketing factors.
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Wall Street Journal 10 reasons to buy a home With newspaper headlines declaring that foreclosures are on the rise, short sales are difficult to navigate, and the rate of homeownership is on the decline, some home buyers may no longer see the value of purchasing a home. However, there are several reasons why homeownership makes economic, financial, and personal sense. KEEP THIS IN MIND • Home prices have declined approximately 30 percent from their peak, according to Standard & Poor’s Case-Shiller Index, which is good news for home buyers hoping to purchase a house at an affordable price. As a result, statewide affordability reached 64 percent in the second quarter of this year, meaning 64 percent of California households could afford to purchase an entry-level home in the state. • Although home buyers should not view a home strictly as an investment, generally speaking, homeownership does offer risk capital. The median home price in California has risen year-over-year for nine consecutive months, which implies home equity will increase over the next few years. • Owning a home also can be beneficial because it acts as “forced savings.” While the monthly mortgage payment may be slightly higher than renting an apartment, most renters do not put the difference into a savings account. The portion of a monthly mortgage payment that’s allocated toward the principal of a mortgage shouldn’t be viewed as a cost, but rather as a forced monthly saving, because in the long run it’s building equity in the home. Read the full story:
http://online.wsj.com/article/SB10001424052748703376504575492023471133674.html?mod=
WSJ_hpp_MIDDLENexttoWhatsNewsSecond
In Other News… CNN Money
California housing prices on the rebound The national housing market is shrouded in uncertainty. But in California, there are glimmers of stability. Read the full story:
http://money.cnn.com/2010/09/15/real_estate/california_home_price_rebound/index.htm?source=cnn_bin&hpt=Sbin
New York Times A downside of short sales
Struggling homeowners have found some refuge in short sales, in which lenders allow borrowers to escape foreclosure by selling a home for less than what is owed on the mortgage. Government programs offering incentives to both parties will push the number of short sales to 400,000 this year from 100,000 in 2008, according to CoreLogic, a financial consulting firm. But the jump in short sales also has given rise to a new form of fraud – which, as a recent study by CoreLogic suggests, could undermine the burgeoning practice. Read the full story:
http://www.nytimes.com/2010/09/12/realestate/12mort.html?_r=1&ref=realestate
San Francisco Chronicle Why your first home shouldn’t be your dream home Since 2000, homeownership rates in the U.S. have hovered around 66-67 percent of the population. In 1900, less than half of Americans owned their home. The biggest surge in home buying came after World War II, when many young families were encouraged to buy a “starter home.” Read the full story:
http://www.sfgate.com/cgi-bin/article.cgi?f=/g/a/2010/09/10/investopedia46862.DTL&type=realestate CNN Money
Home buyer tax credit: 950,000 must repay Nearly half of all Americans who claimed the first-time home buyer tax credit on their 2009 tax returns will have to repay the government. Read the full story:
http://money.cnn.com/2010/09/09/real_estate/who_repays_tax_credit/index.htm
Los Angeles Times Borrowers beware of credit fixer scams Recession-hammered consumers across the country have seen their credit scores decline, and that has made them susceptible to scams that purport to erase delinquencies, judgments, foreclosures, and other problems from their files at the three national credit bureaus – Equifax, Experian, and TransUnion. Read the full story:
http://www.latimes.com/business/realestate/la-fi-harney-20100912,0,7456237.story
The Wall Street Journal Foreclosure fraudsters: The criminals who slow down recovery Foreclosures are once again on the minds of many. After a summer of record lows in home sales and widespread pessimism in the economy, many market-watchers say the next leg down in home prices may come from pressure brought by foreclosed home inventory hitting the market. Read the full story:
http://blogs.wsj.com/developments/2010/09/13/foreclosure-fraudsters-the-criminals-who-slow-down-recovery/
The Mercury News Lenders putting few foreclosed homes on the market
Thousands of homes remain stuck in the foreclosure process as lenders continue to offer relatively few foreclosed homes for sale, according to a report released Tuesday. Read the full story:
http://www.mercurynews.com/business-headlines/ci_16073325
The Orange County Register Bad FICO score? How to boost it
If you’re thinking about buying a home, you know it’s more important than ever to have a high FICO score. Several components make up your score. What steps would you take to bump it up? How would you even know where to start? Read the full story:
http://www.ocregister.com/articles/credit-265786-score-pay.html
What you should know about the market • One indicator of whether a local housing market is improving is the inventory level of homes for sale. REALTORS® can provide this information and tell home buyers and sellers how many months it would take at the current sales rate to absorb the current supply. California’s long-run average of unsold inventory is 7.2 months. In July 2010, the unsold inventory level stood at 5.8 months. • Homeowners who lose their homes to foreclosure should wait three to five years before trying to qualify for a home mortgage insured by the government, depending on the borrower’s circumstances, and assuming they have re-established a record of paying bills on time. Foreclosures can remain on credit reports for up to seven years, likely increasing the interest rates the consumer pays, and making it more difficult to receive approval on a new mortgage loan. Brought to you by the CALIFORNIA ASSOCIATION OF REALTORS® |
Central Valley Business Times CalHFA offers new 30-year mortgage The California Housing Finance Agency (CalHFA) announced this week the launch of a new fixed-rate, 30-year, FHA-insured mortgage program for low- and moderate-income home buyers. KEEP THIS IN MIND
• CalHFA provides financing and programs for low- and moderate-income Californians. The program announced this week enables qualified, first-time home buyers in California to receive a 30-year mortgage with a fixed interest of approximately 4 percent. • The CalHFA program includes upfront mortgage insurance, which is required for most FHA- insured home loans. Borrowers are eligible to use the California Homebuyer’s Downpayment Assistance Program, which can provide up to 3 percent of the purchase price of the home for down payment or closing costs. • In addition to being a first-time home buyer – defined under federal law as not having owned and occupied a home for the past three years – borrowers also must meet income limits, which vary by county and family size. Income limits can be found on the CalHFA Web site at http://www.calhfa.ca.gov/homeownership/limits/income/income-main.pdf. • Borrowers also must purchase homes within FHA’s loan limit and CalHFA’s sales price limits. Mortgage loans are limited to $417,000 under FHA guidelines, while CalHFA’s sales price limits vary by county. • Additionally, borrowers must meet the minimum credit score requirements and maximum debt-to-income ratios and complete a HUD-approved home buyer education program. More information about the CalHFA program can be found at http://www.calhfa.ca.gov/homebuyer/programs/30fha.htm.
Read more Here
In Other News… The New York Times As pay falls, borrowers lose ground
Lenders scrutinize all elements of a mortgage application, but one factor remains critical: The debt-to-income ratio, or the percentage of a borrower’s monthly gross income that goes toward housing expenses. If it surpasses 36 percent, lenders typically will reject the loan. Read more Here
San Diego Union-Tribune Pending home sales rise in July
Pending home sales increased slightly in July from the previous month but are well below last year’s levels, a sign that the long-awaited rebound in the housing market has yet to take hold. Read more Here
The Wall Street Journal The FHA’s “Short Refinance” program: Frequently Asked Questions
The Obama administration recently announced a new program to help underwater homeowners who are current on their mortgage payment refinance into a new FHA-insured loan. Read more Here
San Diego Union-Tribune What do housing price reports mean?
Keeping track of the local housing market in these uncertain economic times can be more than a little crazy. The New York Times Housing woes bring a new cry: Let the market fall
The unexpectedly deep plunge in home sales this summer likely is to force the Obama administration to choose between future homeowners and current ones, a predicament officers had been eager to avoid. The Wall Street Journal Housing inventories rise for eighth straight month
Housing inventories rose in many U.S. cities for the eighth straight month in August in a sign of the continued headwinds facing a soft housing market.
Keep this in mind • Often times, first-time home buyers are so excited at the prospect of becoming homeowners that they start their home search immediately, without knowing how much house they can afford. To prevent buyers from wasting time looking at houses out of their price range, buyers are advised to begin the home-buying process by meeting with lenders and getting pre-approved for a mortgage loan. • Unlike getting prequalified, which is just a ballpark figure and doesn’t require the lender to check the borrower’s credit history, preapproval provides the borrower with a Good Faith Estimate spelling out the terms of the loan, the interest rate, the type of loan, and the closing costs. Brought to you by the CALIFORNIA ASSOCIATION OF REALTORS® |
The New York Times New online help from Fannie Mae Since the start of the housing downturn, the number of Web sites and foreclosure-prevention companies claiming to offer help to struggling borrowers has greatly increased. While some of the businesses are legitimate, others are fraudulent and offer services that consumers may be eligible to receive free of charge. KEEP THIS IN MIND • This month, Fannie Mae - the government-sponsored entity that helps set lending standards for most mortgages-started a Web site, KnowYourOptions.com. The site contains elements distinguishing it from those aiming to prevent foreclosure. All of the information on the site is available in Spanish or English. • KnowYourOptions.com provides video explanations of what users might accomplish in each of the tabbed section of the site. In the "Take Action" section, for example," struggling homeowners are advised that the first step to take in seeking help with their mortgage is to contact their mortgage company. • Other features of the site include contact information for mortgage companies and loan counselors, calculators to determine if the borrower is eligible for assistance, and information on commencing short sales or deeds-in-lieu of foreclosure. • Another helpful Web site for consumers is Hope LoanPort, which allows struggling homeowners and housing counselors to submit financial documents to mortgage companies and track the status of their efforts to avoid foreclosure. Hope LoanPort was created by Hope Now, a consortium of 12 mortgage companies and 250 counseling agencies. To read the full story, please click here:
http://www.nytimes.com/2010/08/22/realestate/22mort.html?_r=1&ref=realestate In Other News... Sacramento Bee Buying an older home? REALTORS® giving $2,000 for certain energy-efficiency improvements The Sacramento Association of REALTORS®, aiming to overcome consumer reluctance about buying older, energy-guzzling houses, has launched a program to give qualified buyers $2,000 to help make energy-efficiency improvements. To read the full story, please click here:
http://www.sacbee.com/2010/08/23/2977186/buying-an-older-home-realtors.html The New York Times Housing fades as a means to build wealth, analysts say Housing will eventually recover, but many real estate experts now believe that homeownership never again will yield rewards like those enjoyed in the second half of the 20th century, when houses not only provided shelter but also a plump nest egg. To read the full story, please click here:
http://www.nytimes.com/2010/08/23/business/economy/23decline.html?ref=realestate Los Angeles Times Mortgage delinquencies remain high at 1 in 10 loans One in 10 American households with a home loan was behind on payments by at least one month this summer, the Associated Press reported. To read the full story, please click here:
http://latimesblogs.latimes.com/money_co/2010/08/delinquencies.html The Wall Street Journal Mortgage fraud is rising, with a twist New data suggests that mortgage fraud-which got tougher to pull off after the collapse of the U.S. real estate market-is returning in a big way. To read the full story, please click here:
http://online.wsj.com/article/SB10001424052748703824304575435383161436658.html?mod=WSJ_hpp_sections_personalfinance
Press Enterprise Mortgage assistance programs help people through patches of unemployment In the current national economic crisis, unemployment has replaced mortgages that readjust to higher rates as the primary cause of home foreclosures. As a result, mortgage assistance programs are being offered to help people through the rough patches of unemployment. To read the full story, please click here:
http://www.pe.com/business/local/stories/PE_Biz_D_unemployed22.2106053.html Los Angeles Times More recent mortgage modifications seem to be sticking Homeowners who had mortgages modified recently are faring better than those who did so earlier in the housing crisis, according to a report published Tuesday, possibly debunking predictions of a huge wave of defaults to come. To read the full story, please click here:
http://www.latimes.com/business/la-fi-re-default-20100824,0,496548.story Inland Valley Daily Bulletin Area home prices jump Home prices in July rose 10.7 percent to $155,000 in San Bernardino County compared with the same time last year, according to a report released Tuesday. To read the full story, please click here:
http://www.dailybulletin.com/ci_15884350 Los Angeles Times Federal foreclosure prevention program is struggling Just as the housing market recovery has stalled, so has the Obama administration's main program to ease home foreclosures. To read the full story, please click here:
http://www.latimes.com/business/la-fi-obama-foreclosures-20100821,0,3901237.story
Keep this in mind ... • In the second quarter of 2010, 64 percent of first-time buyers could afford to purchase an entry-level home in California, according to the First-time Buyer Housing Affordability Index published by the CALIFORNIA ASSOCIATION OF REALTORS®. • The median price of an entry-level home in California was $266,750 in the second quarter of 2010, with an estimated monthly payment of $1,470, including taxes and insurance. • The minimum household income needed to purchase an entry-level home in California in the second quarter of 2010 was $43,960. Brought to you by the CALIFORNIA ASSOCIATION OF REALTORS® |
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Patrick Canavan Realtor® EcoBroker® | Prudential California Realty
181 S. Old Springs Rd. Anaheim, CA 92808
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