STILL UPSIDE DOWN – REFINANCE OPTIONS MAY NOW BE AVAILABLE
There are still no miracle government programs to solve most homeowner’s woes if you owe more than your home is worth; but you still may have some options.
Conventional Refinance: If you have a conventional mortgage (must be owned or guaranteed by Fannie Mae or Freddie Mac) without mortgage insurance, you may be able to refinance up to 125% of the home’s value. Owe more than 125%? With enough compensating factors (i.e. credit, assets, etc.), you may be able to get an appraisal waiver and slip into the 125% range you need to be in. Rates are slightly higher than a standard conventional loan, but with good credit, they are still quite low.
FHA Streamline Refinance: FHA streamlines do not require an appraisal. It does not matter how much you owe verses the value of the home. Anyone with a 5% interest rate or more should look into a streamline refinance. A streamline refinance allows the homeowner to lower their rate with little or no closing costs, and no appraisal. It will not solve your value issues, but it will lower your payment.
“Short’ Refinance: Starting September 7th, FHA will allow “short” refinances. The current first and second mortgage (if applicable) must agree to lower the amount owned to 115% of the property’s current value. The current mortgage(s) must be conventional, and can not be owned or guaranteed by Fannie Mae or Freddie Mac. The mortgage(s) can be negotiated down allowing the homeowner to lower the interest rate and/or improve the terms of the mortgage.
THE LONGEST RECESSION SINCE WORLD WAR II IS OVER – REALLY?
The National Bureau of Economic Research stated that the recession lasted 18 months and was officially over in June of 2009.
Things have been getting better, and for over a year? Did I miss the invite? Less than 10% of the jobs lost during the recession have returned (cnnfn.com). 27 states reported higher unemployment in August. Housing is still in crisis mode. Millions of people are out of work and can not provide for themselves. The economy is not retracting, but who is it expanding for? Statistically the recession may be over, but mainstream America sure doesn’t know it.
NEW HOMES SALES NEAR RECORD LOWS
“New home sales in August came in at an annual rate of 288,000, near record lows, the government says.” – cnnfn.com
AUGUST STATISTICS FOR ARIZONA HOME SALES
Short sales: 29% of all sales.
Median Home Price: $119,000
Closings in August: 7,358 (43% Cash / 28% Conventional / 25% FHA / 4% VA)
Historical:
Most homes sold: 06/2006
In June of 2006, 10,252 homes were sold with a median sales price of $250,000.
Least homes sold: 01/2008
In January of 2008, 2,912 homes were sold with a median sales price of $220,000.
As of 08/2010
In August of 2010, 7,358 homes were sold with a median sales price of $119,000.
Arizona home sales are only 30% off all time highs. Yes, only 30%. If you consider how out of control things were a few years ago; down only 30% is quite remarkable. First time homebuyers and investors are flooding the market. With the median home price now at $119,000, down from $220,000 just a few years ago, there are plenty of opportunities in the Arizona market.
- Statics from Fletcher Wilcox, Grand Canyon Title Agency
HOUSING IN RECOVERY – SLOWLY BUT SURELY
“Housing starts in August unexpectedly rose to their highest level in four months, the U.S. Commerce Department announced today. The 10.5% increase, reflecting a seasonally adjusted annual rate of 598,000 units, is the biggest rise in housing starts since last November.” – fortune.com
PROBLEMS WITH HOMWBUYER TAX CREDIT
“Nearly half of all Americans who claimed the first-time homebuyer tax credit on their 2009 tax returns will have to repay the government. According to a report from the Inspector General for Tax Administration, released to the public Thursday, about 950,000 of the nearly 1.8 million Americans who claimed the tax credit on their 2009 tax returns will have to return the money.”
“The confusion comes because homebuyers were eligible for two different credits, depending on when their homes were purchased. Those who bought properties during 2008 were to deduct, dollar for dollar, up to 10% of the home's purchase price or $7,500, whichever was less. The catch: The money was a no-interest loan that had to be repaid within 15 years.”
“It is also taking a look at all those deceased taxpayers who received credits. The inspector general reported that 1,326 single people listed as dead by the Social Security Administration claimed more than $10 million in credits. The IRS threw out 528 of those 1,326 claims, saving $4 million.” – cnnfn.com
CALIFONIA STABALIZES
California home prices have increased month after month for the past nine months. California home prices are up nearly 10.5% in the last year, landing the median home price at twice the national average. The median home price for California homes is now at $315,000.
CHINA AND JAPAN CONTINUE TO HAVE AN APPITIETE FOR U.S. DEBT
“China resumed buying U.S. government bonds in July, but Japan bought more. Treasury said Thursday in its monthly international capital report that China, the biggest U.S. creditor, bought $3 billion worth of Treasury debt in July, bringing its total to $847 billion. The second-biggest lender to the United States, Japan, continues to close the gap with China. Japan expanded its purchases of U.S. bonds for the third straight month, adding $17 billion worth of Treasurys to its stash, now worth $821 billion.” – cnnfn.com
RATE WATCH
Mortgage Type Interest Rate APR
30 Year Fixed 3.875% 4.005%
15 Year Fixed 3.500% 3.729%
5/1 ARM 3.000% 3.018%
Interest rates as of 09/24/10. Conforming interest rates. Interest rates and APR based on loan amounts not to exceed $417,000. Loan to values not to exceed 80%. 720+ credit score. Owner occupied only. Purchase and rate in term refinances. Not all applicants will qualify. Call today for your individual scenario rate quote.
About Me
- Aaron VanTrojen
- Aaron VanTrojen is a licensed mortgage banker. Geneva Financial, LLC is a mortgage banker / broker licensed in AZ, CA, CO, ID, NV, OR, and WA. LO NMLS: 15420 Company NMLS: 42056 NMLS Consumer Access: www.nmlsconsumeraccess.org
Friday, September 24, 2010
Wednesday, September 1, 2010
MARKET UPDATE - SEPTEMBER 2010
HOW LOW CAN THEY GO
Mortgage Type Interest Rate APR
30 Year Fixed 3.875% 4.005%
15 Year Fixed 3.500% 3.729%
5/1 ARM 3.000% 3.018%
Interest rates as of 09/01/10. Conforming interest rates. Interest rates and APR based on loan amounts not to exceed $417,000. Loan to values not to exceed 80%. 720+ credit score. Owner occupied only. Purchase and rate in term refinances. Not all applicants will qualify. Call today for your individual scenario rate quote.
FHA STREAMLINES CONTINUE TO SURGE
If you currently have an FHA mortgage with a rate of 5.000% or higher, you may be able to refinance with no appraisal, and little or no closing costs. The recent drop in interest rates have caused an influx of borrowers refinancing to take advantage of the FHA Streamline refinance option. Call today if you have an FHA mortgage at 5.000% or higher. 480-368-2000.
FHA NEEDS CASH
In an effort to increase cash reserves, FHA is modifying the upfront mortgage insurance premium and monthly mortgage insurance charge. Currently the upfront mortgage insurance premium is 2.25% of the loan amount, which is rolled into the base loan amount. The current monthly mortgage insurance fee is .55%, which is part of the monthly mortgage payment.
Effective October 4th, 2010, the upfront mortgage insurance premium will be reduced from 2.25% to 1.0%. The monthly mortgage insurance fee will be raised from .55% to .85% - .95%; which will vary based on certain risk factors of the file.
Below is an average effect the changes will have on borrowers payments after October 4th.
Loan Amount Current Payment New Payment Annual Increase
$100,000 $563.92 $582.58 $223.92
$200,000 $1,127.84 $1,165.17 $447.96
$300,000 $1,691.76 $1,747.76 $672.00
$400,000 $2,255.67 $2,330.34 $896.04
*Numbers based on a 4.5% interest rate.
The changes to mortgage insurance is equal to an approximate 0.375% increase in interest rate.
This will impact some borrowers’ ability to purchase a property after October 4th, or help drive down home values further.
NATIONAL HOME PRICES UP FOR THE YEAR
“National home prices jumped a substantial 3.6% in the past year, according to the S&P/Case-Shiller Home Price Index released on Tuesday. Prices also climbed 4.4% in the second quarter compared with a 2.8% plunge in the first quarter.” – cnnfn.com
The tax credit is the largest contributing factor for the increase in home prices. Industry insiders predict that home prices will level off, and potentially see a decline in the coming months, now that the tax credit has expired, and employment is not dramatically improving. Without another stimulus from the Federal Government, the housing market will remain shaky for the foreseeable future.
HOME SALES TAKE A BEATING
Home sales hit a 15 year low.
“Existing home sales sank 27.2% in July, twice as much as analysts expected, to a seasonally adjusted annual rate of 3.83 million units. Much of that drop is attributed to the end of the $8,000 homebuyer tax credit.” – cnnfn.com
TAX CREDIT 2010 & DOWNPAYMENT ASSISTANCE
The housing market is on the slide, and there is no hope in the foreseeable future; but there are rumors of help on the way.
A new buzz is stirring about the possibility of a new Government tax credit for home buyers to once again kick start the housing market. Numbers are now surfacing, and it is apparent that the tax credit had a much bigger impact on housing than many critics of the tax credit claimed.
Did someone say “Downpayment Assistance?” H.R. 600 FHA Seller-Financed Downpayment Reform Act of 2009 is not dead; not yet. Downpayment assistance allowed the seller to contribute the buyer’s minimum downpayment on FHA mortgages and was eliminated a couple of years ago when there was a push for everyone to have “skin in the game.” Downpayment assistance allows borrowers to essentially purchase a home with no money down. With the current housing market sputtering to a standstill, downpayment assistance may be making a come back.
If either the tax credit or downpayment assistance resurfaces, the housing market will once again erupt with new buyers coming off the fence and out of the woodwork. Yes, it may just be a short term Band-Aid, but the Government will want to stop the bleeding before there is hemorrhaging.
Mortgage Type Interest Rate APR
30 Year Fixed 3.875% 4.005%
15 Year Fixed 3.500% 3.729%
5/1 ARM 3.000% 3.018%
Interest rates as of 09/01/10. Conforming interest rates. Interest rates and APR based on loan amounts not to exceed $417,000. Loan to values not to exceed 80%. 720+ credit score. Owner occupied only. Purchase and rate in term refinances. Not all applicants will qualify. Call today for your individual scenario rate quote.
FHA STREAMLINES CONTINUE TO SURGE
If you currently have an FHA mortgage with a rate of 5.000% or higher, you may be able to refinance with no appraisal, and little or no closing costs. The recent drop in interest rates have caused an influx of borrowers refinancing to take advantage of the FHA Streamline refinance option. Call today if you have an FHA mortgage at 5.000% or higher. 480-368-2000.
FHA NEEDS CASH
In an effort to increase cash reserves, FHA is modifying the upfront mortgage insurance premium and monthly mortgage insurance charge. Currently the upfront mortgage insurance premium is 2.25% of the loan amount, which is rolled into the base loan amount. The current monthly mortgage insurance fee is .55%, which is part of the monthly mortgage payment.
Effective October 4th, 2010, the upfront mortgage insurance premium will be reduced from 2.25% to 1.0%. The monthly mortgage insurance fee will be raised from .55% to .85% - .95%; which will vary based on certain risk factors of the file.
Below is an average effect the changes will have on borrowers payments after October 4th.
Loan Amount Current Payment New Payment Annual Increase
$100,000 $563.92 $582.58 $223.92
$200,000 $1,127.84 $1,165.17 $447.96
$300,000 $1,691.76 $1,747.76 $672.00
$400,000 $2,255.67 $2,330.34 $896.04
*Numbers based on a 4.5% interest rate.
The changes to mortgage insurance is equal to an approximate 0.375% increase in interest rate.
This will impact some borrowers’ ability to purchase a property after October 4th, or help drive down home values further.
NATIONAL HOME PRICES UP FOR THE YEAR
“National home prices jumped a substantial 3.6% in the past year, according to the S&P/Case-Shiller Home Price Index released on Tuesday. Prices also climbed 4.4% in the second quarter compared with a 2.8% plunge in the first quarter.” – cnnfn.com
The tax credit is the largest contributing factor for the increase in home prices. Industry insiders predict that home prices will level off, and potentially see a decline in the coming months, now that the tax credit has expired, and employment is not dramatically improving. Without another stimulus from the Federal Government, the housing market will remain shaky for the foreseeable future.
HOME SALES TAKE A BEATING
Home sales hit a 15 year low.
“Existing home sales sank 27.2% in July, twice as much as analysts expected, to a seasonally adjusted annual rate of 3.83 million units. Much of that drop is attributed to the end of the $8,000 homebuyer tax credit.” – cnnfn.com
TAX CREDIT 2010 & DOWNPAYMENT ASSISTANCE
The housing market is on the slide, and there is no hope in the foreseeable future; but there are rumors of help on the way.
A new buzz is stirring about the possibility of a new Government tax credit for home buyers to once again kick start the housing market. Numbers are now surfacing, and it is apparent that the tax credit had a much bigger impact on housing than many critics of the tax credit claimed.
Did someone say “Downpayment Assistance?” H.R. 600 FHA Seller-Financed Downpayment Reform Act of 2009 is not dead; not yet. Downpayment assistance allowed the seller to contribute the buyer’s minimum downpayment on FHA mortgages and was eliminated a couple of years ago when there was a push for everyone to have “skin in the game.” Downpayment assistance allows borrowers to essentially purchase a home with no money down. With the current housing market sputtering to a standstill, downpayment assistance may be making a come back.
If either the tax credit or downpayment assistance resurfaces, the housing market will once again erupt with new buyers coming off the fence and out of the woodwork. Yes, it may just be a short term Band-Aid, but the Government will want to stop the bleeding before there is hemorrhaging.
Thursday, July 29, 2010
MARKET UPDATE - AUGUST 2010
INTEREST RATES REMAIN AT HISTORIC LOWS
Mortgage Type Interest Rate APR
30 Year Fixed 4.125% 4.255%
15 Year Fixed 3.750% 3.977%
5/1 ARM 3.000% 3.326%
Interest rates as of 07/29/10. Conforming interest rates. Interest rates and APR based on loan amounts not to exceed $417,000. Loan to values not to exceed 80%. 720+ credit score. Owner occupied only. Purchase and rate in term refinances. Not all applicants will qualify. Call today for your individual scenario rate quote.
FHA STREAMLINES SURGE
If you currently have an FHA mortgage with a rate of 5.250% or higher, you may be able to refinance with no appraisal, and little or no closing costs. The recent drop in interest rates have caused an influx of borrowers refinancing to take advantage of the FHA Streamline refinance option.
CONSUMER PROTECTION - FINANCIAL REFORM BILL PASSES
President Obama signed into law the most sweeping regulatory financial reform bill since the Great Depression. The Bill will take months, if not years to decipher and implement; and it will be even longer before all of the ramifications of the Bill are truly felt, by Wall Street, and the public. With news headlines that read “Wall Street Rejoices, Financial Reform Bill Passes,” you can only imagine who is going to control the implementation of the bill, and who will ultimately benefit from it. What is now known is that the Bill fails to address some of the most pressing concerns regarding the prevention of future financial crisis; and the consumer is likely to pay a dear price for government protection.
The bill does not address CEO and executive compensation. “Data shows that these are leading causes of the Great Recession.” – fortune.com
Reform of the two powerhouse institutions, Fannie Mae & Freddie Mac, both seized by the Federal Government, who are responsible for nearly half of all mortgages originated in the United States where not addressed in the bill.
Financial reform will likely further tighten credit requirements for consumers and increase costs on mortgage loans. If you thought that the mortgage process is difficult now, wait until this bill sets in. Added disclosures and more red tape is surely an outcome of the bill. The up to 50 page current loan application will not likely be deemed enough disclosure for the consumer. Added disclosures do not make a more informed consumer; it generally means the consumer will be less likely to read it.
“Consumers will see "safer" mortgages, but fewer of them will qualify. They will have fewer choices of mortgage lenders as concentration of mortgage lending by a few big banks accelerates. And virtually all mortgages will be government backed for the foreseeable future, with little chance of unwinding federal support. Uncle Sam will be the nation's mortgage lender for most of the next decade.” – The Huffington Post
Although it will take some time for the bill to be implemented, one thing is for certain. Consumer protection will come at a cost, and Wall Street will not be the one paying for it.
We will be closely following the Financial Reform Bill and its fallout. Please stay tuned.
HOMES SALES IN PHOENIX – UP IN JUNE
“Home sales in the Phoenix Metro Statistical Area (MSA) rose 11% from May, but fell short of a year ago for the second consecutive month. A total of 10,430 new and resale houses and condos closed escrow last month in the Maricopa-Pinal counties metropolitan area, up 11.2% from May, but down 2.8% from a year ago, according to MDA DataQuick.” – housingwire.com
NATIONALLY EXISTING HOME SALES SLIDE AGAIN
Existing home sales were down just over 5% in June. Existing home sales were up 9.8% from June of last year according to the National Association of Realtors.
NATIONALLY NEW HOME SALES SPIKE UP
The sale of new homes spiked up nearly 24% in June over May figures. New home sales are down 17% from June of last year. New home sale prices did drop 1.4% in June.
“An estimated 210,000 new homes were for sale at the end of June, the lowest inventory level in nearly 42 years. At the current sales pace, the government expects it will take 7.6 months to sell through that inventory, down from 9.6 months in May. Six months of inventory is considered normal market conditions.” – cnnmoney.com
BANK BAILOUT 2010
As of July 27th, 2010, 103 FDIC insured banks have been seized by the Federal Government year to date. 140 failed in 2009. 25 failed in 2008. 11 failed between 2003-2007. – fdic.gov
Looks like we are on pace for a record setting year.
HOME OWNERSHIP LOWEST IN OVER A DECADE
“The Census Bureau said the home ownership rate fell to 66.9% in the second quarter of 2010, down half a percentage point from the previous year. The home ownership rate was 67.1% in the first quarter of the year.” – cnnmoney. This is the lowest home ownership has been since 1990.
MARKET UPDATE brought to you by:
Aaron VanTrojen
PRESIDENT
GENEVA FINANCIAL, LLC.
Mortgage Banker licensed in:
AZ: BK-0910215, CA: 603G564, ID: MBL6976, NV: 3195, OR: ML4799, WA: 510-MB-49323
Geneva Financial, LLC NMLS License: 42056
Loan Officer NMLS License:15420
http://www.genevafi.com/
PARTNER
GENEVA REAL ESTATE & INVESTMENTS, LLC.
Real Estate Brokerage licensed in: AZ, CA, WA.
http://www.genevare.com/
Office: 480-368-2000
Cell: 602-793-6383
Email: aaron@genevafi.com
Facebook: www.facebook.com/vantrojen
Mortgage Type Interest Rate APR
30 Year Fixed 4.125% 4.255%
15 Year Fixed 3.750% 3.977%
5/1 ARM 3.000% 3.326%
Interest rates as of 07/29/10. Conforming interest rates. Interest rates and APR based on loan amounts not to exceed $417,000. Loan to values not to exceed 80%. 720+ credit score. Owner occupied only. Purchase and rate in term refinances. Not all applicants will qualify. Call today for your individual scenario rate quote.
FHA STREAMLINES SURGE
If you currently have an FHA mortgage with a rate of 5.250% or higher, you may be able to refinance with no appraisal, and little or no closing costs. The recent drop in interest rates have caused an influx of borrowers refinancing to take advantage of the FHA Streamline refinance option.
CONSUMER PROTECTION - FINANCIAL REFORM BILL PASSES
President Obama signed into law the most sweeping regulatory financial reform bill since the Great Depression. The Bill will take months, if not years to decipher and implement; and it will be even longer before all of the ramifications of the Bill are truly felt, by Wall Street, and the public. With news headlines that read “Wall Street Rejoices, Financial Reform Bill Passes,” you can only imagine who is going to control the implementation of the bill, and who will ultimately benefit from it. What is now known is that the Bill fails to address some of the most pressing concerns regarding the prevention of future financial crisis; and the consumer is likely to pay a dear price for government protection.
The bill does not address CEO and executive compensation. “Data shows that these are leading causes of the Great Recession.” – fortune.com
Reform of the two powerhouse institutions, Fannie Mae & Freddie Mac, both seized by the Federal Government, who are responsible for nearly half of all mortgages originated in the United States where not addressed in the bill.
Financial reform will likely further tighten credit requirements for consumers and increase costs on mortgage loans. If you thought that the mortgage process is difficult now, wait until this bill sets in. Added disclosures and more red tape is surely an outcome of the bill. The up to 50 page current loan application will not likely be deemed enough disclosure for the consumer. Added disclosures do not make a more informed consumer; it generally means the consumer will be less likely to read it.
“Consumers will see "safer" mortgages, but fewer of them will qualify. They will have fewer choices of mortgage lenders as concentration of mortgage lending by a few big banks accelerates. And virtually all mortgages will be government backed for the foreseeable future, with little chance of unwinding federal support. Uncle Sam will be the nation's mortgage lender for most of the next decade.” – The Huffington Post
Although it will take some time for the bill to be implemented, one thing is for certain. Consumer protection will come at a cost, and Wall Street will not be the one paying for it.
We will be closely following the Financial Reform Bill and its fallout. Please stay tuned.
HOMES SALES IN PHOENIX – UP IN JUNE
“Home sales in the Phoenix Metro Statistical Area (MSA) rose 11% from May, but fell short of a year ago for the second consecutive month. A total of 10,430 new and resale houses and condos closed escrow last month in the Maricopa-Pinal counties metropolitan area, up 11.2% from May, but down 2.8% from a year ago, according to MDA DataQuick.” – housingwire.com
NATIONALLY EXISTING HOME SALES SLIDE AGAIN
Existing home sales were down just over 5% in June. Existing home sales were up 9.8% from June of last year according to the National Association of Realtors.
NATIONALLY NEW HOME SALES SPIKE UP
The sale of new homes spiked up nearly 24% in June over May figures. New home sales are down 17% from June of last year. New home sale prices did drop 1.4% in June.
“An estimated 210,000 new homes were for sale at the end of June, the lowest inventory level in nearly 42 years. At the current sales pace, the government expects it will take 7.6 months to sell through that inventory, down from 9.6 months in May. Six months of inventory is considered normal market conditions.” – cnnmoney.com
BANK BAILOUT 2010
As of July 27th, 2010, 103 FDIC insured banks have been seized by the Federal Government year to date. 140 failed in 2009. 25 failed in 2008. 11 failed between 2003-2007. – fdic.gov
Looks like we are on pace for a record setting year.
HOME OWNERSHIP LOWEST IN OVER A DECADE
“The Census Bureau said the home ownership rate fell to 66.9% in the second quarter of 2010, down half a percentage point from the previous year. The home ownership rate was 67.1% in the first quarter of the year.” – cnnmoney. This is the lowest home ownership has been since 1990.
MARKET UPDATE brought to you by:
Aaron VanTrojen
PRESIDENT
GENEVA FINANCIAL, LLC.
Mortgage Banker licensed in:
AZ: BK-0910215, CA: 603G564, ID: MBL6976, NV: 3195, OR: ML4799, WA: 510-MB-49323
Geneva Financial, LLC NMLS License: 42056
Loan Officer NMLS License:15420
http://www.genevafi.com/
PARTNER
GENEVA REAL ESTATE & INVESTMENTS, LLC.
Real Estate Brokerage licensed in: AZ, CA, WA.
http://www.genevare.com/
Office: 480-368-2000
Cell: 602-793-6383
Email: aaron@genevafi.com
Facebook: www.facebook.com/vantrojen
Thursday, June 24, 2010
MARKET UPDATE - JULY 2010
INTEREST RATE UPDATE
Mortgage Type Interest Rate (APR)
30 Year Fixed 4.250% (4.381%)
15 Year Fixed 3.750% (3.977%)
5/1 ARM 3.250% (3.407%)
Interest rates as of 06/24/10. Conforming interest rates. Interest rates and APR based on loan amounts not to exceed $417,000. Loan to values not to exceed 80%. 720+ credit score. Owner occupied only. Purchase and rate in term refinances. Not all applicants will qualify. Call today for your individual scenario rate quote.
NEW HOMES SALES CRASH TO A RECORD LOW
New homes sales in May fall over 18% from the previous year. This is the slowest month for new homes sales since the Commerce Department started recording such data going back to 1963.
The fall in new homes sales in May comes after good numbers in April which were likely inflated due to the first time home credit that ended for buyers not under contract by April 30th. Those that were under contract by April 30th must close on those transactions by June 30th. There are hopeful signs that the deadline will be extended until September 30th, as many homebuyers are struggling to close on time due to the slow and tumultuous underwriting process. Yes, you read that right. Home buyers that were under contract on or before April 30th may need until September 30th to close on their mortgage transaction; four plus months!
“The government report showed that the median price of new homes sold in May was $200,900, down less than 1% from April but a 9.6% drop from May 2009. An estimated 213,000 new homes were for sale at the end of May. At the current sales pace, the government expects it will take 8.5 months to sell through that inventory, up from 5.8 months in April. Six months of inventory is considered normal market conditions.” – cnnfn.com
Existing home sales, according to the National Association of Realtors, declined 2.2% in May. “The NAR report showed that the median price of homes sold in May was $179,600, up 2.7% from a year ago. Just under a third of homes sold during the month were distressed properties.” – cnnfn.com
HOME SHORTAGE
According to a CNN article published in June, the number of new homes started in April was 672,000. Based on the population growth of the United States, those housing numbers are less than 50% of the number of homes that would be needed long term to meet the demand of our Nation’s current growth. Until the job market recovers there may be an over abundance of homes on the market, but that could quickly lead to a housing shortage with an economic recovery.
BUY AMERICAN AND AMERICAN DEBT
The United States is buying what it seems to believe in; U.S. Treasury debt. The U.S. surpassed Japan and is now the second largest holder of Treasury debt. China still remains the number one holder of Treasury debt.
China currently holds $895 billion in U.S. Treasurys. The U.S. households own $796 billion. Japan places third at $785 billion.
The surge in U.S. bonds by U.S. households is once again a flight to safety, or perceived safety, as the U.S. stock market remains volatile and the financial crisis in Europe unfolds.
HOMEPATH REVISITED
Looking for good financing options on a new purchase? HomePath offers some of the best financing available if purchasing a home owned by Fannie Mae. HomePath allows a qualified buyer to purchase a Fannie Mae owned home with little money down, NO mortgage insurance, and no appraisal. That will save you both time and money. Fannie Mae will also credit 3.5% of the purchase price towards buyers closing costs.
Owner Occupied: 97% Loan to Value – No Mortgage Insurance
Non Owner Occupied: 90% Loan to Value – No Mortgage Insurance
Find properties at www.HomePath.com. For financing options, contact Geneva Financial, LLC for the most competitive HomePath financing options.
HOME OWNERS SEEKING HELP
Refinance up to 105% of your homes value. If you owe more than your home is worth and do not know what to do, please give us a call. Geneva Financial, LLC offers federally funded mortgage options that may allow you to refinance your current mortgage into a lower monthly payment. We do not do loan modifications.
Need help with a short sale. Geneva Real Estate & Investments, LLC has many seasoned short sale real estate specialists that will help sell your home at no cost to you.
Our two companies are working hard to help distressed homeowners.
MARKET UPDATE brought to you by:
Aaron VanTrojen
PRESIDENT
Geneva Financial, LLC
Mortgage Banker licensed in:
AZ: BK-0910215, CA: 603G564, ID: MBL6976, NV: 3195, OR: ML4799, WA: 510-MB-49323
Geneva Financial, LLC NMLS License: 42056
Loan Officer NMLS License:15420
http://www.genevafi.com/
PARTNER
Geneva Real Estate & Investments, LLC
Real Estate Brokerage licensed in: AZ, CA, WA.
http://www.genevare.com/
Office: 480-368-2000
Cell: 602-793-6383
Email: aaron@genevafi.com
Facebook: www.facebook.com/vantrojen
Mortgage Type Interest Rate (APR)
30 Year Fixed 4.250% (4.381%)
15 Year Fixed 3.750% (3.977%)
5/1 ARM 3.250% (3.407%)
Interest rates as of 06/24/10. Conforming interest rates. Interest rates and APR based on loan amounts not to exceed $417,000. Loan to values not to exceed 80%. 720+ credit score. Owner occupied only. Purchase and rate in term refinances. Not all applicants will qualify. Call today for your individual scenario rate quote.
NEW HOMES SALES CRASH TO A RECORD LOW
New homes sales in May fall over 18% from the previous year. This is the slowest month for new homes sales since the Commerce Department started recording such data going back to 1963.
The fall in new homes sales in May comes after good numbers in April which were likely inflated due to the first time home credit that ended for buyers not under contract by April 30th. Those that were under contract by April 30th must close on those transactions by June 30th. There are hopeful signs that the deadline will be extended until September 30th, as many homebuyers are struggling to close on time due to the slow and tumultuous underwriting process. Yes, you read that right. Home buyers that were under contract on or before April 30th may need until September 30th to close on their mortgage transaction; four plus months!
“The government report showed that the median price of new homes sold in May was $200,900, down less than 1% from April but a 9.6% drop from May 2009. An estimated 213,000 new homes were for sale at the end of May. At the current sales pace, the government expects it will take 8.5 months to sell through that inventory, up from 5.8 months in April. Six months of inventory is considered normal market conditions.” – cnnfn.com
Existing home sales, according to the National Association of Realtors, declined 2.2% in May. “The NAR report showed that the median price of homes sold in May was $179,600, up 2.7% from a year ago. Just under a third of homes sold during the month were distressed properties.” – cnnfn.com
HOME SHORTAGE
According to a CNN article published in June, the number of new homes started in April was 672,000. Based on the population growth of the United States, those housing numbers are less than 50% of the number of homes that would be needed long term to meet the demand of our Nation’s current growth. Until the job market recovers there may be an over abundance of homes on the market, but that could quickly lead to a housing shortage with an economic recovery.
BUY AMERICAN AND AMERICAN DEBT
The United States is buying what it seems to believe in; U.S. Treasury debt. The U.S. surpassed Japan and is now the second largest holder of Treasury debt. China still remains the number one holder of Treasury debt.
China currently holds $895 billion in U.S. Treasurys. The U.S. households own $796 billion. Japan places third at $785 billion.
The surge in U.S. bonds by U.S. households is once again a flight to safety, or perceived safety, as the U.S. stock market remains volatile and the financial crisis in Europe unfolds.
HOMEPATH REVISITED
Looking for good financing options on a new purchase? HomePath offers some of the best financing available if purchasing a home owned by Fannie Mae. HomePath allows a qualified buyer to purchase a Fannie Mae owned home with little money down, NO mortgage insurance, and no appraisal. That will save you both time and money. Fannie Mae will also credit 3.5% of the purchase price towards buyers closing costs.
Owner Occupied: 97% Loan to Value – No Mortgage Insurance
Non Owner Occupied: 90% Loan to Value – No Mortgage Insurance
Find properties at www.HomePath.com. For financing options, contact Geneva Financial, LLC for the most competitive HomePath financing options.
HOME OWNERS SEEKING HELP
Refinance up to 105% of your homes value. If you owe more than your home is worth and do not know what to do, please give us a call. Geneva Financial, LLC offers federally funded mortgage options that may allow you to refinance your current mortgage into a lower monthly payment. We do not do loan modifications.
Need help with a short sale. Geneva Real Estate & Investments, LLC has many seasoned short sale real estate specialists that will help sell your home at no cost to you.
Our two companies are working hard to help distressed homeowners.
MARKET UPDATE brought to you by:
Aaron VanTrojen
PRESIDENT
Geneva Financial, LLC
Mortgage Banker licensed in:
AZ: BK-0910215, CA: 603G564, ID: MBL6976, NV: 3195, OR: ML4799, WA: 510-MB-49323
Geneva Financial, LLC NMLS License: 42056
Loan Officer NMLS License:15420
http://www.genevafi.com/
PARTNER
Geneva Real Estate & Investments, LLC
Real Estate Brokerage licensed in: AZ, CA, WA.
http://www.genevare.com/
Office: 480-368-2000
Cell: 602-793-6383
Email: aaron@genevafi.com
Facebook: www.facebook.com/vantrojen
Monday, May 3, 2010
MARKET UPDATE - MAY 2010
BAILOUTS AND BONUSES – BUT NOT FOR HOMEOWNERS
On Tuesday, April 27th, Goldman Sachs executives testified before a Senate subcommittee on investigations into potential acts of unethical and even fraudulent activities committed by Goldman Sachs.
Goldman Sachs sold pools of mortgages (which included a high percentage of subprime mortgages) which at the time were rated as high as AAA investments to investors. Goldman Sachs sold these investments “long” (meaning the investor would make money if the loans performed as they were rated). At the same time Goldman Sachs was selling those AAA mortgage pools to investors, Goldman Sachs was “shorting” (betting the investment would drop in value or default) those very same mortgage pools in anticipation that those mortgage pools would suffer losses through loan default. It was a great bet. Those mortgage pools rated AAA by Moody’s and Standard and Poor’s defaulted at an alarmingly high rate.
Creditors were wiped out. Stock holders suffered substantial losses. Millions of homeowners lost (and continue to lose) their homes. Several European countries are on the verge of default. The global economy is now awakening from a U.S. housing boom hangover.
Goldman Sachs on the other hand made billions of dollars betting against those mortgage pools they were selling to investors. The U.S. Government even paid $13 billion to Goldman for bets it made against the mortgage bonds that AIG insured, but was unable to repay. AIG was bailed out by the U.S. government to the tune of $180 billion dollars.
As Goldman Sachs gets grilled by the Senate subcommittee on unethical and fraudulent activity, Goldman Sachs stock price closed up $1.01 on April 27th as the Dow Jones falls $213.04. Shares finally tumble 9% on Friday as Goldman Sachs rating is finally cut.
Lehman Brothers and Bear Sterns were allowed to fail, but most of the large Wall Streets banks were bailed out or broker off by the U.S. Government. CEOs and top executives in most cases were not fired, and still received huge year end bonuses; for making disastrous bets.
As the dust begins to settle and the U.S. housing market begins to show some signs of recovery, there will be no bailouts or bonuses for homeowners. Tax payers will simply float the bill for one of the largest financial disasters to hit the U.S. economy; as Wall Street firms continue to make billions. A broken system or capitalism at its finest?
NEWS FROM THE ARIZONA ASSOCIATION OF MORTGAGE PROFESSIONALS
FHA has announced they are considering raising the annual fee from .55 to 1.5 percent. This is basically triple the current level.
HR 5107 Rural Housing Bill is taking shape in Congress. It has proposals taking the up front fee from 2% to 3.5% and adding an annual fee of .5%. This will allow them to be self funded.
The Dodd bill for Restoring American Financial Stability Act of 2010 has legs. The recent epiphany by Congress to investigate Goldman Sachs has pushed the odds of passage to over 80%. This is a very bad bill. There is language supporting the idea that no company can sell 100% of their originations. They must retain at least 5% just as the FED is considering. Next, there would be a great possibility that a new agency would be formed to take the place of the FED, OCC, FDIC, HUD and others. This could prove disastrous for community banks and small regional banks. The MBA (Mortgage Bankers Association) does not support this bill and put out a warning to the Senators. The Arizona Chapter of the MBA recently secured a meeting with both Senators Kyl and McCain to listen to their concerns about the bill. It is amazing that they can get both Senators to appear together in one room on the same day to speak with 50 bankers. They must be living right and writing big checks!
-Information provided by Jody Davis of the Arizona Association of Mortgage Professionals
FAIRWELL HOMEBUYER TAX CREDIT
The homebuyer tax credit is no more; at least for those not under contract as of April 30th. Those that are in contract must close by the end of June 30th.
There is no evidence that the government plans to extend the homebuyer credit beyond the June 30th date.
Those that are still interested in purchasing a home, but were unable to meet the deadline, do not fret. Homes are still very reasonably priced, and interest rates are hovering at historic lows. However, both home prices and interest rates are expected to rise in the near future.
NEW HOME SALES SKYROCKET
“New home sales improved in March at the fastest single-month rate in 47 years, according to a government report released Friday. New-home sales rose 26.9% to a seasonally adjusted annual rate of 411,000 last month, compared to an upwardly revised annual rate of 324,000 in February, the Census Bureau said.” – cnnfn.com
HOME PRICES ON THE RISE
“February home prices posted their first year-over-year increase since December 2006. The best performing market in February was San Francisco, which posted a double-digit gain over the past 12 months of 11.9%. San Diego home prices jumped 7.6% and Los Angeles gained 5.3%. The biggest loser continued to be Las Vegas, where prices dropped 14.6% over the past 12 months.” – cnnfn.com
EXISTING HOME SALES ON THE RISE
“Existing home sales jumped 6.8% in March. The National Association of Realtors reported that existing home sales rose last month to a seasonally adjusted annual rate of 5.35 million units, up from the revised rate of 5.01 million in February. Sales year-over-year was up 16.1%. Price and inventory: The median price of homes sold in March was $170,000, up 0.4% from March 2009. Distressed properties made up 35% of the houses sold during the month.” – cnnfn.com
INTEREST RATE UPDATE – AMAZING ARM RATES
Mortgage Type Interest Rate APR
30 Year Fixed 4.875% 5.011%
15 Year Fixed 4.250% 4.480%
5/1 ARM 3.250% 3.373%
Call today for your individual scenario rate quote.
Interest rates as of 04/30/10. Conforming interest rates. Not applicable for FHA and VA loans. Interest rates and APR based on loan amounts not to exceed $417,000. Loan to values not to exceed 80%. 720+ credit score. Owner occupied only. Purchase and rate in term refinances. Not all applicants will qualify.
HOME OWNERS SEEKING HELP
If you owe more than your home is worth and do not know what to do, please give us a call. Geneva Financial, LLC offers federally funded mortgage options that may allow you to refinance your current mortgage into a lower monthly payment. We do not do loan modifications.
Need help with a short sale. Geneva Real Estate & Investments, LLC has many seasoned short sale real estate specialists that will help sell your home at no cost to you.
Our two companies are working hard to help distressed homeowners. Contact us at anytime with any questions.
MARKET UPDATE brought to you by:
Aaron VanTrojen
PRESIDENT
Geneva Financial, LLC
Mortgage Banker licensed in:
AZ: BK-0910215, CA: 603G564, ID: MBL6976, NM: 3693, NV: 3195, OR: ML4799, WA: 510-MB-49323
Geneva Financial, LLC NMLS License: 42056
Loan Officer NMLS License:15420
http://www.genevafi.com/
PARTNER
Geneva Real Estate & Investments, LLC
Real estate brokerage licensed in AZ, CA, WA.
http://www.genevare.com/
Office: 480-368-2000
Cell: 602-793-6383
Email: aaron@genevafi.com
Facebook: www.facebook.com/vantrojen
On Tuesday, April 27th, Goldman Sachs executives testified before a Senate subcommittee on investigations into potential acts of unethical and even fraudulent activities committed by Goldman Sachs.
Goldman Sachs sold pools of mortgages (which included a high percentage of subprime mortgages) which at the time were rated as high as AAA investments to investors. Goldman Sachs sold these investments “long” (meaning the investor would make money if the loans performed as they were rated). At the same time Goldman Sachs was selling those AAA mortgage pools to investors, Goldman Sachs was “shorting” (betting the investment would drop in value or default) those very same mortgage pools in anticipation that those mortgage pools would suffer losses through loan default. It was a great bet. Those mortgage pools rated AAA by Moody’s and Standard and Poor’s defaulted at an alarmingly high rate.
Creditors were wiped out. Stock holders suffered substantial losses. Millions of homeowners lost (and continue to lose) their homes. Several European countries are on the verge of default. The global economy is now awakening from a U.S. housing boom hangover.
Goldman Sachs on the other hand made billions of dollars betting against those mortgage pools they were selling to investors. The U.S. Government even paid $13 billion to Goldman for bets it made against the mortgage bonds that AIG insured, but was unable to repay. AIG was bailed out by the U.S. government to the tune of $180 billion dollars.
As Goldman Sachs gets grilled by the Senate subcommittee on unethical and fraudulent activity, Goldman Sachs stock price closed up $1.01 on April 27th as the Dow Jones falls $213.04. Shares finally tumble 9% on Friday as Goldman Sachs rating is finally cut.
Lehman Brothers and Bear Sterns were allowed to fail, but most of the large Wall Streets banks were bailed out or broker off by the U.S. Government. CEOs and top executives in most cases were not fired, and still received huge year end bonuses; for making disastrous bets.
As the dust begins to settle and the U.S. housing market begins to show some signs of recovery, there will be no bailouts or bonuses for homeowners. Tax payers will simply float the bill for one of the largest financial disasters to hit the U.S. economy; as Wall Street firms continue to make billions. A broken system or capitalism at its finest?
NEWS FROM THE ARIZONA ASSOCIATION OF MORTGAGE PROFESSIONALS
FHA has announced they are considering raising the annual fee from .55 to 1.5 percent. This is basically triple the current level.
HR 5107 Rural Housing Bill is taking shape in Congress. It has proposals taking the up front fee from 2% to 3.5% and adding an annual fee of .5%. This will allow them to be self funded.
The Dodd bill for Restoring American Financial Stability Act of 2010 has legs. The recent epiphany by Congress to investigate Goldman Sachs has pushed the odds of passage to over 80%. This is a very bad bill. There is language supporting the idea that no company can sell 100% of their originations. They must retain at least 5% just as the FED is considering. Next, there would be a great possibility that a new agency would be formed to take the place of the FED, OCC, FDIC, HUD and others. This could prove disastrous for community banks and small regional banks. The MBA (Mortgage Bankers Association) does not support this bill and put out a warning to the Senators. The Arizona Chapter of the MBA recently secured a meeting with both Senators Kyl and McCain to listen to their concerns about the bill. It is amazing that they can get both Senators to appear together in one room on the same day to speak with 50 bankers. They must be living right and writing big checks!
-Information provided by Jody Davis of the Arizona Association of Mortgage Professionals
FAIRWELL HOMEBUYER TAX CREDIT
The homebuyer tax credit is no more; at least for those not under contract as of April 30th. Those that are in contract must close by the end of June 30th.
There is no evidence that the government plans to extend the homebuyer credit beyond the June 30th date.
Those that are still interested in purchasing a home, but were unable to meet the deadline, do not fret. Homes are still very reasonably priced, and interest rates are hovering at historic lows. However, both home prices and interest rates are expected to rise in the near future.
NEW HOME SALES SKYROCKET
“New home sales improved in March at the fastest single-month rate in 47 years, according to a government report released Friday. New-home sales rose 26.9% to a seasonally adjusted annual rate of 411,000 last month, compared to an upwardly revised annual rate of 324,000 in February, the Census Bureau said.” – cnnfn.com
HOME PRICES ON THE RISE
“February home prices posted their first year-over-year increase since December 2006. The best performing market in February was San Francisco, which posted a double-digit gain over the past 12 months of 11.9%. San Diego home prices jumped 7.6% and Los Angeles gained 5.3%. The biggest loser continued to be Las Vegas, where prices dropped 14.6% over the past 12 months.” – cnnfn.com
EXISTING HOME SALES ON THE RISE
“Existing home sales jumped 6.8% in March. The National Association of Realtors reported that existing home sales rose last month to a seasonally adjusted annual rate of 5.35 million units, up from the revised rate of 5.01 million in February. Sales year-over-year was up 16.1%. Price and inventory: The median price of homes sold in March was $170,000, up 0.4% from March 2009. Distressed properties made up 35% of the houses sold during the month.” – cnnfn.com
INTEREST RATE UPDATE – AMAZING ARM RATES
Mortgage Type Interest Rate APR
30 Year Fixed 4.875% 5.011%
15 Year Fixed 4.250% 4.480%
5/1 ARM 3.250% 3.373%
Call today for your individual scenario rate quote.
Interest rates as of 04/30/10. Conforming interest rates. Not applicable for FHA and VA loans. Interest rates and APR based on loan amounts not to exceed $417,000. Loan to values not to exceed 80%. 720+ credit score. Owner occupied only. Purchase and rate in term refinances. Not all applicants will qualify.
HOME OWNERS SEEKING HELP
If you owe more than your home is worth and do not know what to do, please give us a call. Geneva Financial, LLC offers federally funded mortgage options that may allow you to refinance your current mortgage into a lower monthly payment. We do not do loan modifications.
Need help with a short sale. Geneva Real Estate & Investments, LLC has many seasoned short sale real estate specialists that will help sell your home at no cost to you.
Our two companies are working hard to help distressed homeowners. Contact us at anytime with any questions.
MARKET UPDATE brought to you by:
Aaron VanTrojen
PRESIDENT
Geneva Financial, LLC
Mortgage Banker licensed in:
AZ: BK-0910215, CA: 603G564, ID: MBL6976, NM: 3693, NV: 3195, OR: ML4799, WA: 510-MB-49323
Geneva Financial, LLC NMLS License: 42056
Loan Officer NMLS License:15420
http://www.genevafi.com/
PARTNER
Geneva Real Estate & Investments, LLC
Real estate brokerage licensed in AZ, CA, WA.
http://www.genevare.com/
Office: 480-368-2000
Cell: 602-793-6383
Email: aaron@genevafi.com
Facebook: www.facebook.com/vantrojen
Friday, April 2, 2010
MARKET UPDATE - APRIL 2010
HOMEBUYER TAX CREDIT ENDS THIS MONTH
To take advantage of the homebuyer tax credit, buyers must be under contract by April, 30th, 2010. The home must also close by June 30th, 2010 to qualify.
“There is little sentiment for continuing this program, especially because many consider the latest results to be disappointing. Even the Senate's biggest proponent of the homebuyer tax credit, Johnny Isakson, R-Ga., is ready to let it end. "He has no plans to introduce legislation to extend the credit," said Isakson's spokeswoman. "Part of the benefit of the tax credit was the urgency its sun-setting generated." – CNNMoney.com
FED HOLDS SHORT TERM RATES STEADY, BUT FOR HOW LONG
The Fed’s aggressive purchasing of mortgage backed securities to the tune of $1.25 trillion ended March 31st. Long term interest rates have remained stable with the 30 year fixed rates hovering around 5.0%. Long term rates will not drastically rise as long as investors step in to buy mortgage back securities.
“Fixed mortgage rates likely will rise less than a quarter of a percentage point in the next three months, the smallest increase for the second quarter since a drop in 2005, according to estimates by Fannie Mae and Freddie Mac.” - Bloomberg
The Fed also kept short term rates at historic lows; but for how long? The Fed held short-term interest rates unchanged in the range of 0.00 to 0.25 percent. The central bank stated that "economic activity has continued to strengthen and that the labor market is stabilizing." – CNNMoney.com
Short term rates will not likely begin to rise until there is solid signs of recovery in the economy; most notably the job market. Expect to see short term rates climb in the late third or forth quarter of 2010.
INTEREST RATE UPDATE
Mortgage Type Interest Rate APR
30 Year Fixed 4.875% 5.011%
15 Year Fixed 4.250% 4.480%
Call today for your individual scenario rate quote.
Interest rates as of 04/02/10. Conforming interest rates. Not applicable for FHA and VA loans. Interest rates and APR based on loan amounts not to exceed $417,000. Loan to values not to exceed 80%. 720+ credit score. Owner occupied only. Purchase and rate in term refinances. Not all applicants will qualify.
SALES DECLINE BUT PRICES STABILIZE
“Sales of existing U.S. homes fell in February for a third month and the number of properties on the market climbed by the most in almost two years, according to the National Association of Realtors. Purchases dropped 0.6 percent to a 5.02 million annual rate, the lowest level in eight months, and there were 3.59 million houses for sale, the biggest gain since April 2008.”
“At the same time, the S&P/Case-Shiller home-price index covering 20 U.S. cities showed signs that real estate values may be stabilizing. Home prices dropped 0.7 percent in January from a year earlier, the smallest annual decrease in three years, according to a report issued today. Measured monthly, the gauge rose 0.3 percent from December.” - Bloomberg
FASTEST APPRECIATING U.S. CITIES
CNN just reported the 25 U.S. cities with the highest estimated appreciation over the next year. It is not big percentage, but at least it is going the right direction.
Those cities in green are serviced by Geneva Financial, LLC and Geneva Real Estate & Investments, LLC.
Rank City Annual Increase
#1 Santa Rosa, CA 6.0%
#2 Cheyenne, WY 4.7%
#3 Kennewick, WA 4.6%
#4 Merced, CA 4.4%
#5 Fairbanks, AK 4.2%
#5 Bremerton, WA 4.2%
#7 Corvallis, OR 4.1%
#8 Tacoma, WA 3.9%
#9 Anchorage, AK 3.8%
#10 Bend, OR 3.3%
#11 Modesto, CA 3.2%
#12 Pueblo, CO 3.0%
#13 Bellingham, WA 2.9%
#14 Yakima, WA 2.8%
#14 Spokane, WA 2.8%
#16 Billings, MT 2.7%
#17 Olympia, WA 2.3%
#17 Napa, CA 2.3%
#19 Mount Vernon, WA 2.2%
#20 Glen Falls, NY 2.0%
#20 Great Falls, MT 2.0%
#22 Charleston, SC 1.5%
#23 Casper, WY 1.8%
#24 Medford, OR 1.7%
#25 Eugene, OR 1.6%
NEW UNDERWRITING GUIDELINES
In a bold attempt to reduce mortgage delinquencies and fraud, the following underwriting guidelines take effect immediately.
• All Borrowers’ Birth Certificates will be required with Pictures taken in the hospital with medical staff. Birth certificate with a live home delivery will not be eligible for first time home buyers.
• Marriage certificate with bridal dress will be required if both husband and wife are required to qualify for the loan
• GFE will not require signature but will require blood sampling from a recognized institution within three days of application
• DNA test will be performed at closing to avoid any non-arms length transactions. Loan funding will be contingent upon satisfactory receipt of DNA results.
• Verification of deposit will be acceptable only if Bank representative is present at the closing.
• Copy of Pay stubs and W2 will only be acceptable through IRS and only with a wax sealed envelope mailed directly to the lender.
• 7 Witnesses from neighborhood will be required as proof of primary residence in case Borrower owns more then 1 property.
• All appraisers will be required to use masks and ear plugs at the time of inspection to avoid any personal influence by the borrower for the appraised value.
• In order to correctly calculate DTI and true housing ratio a list of grocery items, monthly usage and brand names will be required with receipts and projected 12 month consumption chart.
• Closing will not occur without loan officer presence at settlement and loan officer picture will be taken at the closing in a mug shot format with loan number. Picture should meet standard guideline of 2 X 2 inch in color format with one facing and one side view.
• Loan officer picture will be attached to the deed and note and will be made available for general public and security agencies in case borrower defaults on the loan.
It would be funnier if it wasn’t so true. -Author unknown.
HOME OWNERS SEEKING HELP
If you owe more than your home is worth and do not know what to do, please give us a call. Geneva Financial, LLC offers federally funded mortgage options that may allow you to refinance your current mortgage into a lower monthly payment. We do not do loan modifications.
Need help with a short sale. Geneva Real Estate & Investments, LLC has many seasoned short sale real estate specialists that will help sell your home at no cost to you.
Our two companies are working hard to help distressed homeowners. Contact us at anytime with any questions.
To take advantage of the homebuyer tax credit, buyers must be under contract by April, 30th, 2010. The home must also close by June 30th, 2010 to qualify.
“There is little sentiment for continuing this program, especially because many consider the latest results to be disappointing. Even the Senate's biggest proponent of the homebuyer tax credit, Johnny Isakson, R-Ga., is ready to let it end. "He has no plans to introduce legislation to extend the credit," said Isakson's spokeswoman. "Part of the benefit of the tax credit was the urgency its sun-setting generated." – CNNMoney.com
FED HOLDS SHORT TERM RATES STEADY, BUT FOR HOW LONG
The Fed’s aggressive purchasing of mortgage backed securities to the tune of $1.25 trillion ended March 31st. Long term interest rates have remained stable with the 30 year fixed rates hovering around 5.0%. Long term rates will not drastically rise as long as investors step in to buy mortgage back securities.
“Fixed mortgage rates likely will rise less than a quarter of a percentage point in the next three months, the smallest increase for the second quarter since a drop in 2005, according to estimates by Fannie Mae and Freddie Mac.” - Bloomberg
The Fed also kept short term rates at historic lows; but for how long? The Fed held short-term interest rates unchanged in the range of 0.00 to 0.25 percent. The central bank stated that "economic activity has continued to strengthen and that the labor market is stabilizing." – CNNMoney.com
Short term rates will not likely begin to rise until there is solid signs of recovery in the economy; most notably the job market. Expect to see short term rates climb in the late third or forth quarter of 2010.
INTEREST RATE UPDATE
Mortgage Type Interest Rate APR
30 Year Fixed 4.875% 5.011%
15 Year Fixed 4.250% 4.480%
Call today for your individual scenario rate quote.
Interest rates as of 04/02/10. Conforming interest rates. Not applicable for FHA and VA loans. Interest rates and APR based on loan amounts not to exceed $417,000. Loan to values not to exceed 80%. 720+ credit score. Owner occupied only. Purchase and rate in term refinances. Not all applicants will qualify.
SALES DECLINE BUT PRICES STABILIZE
“Sales of existing U.S. homes fell in February for a third month and the number of properties on the market climbed by the most in almost two years, according to the National Association of Realtors. Purchases dropped 0.6 percent to a 5.02 million annual rate, the lowest level in eight months, and there were 3.59 million houses for sale, the biggest gain since April 2008.”
“At the same time, the S&P/Case-Shiller home-price index covering 20 U.S. cities showed signs that real estate values may be stabilizing. Home prices dropped 0.7 percent in January from a year earlier, the smallest annual decrease in three years, according to a report issued today. Measured monthly, the gauge rose 0.3 percent from December.” - Bloomberg
FASTEST APPRECIATING U.S. CITIES
CNN just reported the 25 U.S. cities with the highest estimated appreciation over the next year. It is not big percentage, but at least it is going the right direction.
Those cities in green are serviced by Geneva Financial, LLC and Geneva Real Estate & Investments, LLC.
Rank City Annual Increase
#1 Santa Rosa, CA 6.0%
#2 Cheyenne, WY 4.7%
#3 Kennewick, WA 4.6%
#4 Merced, CA 4.4%
#5 Fairbanks, AK 4.2%
#5 Bremerton, WA 4.2%
#7 Corvallis, OR 4.1%
#8 Tacoma, WA 3.9%
#9 Anchorage, AK 3.8%
#10 Bend, OR 3.3%
#11 Modesto, CA 3.2%
#12 Pueblo, CO 3.0%
#13 Bellingham, WA 2.9%
#14 Yakima, WA 2.8%
#14 Spokane, WA 2.8%
#16 Billings, MT 2.7%
#17 Olympia, WA 2.3%
#17 Napa, CA 2.3%
#19 Mount Vernon, WA 2.2%
#20 Glen Falls, NY 2.0%
#20 Great Falls, MT 2.0%
#22 Charleston, SC 1.5%
#23 Casper, WY 1.8%
#24 Medford, OR 1.7%
#25 Eugene, OR 1.6%
NEW UNDERWRITING GUIDELINES
In a bold attempt to reduce mortgage delinquencies and fraud, the following underwriting guidelines take effect immediately.
• All Borrowers’ Birth Certificates will be required with Pictures taken in the hospital with medical staff. Birth certificate with a live home delivery will not be eligible for first time home buyers.
• Marriage certificate with bridal dress will be required if both husband and wife are required to qualify for the loan
• GFE will not require signature but will require blood sampling from a recognized institution within three days of application
• DNA test will be performed at closing to avoid any non-arms length transactions. Loan funding will be contingent upon satisfactory receipt of DNA results.
• Verification of deposit will be acceptable only if Bank representative is present at the closing.
• Copy of Pay stubs and W2 will only be acceptable through IRS and only with a wax sealed envelope mailed directly to the lender.
• 7 Witnesses from neighborhood will be required as proof of primary residence in case Borrower owns more then 1 property.
• All appraisers will be required to use masks and ear plugs at the time of inspection to avoid any personal influence by the borrower for the appraised value.
• In order to correctly calculate DTI and true housing ratio a list of grocery items, monthly usage and brand names will be required with receipts and projected 12 month consumption chart.
• Closing will not occur without loan officer presence at settlement and loan officer picture will be taken at the closing in a mug shot format with loan number. Picture should meet standard guideline of 2 X 2 inch in color format with one facing and one side view.
• Loan officer picture will be attached to the deed and note and will be made available for general public and security agencies in case borrower defaults on the loan.
It would be funnier if it wasn’t so true. -Author unknown.
HOME OWNERS SEEKING HELP
If you owe more than your home is worth and do not know what to do, please give us a call. Geneva Financial, LLC offers federally funded mortgage options that may allow you to refinance your current mortgage into a lower monthly payment. We do not do loan modifications.
Need help with a short sale. Geneva Real Estate & Investments, LLC has many seasoned short sale real estate specialists that will help sell your home at no cost to you.
Our two companies are working hard to help distressed homeowners. Contact us at anytime with any questions.
Monday, March 1, 2010
MARKET UPDATE - MARCH 2010
WHERE DID MY MORTGAGE BROKER GO
Not to worry, some of us are still here. I just returned from Washington D.C. in an attempt to do my part to make sure we will always be here.
The National Association of Mortgage Brokers (NAMB) had its annual national conference in Washington D.C. to rally the troops and lobby our Representatives to help support small business; i.e. your local mortgage broker. The showing was strong, although our numbers were down to a few hundred verses a few thousand of years past. Why do you care? Because, the decisions that are being made in Washington today will change the way you finance real estate now and in the future.
There were a numbers of things that were made clear.
1. The Department of Housing and Urban Development (HUD) supports the future of small business and your local mortgage broker. Ivy Jackson, the Director of the Office of RESPA and Interstate Land Sales (HUD) stated that mortgage brokers offer one of the best vehicles to bring product to the market and will continue to be competitive in this mortgage environment. She stated that brokers currently deliver 50% of all FHA mortgages. This statement may seem contradictory to HUD’s recent implementation of the new Good Faith Estimate, HUD-1, and changes to Yield Spread Premiums, which at first was viewed by those in the industry as another nail in the mortgage broker’s coffin. Two months after the implementation of the HUD rule and the greatest RESPA reform since its inception, mortgage professionals now know that it has not effected compensation or our competitiveness in the marketplace.
2. HUD is not going to raise the minimum down payment for FHA mortgages from the current minimum 3.5% to 5% as had been originally discussed. HUD determined that the default rate is not considerably higher with 3.5% down verses 5.0% down and that raising the down payment would create an unnecessary barrier for many first time home buyers. In an attempt to increase FHA reserves the upfront mortgage insurance premium that is rolled into the base loan amount will be increased from 1.75% to 2.25%.
3. Paul Mondor, Senior Attorney, Division of Consumer and Community Affairs (Federal Reserve Board) spoke and participated in a Q & A session regarding the FED proposal and its potential to change broker / banker compensation. It was apparent that the FED is disconnected from HUD policy and the mortgage process at the ground level. I will not bore you with details, but much of what Mr. Mondor said contradicted HUD policy and was either inaccurate or flat out not true with regards to how mortgages are originated and how small businesses generate revenue. The general feeling was of unease due to the fact that such individuals are making policy changes that have the potential to affect so many small businesses and so many homeowners. The FED needs to not overstep its authority and let the new RESPA reform implemented by HUD run its course. To date the majority of reform (i.e. HVCC, MDIA, HUD Rule), although long over due in some form, has come at a cost to the borrower.
4. On December 11, 2009, U.S. House of Representatives passed HR 4173 which has been labeled the “most significant reform of the U.S. financial system since the New Deal of the 1930’s.” Although there are a number of important aspects of this bill, one part eliminated mortgage options to the consumer and ultimately would hurt small business owners. With regards to mortgage origination, this bill would have potentially given Big Banks an unfair advantage over smaller mortgage brokers and bankers. It appears that this bill has been squashed by the Senate. The House and the Senate’s inability to agree on anything have proved to be a small victory for small business and the homeowner.
5. The National Association of Mortgage Brokers (NAMB) is not the National Association of Realtors (NAR) or the National Riffle Association (NRA). The NAMB does not have the political might of the NAR or NRA. Although I knew this going in, it was the first time of experiencing it first hand; money equals power in politics. I am confident that our lobbying efforts had an impact, although it would have been nice to have a war chest full of cash to buy their attention. For right or wrong, that is how things get done in Washington. Instead of meeting with staffers just out of college, we would have been talking directly to the Representatives who we voted into office; and who we can vote out of office.
In 2006 during the height of the mortgage industry and housing boom, mortgage brokers accounted for 65 percent or more of all mortgages. Today that number is estimated at just over 15 percent. The reason for our past dominance in this industry is that we have more options than the Big Banks. We have access to dozens of different lenders that have a diverse appetite for different types of loans, property types, and borrowers. Sweeping mortgage reform and regulation, a lot too late, has had an adverse effect on the industry as a whole, felt most by under capitalized banks, and small business mortgage brokers.
This year the mortgage broker will attempt to mount a comeback. Despite all that still stands before us (i.e. New HUD rules and the FED intervention) we still have the most diverse options of mortgage products. We still offer the most competitive rates and fees. The S.A.F.E. Act mandated that all loan officers and mortgage brokers not working for a FDIC insured bank had to go through classroom mortgage education, take a state and national test, and be licensed. Loan officers at Big Banks do NOT. Mortgage brokers are and will continue to be faster, more diverse, less expensive, and now smarter than the Big Banks.
Thank you for your continued support of small business owners, and your local mortgage broker.
FORECLOSURE ROLLERCOASTER CONTINUES
Foreclosures in January posted a 15% increase over last year with over 300,000. – cnnfn.com
Government programs and loan modifications have been slow at best to help homeowners who are under water or unable to make their mortgage payments actually save their homes from foreclosure. 25% of all homeowners currently owe more than the home is worth. RealtyTrac estimated that the number of bank owned properties may rise this year to over three million.
WARNING OF RISING INTEREST RATES
The Federal Reserve in an aggressive move to help stabilize the housing market has been buying mortgage backed securities since 2008, to the tune of over a trillion dollars in mortgages. The by product of this action has kept mortgage interest rates at near all time lows.
This month the FED has stated that it will stop purchasing mortgage backed securities.
Who is going to take the FED’s place? For the past couple of years institutional buyers of mortgage backed securities, i.e. private investors, Wall Street, hedge funds, and foreign governments have been hesitant to jump back into mortgage back securities due to the unstable U.S. housing market. Although it is uncertain who will purchase all the mortgage back securities now that the FED is pulling out of the position, one thing is certain; without buyers rates will likely rise.
HOMEBUYER TAX CREDIT ENDS SOON
To take advantage of the homebuyer tax credit, buyers must be under contract by April, 30th, 2010. The home must also close by June 30th, 2010 to qualify.
INTEREST RATE UPDATE
Mortgage Type Interest Rate APR
30 Year Fixed 4.625% 4.759%
15 Year Fixed 4.125% 4.335%
Call today for your individual scenario rate quote.
Interest rates as of 03/01/10. Conforming interest rates. Not applicable for FHA and VA loans. Interest rates and APR based on loan amounts not to exceed $417,000. Loan to values not to exceed 80%. 720+ credit score. Owner occupied only. Purchase and rate in term refinances. Not all applicants will qualify. For any additional information, call or email me at any time.
MARKET UPDATE brought to you by:
Aaron VanTrojen
PRESIDENT
Geneva Financial, LLC
Mortgage Banker / Broker licensed in:
AZ: BK-0910215, CA: 603G564, ID: MBL6976, NM: 3693, NV: 3195, OR: ML4799, WA: 510-MB-49323
Geneva Financial, LLC NMLS License: 42056
Loan Officer NMLS License: 15420
www.genevafi.com
PARTNER
Geneva Real Estate & Investments, LLC
Real estate brokerage licensed in AZ, CA, WA.
http://www.greiusa.com/ / www.genevare.com
Office: 480-368-2000
Cell: 602-793-6383
Email: aaron@genevafi.com
Not to worry, some of us are still here. I just returned from Washington D.C. in an attempt to do my part to make sure we will always be here.
The National Association of Mortgage Brokers (NAMB) had its annual national conference in Washington D.C. to rally the troops and lobby our Representatives to help support small business; i.e. your local mortgage broker. The showing was strong, although our numbers were down to a few hundred verses a few thousand of years past. Why do you care? Because, the decisions that are being made in Washington today will change the way you finance real estate now and in the future.
There were a numbers of things that were made clear.
1. The Department of Housing and Urban Development (HUD) supports the future of small business and your local mortgage broker. Ivy Jackson, the Director of the Office of RESPA and Interstate Land Sales (HUD) stated that mortgage brokers offer one of the best vehicles to bring product to the market and will continue to be competitive in this mortgage environment. She stated that brokers currently deliver 50% of all FHA mortgages. This statement may seem contradictory to HUD’s recent implementation of the new Good Faith Estimate, HUD-1, and changes to Yield Spread Premiums, which at first was viewed by those in the industry as another nail in the mortgage broker’s coffin. Two months after the implementation of the HUD rule and the greatest RESPA reform since its inception, mortgage professionals now know that it has not effected compensation or our competitiveness in the marketplace.
2. HUD is not going to raise the minimum down payment for FHA mortgages from the current minimum 3.5% to 5% as had been originally discussed. HUD determined that the default rate is not considerably higher with 3.5% down verses 5.0% down and that raising the down payment would create an unnecessary barrier for many first time home buyers. In an attempt to increase FHA reserves the upfront mortgage insurance premium that is rolled into the base loan amount will be increased from 1.75% to 2.25%.
3. Paul Mondor, Senior Attorney, Division of Consumer and Community Affairs (Federal Reserve Board) spoke and participated in a Q & A session regarding the FED proposal and its potential to change broker / banker compensation. It was apparent that the FED is disconnected from HUD policy and the mortgage process at the ground level. I will not bore you with details, but much of what Mr. Mondor said contradicted HUD policy and was either inaccurate or flat out not true with regards to how mortgages are originated and how small businesses generate revenue. The general feeling was of unease due to the fact that such individuals are making policy changes that have the potential to affect so many small businesses and so many homeowners. The FED needs to not overstep its authority and let the new RESPA reform implemented by HUD run its course. To date the majority of reform (i.e. HVCC, MDIA, HUD Rule), although long over due in some form, has come at a cost to the borrower.
4. On December 11, 2009, U.S. House of Representatives passed HR 4173 which has been labeled the “most significant reform of the U.S. financial system since the New Deal of the 1930’s.” Although there are a number of important aspects of this bill, one part eliminated mortgage options to the consumer and ultimately would hurt small business owners. With regards to mortgage origination, this bill would have potentially given Big Banks an unfair advantage over smaller mortgage brokers and bankers. It appears that this bill has been squashed by the Senate. The House and the Senate’s inability to agree on anything have proved to be a small victory for small business and the homeowner.
5. The National Association of Mortgage Brokers (NAMB) is not the National Association of Realtors (NAR) or the National Riffle Association (NRA). The NAMB does not have the political might of the NAR or NRA. Although I knew this going in, it was the first time of experiencing it first hand; money equals power in politics. I am confident that our lobbying efforts had an impact, although it would have been nice to have a war chest full of cash to buy their attention. For right or wrong, that is how things get done in Washington. Instead of meeting with staffers just out of college, we would have been talking directly to the Representatives who we voted into office; and who we can vote out of office.
In 2006 during the height of the mortgage industry and housing boom, mortgage brokers accounted for 65 percent or more of all mortgages. Today that number is estimated at just over 15 percent. The reason for our past dominance in this industry is that we have more options than the Big Banks. We have access to dozens of different lenders that have a diverse appetite for different types of loans, property types, and borrowers. Sweeping mortgage reform and regulation, a lot too late, has had an adverse effect on the industry as a whole, felt most by under capitalized banks, and small business mortgage brokers.
This year the mortgage broker will attempt to mount a comeback. Despite all that still stands before us (i.e. New HUD rules and the FED intervention) we still have the most diverse options of mortgage products. We still offer the most competitive rates and fees. The S.A.F.E. Act mandated that all loan officers and mortgage brokers not working for a FDIC insured bank had to go through classroom mortgage education, take a state and national test, and be licensed. Loan officers at Big Banks do NOT. Mortgage brokers are and will continue to be faster, more diverse, less expensive, and now smarter than the Big Banks.
Thank you for your continued support of small business owners, and your local mortgage broker.
FORECLOSURE ROLLERCOASTER CONTINUES
Foreclosures in January posted a 15% increase over last year with over 300,000. – cnnfn.com
Government programs and loan modifications have been slow at best to help homeowners who are under water or unable to make their mortgage payments actually save their homes from foreclosure. 25% of all homeowners currently owe more than the home is worth. RealtyTrac estimated that the number of bank owned properties may rise this year to over three million.
WARNING OF RISING INTEREST RATES
The Federal Reserve in an aggressive move to help stabilize the housing market has been buying mortgage backed securities since 2008, to the tune of over a trillion dollars in mortgages. The by product of this action has kept mortgage interest rates at near all time lows.
This month the FED has stated that it will stop purchasing mortgage backed securities.
Who is going to take the FED’s place? For the past couple of years institutional buyers of mortgage backed securities, i.e. private investors, Wall Street, hedge funds, and foreign governments have been hesitant to jump back into mortgage back securities due to the unstable U.S. housing market. Although it is uncertain who will purchase all the mortgage back securities now that the FED is pulling out of the position, one thing is certain; without buyers rates will likely rise.
HOMEBUYER TAX CREDIT ENDS SOON
To take advantage of the homebuyer tax credit, buyers must be under contract by April, 30th, 2010. The home must also close by June 30th, 2010 to qualify.
INTEREST RATE UPDATE
Mortgage Type Interest Rate APR
30 Year Fixed 4.625% 4.759%
15 Year Fixed 4.125% 4.335%
Call today for your individual scenario rate quote.
Interest rates as of 03/01/10. Conforming interest rates. Not applicable for FHA and VA loans. Interest rates and APR based on loan amounts not to exceed $417,000. Loan to values not to exceed 80%. 720+ credit score. Owner occupied only. Purchase and rate in term refinances. Not all applicants will qualify. For any additional information, call or email me at any time.
MARKET UPDATE brought to you by:
Aaron VanTrojen
PRESIDENT
Geneva Financial, LLC
Mortgage Banker / Broker licensed in:
AZ: BK-0910215, CA: 603G564, ID: MBL6976, NM: 3693, NV: 3195, OR: ML4799, WA: 510-MB-49323
Geneva Financial, LLC NMLS License: 42056
Loan Officer NMLS License: 15420
www.genevafi.com
PARTNER
Geneva Real Estate & Investments, LLC
Real estate brokerage licensed in AZ, CA, WA.
http://www.greiusa.com/ / www.genevare.com
Office: 480-368-2000
Cell: 602-793-6383
Email: aaron@genevafi.com
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