Mortgage Rates Still In A Fantastic Place
Posted by Kevin Kueneke | Currently 1 Comment »
When rates shot up a month or so ago, we saw many potential San Diego real estate buyers get cold feet since 30 year fixed rates in the 4’s were gone. These buyers felt that the home of their dreams was no longer available if their rate was not under 5%. Face it, we were all spoiled. 
I remember in 1994 when conforming “A” paper first mortgage rates were as high as 10% and people were still buying homes. This was immediately following the first real refinance boom of our time (1992-1993) when rates were down to 6% or so.
Those that were in the industry in the ’80’s tell tales of rates in the 13’s and 14’s. So a rate just over 5% is not a good deal…?
How much of a difference does it make if the rate is just under 5% vs. just over 5%? The payment on a $400,000 loan at 5.125% is only $62 more than at 4.875%. The payment on a $200,000 loan at 5.125% is only $31 more than at 4.875%.
If you are a buyer that thinks a rate above 5% is high, call or email me and I can show you the payment difference for your particular price range. You might be pleasantly surprised.
**FHA, VA, High Balance Conforming buyers should also call. Your rates are great as well!
Email: Kevin@MyCWMtg.com Phone: (760)500-1919
Related Posts: CW Mortgage, Financial news, Home Loans, Interest Rates, Mortgage News, San Diego
FHA, FNMA, and FHLMC Loan Limits In San Diego Returned To $697,500!
Posted by Kevin Kueneke | Leave A Comment »
Well, it looks like the “new and improved” stimulus bill will have an immediate effect on mortgages. Fannie Mae (FNMA), Freddie Mac (FHLMC), and the Federal Housing Administration (FHA) have announced that they are reinstating last year’s high balance conforming loan limits.
For 2008, FNMA and FHLMC, as well as FHA, would insure loan amounts up to $697,500 in San Diego. Any loan greater than that number was considered a Jumbo loan. Unfortunately, that loan limit dropped to $546,250 effective for loans closing on or after January 1, 2009. That meant that anyone looking to buy or refinance San Diego real estate could pay an interest rate as much as 2% higher than if borrowing the true conforming loan amount of $417,000.
However, the recently passed H.R. 1, also known as the American Recovery and Reinvestment Act, restores the higher limit of $697,500. In some areas, such as Los Angeles and Orange Counties, the restored loan limit is $729,750 up from $625,500 earlier this year.
These higher loan limits are often referred to as Conforming Plus or High Balance Conforming loans. FHA loans that exceed $417,000 in San Diego County may be referred to as FHA Jumbo loans.
This is great news for those borrowers that are looking to purchase or refinance in today’s low interest rate environment. Conventional buyer’s can now purchase a $775,000 home with only a 10% down payment.
Questions? Please feel free to email me today.
Related Posts: Buyers, CW Mortgage, Financial news, Home Loans, Homeowners, Interest Rates, Mortgage News, Real Estate News
What about Real Estate Scares You?
Posted by Mark Loscher | Leave A Comment »
Franklin D. Roosevelt said, “The only thing we have to fear is fear itself.”
In times like these, facts are what we need to focus on. Below is a 13 month look at interest rates. If you couple this trend with the enormous number of buyers that have been hitting the streets lately, the news is good.
It is important to reinforce to everyone that our economy is designed to have ups and downs, that is how we adjust.
During these periods of adjustments it is always better to deal with facts rather than fear. We will pull out of this current period of adjustment and the housing market will most likely lead the way, much like they lead the way in.
The good news is, if you are a buyer there has never been a better time for you. There are many options to consider, all of them positive for the buyer, low interest rates and low prices to name two. If you are a seller, the good news is there are many more buyers today than there have been for many months and multiple offers are back.
So, look at the facts of the situation and know that the current market adjustments are necessary, can be helpful, and will end. The facts I read say we are heading toward the end of this adjustment period.
This chart is only one of those facts that point to a positive trend.
More facts to come, stay tuned.
Related Posts: Area Statistics, Buyers, Financial news, Home Loans, Homeowners, Interest Rates, Market Trends, Mortgage News, Real Estate News
New Conforming Loan Limits Announced For 2009
Posted by Kevin Kueneke | Currently 2 Comments »
After months of speculation, we finally know what the new 2009 high balance conforming loan limits are for San Diego and other “high cost” areas. The Federal Housing Finance Agency (FHFA) said that the $697,500 number we enjoyed for part of 2008 is dropping to $546,250 in San Diego.
Some areas such as Los Angeles-Orange Counties, San Francisco, San Jose, and Santa Cruz are having their 2009 numbers set at the new maximum of $625,500.
According to FHFA’s press release, the 2009 loan limits were calculated using 115% of median house prices as determined by the Federal Housing Administration (FHA) whereas the 2008 loan limits were calculated using 125% of median house prices.
So what does this mean? It means that anyone currently in escrow in San Diego with plans to borrow more than $546,250 needs to do everything they can to get their loan closed before 12/31/2008 or face significantly higher interest rates. There is almost a 2% interest rate difference between loans less than $697,500 and loans greater than $697,500 (also known as true jumbo loans) because conforming loans are guaranteed by the government (FNMA and FHLMC). Guidelines are also more strict for true jumbo loans than for conforming and high balance conforming loans.
As expected, the Federal Housing Administration (FHA) announced that FHA Jumbo limits will match the high balance conforming limits. The Department of Veteran’s Affairs (VA) said that VA Jumbo loans with zero-down payments will be allowed up to the high balance conforming loan limits through the end of 2011. This is good news for FHA and VA buyers as they will still be allowed to take advantage of these programs for higher priced properties.
Any questions or comments? Please email me at Kevin@MyCWMtg.com
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Fannie And Freddie Bailout…My First Take
Posted by Kevin Kueneke | Currently 2 Comments »
By now, most everyone has heard of the announcement made last Sunday that the government is officially bailing out Fannie Mae (FNMA) and Freddie Mac (FHLMC), the two mortgage giants that own or guarantee about $5 trillion in home loans. Both CEO’s are being replaced and the new heads will report to the newly formed Federal Housing Finance Agency which was created under our friend the Housing and Economic Recovery Act.
Although the bailout is in itself a complicated issue, it is better than the alternative which is a complete failure of the two companies. A complete failure could have led to a catastrophic freeze in the mortgage market, essentially a lack of money to fund new loans. Overall, the bailout is positive news which is what the housing industry needs right now.
There will be an injection of up to $100 billion in each of the two companies which could help lower mortgage rates and add stability to the economy. These lower rates and added stability could entice banks to become more willing to write new purchase-money loans as well as refinance existing loans.
We have already seen a dramatic decrease in rates since the announcement. From Friday 9/5/2008 to Monday 9/8/2008, Conforming 30 year fixed rates dropped about a half percent! In my fifteen years of lending, I cannot remember a time when rates decreased that much in such a short period, even during the last big refinance boom that ended in 2003. I have had many potential buyers coming out of the woodwork asking how much more they can afford at these lower rates. Their buying power has been significantly increased basically overnight and right now is a fantastic time to buy a home. The key will be if these rates can hold at these low levels.
It is still hard to tell how all of this will be absorbed in the long run. One concern is that taxpayers will shoulder the financial burden of the bailout, especially if market conditions worsen. Lower mortgage rates alone will not fix the housing crisis as there are still too many houses on the market. There have been several cries to loosen the recently tightened lending guidelines, but it is doubtful that we will see the return of the Wild West of loan guidelines from a year or so ago as those guidelines helped get us into this mess in the first place. There is obviously no quick fix to the housing situation, but combined with other recently passed legislation, this may be a start.
If you would like to discuss this further, please feel free to call me at (760)500-1919 or email me.
Related Posts: Buyers, CW Mortgage, Home Loans, Homeowners, Mortgage News
