Real Estate News

HUD offers services to public in 175 languages

January 21, 2012

HUD recently announced the launch of the HUD Language Line, a telephone language service pilot that will offer live, one-on-one interpretation services in more than 175 languages. Accessible throughout the nation, the language line will help HUD staff to better communicate with Limited English Proficient (LEP) individuals and families about HUD housing programs, services, and activities.

The pilot program will run through September 2012. HUD staff across the nation will be able to use the HUD Language Line to provide non-English-speaking individuals and families with information about fair housing, homeownership, lead abatement, housing assistance, and other HUD programs and services. When a person with limited English proficiency contacts the Department, the HUD staff person taking the call will contact the Language Line and speak with a live operator, who will connect the caller and HUD staff person with an interpreter who speaks the caller’s language.

HUD also offers a Limited English Proficiency website to promote equal access to housing programs by providing important HUD documents in 18 different languages. HUD’s expanded LEP website features factsheets, housing brochures and other HUD forms in Amharic, Arabic, Armenian, Cambodian, Chinese, Creole, Farsi, French, Hmong, Khmer, Korean, Lao, Polish, Portuguese, Russian, Spanish, Tagalog, and Vietnamese, in addition to English.

The site offers brochures on fair housing, model lease agreements, information about HUD’s Housing Choice Voucher Program (Section 8), and Resident Rights and Responsibilities. The larger LEP initiative is in response to Executive Order 13166, which requires all federal, local and state agencies that receive federal funding to ensure that people with limited language skills have meaningful access to government programs and services.

: Real Estate News
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FHFA revises HARP to help more borrowers

January 8, 2012

The Federal Housing Finance Agency, along with Fannie Mae and Freddie Mac,  announced changes to the Home Affordable Refinance Program (HARP) to help more borrowers.

The program will continue to be available to borrowers with loans sold to Fannie Mae and Freddie Mac on or before May 31, 2009, with current loan-to-value (LTV) ratios above 80 percent.

The new program enhancements address several other key aspects of HARP including:

-Eliminating certain risk-based fees for borrowers who refinance into shorter-term mortgages and lowering fees for other borrowers
-Removing the current 125 percent LTV ceiling for fixed-rate mortgages backed by Fannie Mae and Freddie Mac
-Waiving certain representations and warranties that lenders commit to in making loans owned or guaranteed by Fannie Mae and Freddie Mac
-Eliminating the need for a new property appraisal where there is a reliable AVM (automated valuation model) estimate provided by the Enterprises
-Extending the end date for HARP until Dec. 31, 2013, for loans originally sold to the Enterprises on or before May 31, 2009.

Fannie and Freddie plan to issue guidance with operational details about the HARP changes to mortgage lenders and servicers by Nov. 15. Since industry participation in HARP is not mandatory, implementation schedules will vary as individual lenders, mortgage insurers and other market participants modify their processes.

: Loan Modification, Real Estate News, San Diego Real Estate
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Troubled San Diego homeowners get a lifeline with HARP

November 26, 2011

The government is changing its Home Affordable Refinance Program (HARP), making it easier for homeowners to refinance their underwater, high-interest mortgages.

Although HARP has helped more than 890,000 homeowners nationwide by reducing their monthly mortgage payments, there are still millions of homeowners who are too far underwater to participate.

Under the new rules, homeowners who owe more than 125 percent of the market value of their homes will be allowed to refinance into new loans.

The program also streamlines the refinancing process for homeowners who are current on their mortgage payments and reduces or removes fees that previously hindered them from refinancing.

Fannie Mae and Freddie Mac also will reduce the fees they charged in the past to enable borrowers to better afford the new loans.  Among the fees that will be reduced or eliminated are those for appraisals, title insurance, and closing costs.

Fees also will be waived for some underwater borrowers who are refinancing into 20-year or shorter-term loans.
HARP is only open to borrowers who are current on their payments for the past six months with no more than one missed payment in the past 12 months.  The loans must have been originally issued before May 31, 2009, and purchased by Fannie Mae or Freddie Mac.

: Loan Modification, Mortgages, Real Estate News, Short Sale
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Maximum FHA Loan Limits Restored To $729,750

November 22, 2011

FHA Loan Limits RestoredAfter a brief return to lower, pre-2009 levels, FHA loan limits have been restored. As signed into law last Friday, maximum FHA loan limits are — once again — as high as $729,750.

The move creates additional mortgage financing possibilities in more than 650 U.S. counties, and promises to increase the FHA’s mortgage market share, which has grown from 6% in 2007 to roughly 30% today.

The change in FHA loan limits also marks the first time that FHA loan limits exceed those of conventional mortgage-backers Fannie Mae and Freddie Mac.

Conventional loans remain capped at a maximum of $625,500.

For home buyers in Carlsbad and nationwide, FHA-insured mortgage offer several advantages over comparable conventional loans, the most commonly cited of which is that FHA-insured loans require a down payment of just 3.5 percent.

FHA-insured mortgages carry other advantages, too, however.

First, FHA home loans are not subject to loan-level pricing adjustments (LLPA). This means that, all things equal, buyers and would-be refinancers with credit scores below 740; or, who live in multi-unit homes; or, who have high loan-to-values are not subject to additional loan fees as a conventional mortgage applicant might.

Second, after 6 months of on-time payments, FHA-backed homeowners are eligible for the FHA Streamline Refinance. The FHA Streamline Refinance is among the simplest loan products for which to qualify with no appraisal required. Even if you’re “underwater” on your mortgage, you can still be streamline-eligible.

And, lastly, at least in today’s market, FHA mortgage rates are below those of the conventional market.

The downside of FHA financing, however, is that all FHA mortgages require mortgage insurance and FHA mortgage rates are often higher versus a comparable conventional loan. This means that, although its mortgage rate may be lower, the payment for an FHA home loan may be higher as compared to a Fannie Mae mortgage with similar credit traits.

FHA loans aren’t always optimal, but with higher FHA loan limits, expect the FHA’s market share to increase.

Check your local FHA loan limit at the HUD website.

: Mortgage Guidelines, Real Estate News
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Foreclosure Filings Climbing 4 States Account For Half Of Nationwide Activity

November 15, 2011

Foreclosures per capita October 2011

Foreclosure homes are a hot market throughout California — and supplies are ramping up.

According to foreclosure-tracking firm RealtyTrac, October’s foreclosure filings rose 7 percent to 231,000 filings nationwide.

A “foreclosure filing” is any one of the following foreclosure-related events : A default notice on a home; a scheduled auction for a home; or, a bank repossession of a home. Because of this definition, a single home can account for up to 3 foreclosure filings — one from each category. 

Because of this, we may glean more relevant insight into the foreclosure market by separating RealtyTrac’s foreclosure report into “event types”.

  • Default Notices : Up 10% from September 2011; Down 31% from October 2010.
  • Scheduled Auctions : Up 8% from September 2011; Down 38% from October 2010.
  • Bank Repossessions : Up 4% from September 2011; Down 27% from October 2010.

These breakdowns suggest that, although improved as compared to last year, the foreclosure market is growing. At least, it’s growing in some parts of the country. We can’t forget that — like everything real estate — home foreclosures are a local phenomenon. 

In October, just 4 states accounted for more than half of the country’s foreclosure filings. Those four states — California, Florida, Michigan and Illinois — represent just 26% of the U.S. population.

Even on a per household basis, the figures remain disproportionate :

  • Top 10 Foreclosure States : 1 foreclosure per 341 households, on average
  • Bottom 10 Foreclosure States : 1 foreclosure per 7,434 households, on average

The nationwide foreclosure rate was 1 foreclosure per 563 households.

As a home buyer, Carlsbad foreclosures are worth watching. They account for 18% of home resales nationwide and, in some markets, can be bought at steep discounts versus a comparable “non-distressed” home. That is part of their appeal, in fact.

But just because Carlsbad foreclosure properties can be a “deal”, it doesn’t mean you should rush to buy one. Buying a foreclosure home from a bank is different from buying a non-foreclosed home from a “person”. The contracts and negotiation process are different, and foreclosed homes are marketed in an as-is condition.

“As-is” means “this home may have defects” that the seller in not willing to remedy.

Therefore, if you plan to buy a Carlsbad foreclosure home, talk with a real estate professional first. You can learn a lot about the housing market online, but with respect to writing an offer on a property, you’ll want an experienced Carlsbad real estate agent on your side.

: Carlsbad Real Estate, Housing Analysis, Real Estate News, Statistics
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Banks Resume Tightening Mortgage Guidelines

November 10, 2011

Mortgage guidelines get tougher

As part of its quarterly survey to member banks nationwide, the Federal Reserve asked senior loan officers whether last quarter’s “prime” residential mortgage guidelines have tightened, loosened, or remained as-is.

A “prime” borrower is defined as one with a well-documented, high-performance credit history; with low debt-to-income ratios; and who chooses to finance a home via a traditional fixed-rate or adjustable-rate mortgage product.

After a 2-year easing cycle, the nation’s biggest bank banks report that they’ve reversed course, and are raising the bar on mortgage approvals.

For the period July-September 2010, 88% of responding loan officers admitted to tightening their prime guidelines, or leaving them “basically unchanged”.

If you’ve applied for a San Diego home loan lately, you’ve experienced this first-hand.

High delinquency rates and mortgage defaults since 2007 have caused the banks to rethink what they will lend, and to whom. As a result, today’s mortgage lenders scrutinize assets, incomes, and credit scores to make sure that nothing “slips by”.

For today’s San Diego home buyers and would-be refinancers, the San Diego mortgage approval process can be challenging as compared to how it looked just 18 months ago.

  • Minimum credit scores requirements are higher today
  • Downpayment/equity requirements are larger today
  • Debt-to-Income ratio requirements are more strict today

In other words, although mortgage rates are the lowest that they’ve been in history, fewer applicants can qualify. And, with more of the housing market still in recovery, it’s likely that guidelines will tighten again in 2012.

Therefore, if you’re among the many people wondering if it’s the right time to buy a San Diego home or refinance, consider that, although San Diego mortgage rates may fall, approval standards may not.

The best rate in the world won’t matter if you’re not eligible to lock it.

: Mortgage Guidelines, Mortgage Rates, Mortgages, Real Estate News
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Mortgage Rates Dip Reaching Another Record Low

November 7, 2011

Daily Real Estate News
For the second time in a month, fixed and adjustable-rate mortgage rates set new record lows this week, Freddie Mac reports in its weekly mortgage market survey. The previous record lows were set Aug. 18. Economic uncertainty and employment concerns are continuing to keep rates low, says Frank Nothaft, Freddie Mac’s chief economist.

Here’s a closer look at rates for the week ending Sept. 8:

  • 30-year fixed-rate mortgages:averaged 4.12 this week, down from last week’s 4.22 percent. The 30-year rates’ previous low was 4.15 percent, set on Aug. 18.
  • 15-year fixed-rate mortgages: averaged 3.33 percent this week, down from last week’s 3.39 percent average. Its previous record low was 3.36 percent.
  • 5-year adjustable-rate mortgages:averaged 2.96 percent, holding steady at the same record low it set last week.
  • 1-year ARMs: averaged 2.84 percent this week, down from last week’s 2.89 percent average. Its previous record low was 2.86 percent.

Despite the low rates, mortgage application volume remains low, dropping for the third straight week, the Mortgage Bankers Association reported this week. The volume of mortgage applications for purchase remained relatively flat this week at “extremely low levels, close to lows last seen in 1996,” says Mike Fratantoni, MBA’s vice president of Research and Economics. Refinance application volume was also down, dropping more than 35 percent below levels last year at this time.

: Mortgages, Real Estate News

The Most Expensive ZIP Codes In The Country (2011 Edition)

November 4, 2011

Most Expensive ZIP CodesIn the housing market, amenities and location have as much to do with a home’s value as the everyday forces of supply-and-demand. Whereas the latter causes home values to rise and fall over time, the former creates a starting point for said values. 

Where you live — and the features of your home — determine your home’s price range. Naturally, homes in some areas are consistently higher-valued than homes in others.

Using data compiled by real estate market data firm Altos Research, Forbes Magazine presents America’s 10 most expensive ZIP codes. California and the New York Metro area dominate the list.

  1. Alpine, NJ (07620) : $4,550,000
  2. Atherton, CA (94027) : $4,295,000
  3. Sagaponack, NY (11962) : $3.595,000
  4. Hillsborough, CA (94010) : $3,499,000
  5. Beverly Hills, CA (90210) : $3,469,891
  6. New York, NY (10012) : $3,392,574
  7. New York, NY (10013) : $3,317,962
  8. Water Mill, NY (11976) : $3,300,000
  9. Montecito, CA (93108) : $3,099,348
  10. Old Westbury, NY (11568) : $3,095,000

In fact, of the top 50 most expensive ZIP codes, only 6 are located outside of California and New York regions. 3 are Colorado resort towns — Snowmass (81654), Aspen (81611) and Telluride (81435) — one is in Maryland, one is in Florida, and the last is in Washington State.

Chicago-suburb Kenilworth (60043) is the top-ranked Midwest ZIP code. It placed 86th overall.

The Forbes list may be interesting but, to home buyers or sellers , it should not be the final word in home values. Real estate is a local market which means that — even within a given ZIP code — prices can vary based on street and neighborhood.

Look past general data and get specific. Talk to your real estate agent for local market pricing.

: Real Estate News, Statistics
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A Simple Explanation Of The Federal Reserve Statement November 2011 Edition

November 2, 2011

Putting the FOMC statement in plain EnglishWednesday, the Federal Open Market Committee voted to leave the Fed Funds Rate unchanged within its current target range of 0.000-0.250 percent.

The vote was nearly unanimous, with just one dissenting voter. There were 3 dissenters at each of the FOMC’s last two meetings.

In its press release, the Federal Reserve presented an improved outlook for the U.S. economy, noting that since its last meeting in September, there’s new evidence that the economy “strengthened somewhat” in the third quarter.

One example cited is that consumer and business spending continues to rise while inflationary pressures on the economy remain modest. This indicates controlled growth — a plus in a recovering economy.   

The economy remains slowed by a number of factors, though, as noted by the Fed :

  1. “Continuing weakness” in the labor market
  2. Softness in commercial real estate
  3. A “depressed” housing market

In response to mixed economic conditions, the FOMC opted to “do nothing” today; it introduced no new monetary policy, and revised none of its existing market stimulus. The Fed re-iterated its plan to leave the Fed Funds Rate in its current range near 0.000 percent “at least until mid-2013″ and affirmed “Operation Twist” — the program in which the Fed sells Treasury securities with a maturity of 3 years or less, and uses the proceeds to buy mortgage bonds with maturity between 6 and 30 years.

Mortgage market reaction to the FOMC statement has been negative this afternoon. Mortgage rates are rising because analysts expected the Fed to launch new, bigger stimulus plans. It didn’t. Rates may drift higher for the new few days, too.

Therefore, it today’s mortgage rates fit your household budget, consider locking in a mortgage rate. Mortgage rates are very low right now, relative to history. It may not last.

The FOMC’s next meeting — its last scheduled meeting of the year — is December 13, 2011.

: Federal Reserve, Mortgage Rates, Mortgages, Real Estate News
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Pending Home Sales Index Slips For 4th Straight Month

October 28, 2011

Pending Home SalesNationwide, fewer homes are going under contract to sell.

According to the National Association of REALTORS®, the Pending Home Sales Index fell 5 percent last month. September marks the fourth consecutive month in which the index has dropped. 

The Pending Home Sales Index is a monthly index which measures the number of homes under contract to sell, but not yet closed. As such, it’s among the few “forward-looking” housing indicators; a data set meant to predict future home sales. 

80% of homes under contract close within 2 months so, if the September Pending Home Sales Index is to be believed, we should expect home sales to decline through October and November. 

And that’s before we account for cancelled contracts.

Also from the National Association of REALTORS®, we learn that 18 percent of homes under contract failed to close in September. This is double the failure rate from September 2010 and it, too, should drag Existing Home Sales volume lower this fall.

On a seasonally-adjusted, regional basis, the Pending Home Sales Index fell everywhere. 

  • Northeast Region: -4.7% from August
  • Midwest Region : -6.2% from August
  • South Region : -5.5% from August
  • West Region : -2.1% from August

For home buyers and sellers, though, regional data remains too broad to be useful. Housing markets are local, meaning that each block on each street on each city has its own distinct economy. When 9 states are grouped into a single “region”, it’s neither helpful nor relevant to people making buy/sell decisions.

That said, the Pending Home Sales Index remains important because it’s about housing, and housing is a keystone of the U.S. economic recovery.

The market looks ideal for buyers. Home prices are rising, but slowly; and mortgage rates remain near rock-bottom levels. Home affordability is high and should remain that way for the next few weeks.

If you’re shopping for a home, it’s an excellent time to go under contract.

: Carlsbad Real Estate, Home Buying Tips, Home Selling Tips, Housing Analysis, Oceanside Real Estate, Real Estate News, San Diego Real Estate
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