New FHA Loan Limits

Los Angeles County and Orange County FHA loan limits are rising January 1, 2009. What does that mean to todays home buyers? This means that Fannie Mae and Freddie Mac loans remain high through the end of 2008, buyers can qualify for higher loans on homes closing prior to the end of this year. Once the New Year rolls around buyers will have less buying power due to the lower loan limits. This is true for all residential loans, including; homes, condos and residential investment property under 4 units.

Whats the big deal? Lower maximums loan amounts means decreased buying power.

Today is November 16, 2008. It is still possible to find and close on a home or condo before the new lower loan limits take effect. If you have been thinking about buying, were contemplating putting that purchase off until after the New Year and are in the price range that would be affected by the new lower FHA loan limits, you might want to consider getting out there right now while you can still take advantage of the higher FHA loan limits. Remember, your escrow must close prior to 12/31/2008.

Federal Housing Authority Home

Real estate is always a good purchase, now really is a very good time to consider purchasing a Long Beach Home, Condo or Income Property. If you have been sitting on the fence call us today to discuss your needs and wants. We are always here for you. Call Laurie (562) 212-5420

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Understanding how your credit score will affect the purchase of Long Beach
homes.

We all know that a good credit score is not only helpful, but today it is necessary to get a mortgage to purchase Long Beach homes, or even buy a car.  Your credit score will also determine the interest rate you have to pay.

Factors that go into figuring a credit score?

• Have you Established Credit? Paying cash is often construed to be the act of a responsible consumer, by doing so you establish no history for a mortgage lender to examine. One way to establish credit is to get credit cards and use them – you can, and should, pay them off every month and on time.  A credit score considers the number of creditors as well as payment history.
  

Read Also: How to establish credit

• Prompt Payment of Financial Obligations. This is very important, but you should know that this accounts for only about a third of the total score.

• Amount of Available Credit. Your credit score might be impacted by the number of credit cards you have, even if you never use them.  They indicate the amount of credit you have access to, thus opening up the chance of financial strain.

• Your Debt Ratio.
  Lenders will consider your debt ratio when you apply for a Long Beach mortgage. In spite of an excellent credit rating they will use this debt ratio to see if you can take on additional debt for a mortgage on your Long Beach home.

• Consolidation of Debt. Although, this might make it easier to pay off debt and thus increase your credit score, the process of consolidation will have no effect on your credit score.
  

What do the Credit Score numbers mean?

Your FICO score is comprised of a compilation of your credit history from the three major credit reporting bureaus, Equifax, Transunion, and Experian. Basically your credit score is determined by a formula that is calculated that is proprietary information and owned by Fair Isaac.  Your credit score number will be between 300-900, and the higher the number the better off you are.

Are you ready to start the process of applying for a Long Beach Mortgage now?  Before you approach a lending institution for a Long Beach home mortgage, know where you stand with your credit score.  Not sure where you stand, a good Mortgage professional will assist you with obtaining a copy of your report.  After obtaining a copy of it, they will review it with you and assist you to resolve any issues that are affecting your
credit score negatively.

Guest author: Colleen Kulikowski, Buffalo NY Realtor

Long Beach real estate market 2009 Forecast

Author: Brian Brady.

If bifurcation was the theme for the 2008 Long Beach real estate market, convergence will be the theme in 2009. Both the bifurcation of 2008 and the Convergence of 2009 are closely tied to the ability to finance Long Beach properties.  While prices were lower across Long Beach, this past year, the under
$400,000 real estate market was extremely hard hit. Vanishing stated income and Sub-prime loan programs reduced the number of qualified buyers, driving prices dramatically lower in areas like California Heights, Lakewood Plaza/Rancho, Bixby Knolls, and the non-waterfront condominiums in Downtown Long Beach. In some cases, those prices are below the fundamental value, and offer a great buy for investors and owner-occupants alike.

The Long Beach neighborhoods of Belmont Shore, Belmont Heights, Bluff Park, Alamitos Beach and Virginia Country Club might not fare so well in 2009, While I expect Long Beach homes priced below $500,000 to hold relative value next year, it’s the homes priced over $700,000 and below $1,000,000 that are most vulnerable to vanishing financing. I discussed this very challenge in my 2009 San Diego Real Estate Outlook:

The key component to the housing recovery for San Diego remains in
The ability for a home buyer to get financing. The US Treasury stepped
In to provide financing for properties under $625,000, by:

(a) increasing the loan limits for FHA, conforming and VA loans to 115% of median price (expected Jan,2009)
(b) nationalizing Fannie Mae and Freddie Mac (guaranteeing the loan from default)

The luxury home market ($1,000,000 and above) is generally a cash
Market. As such, credit availability affects those housing units far
Less than the “rank and file” developments inhabited by those of us in
The “working class”. Expect SOME softness in the luxury home market but
If the buyer likes the home, she’ll either pay cash or have access to
Highly specialized financing available to the only asset-rich.

After January 1, 2009, the government loan limits will be capped at $625,000 for Long Beach. This means that rates for loan amounts above that number will be as much as 2% higher than the government-backed Financing and downpayment requirements will be 25% or greater. If you’re selling a home in that price range, the buyer pool is about to shrink in about 3 months.

Exacerbating this financing issue is the loss of jobs a recession may bring. Unemployment in California has spiked this past year.  Job losses have been concentrated in the lower to middle income range
in 2008 while the upper-income jobs have remained relatively safe. A recession will hit those upper-income jobs harder than the lower income ones. I said that 2008 is the year where the “rich will get not rich and the poor will get clobbered“; that certainly happened this year. 2009 will be the great equalizer as the higher-priced homes decline and higher-paid jobs disappear.

What then, should be your strategy for 2009?

Investors should pay close attention to the lower-end of the real estate market for fantastic buys. Long Beach real estate is a great investment and opportunities to own a property that offers positive cash flow are evident today in the under $500,000 market. There will be some great opportunities in those mid-priced homes, next year as well as the $700,000 to $1,000,000 drops below the financing caps.

If you’re planning on selling a Long Beach home in that $700,000 to $1,000,000 price range, better to list it today rather than to wait until after the new year. Veterans can buy up to $729,000 with no money down. FHA buyers can buy up to $729,000 with 3.5% down. Conventional buyers can buy to that limit with as little as 5% down…today. Next year, that all goes away.

Brian Brady is a Managing Director with World Wide Credit Corporation, a San Diego-based mortgage banking and brokerage firm. Google calls him America’s #1 Mortgage Broker; you can call him at (858)-777-9751

Countrywide customers finally get some relief through the Bank of America Nationwide Homeownership Retention Program.

Program
will systematically modify troubled mortgages with up to $8.4 billion
in interest rate and principal reductions for nearly 400,000
Countrywide Financial Corporation customers nationwide.

• Read the press release to learn more about this announcement.
• Learn more about the Homeownership Retention Program with this Fact Sheet Overview.
• Additional information for customers who may need additional Financial Hardship Assistance.

Beginning December 1, 2008, Countrywide will proactively contact
subprime and Pay Option ARM borrowers whose loans are scheduled for an
interest rate change.

This program is designed to try to keep homeowners in their homes by way of affordable mortgage payments for borrowers who financed their homes with subprime loans or pay
option adjustable rate mortgages serviced by Countrywide and originated
prior to December 31, 2007.  Countrywide will forestall the foreclosure process until a decision regarding eligibility is made for qualified recipients.

Modification options include, among others:

• FHA refinancing under the HOPE for Homeowners Program;
• Interest rate reductions, which may be granted automatically through streamlined processing; and
• Principal reductions on Pay Option adjustable rate mortgages that restore lost equity for certain borrowers.

One of the requirements for eligibility is occupying the home as your primary residence.

As part of agreements to resolve outstanding claims
against Countrywide by certain states, borrowers in participating
states will additionally be eligible to access their share of:

• A Foreclosure Relief Program of
  $150 million on a nationwide basis for payment to eligible Countrywide
  servicing customers who suffered foreclosure or are currently at
  serious risk of foreclosure having made only minimal payments since the
  time their mortgages were originated by Countrywide; and
• An
  additional program, projected to make payments up to $70 million to
  support customers with loans serviced by Countrywide who face imminent
  foreclosure, providing financial assistance with their transition from
  home ownership.

As part of the
state agreements, Countrywide is further committing to eligible
borrowers in participating states that it will waive late fees
associated with a borrower’s default in finalizing modifications under
the program.

If you have a home loan through Countrywide and your home is in jeopardy this is a great opportunity for you to work out a plan to keep your Long Beach homes by re-arranging your mortgage through these new programs.  Please read the entire press release>>>>>>>>

]]> http://www.lauriemanny.com/bank-of-america-announces-nationwide-homeownership-retention-program-for-countrywide-customers-long-beach-real-estate/feed/ 0 http://www.lauriemanny.com/long-beach-mortgage-rates-report-september-29-2008/ http://www.lauriemanny.com/long-beach-mortgage-rates-report-september-29-2008/#comments Mon, 29 Sep 2008 17:59:23 +0000 lauriemanny http://testing.realestatetomato.com/2008/09/29/long-beach-mortgage-rates-report-september-29-2008/ Remember I told you to sit tight on that mortgage rate lock until after the Bailout Bill was passed?

Well, it failed.

Mortgage rates are a little better than they were this morning.
This morning a 30-year fixed par rate was at 6.0%; this
afternoon, it was at 5.875%.  If you’re closing on your home loan in 30
days , there is more risk that you’ll get a rate over 6% than under
6%.  Lock your mortgage rate if you’re closing in October.

If you have time, wait it out.  The bailout bill failed but it isn’t
dead.  If the bailout bill DOES ultimately fail, mortgage rates will
skyrocket, housing prices will tank, and you’ll probably renegotiate or
cancel that home purchase.

When the bailout goes through (and the whining on Wall Street will
be so loud that it WILL go through), mortgage rates will come back down.

PS:  If you’re a baby boomer, this is your worst nightmare.
Most of the people over 55 have most of their retirement assets in the
stock market, through mutual funds in their 401-k plan.  If you’re a
real estate investor or buyer, this might be really good news.

PPS: Did you know that Main Street already got bailed out? I’ll talk about that next time.

Brian Brady

(858) 777-9751