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Monday, August 16, 2010
Thursday, July 15, 2010
Rates Improve; 2nd "Wave" of Foreclosures; Gift Funds Again
30 Year Fixed Rate Loan at a Cost of One Point: 4.25%*
Rates improved yesterday, as more surprisingly weak economic news surfaced (retail sales and manufacturing activity). The Fed also revised their growth projections downward, and inflation remains non-existent. The "recovery" is stalled or very weak at best, and this bodes well for rates.
1 million foreclosures are expected this year in the so-called "2nd wave". This one is supposedly caused by unemployment and it involves more "A Paper" loans instead of "sub prime", but it remains our observation that it is "negative equity" that sparks the most foreclosures. The upside to all the foreclosures: All of these houses have to be sold, meaning transactions for us, and more inventory for our buyers.
Gift Funds (for down payments) should always be transferred directly from the donor to escrow. Running gift funds through a buyer's account creates all kinds of "paper trail" issues. One of our best and sharpest Realtors yesterday stopped her client from getting gift funds too soon from her Mother, saving us all a ton of paperwork hassles.
Jay Voorhees and Heejin Kim at (925) 855-4491
Rates improved yesterday, as more surprisingly weak economic news surfaced (retail sales and manufacturing activity). The Fed also revised their growth projections downward, and inflation remains non-existent. The "recovery" is stalled or very weak at best, and this bodes well for rates.
1 million foreclosures are expected this year in the so-called "2nd wave". This one is supposedly caused by unemployment and it involves more "A Paper" loans instead of "sub prime", but it remains our observation that it is "negative equity" that sparks the most foreclosures. The upside to all the foreclosures: All of these houses have to be sold, meaning transactions for us, and more inventory for our buyers.
Gift Funds (for down payments) should always be transferred directly from the donor to escrow. Running gift funds through a buyer's account creates all kinds of "paper trail" issues. One of our best and sharpest Realtors yesterday stopped her client from getting gift funds too soon from her Mother, saving us all a ton of paperwork hassles.
Jay Voorhees and Heejin Kim at (925) 855-4491
Wednesday, July 14, 2010
Rates Improve Slightly after a 5 Day Slide; Amortization Schedules at Bankrate
30 Year Fixed Rate at a Cost of One Point: 4.25%*
We have one lender (Citi again) offering 4.25%; all of our other lenders are remain at 4.375%, as rates improved only slightly today after disappointing retail sales numbers were announced. Prior to today rates have been trending slightly upward every day for the last several days.
This is largely due to money managers shifting their focus back to stocks in an effort to chase higher yields. This translates to less demand for bonds and mortgages and generally higher rates. The advice we are getting from our analysts is to lock now, as rates appear to have bottomed out.
We frequently get requests for Amortization Schedules from our more conservative borrowers who want to see how fast they will/can pay down their principle. Bankrate.com has a great link that provides excellent amortization schedules with minimal input. Here is that link: http://www.bankrate.com/calculators/managing-debt/loan-calculator.aspx
We realize we are taking a mild risk by sending our clients to Bankrate b/c they have advertisements from mortgage lenders. But, our rates and turn-times are always much better than those advertised, so we worry little. Bankrate is a great resource.
Jay Voorhees and Heejin Kim at (925) 855-4491
We have one lender (Citi again) offering 4.25%; all of our other lenders are remain at 4.375%, as rates improved only slightly today after disappointing retail sales numbers were announced. Prior to today rates have been trending slightly upward every day for the last several days.
This is largely due to money managers shifting their focus back to stocks in an effort to chase higher yields. This translates to less demand for bonds and mortgages and generally higher rates. The advice we are getting from our analysts is to lock now, as rates appear to have bottomed out.
We frequently get requests for Amortization Schedules from our more conservative borrowers who want to see how fast they will/can pay down their principle. Bankrate.com has a great link that provides excellent amortization schedules with minimal input. Here is that link: http://www.bankrate.com/calculators/managing-debt/loan-calculator.aspx
We realize we are taking a mild risk by sending our clients to Bankrate b/c they have advertisements from mortgage lenders. But, our rates and turn-times are always much better than those advertised, so we worry little. Bankrate is a great resource.
Jay Voorhees and Heejin Kim at (925) 855-4491
Tuesday, July 13, 2010
Tuesday Rate Quotes; Same As Last Week; Higher Than Yesterday
30 Year Fixed Rate CONFORMING Loan at a Cost of One Point: 4.375%*
*Assumes: 20% Down; Credit Score above 740; Loan Amount Less than $417,000; Owner-Occupied; Single Family Residence
30 Year Fixed Rate HIGH BALANCE Loan at a Cost of One Point: 4.625%*
*Assumes: 20% Down; Credit Score above 740; Loan Amount GREATER than $417,000; Owner-Occupied; Single Family Residence
Investment Property CONFORMING: 30 Year Fixed Rate Loan at a Cost of One Point: 4.875%*
*Assumes: 25% Down; Loan Amount less than $417,000; Credit Score above 720; NOTE: Competitive Investment Property Financing Requires 25% Down
FHA Purchase CONFORMING: 30 Year Fixed Rate Loan at a Cost of One Point: 4.375%*
*Assumes: 3.5% Down; Loan Amount less than $417,000; Credit Score above 680
Investment Property “HIGH BALANCE”: 30 Year Fixed Rate Loan at a Cost of ONE Point: 5.0%*
*Assumes: 35% Down; Loan Amount GREATER than $417,000; Credit Score above 720; NOTE: Competitive Investment Property Financing Requires 25% Down
FHA Purchase “HIGH BALANCE”: 30 Year Fixed Rate Loan at a Cost of One Point: 4.5%*
*Assumes: 3.5% Down; Loan Amount GREATER than $417,000; Credit Score above 680
30 Year Fixed Rate JUMBO Purchase to $2,000,000 Loan Amount at a Cost of One Point: 5.25%*
*Assumes: 20% Down; Loan Amount less than $2,000,000; Credit Score above 740. Call for Quote. True "Jumbo Loans" are readily available now for qualified buyers
Jay Voorhees or Heejin Kim at (925) 855-4491
*Assumes: 20% Down; Credit Score above 740; Loan Amount Less than $417,000; Owner-Occupied; Single Family Residence
30 Year Fixed Rate HIGH BALANCE Loan at a Cost of One Point: 4.625%*
*Assumes: 20% Down; Credit Score above 740; Loan Amount GREATER than $417,000; Owner-Occupied; Single Family Residence
Investment Property CONFORMING: 30 Year Fixed Rate Loan at a Cost of One Point: 4.875%*
*Assumes: 25% Down; Loan Amount less than $417,000; Credit Score above 720; NOTE: Competitive Investment Property Financing Requires 25% Down
FHA Purchase CONFORMING: 30 Year Fixed Rate Loan at a Cost of One Point: 4.375%*
*Assumes: 3.5% Down; Loan Amount less than $417,000; Credit Score above 680
Investment Property “HIGH BALANCE”: 30 Year Fixed Rate Loan at a Cost of ONE Point: 5.0%*
*Assumes: 35% Down; Loan Amount GREATER than $417,000; Credit Score above 720; NOTE: Competitive Investment Property Financing Requires 25% Down
FHA Purchase “HIGH BALANCE”: 30 Year Fixed Rate Loan at a Cost of One Point: 4.5%*
*Assumes: 3.5% Down; Loan Amount GREATER than $417,000; Credit Score above 680
30 Year Fixed Rate JUMBO Purchase to $2,000,000 Loan Amount at a Cost of One Point: 5.25%*
*Assumes: 20% Down; Loan Amount less than $2,000,000; Credit Score above 740. Call for Quote. True "Jumbo Loans" are readily available now for qualified buyers
Jay Voorhees or Heejin Kim at (925) 855-4491
Monday, July 12, 2010
Rates About the Same; Among Many Lenders - Rates/Guidelines VARY Tremendously
30 Year Fixed Rate Loan at ZERO Points: 4.375%* (rate requires impounds)
Rates remain about the same today as on Friday, as the markets sit on edge waiting for major corporate earnings reports and other major economic news this week. Expect more volatility.
Note that our Rate Quote above is for a "No Points" loan in lieu of our typical "One Point" loan. This is because the "Yield Curve" is very flat today, meaning borrowers get little bang for their buck in paying points. We will strongly encourage "No Points" loans today for that reason (It is not worth paying a point to buy down your rate 1/8 of a per cent).
This brings up another point. Among our 50 or so lenders, only one (Plaza Mortgage) is offering 4.375% at "No Points". No other lender touches that rate today. We have an EXTREMELY rate conscious buyer right now shopping for the "best rate available", and none of our competitors have come close to matching our quote.
This is why it is so important to have access to multiple lenders. Both RATES and GUIDELINES vary tremendously from lender to lender.
Jay Voorhees and Heejin Kim at (925) 855-4491
Rates remain about the same today as on Friday, as the markets sit on edge waiting for major corporate earnings reports and other major economic news this week. Expect more volatility.
Note that our Rate Quote above is for a "No Points" loan in lieu of our typical "One Point" loan. This is because the "Yield Curve" is very flat today, meaning borrowers get little bang for their buck in paying points. We will strongly encourage "No Points" loans today for that reason (It is not worth paying a point to buy down your rate 1/8 of a per cent).
This brings up another point. Among our 50 or so lenders, only one (Plaza Mortgage) is offering 4.375% at "No Points". No other lender touches that rate today. We have an EXTREMELY rate conscious buyer right now shopping for the "best rate available", and none of our competitors have come close to matching our quote.
This is why it is so important to have access to multiple lenders. Both RATES and GUIDELINES vary tremendously from lender to lender.
Jay Voorhees and Heejin Kim at (925) 855-4491
Friday, July 9, 2010
Rates Tad Worse; How to Get Entire Condo Projects Approved by FHA
30 Year Fixed Rate Loan at a Cost of One Point: 4.375%*
Rates remain low b/c the economy remains weak. Many analysts consider them likely to stay low in the near future, as economic troubles continue to mount in both the US and Europe. The only thing that will spike rates in the near term are unexpected reports of strength in the economy - improving private sector employment numbers; improved retail sales; increases in factory orders, etc. Unexpected inflation reports would also spike rates, but such reports are considered highly unlikely in this languid economic environment.
If a buyer in need of FHA financing wants to buy a condo in a complex that is NOT FHA approved, we can get the entire complex approved by HUD (FHA). We have done this several times over the years, so we know it is possible. But the complex needs to be strong overall, with minimal HOA dues delinquencies, strong capitalization, and at least a 51% Owner Occupancy ratio. Time frames to get an entire complex approved by HUD range from 21 days (for very strong complexes with clean and clear financials and HOA docs), to 60 days for more complicated situations.
Jay Voorhees and Heejin Kim at (925) 855-4491
Rates remain low b/c the economy remains weak. Many analysts consider them likely to stay low in the near future, as economic troubles continue to mount in both the US and Europe. The only thing that will spike rates in the near term are unexpected reports of strength in the economy - improving private sector employment numbers; improved retail sales; increases in factory orders, etc. Unexpected inflation reports would also spike rates, but such reports are considered highly unlikely in this languid economic environment.
If a buyer in need of FHA financing wants to buy a condo in a complex that is NOT FHA approved, we can get the entire complex approved by HUD (FHA). We have done this several times over the years, so we know it is possible. But the complex needs to be strong overall, with minimal HOA dues delinquencies, strong capitalization, and at least a 51% Owner Occupancy ratio. Time frames to get an entire complex approved by HUD range from 21 days (for very strong complexes with clean and clear financials and HOA docs), to 60 days for more complicated situations.
Jay Voorhees and Heejin Kim at (925) 855-4491
Thursday, July 8, 2010
Rates Increase As Stocks Rally; Townhome Complexes Do NOT Need FHA Approval
30 Year Fixed Rate Loan at a Cost of One Point: 4.375%*
Rates increased sharply yesterday afternoon, as the stock market rallied; investors pulled money from bonds and mortgages in favor of the stocks, and pushed rates upward. There was little financial news to spark the rally, but this type of volatility is typical when rates appear to have hit a trough or a low ebb. Expect more volatility; a "rate quote" remains valid for only a very short period of time, unless locked immediately.
Please remember that Town-home or PUD Complexes do NOT need a formal FHA approval in the same way that a Condo Complex does. A single PUD or town-home qualifies for FHA financing in the same way that any other SFR does; you do not need a "spot approval". This is very important b/c many buyers in need of FHA financing unnecessarily avoid PUD/town-home complexes.
A town-home can look just like a Condo, but the difference is that the owners of a town-home own the land or the lot underneath their unit. With Condos there are no individual lots; condo owners do NOT own a lot under their unit (often Condos are 2nd-story units with no access to the ground in any case). Condo owners instead own an equal and undivided portion of the entire parcel that encompasses the entire complex.
You can tell the difference between the two types complexes by looking at the preliminary title report and/or accompanying the plat map.
Jay Voorhees and Heejin Kim at (925) 855-4491
Rates increased sharply yesterday afternoon, as the stock market rallied; investors pulled money from bonds and mortgages in favor of the stocks, and pushed rates upward. There was little financial news to spark the rally, but this type of volatility is typical when rates appear to have hit a trough or a low ebb. Expect more volatility; a "rate quote" remains valid for only a very short period of time, unless locked immediately.
Please remember that Town-home or PUD Complexes do NOT need a formal FHA approval in the same way that a Condo Complex does. A single PUD or town-home qualifies for FHA financing in the same way that any other SFR does; you do not need a "spot approval". This is very important b/c many buyers in need of FHA financing unnecessarily avoid PUD/town-home complexes.
A town-home can look just like a Condo, but the difference is that the owners of a town-home own the land or the lot underneath their unit. With Condos there are no individual lots; condo owners do NOT own a lot under their unit (often Condos are 2nd-story units with no access to the ground in any case). Condo owners instead own an equal and undivided portion of the entire parcel that encompasses the entire complex.
You can tell the difference between the two types complexes by looking at the preliminary title report and/or accompanying the plat map.
Jay Voorhees and Heejin Kim at (925) 855-4491
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