Access Real Estate Lending

Labor, Interest Rates, Housing Recovery…Facts and Protections For YOU

2013-07-02T22:55:45Z

The labor market’s recovery has been a long and arduous one; considerably longer than previous economic recessions. This was a credit recession that hit the consumer and the “little guy’s” assets a lot harder than previous recessions. Companies were more reluctant to hire, frightened of more potential economic waves, crashing upon their balance sheets, together with the global crisis, as opposed to previously more domestic recessions. This economic recovery has seen many workers continue to exit the work environment, significantly in more numbers than previous recessions. Even back to 1973, we had workers returning to the work place, while other workers kept their jobs. In the current “recovery,” we continue to see workers leaving the work place, as others are being hired; a chilling concern, and another example of why this recovery is taking so long to bounce back, from such low unemployment figures. Layoffs are beginning to cease, however. Finally, a good sign!
Young people are finding it more difficult to enter the work force, as older workers are forced to delay their retirement, since the financial crisis ate up their equity in their investments and home values. According to the Census Bureau, American Community Survey, twenty-five to thirty-four years olds from 2005 to today, saw the largest drop in home ownership. However, the good news is that with the housing recovery, seemingly on its way, we may see a reversal of these delayed retirements, giving younger people the opportunity to get hired, save a down payment, and get into the housing market. With companies like Chico’s Build.com, we may have an opportunity to see this at a faster pace than the rest of the nation. A tight supply of homes is going to increase desire, and therefore values. As these values increase, it gives sellers an opportunity to finally sell, and not lose money. We are seeing existing and new home sales climb nicely, however nowhere near the levels of 2005 and 2006, nor even close to 2000 levels. So, a note of caution is that this growth has been partly attributed to low interest rates. Will this sustain as interest rates climb with the announcement of the tapering off of the government’s interest rate producing mortgage backed securities’ purchasing program? That’s a big challenge for the Federal Reserve to try and balance.
It’s interesting to note that about two months ago, when Federal Reserve Chairman Ben Bernanke mentioned that the government was considering “tapering” its $85 Billion a month bond purchasing program (which is what has kept interests artificially low for the past few years), then again, this past week, his ambiguous comments caused the markets to panic, again, sending interest rates over a full percent higher, and in some cases close to one and one-half percent higher than just two months previous to the comments, that you would hear Dr. Mark Palim, Director in the Economic and Strategic Research group at Fannie Mae, indicate that with inflation being pretty subdued, and unemployment coming down only slowly …”at this point the balance is still toward continuing the bond buying, and perhaps sometime in 2014, reducing it, or stopping it.” And Fed member Richard Fisher indicate that any tapering would be a long, drawn out process. Powerful words, from very knowledgeable people, however, which statement do you think moved the markets and interest rates so abruptly? Incredible! Also it’s interesting to know that Bernanke’s job is to keep markets calm and to not stir the financial world into indecisive decision making based on a Federal Reserve Chairman’s words. So, was this a calculated statement to “test the waters” of the government’s decline of purchasing treasuries? It’ all very interesting to ponder, however, what protections does the consumer have? Banks have started to roll out 345 day locks. That’s right! Now, you can protect yourself, from rising rates, by paying an up-front fee to lock in for up to about one year. This is particularly helping for new construction. As builders take on risks of building new homes, and interest rates climbing, potentially creating an effect of kicking a number of buyers out of qualifying for their mortgage payments, long term locks can be very helpful. Also, as rates climb, don’t forget the mortgage insurance buy-out programs that don’t have that monthly payment tacked onto qualifying ratios…enable buyers to keep their payments lower, and continue to stay approved, for their agreed upon price. Also, 21 day closing programs, offered by only one lender in town. These are things to keep in mind, as the economy continues to grow, uncertainty in the market place, as well as comments by policy makers and financial conductors of the world, create a jittery market whereby interest rates are a Nervous Nelly.

FHA MORTGAGE INSURANCE CHANGES JUNE 3RD

2013-05-21T16:45:40Z

On January 31, 2013 HUD issued Mortgagee Letter 2013-04, announcing a number of revisions concerning the cancellation of the annual Mortgage Insurance Premium (MIP). This change rescinds the automatic cancellation of the annual MIP collection. The change will require that for loans with FHA case numbers assigned on or after June 3, 2013 (FHA case numbers must be dated on or after the application date), FHA will collect the annual MIP for the maximum duration permitted (see chart below).

FHA loans are subject to HPML regulations and due to the extended MI more loans will fail the HPML test than before. Run the HPML test at time of application, when you lock the loan, and anytime the APR changes. See attached instructions for the HPML test.

Case #’s on or after 6/03/2013 – New Duration of Annual MIP
Term	LTV (%)	Previous	New
≤ 15 years	≤ 78	No annual MIP	11 years
≤ 15 years	> 78 – 90.00	Cancelled at 78% LTV	11 years
≤ 15 years	> 90.00	Cancelled at 78% LTV	Loan term
>15 years	≤ 78	5 years	11 years
>15 years	>78 – 90.00	Cancelled at 78% LTV & 5 years	11 years
>15 years	>90.00	Cancelled at 78% LTV & 5 years	Loan term

*For all SF Forward Streamline Refinance transactions that are refinancing FHA loans endorsed on or before May 31, 2009, the Annual MIP will be .55%, regardless of the base loan amount.

Case #’s on or after 6/03/2013 – New Annual MIP TERM ≤ 15 years

Base Loan Amount

LTV

Previous MIP

New MIP

Any Amount

≤ 78 %

.00

.45%

Gift Fund Documentation Requirements

2013-05-02T20:26:12Z

Gift fund documentation is an important requirement of HUD and our investors. All gift fund conditions are a PTD condition and can’t be moved to a PTF condition. Below are the documentation requirements for gift funds:

FHA

Fully completed gift letter
Copy of gift check
Evidence of withdrawal (either bank statement or withdrawal slip)
If funds go into borrower’s account:
- Copy of bank statement to show deposit with new balance
If funds go directly to escrow via wire:
- Wire account numbers to match donor’s bank statement
If funds go directly to escrow via cashier check:
- Copy of receipt from escrow
- Copy of casher check with donor’s information
Donor’s ability to gift
- Bank statements (all pages or statement from bank with tellers name, phone# on bank letterhead showing available current balances)

Conventional and VA

Fully completed gift letter
Copy of gift funds (check, cashier check, or wire)
If funds go into borrower’s account:
- Copy of bank statement to show deposit with final new balance
If funds go directly to escrow via wire:
- Wire account numbers to match donor’s bank account
If funds go directly to escrow via cashier’s check:
- Copy of receipt from escrow or
- Copy of cashier check

All information contained herein is for informational purposes only and, while every effort has been made to insure accuracy, no guarantee is expressed or implied. Information is subject to change without notice. All loans subject to underwriting approval.

Making Certain You Get Your “Keys On Time”

2013-07-10T16:02:56Z

Some Statistics:

That housing market is heating up, all over the nation, and Chico, Paradise, and the surrounding area are no exception! On April 4th, CoreLogic reported that home prices rose by 10.2% annually in the month ended in February. The largest annual gain since March of 2006, and was the 12th consecutive monthly increase in home prices, nationally. Housing Starts were up an amazing 47% in the year ended in March of 2013 to 1.036 million units and up 72% from March of 2011. The 47% increase was the biggest year-over-year increase since 1992. Even though Existing Housing Sales for March were reportedly down 0.6% to 4.92 Million Units, since February was revised to 4.95 Million Units, that’s really only 0.3%, and while not at expectations, it’s still a hot number.

Competitive Market:

When you have a hot market, and inventory is low, it can create quite the competitive market. In order to be a top consideration for sellers, make sure you plan ahead, and are prepared to move forward with all of your ducks in a row. It could be the difference between getting your offer accepted, or rejected. Some important things to think about are credit scores, income-to-debt ratios, source of down payment and percentage down, structuring your offer with your Realtor, and length in time to close.

Credit:

Credit Scores are key! Any score, lower than 740, has an add-on to the cost of the loan, due to the delivery fee, to Fannie Mae or Freddie Mac. These delivery fees increase with their level of risk…so the lower the score, the higher the risk, the higher the delivery fee (and therefore, cost of the loan). Often times, when given a chance by visiting a lender, early in the process, there is time to observe the credit score and credit report. Some clients have something as simple as a gas card that may have $290 on it, yet a high credit limit of $300. By paying down this revolving account to less than 30% of the high credit limit, credit risk scores can soar…sometimes saving client tens of thousands of dollars, over the course of their loan. By offering a “rapid rescore” from the credit bureau subsidiaries, scores can increase in a matter of days, as opposed to waiting 60 days for the bureaus to report the adjustments, appropriately.

Qualifying Ratios:

Debt-to-Income Ratios are also key to getting your loan approved. There is the front-end ratio and the back end ratio. Fannie Mae and Freddie Mac like to keep the back-end ratio at 45% of a borrower’s gross monthly income (before taxes). FHA will still go to 55%, however, they prefer to insure loans with a 50% back end ratio. So, pulling your credit early can assist in knowing these ratios, and give you an opportunity to pay down any debt, they may be preventing you from qualifying for the home you desire.

Funds to Close:

The source of your down payment is critically particular. A 5-10% down loan has different requirements, as from where the down payment may come from, then 3.5% FHA loans, or 20% down loans. Getting to a lender early enough to understand the varying requirements could save you a lot of heartache. Cash, for example, is a no-no, regarding using it to close a real estate transaction. Also, non-documented sources may not be used. Gift funds, from family, need to be sourced and documented with signed forms and copies of transfers and deposits. FHA and 20% down loan allow 100% gift funds for down payment and closing costs, while less than 20% down, conventional loans require that the buyer have 5% of his or her own funds, then, the rest may be gifted.

Writing the Offer:

The offer you make, to the seller, with your Real Estate Agent, could also be key, in getting the key, so to speak, for the home you’re interested in. Asking for too many fixes, too many contingencies, or too long of a period for escrow, could all be damaging to your chances. Working with an Agent that understands these intricacies of the loan process, can help you. For example, knowing that a buyer needs help with closing costs, and knowing that lender is going to credit 2% of the buyer’s loan amount, to help with closing costs, strengthens the deal by letting the seller know that they may only have to pay for about 1% of the sales price, towards the buyer’s closing costs. If the Agent and lender don’t discuss this, prior to writing an offer you’re walking into the negotiations somewhat blindly.

Closing on Time:

Approval letters, from lenders, showing that buyers are approved, can truly strengthen your offer. Access Real Estate Lending’s “Keys On Time,” Guarantee, printed on our approval letters is a 21-Day Guarantee, or a close on, or before, the scheduled closing date, or we’ll pay for the client’s Administrative Fee. Some of the nation’s largest lenders are having trouble closing escrows in 60 days…let alone twenty-one. The average “Keys On Time” Close is 16.87 Days…now, THAT should get some offers accepted. Rules and restrictions apply. Call us, for more details, on how this program works. TOLL FREE: 877.89.ACCESS

Article Featured in Chico Enterprise Record

See the Flyer on Facebook

- Listen to Danny explain why the current market is heating up as well as explain “Keys on Time”

Disclaimer:

* The “Keys on Time” program is a limited guarantee that Access Real Estate Lending will provide a credit to the borrower of $795 after the close of escrow if, due to some fault on the part of AREL, its originators or other AREL staff, a purchase transaction does not close until a date after the originally stated close of escrow date. The “Keys on Time” limited guarantee does not apply if the purchase transaction fails to close on or before the anticipated close of escrow date due to events/circumstances beyond AREL’s control, including but not limited to, delays caused by: an unacceptable or unexpectedly low appraisal value on the subject property, acts or omissions by the escrow or title company, second lien holder approvals, short sale approval, or loan conditions imposed by the lender that, despite reasonable diligence by AREL, are not met by any party in a timely manner. The “Keys on Time” limited guarantee trigger begins when the initial loan package is received by AREL’s Fulfillment center. The complete loan package must be received in the AREL Fulfillment center a minimum of 18 days prior to the COE date. Exclusions: The limited guarantee does not apply to the HARP program, reverse mortgages, FHA 203k, non-delegated jumbo products or any loans that require prior approval from an investor. The limited guarantee applies to purchase transactions only. All programs are subject to borrower and property qualifications. Rates, terms, and conditions are subject to change without notice.

HUD’s Revision to FHA Cancellation and Increase of Annual MIP

2013-03-11T22:33:54Z

From the U.S Department of Housing and Urban Development (HUD): Mortgagee Letter 2013-04
Signed: Carol J. Galante (Assistant Secretary for Housing – Federal Housing Commissioner)

Download a copy here

Subject:

Revision of Federal Housing Administration (FHA) policies concerning cancellation of the annual Mortgage Insurance Premium (MIP) and increase to the annual MIP

Purpose:

Consistent with FHA’s ongoing efforts to strengthen the Mutual Mortgage Insurance Fund, FHA is:

Revising the period for assessing the annual MIP
Removing the exemption from the annual MIP for loans with terms of 15 years or less and Loan to Value (LTV) ratios of less than or equal to 78 percent at origination
Increasing the annual MIP on all forward mortgages except single family forward streamline refinance transactions that refinance existing FHA loans that were endorsed on or before May 31, 2009 (see ML 2012-4)

Effective Date:

The section of this ML that increases the annual MIP is effective for case numbers assigned on or after April 1, 2013, except as noted below.

The following sections of this ML are effective for all mortgages with FHA case numbers assigned on or after June 3, 2013:

Revision to the period for assessing the annual MIP
Removal of the exemption from the annual MIP for loans with terms of 15 years or less and LTVs of less than or equal to 78 percent at origination
Increase in the annual MIP for mortgages with terms less than or equal to 15 years and LTV ratios less than or equal to 78 percent at origination

Affected Topics:
This ML:

Rescinds the automatic cancellation of the annual MIP collection announced in MLs 2000-38 and 2000-46
Rescinds ML 2011-35, under which mortgages with terms of 15 years or less and LTVs of less than or equal to 78 percent at time of origination were exempt from the annual MIP
Rescinds and updates Sections 7.3.a, 7.3.c, 7.3.d, 7.3.e, 7.3.f, and 7.3.g of HUD Handbook 4155.2 as appropriate

This ML increases the annual MIP on all forward mortgages previously announced in ML 2012-4, except single family forward streamline refinance transactions that are refinancing existing FHA loans that were endorsed on or before May 31, 2009; the rate for those streamline transactions remains at the level announced in ML 2012-4.

Revision to the Period for Assessing Annual MIP:

For loans with FHA case numbers assigned on or after June 3, 2013, FHA will collect the annual MIP for the maximum duration permitted under statute. See 12 U.S.C. § 1709(c)(2)(B).

For all mortgages regardless of their amortization terms, any mortgage involving an original principal obligation (excluding financed Up-Front MIP (UFMIP)) less than or equal to 90 percent LTV, the annual MIP will be assessed until the end of the mortgage term or for the first 11 years of the mortgage term, whichever occurs first.
For any mortgage involving an original principal obligation (excluding financed UFMIP) with an LTV greater than 90 percent, FHA will assess the annual MIP until the end of the mortgage term or for the first 30 years of the term, whichever occurs first.

Note: FHA calculates LTV as a percentage by dividing the loan amount (prior to the financing of any UFMIP) by the lesser of the purchase price (if applicable) or the appraised value of the home. For streamline refinances without appraisals, FHA uses the original appraised value of the property to calculate the LTV.

Revision to the Period for Assessing Annual MIP (continued):

The table below shows the previous and the new duration of annual MIP by
Period for amortization term and LTV ratio at origination.

Term	LTV (%)	Previous	New
≤ 15 yrs	≤ 78	No annual MIP	11 years
≤ 15 yrs	> 78 – 90.00	Cancelled at 78% LTV	11 years
≤ 15 yrs	> 90.00	Cancelled at 78% LTV	Loan term
> 15 yrs	≤ 78	5 years	11 years
> 15 yrs	> 78 – 90.00	Cancelled at 78% LTV & 5 yrs	11 years
> 15 yrs	> 90.00	Cancelled at 78% LTV & 5 yrs	Loan term

Increase to Annual Mortgage Insurance Premium:

Under Public Law 111-229(1)(b), FHA may adjust its mortgage insurance premium rates, as measured in basis points (bps), by Mortgagee Letter.

The first table shows the previous and the new annual MIP rates by amortization term, base loan amount and LTV ratio. All MIPs in this table are effective for case numbers assigned on or after April 1, 2013.

	Term > 15 Years
Base Loan Amt.	LTV	Previous MIP	New MIP
≤ $625,500	≤ 95.00%	120 bps	130 bps
≤ $625,500	> 95.00%	125 bps	135 bps
> $625,500	≤ 95.00%	145 bps	150 bps
> $625,500	> 95.00%	150 bps	155 bps
Term ≤ 15 Years
≤ $625,500	78.01% -90.00%	35 bps	45 bps
≤ $625,500	> 90.00%	60 bps	70 bps
> $625,500	78.01% -90.00%	60 bps	70 bps
> $625,500	> 90.00%	85 bps	95 bps

The second table shows the previous and the new effective annual MIP rates for loans with an LTV of less than or equal to 78 percent and with terms of up to 15 years. The new annual MIP for these loans is effective for case numbers assigned on or after June 3, 2013.

	Term ≤ 15 Years
Base Loan Amt.	LTV	Previous MIP	New MIP
Any Amount	≤ 78.00 %	0 bps	45 bps

Exceptions to MIP Duration Changes:

The changes to the duration of the annual MIP as specified in this ML are effective for all Single Family FHA programs for which FHA charges an annual MIP except:

Title I
Home Equity Conversion Mortgages (HECM)

Exceptions to Announced MIP Increases:

The increases in the annual MIP specified in this ML apply to all mortgages insured under FHA’s Single Family Mortgage Insurance Programs except:

Streamline refinance transactions of existing FHA loans that were
endorsed on or before May 31, 2009 (see ML 2012-04)
Title I
Home Equity Conversion Mortgages (HECM)
Section 247 (Hawaiian Homelands)
Section 248 (Indian Reservations)

Information Collection Requirements:

The information collection requirements contained in this document have been approved by the Office of Management and Budget (OMB) under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520) and assigned an OMB control number of 2502-0583. In accordance with the Paperwork Reduction Act, HUD may not conduct or sponsor, and a person is not required to respond to, a collection of information unless the collection displays a currently valid OMB Control Number.

Questions:

Please address any questions about the topics addressed in this Mortgagee letter to the FHA Resource Center at 1-800-CALLFHA. Persons with hearing or speech impairments may reach this number via TTY by calling the Federal Information Relay Service at 1-800-877-8339. For additional information on this Mortgagee Letter, please visit www.hud.gov/answers.

HARP 2.0 Open Access UNLIMITED

2013-02-27T23:58:12Z

Beginning March 4, 2013 Freddie Mac’s Open Access refinance loan program through HARP 2.0 will have these changes:

Unlimited LTV/CLTV
LP Only
620 Minimum FICO
MI Transfers Allowed
All Occupancies Allowed

If you cannot see the Flash PDF, view it here: HARP Open Access Relief Unlimited

Below is only a snapshot of Open Access and information is subject to change.

USDA Edge Loan Product

2013-02-27T00:41:52Z

What is a USDA Home Loan?

A United State Department of Agriculture loan might be right for you if you want to purchase a home with no down payment. If you’re unsure about your credit rating, or have concerns about a down payment, USDA mortgage loans can give you piece of mind with super low closing costs and flexible payment options.

What Types of Loans does USDA offer?

Currently, there are two kinds of USDA mortgage loans available for single family households:

USDA Guaranteed Rural Housing Loans:

The most common type of USDA home loan and allow for higher income limits and 100% financing for home purchases. USDA Guaranteed Loan applicants may have an income of up to 115% of the median household income for the area. Area income limits for this program can be viewed here. All USDA Guaranteed Loans carry 30 year terms and are at a fixed rate.

USDA Direct Rural Housing Loans:

These are less common than USDA Guaranteed and are only available for low and very low income households to obtain home ownership, as defined by the USDA. Very low income is defined as below 50 percent of the area median (AMI); low income is between 50 and 80 percent of AMI; moderate income is 80 to 100 percent of AMI.

Changes

Guarantee Fee Changes went into effect on October 1, 2011. An annual fee of .30% of the outstanding principal balance was implemented, to allow the Agency to reduce the up-front guarantee fee. As of October 1, 2012, the annual fee is now .40%

Therefore, beginning on October 1, 2011 the up-front guarantee fee for purchase transactions now are decreased from 3.5 percent to 2 percent for purchase loan transactions. The up-front guaranteed fee for refinance loan transactions increased to 1.5% beginning October 1, 2012.

New Pilot States Added & Effective 2/25/2013: AK, AR, CO, ID, KS, MO, MT, ND, OK, SD, TX, UT, WA, WV, WI

USDA EDGE Fixed Product:

Fixed Rate Mortgage insured by the United States Department of Agriculture

USDA Fixed Rate
Fully Amortizing Mortgage
30 Year Term
No Money Down
No Mortgage Insurance – See Guarantee and Annual fee below
No First-Time Homebuyer Requirement

Below is a Snapshot of details, eligibility, restrictions, and other information for USDA Edge Fixed Product. New Eligible States have been added and are effective starting 2/25/2013.

Can’t see Flash PDF? View it here: USDA EDGE FIXED PRODUCT

Feburary Newsletter: Tax Credit for Home Owners and Industry Updates

2013-02-25T23:27:02Z

Tis the Season…for Dreaded Taxes!

(But Here’s Some Help)

2012 Tax Transcripts

When 2012 income is used to qualify borrowers and tax returns are required, the following documentation must be provided:

2012 Tax Transcripts (if not available the following documentation is required)
- 2012 Tax Returns and
- 2012 Transcripts must be ordered and if not available a copy of IRS Notice Showing “No Record of Return Filed” must be provided and
- Documented Acknowledgement Receipt (e.g. IRS Officially Stamped Tax Returns or evidence the return was electronically received) from the IRS
Previous Years Tax Transcripts
If payment is owed for the 2012 tax year, proof the taxes were paid or evidence borrower has sufficient assets to pay liability.

An up to 20% Variance from current calendar year and transcripts from prior year are acceptable; anything over 20% will be at the underwriter’s discretion.

First-Time Home Buyer’s Tax Credit

Did you know First Time Home Buyer Tax Credits are still available? They are alive and well, but only when using an approved mortgage lender. This program is called Mortgage Credit Certificate Tax Credit Program (MMC) which we are an eligible lender for. All of Butte County Properties are eligible for this program. When a client participates in this program they will receive a 20% dollar for dollar credit on all the mortgage interest they pay in a year.

The MCC Tax Credit is a federal credit which can reduce potential federal income tax liability, creating additional net spendable income which borrowers may use toward their monthly mortgage payment. This MCC Tax Credit program may enable first-time homebuyers to convert a portion of their annual mortgage interest into a direct dollar for dollar tax credit on their U.S. individual income tax returns.

Highlights:

Twenty Percent MCC tax credit rate
Open to all areas within the state of California that is not currently covered by a partnering county or locality
Income and sales price limits apply
May be combined with a California Homebuyer’s Downpayment Assistance Program (CHDAP)
Available with all Government or conventional first mortgage programs, including adjustable rate mortgages
The term of the CalFHA MCC Tax Credit matches the term of the first mortgage; however, the tax credit will expire on the date the first mortgage loan is paid in full or refinanced

To apply, you must contact your participating Loan Officer. You may call Daniel Salas or Becke Reid at our office 530.897.4090

These documents will be needed:

Pay stubs
Bank statements
Employment history
Previous tax returns

Many Rules and Restrictions Apply. For More Information, check out CAL HFA’s website

If you are not a First-Time Buyer, you may still apply for the loan program depending on your location in California.

Find out more information here.

Looking for a Home?

Are you or someone you know currently trying to buy a new home? We have Property Listing Flyers for houses on the Market all over Northern California, complete with housing financial information on our Pinterest Page! New listings are added all the time, so make sure to “Follow” us.

Current Housing Industry News

Rates have managed to creep up a little recently. Rates go up a little, down a little – we could easily see this for all of 2013. (But gfee increases and loan level price adjustment changes will definitely impact borrower’s rates.) Inflation is well under control – and when was the last time we actually had economy-wide inflation – and the housing market is doing pretty well. But the big focus yesterday was on minutes from the Fed meeting. You’ll all recall the knee-jerk reaction last month to the release of those minutes, which for some reason put the fear of the end of QE# (the Fed buying securities) into the market. Prices went down, rates shot up, reminding us of the eventual exit of the Fed buying. Falling MBS prices result in higher mortgage rates. Rising MBS prices result in lower mortgage rates. Daily mortgage rates are based on real-time mortgage market pricing and are where mortgage rates come from. Inflation is currently not an issue.

Thursday the 10-yr was yielding 1.98% and MBS prices were marked higher (better) by about .125 than Wednesday’s closed by nearly .250 in price.

Redfin conducted an analysis of new property listings in the first five weeks of 2013 (January 1 to February 11) compared to the same period in 2012. Short sale listings decreased 54 percent from 2012, while REO listings are down by 46 percent. Overall, new listings declined 18 percent from 2012.

“Prices have gone up enough to stem the tide of short sales and bank-owned homes, but not enough to bring out the pent-up supply of would-be home sellers who have been sitting out the declining market” Redfin explained.

In addition, expansions to the Home Affordable Refinance Program (HARP) have allowed more underwater borrowers to stay in their home by broadening eligibility for refinancing, according to Redfin

Just how much HARP business is being originated? “Lots” probably isn’t a solid answer. The FHFA released Home Affordable Refinance Program (HARP) data for November 2012 and (drum roll please) the data show that HARP volume was strong in November, increasing 42% month over month (October was down 11%) and hitting 129,746 loans, while non-HARP GSE refis were up a more moderate 27%. The release also included moderate upward historical revisions for Fannie Mae HARP data based on a revised program definition, in line with Freddie Mac’s definition. (If you want more numbers, HARP volume as a percentage of total GSE refi increased to 23% from 21% in October, and high LTV loans – to borrowers with LTVs above 125 – increased 43% month over month to 30,670 loans.) Fannie Mae’s HARP data now includes second homes and investment property refinances with LTVs over 80, consistent with Freddie Mac.

But where does HARP go from there? Most expect the absolute level of HARP volume to remain elevated over the coming quarters, which will certainly help gain-on-sale margins in 2013, if not longer. Find out more about NEW Elite HARP 2.0 and Other Options for Underwater Home Owners.

Why NOW is the Time to get Your Home Loan

Mortgage Rates and Home Prices are on the rise while home inventory is decreasing, especially in California. Read why these events are taking place as well as why these factors mean now is the time to buy a home or refinance a current one in our article here.

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Great Option for Underwater Home Owners: Elite HARP 2.0

2013-02-20T00:36:25Z

ELITE HARP 2.0 Freddie Mac Open Access Relief Retained

A New HARP Option with Better Pricing for Underwater Home Owners

If you are unable to view PDF Flash Form, click this link to read: Elite HARP 2.0 Open Access Relief

If you are a home owner who owes more than your property is worth, it may be extremely benefitical to Refinance. Call us today @ 530.897.4090 to speak with an experienced Mortgage Lender or get started on getting PreApproved on our safe and easy online form: http://accessloans.net/get-a-loan-apply-now/

Related Reads:

More on HARP for Underwater Home Owners: http://accessloans.net/2012/11/29/options-for-underwater-home-owners/
Why Now is the time to Buy or Refinance

The Time to Buy or Refinance

2013-02-14T00:18:36Z

Market Update: More Proof – Now is the time to Buy or Refinance

Mortgage Rates are on the Rise!

Freddie Mac’s weekly mortgage rate survey reported last week’s 30-year fixed rate nationwide average at 3.35%, which is one quarter-percent point higher than the all-time low that happened last November.

Mortgage Bankers Association predicts in its annual rate forecast that the 30-year fixed will increase to 4.40% in 2013 (more than a full percentage point higher than January of this year). This high increase would suppress homebuyers’ purchasing power.

Example of the extremity of rates reaching 4.40%:

Buying home in the Bay Area (California) with a jumbo loan limit of $625,500

2012: at 3.32% – the mortgage payment would be $2,751
2013: at 4.40% – the mortgage payment would be $3,132. This would be a increase of $381 – a 12.4% decrease in purchasing power.

This high escalation in mortgage rates may also conclude the longest Refinance Boom in recent history. However, the demand for HARP (Home Affordable Refinance Program) refinances is still going strong. These government mortgages closed 1 in 4 refinances in the Q3 of 2012. HARP is currently on its second installment and is expected to help over 1 million owners in 2013 with their homes. Mortgage rates are known to rise suddenly and unexpectedly, though, so trying to refinance early in the year seems to be the safest move.

Home Prices Rising

The National Association of Realtors released on Monday that the national existing single-family home price median increased 10.0% in 4Q, the strongest increase since the 4Q in 2005. Those houses currently or soon to be on the market are going to be higher in price because they are higher quality (purchased more than 7 years ago). The monthly list price per square foot also increased $4 in January from $169 that was December’s price. Last January, the square foot price was $155.

Inventory is Low and Decreasing

January inventory dropped from December, to the lowest point in 3 years, which conflicts with the housing market’s seasonal norm. California has taken the top 7 cities of highest inventory drops. Right now, there is around 88,000 listed home on the MLS system which is a 47% decrease from September 2010′s peak and 19% from January of last year. There are many reasons why inventory is low when the market seems like its been on such a high; the main reason being the mortgage financial crisis that hit this country not so long ago. Typically, home owners sell their houses and look for a new place within 5-7 years of their original purchase. This means, buyers of 2006-2008 in a normal sense would be putting their homes on the market. However, these owners are still trying to get back the money they invested in their house. Banks are also keeping their foreclosures off of the market, because they want the highest sale they can get.

Why is this all going to be the hardest on First Time Buyers? With inventory low, the only houses being put on the market are of high quality and high price. First Timers also usually cannot beat the current low, long-term fixed rates. This means Investors have the power because they have cash, so an increase in rates or house prices. However, this is not to discourage new home buyers. While it may take more effort to find the right house, now is the perfect time for those looking to buy for their first time. Rates are still extraordinarily low and home prices are just freshly increasing. Finding the right agent and mortgage lender will help in process while finding you the best deal.

More Current Industry News

Top Ten Metro Cities with Major Inventory Decreases*

1. Sacramento – 75.11%

2. Oakland – 66.77%

3. San Francisco – 61.41%

4. Long Beach – 56.19%

5. San Diego – 49.34%

6. Los Angeles – 48.68%

7. Fresno – 47.62%

8. Portland – 43.18%

9. Denver – 39.02%

10. Houston – 35.02%

* From Movato.com