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Pending Homes Sales Rise - More Signs of Recovery

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Get To Know Your 30 Year Fixed Mortgage

Finally: Home Buying Signals A Recovery

4 Simple Staging Solutions For An Open House

Nevada Relinquishes "Top Foreclosure State" Title

Single-Family Housing Starts Slip 0.2% In March

Homebuilder Confidence Slips 3 Points In April

Four Easy Steps To A Guaranteed Rate Mortgage

How To Use Newspapers To Kill Garden Weeds

Do You Have What It Takes To Be A New Home Buyer?

The Unbelievable Housing Trend Hitting America

The Top 10 Cities In Which To Raise A Family

Homes Get More Affordable On March Jobs Data

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Has The Best Time to Refinance Passed?

FHA Mortgage Insurance Premiums Increasing April 9, 2012

Planning to use an FHA-backed mortgage for your next home loan? You might want to get your application in gear today.

Beginning next week, the Federal Housing Administration (FHA) is changing the way it charges mortgage insurance to U.S. homeowners. For the fourth time since 2010, FHA mortgage insurance premiums are rising for all FHA-backed homeowners.

For FHA Case Numbers assigned on, or after, Monday, April 9, 2012, there are two planned changes.

First, FHA Upfront Mortgage Insurance Premiums (UFMIP) will increase by 75 basis points to 1.75%, or $1,750 per $100,000 borrowed. Upfront Mortgage Insurance Premium is paid at closing, and typically added to an FHA borrower’s loan size.

The current UFMIP rate is 1.000 percent.

Second, annual FHA mortgage insurance premiums are rising. All new FHA-backed loans will be subject to a 10 basis point increase in annual mortgage insurance premiums, costing homeowners an extra $100 per $100,000 borrowed per year.

The new FHA annual mortgage insurance premium schedule follows :

• 15-year loan term, loan-to-value > 90% : 0.60% MIP per year
• 15-year loan term, loan-to-value <= 90% : 0.35% MIP per year
• 15-year loan term, loan-to-value <= 78% : 0.00% MIP per year
• 30-year loan term, loan-to-value > 95% : 1.25% MIP per year
• 30-year loan term, loan-to-value <= 95% : 1.20% MIP per year

In addition, for loans above $625,500, beginning with FHA Case Numbers assigned on, or after, June 11, 2012, there will be an additional 25 basis point increase in annual MIP.

To calculate your monthly MIP obligation as a FHA homeowners, multiply your starting loan size by your insurance rate from the list above, then divide by 12.

Note that the FHA mortgage insurance changes apply to new FHA Case Numbers only. If you have an FHA mortgage approval in-process, or an existing FHA home loan, you are not subject to the new MIP schedule. To avoid paying the FHA’s new MIP schedule, therefore, begin your FHA mortgage application today.

Once your FHA Case Number is assigned, you’re locked in to today’s lower premiums.

Contact your mortgage professional today!

Spring Cleaning Shortcuts

If you are in the market for a new home so you can utilize these spring cleaning tips, contact me today!

Mortgage Rates Fall Back Below 4%

Case-Shiller Shows Uneven Recovery For U.S. Housing

Pending Home Sales Index Remains Strong Into Spring

New Home Sales Slip In February

What makes a Mortgage a Jumbo Mortgage?

How To Replace Cracked, Dirty Grout

Building Permits On The Rise

Existing Home Sales Stay Strong; Spring Season Underway

Buyer Foot Traffic Up Threefold Since 2009

Home builder confidence in the newly-built, single-family housing market remains high.

In March, for the second consecutive month, the National Association of Homebuilders reports the Housing Market Index at 28 — a doubling of the reading from just 6 months ago and, along with last month, the highest HMI value since June 2007.

When home builder confidence reads 50 or better, it reflects favorable builder conditions in the single-family, new home market. Readings below 50 suggest unfavorable builder conditions.

The HMI itself is a composite reading. It’s the result of three separate surveys sent to home builders by the trade association. The NAHB asks builders to report on their current single-family home sales volume; their projected single-family home sales volume for the next 6 months; and, their current buyer “foot traffic”.

Approximately 400 surveys are returned each month. The results are compiled into the NAHB Housing Market Index.

In March, home builders provided mixed replies to the survey questions :

• Current Single-Family Sales : 29 (-1 from February)
• Projected Single-Family Sales : 36 (+2 from February)
• Buyer Foot Traffic : 22 (Unchanged from February)

It’s noteworthy, despite slowing sales in March, that home builders expect a surge in new home sales over the next 6 months. The reasons for this are several and should be of interest to today’s home buyers.

First, the jobs market is heating up. The U.S. economy has added more than 1 net new million jobs over the last 6 months and that is increasing the pool of potential home buyers in California and nationwide. 

Second, the housing market, in general, is improving. Home sales are brisk in many U.S. markets and home supplies are dropping. This creates pressure on home prices to rise.

And, third, low mortgage rates have helped pushed home affordability to all-time highs. More home buyers earning the national median income can afford a median-priced home than at any time in history. 

It’s all culminated in a monthly Buyer Foot Traffic reading which, at 22, is nearly triple the foot traffic reading from just three years ago. Home buyers — in Danville and everywhere else — are out in full-force, capitalizing on today’s buyer-friendly market.

If you’re looking to buy new construction in the second half of 2012, consider moving up your time frame. Market conditions are constantly changing, and may move out of your favor. As builder optimism increases, the price you pay for your new home may increase, too.

Loans For Underwater Homeowners : HARP 2.0 Now Available

The new, revamped HARP program is now available in California and   nationwide. It was officially released Saturday, March 17, 2012 by Fannie Mae and Freddie Mac.

HARP is an acronym. It stands for Home Affordable Refinance Program. HARP is the conforming mortgage loan product meant for “underwater homeowners”. Under the HARP program, homeowners in Pleasanton can get access to today’s low mortgage rates despite having little or no equity whatsoever.

HARP is expected to reach up to 6 million U.S. homeowners who would otherwise be unable to refinance.

HARP is not a new program. It was originally launched in 2009. However, the program’s first iteration reached fewer than 1 million U.S. households because loan risks were high for banks, and loan costs were high for consumers.

With HARP’s re-release — dubbed HARP 2.0 — the government removed many of HARP’s hurdles.

In order to qualify for HARP, homeowners must first meet 3 qualifying criteria. 

First, their current mortgage must be backed either Fannie Mae or Freddie Mac. Loans backed by the FHA or VA are ineligible, as are loans backed by private entities. This means jumbo loans and most loans from community banks cannot be refinanced via HARP.

• To check if your loan is Fannie Mae-backed, click here.
• To check if your loan is Freddie Mac-backed, click here.

The second qualification standard for HARP is that all loans to be refinanced must have been securitized by Fannie Mae or Freddie Mac prior to June 1, 2009. Mortgages securitized on, or after, June 1, 2009 are HARP-ineligible.

There are no exceptions to this rule.

And, lastly, the third HARP qualification standard is that the existing mortgage must be accompanied by a strong repayment history. Homeowners must have made the last 6 mortgage payments on-time, and may not have had more than one 30-day late within the last 12 months.

If the above three qualifiers are met, HARP applicants in Ruby Hill will find mortgage guidelines lenient overall :

• Refinancing into a fixed rate mortgage allows for unlimited loan-to-value
• The standard 7-year “waiting period” after a foreclosure is waived in full
• Except in rare cases, home appraisals aren’t required for HARP

Furthermore, HARP mortgage rates are on par with non-HARP rates. This means that HARP applicants get access to the same mortgage rates and loan fees as non-HARP applicants. There’s no “penalty” for using HARP.

To apply for HARP, check with your loan officer today.

How To Store Your Winter Clothes For The Summer Season

Foreclosure Volume Slated To Rise This Spring

After a series of months during which foreclosure volume was low, total filings have started to rise again, says RealtyTrac. 

In February, 21 states posted a year-over-year increase in monthly foreclosure filings, according to the national foreclosure-tracking firm. This is nearly twice as many states as compared to December 2011, marking the highest monthly reading since November 2010.

A “foreclosure filing” is defined to include any one of the following foreclosure-related events : (1) The serving of a default notice, (2) A scheduled home auction, or (3) A bank repossession.

Nationally, the number of foreclosure filings fell 2 percent from January. However, it’s a trend that may reverse. Foreclosure volume is expected to rise over the next few months.

This is because the $25 billion mortgage servicer settlement provides a framework for servicers to execute necessary foreclosures, from notice-to-auction. Some analysts believe that foreclosure filings were artificially depressed in 2011 because of the absence of such guidance. 

Like all things in real estate, though, foreclosures remain local.

For example, nationally, there was one foreclosure for every 637 housing units. On a state-by-state basis, however, the results looked different.  

• Nevada : 1 foreclosure for every 278 housing units
• California : 1 foreclosure for every 283 housing units
• Arizona : 1 foreclosure for every 312 housing units
• Georgia : 1 foreclosure for every 331 housing units
• Florida : 1 foreclosure for every 341 housing units

Even on a city-by-city level, foreclosure concentration varied. Figures from several select cities include : 

• Atlanta : 1 foreclosure for every 244 housing units
• Chicago : 1 foreclosure for every 302 housing units
• New York : 1 foreclosure for every 3,439 housing units
• Seattle : 1 foreclosure for every 1,229 housing units
• Washington : 1 foreclosure for every 1,198 housing units

One reason why foreclosure concentration is worth tracking is because homes in various stage of foreclosure are often sold at deep discounts as compared to similar, non-distressed homes. It’s no wonder foreclosed homes are in high demand among today’s Pleasanton home buyers. 

However, if you plan to buy a foreclosure in California , be sure to work with an experienced real estate agent. Foreclosed homes are often sold “as-is”, and may be defective at best and uninhabitable at worst. It makes good sense to have an advocate on your side to help with contracts and inspections.

Mortgage Rates Climb Sharply After Retail Sales Report

A Simple Explanation Of The Federal Reserve Statement (March 13, 2012)

How To Remove Soap Scum From Shower Doors

Dirty shower doors can ruin an otherwise sparkling-clean bathroom. The soap scum that accumulates isn’t just unsightly; it contains body oils and skin particles that provide for a perfect bacteria breeding ground.

Supermarket shelves in Pleasanton are filled with bathroom cleaners that promise to cut through soap scum, but the cleansers don’t always work and those that do often contain harsh chemicals that can irritate your skin.

Cleaning shower doors can be more safe and more pleasant, then, when you use chemical-free household products, many of which you likely have in your kitchen already.

White vinegar makes an excellent soap scum remover, for example.

To remove soap scum from your shower doors using white vinegar, pour non-diluted white vinegar into a spray bottle, and then spray your shower doors until the soap-scummy sections are completely saturated. Let the vinegar sit for several minutes. This allows the white vinegar time begin breaking down the soap scum.

Spritz the surface again, if necessary, to keep the surface wet.

After the white vinegar has had some time to work, wipe the soap scum away with a non-scratching sponge.

If the soap scum is particularly stubborn, cutting through it completely may require a mild abrasive.

After letting the vinegar soak for several minutes, sprinkle baking powder on your sponge and remove the soap scum using a moderate amount of pressure and small circular motions. If your shower doors are textured, you may need to switch to a scrub brush to get into the crevasses.

Reapply baking soda and re-spritz the doors with vinegar as needed to remove the soap scum completely. Then, just rinse away the residue with hot water.

Give the shower floor a final rinse after the residue drains.

FHA Drops Upfront Mortgage Insurance Premium To 0.01%

Mortgage Rates Expected To Rise On A Strong Job Report

Are You Wasting $471 Per Month On Your Mortgage?

According to Freddie Mac’s weekly mortgage rate survey, for 13 straight weeks, the average 30-year fixed rate mortgage has held below 4.000% for mortgage applicants willing to pay up to 0.8 discount points plus a full set of closing costs.

These are the lowest mortgage rates in history and now — with a bevy of loan programs for the nation’s 11 million “underwater homeowners” including HARP, the FHA Streamline Refinance, and the VA IRRRL — millions of U.S. homeowners can exploit the current mortgage rate environment.

In this 4-minute clip from NBC’s The Today Show, you’ll learn about today’s mortgage market and your refinancing opportunities in California.

The video begins by telling us that 14 million credit-worthy Americans have yet to refinance their respective mortgages, and are leaving an average of $471 in “wasted savings” on the table each month which adds up to more than $5,600 annually.

That’s a big number.

Some of the video’s other key points include :

• Refinancing is “worth the hassle” when mortgage rates are as low as they are today
• The best rates are reserved for homeowners with the highest credit scores
• Comparison shop — your current mortgage lender may not offer you the best rates

Furthermore, the video reveals the characteristics of the homeowner type most likely to benefit from a refinance. These traits include having with 20% equity in the home; have plans to live in the home for at least the next 36 months; carrying a current mortgage rate of 5 percent or higher.

It should also be added that, with a zero-closing-cost or low-closing-cost mortgage, even a small reduction in your mortgage rate can make a refinance worthwhile.

Mortgage rates are low but can’t stay low forever. If you haven’t participated in the Refi Boom, talk with a loan officer and review your mortgage options. You may be able to save hundreds of dollars per month with just modest closing costs.

Home Affordability Reaches An All-Time High

Home affordability moved higher last quarter, boosted by the lowest mortgage rates in history, a rise in median income, and slow-to-recover home prices throughout California and the country.

According to the National Association of Home Builders, the quarterly Home Opportunity Index read 75.9 in 2011′s fourth quarter. More than 3 in 4 homes sold between October-December 2011, in other words, were affordable to households earning the national median income of $64,200.

Never in recorded history have U.S. homes been as affordable on a national level. Even on a regional and local level, affordability soared.

Affordability was highest in the Midwest; 7 of the 10 most affordable markets nationwide were in the nation’s heartland. 

The Top 5 most affordable U.S. cities in Q4 2011 were:

1. Kokomo, IN (99.2% home affordability)
2. Fairbanks, AK (97.5% home affordability)
3. Cumberland, WV (96.9% home affordability)
4. Lima, OH (96.0% home affordability)
5. Rockford, IL (95.5% home affordability)

These are each considered “small markets”. The most affordable “major market” was the Youngstown, Ohio area, where 95.1% of homes sold were affordable to households earning the area’s local median income.

Not surprisingly, America’s “least affordable cities” were regionally-concentrated, too, with 7 of the 10 least affordable markets located in either California or Texas.

San Francisco (#3), Santa Ana (#4), and Los Angeles (#5) led for the Golden State but, for the 15th consecutive quarter, the New York metropolitan area took “Least Affordable Market” honors.

Just 29 percent of homes in and around New York City were affordable to households earning the area’s median income last quarter. It’s a large jump from the quarter prior during which 23 percent of homes were affordable.

The rankings for all 225 metro areas are available for download on the NAHB website.

10 Ways To Successfully Prepare A Home For Selling

1. Go through your home and decide what you can throw away or put into storage. Pay extra attention to closets, bookcases, shelves and counters. Less clutter lets the buyer see the home, not your stuff.
2. Buyers are very interested in the space your home can provide them, so organize accordingly. Bedroom closets should be cleaned so that hanging clothes are aligned and have lots of space. Don’t have anything on the floors! Also, line up your dishes and glassware and make sure all drawers are neatly organized.
3. Clean, clean, clean!! Give your home a deep clean, including windows, carpets and appliances.
4. Paint your walls a neutral color. A fresh coat of paint is the least expensive, but most effective way to enhance the appearance of your home.
5. Light it up! Light gives the impression of space, so make sure you have tons of light in every room. Wash the windows, raise the blinds and turn on the lights. Higher wattage light bulbs can brighten dark areas, while dimmers can add a desirable feature to the home.
6. If you live in a single-family home or townhouse, make sure you maintain your lawn and landscape it prior to a showing. During the winter, shovel and de-ice the walkways. Make sure your balcony, deck and/or patio is inviting, with potted plants and flowers.
7. Make small home repairs as seen fit. This can include touching up your spackling and painting, replacing a cracked window or town screen, fixing a leaky faucet or even just changing burned our light bulbs. Every detail makes a difference!
8. If you do not plan on including personal property such as window treatments or light fixtures as part of a sale, remove them prior to your first showing and replace them with attractive alternatives. Use light, airy window treatments, like simple sheers.
9. Keep your pets out of the home during showings. If pet odors are present, have the home professionally cleaned and make sure you conceal food bowls and litter boxes.
10. A professional, licensed home inspector can spot the potential problems prior to your first showing. You may want to invest in one so that you can be sure you fixed all the problems before any potential buyers make them an issue.

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FHA To Raise Mortgage Insurance Premiums April 1, 2012

Beginning April 1, 2012, the FHA is once again raising mortgage insurance premiums (MIP) on its newly-insured borrowers throughout Danville and the country.

It’s the FHA’s fourth such increase in the last two years.

Beginning April 1, 2012, upfront mortgage insurance premiums will be higher by 75 basis points, or 0.75%; and annual mortgage insurance premiums will be higher by 10 basis points per year, or 0.10%.

For borrowers with a loan size of $200,000, the new MIP will add $1,500 in one-time loan costs, plus an on-going, annual $200 increase in total mortgage insurance premiums paid.

All new FHA loans are subject to the increase — purchases and refinances.

The FHA is increasing its mortgage insurance premiums because, as an entity, the FHA is insuring a much larger percentage of the U.S. mortgage market than ever before. 

In 2006, the FHA insured 2 percent of all purchase-money mortgages. In 2011, that figure jumped to 18 percent. Unfortunately, as the FHA has insured more loans, it’s number of loans in default have climbed, too, forcing the FHA to boost its reserves.

Beginning April 1, 2012, the new FHA annual mortgage insurance premium schedule is as follows :

• 15-year loan term, loan-to-value > 90% : 0.60% MIP per year
• 15-year loan term, loan-to-value <= 90% : 0.35% MIP per year
• 30-year loan term, loan-to-value > 95% : 1.25% MIP per year
• 30-year loan term, loan-to-value <= 95% : 1.20% MIP per year

In order to calculate what your FHA annual mortgage insurance premium would be on a monthly basis, multiply your beginning loan size by your insurance premium in the chart above, then divide by 12.

In addition, for loans over $625,500, beginning June 1, 2012, there is an additional 25 basis point increase to annual MIP.

To avoid paying the new FHA mortgage insurance premiums, start your FHA mortgage application today. Existing FHA-insured homeowners will not be affected by the change.

Mortgage insurance premiums will not rise for loans already made.

Today's Market Update

The month-end sell-off we saw yesterday appears to be continuing as mortgages are heading lower after a mixed bag of economic data.  The labor market continually shows signs of improvement since the February employment report, with initial jobless claims coming in slightly lower than expected at +351k.  The number of people already claiming unemployment fell to 3,402k, vs. 3,418k expected.  Personal income was in-line with the street.  From a technical perspective, mortgages have been tracking rates and 10-year treasury yields are once again bumping up against some key consolidation points.  2.04, 2.08, and 2.09 are all yields that have held throughout 2012 and defined the upper end of our range.

Case-Shiller Index Shows Home Values Rising In Detroit

Standard & Poors released its December 2011 Case-Shiller Index this week. The report is the most widely-cited, private-sector metric for the housing market. The index aims to measures change in home prices from month-to-month, and from year-to-year, in select U.S. cities and nationwide.

According to the report, between November and December 2011, home values fell within 18 of the Case-Shiller Index’s 20 tracked markets; and through the 12 months leading up to December 2011, 19 of 20 tracked markets fell.

Only Detroit posted year-over-year gains, adding 0.50% since December 2010. 

Now, these statistics may look dire for the housing market, but it’s important to remember that the Case-Shiller Index — though widely-cited — remains a flawed statistic for everyday buyers and sellers in San Ramon. Rather, the monthly Case-Shiller Index is more appropriately applied by policy-makers and economists to macro-economic issues than by you and me for buy-or-sell decisions..

There are three ways in which Case-Shiller is flawed — each tied to the way by which Case-Shiller Index is calculated.

The first reason why the Case-Shiller Index is flawed is that, although it’s purported to be a “national” housing index, the index tracks just 20 cities nationwide. The United States, by comparison, houses more than 3,100 municipalities. The Case-Shiller Index is not a representative sample of the U.S. housing market.

And then, even within its tracked markets, Case-Shiller fails provide sufficient details to be useful.

Within each Case-Shiller Index city, there are innumerable “local markets”, each with its own local economy. When home values are shown to be falling in Phoenix, for example, that doesn’t mean that values are falling everywhere in Phoenix — only in the aggregate. There are multiple neighborhoods in Phoenix in which home values improved in December.

The Case-Shiller Index doesn’t capture that. 

As another reason to ignore the Case-Shiller Index, note that the Case-Shiller Index only includes home sale data for single-family, detached homes — sales of condominiums and of multi-unit homes are specifically excluded. In some markets — Chicago and New York, for example — sales of these types can represent a large percentage of overall monthly sales.

Lastly, as a third reason to reduce the Case-Shiller Index’s significance — it’s “old”.

The Case-Shiller Index is published on a 60-day delay and includes sales contracts from even 60 days prior to that. In other words, the data used in this week’s Case-Shiller Index dates back to October 2011.

Data from 5 months ago is of little relevance to buyers in California today. Up-to-date and current information is what matters.

For actionable, real-time housing market data, therefore, look past the Case-Shiller Index. Look to your local real estate agent instead.

Pending Home Sales Rise To 22-Month High

New Pilot Announced by FHFA for REO Property Sales in Hardest-Hit Area

New Home Supply Falls To 5.6 Months

The new construction market rolls on.

As foreshadowed by February’s Homebuilder Confidence survey, which rose to a 4-year high, the Census Bureau reports new homes are selling more quickly than builders have built them, lowering the national “home supply” to levels not seen since 2006.

A “new home” is a home that is considered new construction and, at the current pace of sales, the nation’s entire new home inventory of 151,000 homes would be sold in 5.6 months.

Anything less than 6.0-month supply is thought to connote a “sellers’ market”.

321,000 new homes were sold last month on a seasonally-adjusted, annualized basis. 7 of 10 new homes sold for less than $300,000. 

The South Region continues to account for the majority of new construction sales, posting a 59% market share in January. South Region sales were up 9 percent as compared to December. The other 3 regions turned in mixed results. 

• Northeast Region : +11.1% from December 2011 
• Midwest Region : -24.5% from December 2011 
• West Region : -10.6% from December 2011 

Unfortunately, the Census Bureau’s New Home Sales data could be wrong.

Although New Home Sales were said to fall by about one percent nationally from December to January, the government’s monthly report was footnoted with a ±16.6% margin of error. This means that the actual New Home Sales reading may have been as high as +15%, or as low as -18%. 

Because the range of values includes positive and negative values, the January New Home Sales data is of “zero confidence”. However, that’s not to say that it should be ignored. The aforementioned homebuilder confidence survey shows builders optimistic for the future, and a bevy of home sale data since October 2011 suggests a market in recovery.

If you’re in the market for new construction in San Ramon , therefore, consider going into contract sooner rather than later. Home prices remain low and mortgage rates do, too — a terrific combination for today’s buyers.

In a few months, the landscape may look different.

Housing Market Is Looking Up!

Mortgage Company Danville CA

Are you considering the purchase of a home in Danville CA or the Bay Area? The best time to contact a local mortgage company is well before you’re looking for a home loan. That way, we can help guide you through the process of qualifying for a mortgage before you begin looking at houses, which saves you time and keeps you moving towards realizing the dream of home ownership.

Many people think that you should contact a real estate professional before contacting a mortgage company. While this assumption seems sound on the surface, since you need to find the house you want to buy before you can take out a loan to pay for it, it’s actually better to contact a mortgage company before you begin looking at real estate. Many real estate agents won’t meet with a potential buyer until they can present a pre-qualification for a loan, but real estate agents can’t get a pre-qualification letter for you – only a professional mortgage company can.

When you meet with a mortgage company with the intention of buying a home, the first thing we will do is take a look at your financial situation. What sort of loan you are able to get, what interest rates will be available to you, maximum loan amounts, necessary down payments… these things will all differ from person to person and are related to things such as your credit rating, outstanding debts and how much you make. Meeting with a local mortgage company means we can take a look at your current situation and see what sort of loans you can qualify for – no guesswork on your part, and it gives you an opportunity to get that all important pre-qualification letter!

What if the loan that you pre-qualify for isn’t what you want? The amount that the bank is able to loan you may be too low, or the interest rate or down payment required may be too high to get you into that Canyon Park home of your dreams. As a professional mortgage company, we’re able to help with advice to help improve the factors that the bank looks at when writing a loan. Spending time working with a mortgage company on ways to improve the markers that can help get you a better loan is a smart move. Because all our mortgage company does it help people get mortgages, we can give you informed and accurate advice about how to get the best loan for you.

There’s nothing we love more than getting someone a loan for the Danville CA, or Bay Area home they’re dreaming of – give us a call and see how our mortgage company can help you realize your goal!

Contact: Robert Sinohue (925) 364-5210

Federal Reserve Wary Of European Spillover

Existing Home Sales Climb To A 20-Month Record

January’s home resales moved to a 20-month high — additional evidence that the nation’s housing recovery is underway.

According to the National Association of REALTORS®, the January 2012 Existing Home Sales showed 4.57 million units sold last month on a seasonally-adjusted, annualized basis — a 4 percent increase as compared to December’s revised figures.

An “existing home” is one that’s been previously occupied and cannot be categorized as new construction.

Beyond the headline numbers, though, there was plenty about which for today’s Pleasanton home sellers to get excited. Demand for homes remains strong, foreshadowing higher home prices through 2012.

First, the national housing stock is at a 5-year low.

In January, the number of homes for sale nationwide slipped to 2.31 million, the smallest home inventory since February 2007, and a 21% decrease from just one year ago.

Falling home supply amid constant home demand leads home prices higher. At the current pace of sales, today’s complete home inventory would “sell out” in 6.1 months. 

Analysts say that a 6-month supply is a market in balance. Anything less is Bull Market territory.

Second, the National Association of REALTORS® says that one-third of all homes under contract “failed” last month. This means that many more buyers tried to buy, but couldn’t for a number of reasons including mortgage denials; or, insurmountable home inspections issues; or, homes appraising for less than the contract price.

As contract failures subside, Existing Home Sales are expected to rise even faster.

And, lastly, first-time buyers continue to power the home resale market. In January, 33% of all sales were made to first-time buyers, up four points from last year. This statistic suggests that renters are moving into homeownership, an important component in a sustained housing market recovery.  

Given high demand and shrinking supply, we should expect for Windemere home prices to rise in the coming months, if they haven’t already. Thankfully, mortgage rates remain near all-time lows.

Low mortgage rates make homes more affordable.

3 Ways To Decide If You Should Buy A Home (That Don’t Involve Money)

While money can decide what you can afford when it comes to owning a home, there are many other motivators and drivers of a real estate decision. Here are the top 3.

1. Family
When considering if you should buy a new home, family is usually the number one factor. Maybe you’re just starting your family, or your family has grown and needs extra room. Owning a home can give your children stability, such as the same school, place and community. You may also consider passing the house down as a gift to your child, later one when they’re older.

2. Comfort and Control
Owning your home means you have control over many factors: location, decorating preferences, noise levels and proximity to neighbors to name a few. All these controls lead to you having more comfort in your living environment, one of the main things humans desire.

3. Career
Your career and your home tend to be intertwined. Some buy a home to make their commute to work easier. However, committing to a home also limits your freedom to move for new job opportunities. It also gives you an obligation to pay off your mortgage, potentially putting boundaries on how much you work, what work you do and/or who you work for.

Which non-financial factor do you consider when buying a home? Is it one that we didn’t list? Let us know.

Foreclosure Filings Down 19 Percent In One Year

Foreclosure filings fell 19 percent last month versus one year ago, says foreclosure-tracking firm RealtyTrac. It’s yet one more signal that the U.S. housing market may have already climbed off its bottom.

According to RealtyTrac, a ”foreclosure filing” is any one of the following foreclosure-related events : (1) A default notice on a home; (2) A scheduled auction for a home; or, (3) A bank repossession of a home.

In looking at the January 2012 figures :

• Default Notices were down 22% from January 2011
• Scheduled Auctions were down 19% from January 2011
• Bank Repossessions were down 15% from January 2011

On a monthly basis, however, the numbers weren’t so promising.

Default notices and scheduled auctions were mostly unchanged, but bank repossessions rose 8 percent. The rise in bank repossessions is likely because 2010′s robo-signing controversy has been rectified at the state and lender level.

This trend toward more bank-owned homes is expected to continue through 2012.

As in most months, January’s foreclosure activity was geographically concentrated. Nevada led the nation in Foreclosures Per Capita, followed closely by California. 13 states fared worse than the national average of 1 foreclosure per 624 households. 37 fared better.

The difference in foreclosure frequency among the two groupings was stark :

• Top 13 Foreclosure States : 1 foreclosure per 435 households, on average
• Bottom 37 Foreclosure States : 1 foreclosure per 5,101 households, on average

North Dakota had January’s lowest foreclosure rate nationwide. Just 1 in 63,500 homes was in some form of foreclosure in North Dakota last month.

As a first-time or seasoned buyer in Pleasanton , foreclosed homes can be enticing. They’re plentiful and cheap. However, just because a foreclosed home can be bought for a “steal”, that doesn’t mean it’s worth buying. The process of buying a foreclosed homes is different from the process of buying a non-foreclosed home.

The contract-and-negotiation process may be different with a foreclosed property, and foreclosed homes are often sold “as-is”. This means the home you buy at auction could be run-down and defective to the point where it’s uninhabitable.

If you plan to buy a foreclosed home, therefore, have a real estate professional on your side. The internet can teach you much about how the California housing market works, but when it comes to writing contracts, you’ll want an experienced agent on your side.

How To Take Advantage Of The Foreclosure Settlement

Starting March 1st the $25 billion Robo-Signing (or Foreclosure) settlement will begin to go into effect. The settlement, put together between the US government and five major banks (Ally Financial Inc/GMAC Mortgage, Bank of America, Citigroup, JP Morgan Chase and Wells Fargo), is designed to help relieve many borrowers who are either struggling to make payments, owe more than their home is worth or have already lost their home to foreclosure.

But how do you take advantage of this new settlement if you're not a borrower in the above situations? What if you're a new homebuyer, just starting to look for a home?

This settlement will encourage banks to deal with the delayed foreclosures they've been sitting on lately, and eventually speed up the foreclosure process.

As these foreclosures go through, there will be an increasingly large amount of available properties to be sold, all at extremely low prices, creating a great opportunity for new homebuyers and real estate agents alike to get homes at great deals!

If you want more information about the settlement or how you can take advantage, contact Robert Sinohue, Guaranteed Rate.

When Can I Buy A Home After Foreclosure, Bankruptcy, Or Short Sale?

A very common question in the mortgage industry lately is this; when can I buy a home after foreclosure, bankruptcy, or a short sale? With many people having to foreclose and file for bankruptcy in the past few years, this has become quite a common topic. Most people do not know how long they must wait before jumping back into the housing market. The length of time you need to wait before being able to qualify for a house is dependent upon which loan program, or product, you choose. Each loan program has a different answer.

The housing crisis that we have experienced recently has caused many rules and regulations to change, regarding these situations.

Here is the up to date breakdown for the waiting period:

Once your waiting period is over you should begin looking at your credit report, and credit score. At least six months before you initiate any home buying transactions, you should be focusing on your credit report and score to make sure there are no discrepancies. A smart thing to do would be to contact a credit specialist, or your trusted mortgage adviser, to ensure you are on the right track. If you are interested in finding out more please call (925) 364-5210, or email rsinohue@guaranteedrate.com

Are You Missing the Best Time to Buy a Home?

Are You Missing the Best Time to Buy a Home?

For the sixth month in a row, homebuilder confidence rose, climbing four points in February and reaching the highest mark the index has seen since May 2007! And it's no wonder: with low rates, low down payment options and a recovering economy, there has been a lot of buyers looking at the market. It's reported that there are two times the amount of buyers touring homes now than there were in September of 2011.

Home affordability is certainly at its best right now, and home builders can see what's coming, which means that low home prices could be ending soon. Your best chance at getting your home for a low price, with a low interest rate could be right now. It could be too late 3 months from now!

Homebuilder Confidence Returns To Pre-Recession Levels

New construction buyers in Pleasanton , look out. The nation’s home builders are predicting a strong 2012 for new home sales. It may mean higher home prices as the spring buying season approaches.

For the sixth straight month, the National Association of Homebuilders reports that homebuilder confidence is on the rise. The Housing Market Index climbed four points to 29 in February, the index’s highest reading since May 2007.

The Housing Market Index is now up 8 points in 8 weeks. The last time that happened was June 2003, a month during which the U.S. economy was regaining its footing, much like this month. It’s noteworthy that June 2003 marked the start of a 4-year bull run in the stock market that took equities up 54%.

The NAHB’s Housing Market Index itself is actually a composite reading. It’s the end-result of three separate surveys sent to home builders monthly.

The association’s questions are basic :

1. How are market conditions for the sale of new homes today?
2. How are market conditions for the sale of new homes in 6 months?
3. How is prospective buyer foot traffic?

In February, builders reported marked improvement across all three areas. Builders report that current home sales climbed 5 points; that sales expectations for the next 6 months climbed 5 points; and that buyer foot traffic climbed 1 point.

Most notable of all of the statistics, though, is that the nation’s home builders report that there are now twice as many buyers setting foot inside model units as compared to just 6 months ago.

This data is supported by the monthly New Home Sales report which shows rising sales and a shrinking new home inventory.

Because of this, today’s new home buyers throughout California  should expect fewer concessions from builders at the time of contract including fewer price breaks on a home and fewer free upgrades. Builders are optimistic for the future and, therefore, may be less willing to “make a deal”.  

This spring may mark the best time of year to buy a new home. 60 days forward, it may be too late.

More Borrowers Look to Shorten Their Loan Terms Last Quarter

According to Freddie Mac Quarterly Product Transition Report, released yesterday, more than 95% of refinance loans were fixed-rate mortgages. It is clear that refinancing borrowers are clearly taking advantage of the record low interest rates, preferring fixed-rate loans regardless of whether their original loan was or not.

"Fixed mortgage rates averaged well below long-term averages. It's no wonder we continue to see strong refinance activity into fixed-rate loan," Frank Nothaft, Freddie Mac's Vice President and Chief Economist stated. "For borrowers motivated to refinance by low fixed-rates, they could obtain even lower rates by shortening their term."

Borrowers already seem to be jumping on this trend, as an increasing share of refinancing borrowers chose to shorten their loan terms during the fourth quarter of 2011. Of borrowers who paid off a 30-year fixed-rate mortgage, 43% chose a 15- or 20-year loan, the highest since the first quarter of 2003.

If you're interested in shortening your loan terms, contact us at Guaranteed Rate to see what your options are.

Home Prices Are Expected To Rise

The U.S. economy continues to show signs of a rebound.

According to the Census Bureau, Retail Sales climbed to $329 billion last month on a seasonally-adjusted basis, excluding automobiles. January’s data marks the 18th time in 19 months that Retail Sales rose, a run that’s increased total sales receipts by 11 percent.

This is big news because Retail Sales accounts for close to 70% of the U.S. economy.

In addition, consumer confidence is rising.

In a separate, joint report from the University of Michigan and Thompson Reuters, it was shown that consumer attitudes toward the economy and the future are improving, primarily the result of recent job gains.  

The Survey of Consumers posted its highest value in 12 months.

It is not a coincidence that Retail Sales and consumer confidence both made multi-month highs — the readings are more than loosely linked. As consumers feel more confident about the economy and their personal prospects for the future, they’re more likely to spend money on goods and services, which leads to an increase in consumer spending.

For the housing market, the ramifications are two-fold.

First, from the financing side, an expanding economy is linked to rising mortgage rates. This is because Wall Street tends to chase risk in a growth economy and the bond market offers little in the way of risk. As demand for bonds drops, then, mortgage rates rise throughout California.

Second, rising consumer confidence can lead San Ramon home values higher, too.

Confident consumers are more likely than fearful ones to become home buyers. They’re more likely to stop renting and start buying; more likely to list their home and “move-up” to something bigger; more likely to “take the next step”.

So, as more buyers enter the market at a time when the national home supply is shrinking, the supply-demand balance in housing is shifting toward the sellers. This creates price pressures and should lead to higher home valuations in neighborhoods like Blackhawk.

If you have plans to buy a home in 2012, the best time to buy may be now. Today’s mortgage rates are low and so are the home prices — a combination that’s unlikely to last.

20 Documents You Need for a Smooth Home Purchase

Buying a home involves a variety of parts; many people, documents and tasks are needed in order to make your purchase go smoothly. It's better to get organized as soon as possible, but what exactly do you need?

To start, you should get all the paperwork that will be required gathered and organized. Here's a list of the paperwork you'll need to buy a home, depending on what stage of the purchase process you're at:

If you're ahead of the game and still getting ready for your pre-approval or mortgage:
1. Tax Returns (at least one year, if self-employed or commission typically 2 years)
2. W2s (last 2 years)
3. Pay Stubs (last 2 years with year-to-date earnings)
4. Bank Statements (last 2 months)
5. Investment Account Statements
6. Copy of Your Driver's License or Photo ID
7. Credit Report

If you're at the point of submitting an offer:
1. Copy of Your Pre-Approval Letter
2. Sales Contract (signed and dated)
3. Any Addendum

If you're already at closing:
1. Sales Contract (signed by Buyers and Sellers)
2. Title
3. Title Insurance
4. Copy of Your Driver's License or Photo ID
5. Deed
6. HUD-1 Statement
7. Survey
8. Proof of Home Insurance (if required by lender)
9. Proof of Required Repairs
10. Checks

Fewer Jobless Claims Suggests Higher Home Prices Ahead

Economists believe the strength of the 2012 housing market will be closely tied to jobs. If they’re right, the housing market is ripe for a boost. It spells good news for Danville home sellers and may mean the end of bargain-basement prices for buyers.

Since peaking in mid-2009, the number of U.S. workers filing for first-time unemployment benefits has dropped 44 percent. Over the same period of time, the U.S. economy has added more than 2 million jobs and the national Unemployment Rate is down more than 1 percentage point to 8.3%.

Employment’s link to the housing market of Ruby Hill is both economic and psychological.

To make the economic link is straight-forward. A person with a job earns verifiable income and such income is required in order to be mortgage-eligible. For conventional and FHA purchase loans, for example, mortgage lenders want a home buyer’s monthly income be more than double his monthly debts. 

For the formerly unemployed that have since returned to work, having a full-time income makes buying homes possible. It also supports higher home valuations nationwide because home prices are based on supply-and-demand. All things equal, when the number of buyers in a market goes up, prices do, too.

The psychological connection between housing and employment is a tad more complicated, but every bit as important. It’s not just out-of-work Americans that don’t look for homes — it’s fearful Americans, too. People with concerns about losing a job are just as unlikely to shop for homes as people actually without a job. The same is true for people unsure of their prospects for a better-paying job, or their own upward mobility.

A recovering job market can lessen those fears and draw out buyers — especially those who face a loss on the sale of an “underwater” home.

The Initial Jobless Claims rolling 4-week average is at its lowest level since 2008. Fewer Americans are losing jobs, and more are finding permanent placement.

It’s one more reason to be optimistic for this year’s housing market.

Top 10 Sunniest Cities In the United States

As compared to gloomy days, do “sunny days” put you in a good mood? If you’re like many people in California , the answer is “yes”.

In a study of more than 1,200 people, researchers found that daily weather factors such as temperature, precipitation and length of day can alter a person’s emotional state. Of all the weather factors, however, “sunshine” can have the most profound effect.

The most likely reason is because sunshine affects people in a physiological manner.

When the human brain detects sunlight, our bodies produce serotonin, a chemical which promotes happiness and well-being. By contrast, when the brain detect darkness, our bodies produce melatonin, a chemical which promotes sleep cycles.

Sunlight — quite literally — leads to happiness.

Understanding the effect of sunlight on human mood, therefore, we must consider the nation’s “sunniest cities” as more than just a novelty list. It may be a link to personal well-being, too.

From the National Climactic Data Center, these are the Top 10 Sunniest Cities in the United States :

1. Yuma, AZ : Sunny on 90% of all days
2. Redding, CA : Sunny on 88% of all days
3. Las Vegas, NV : Sunny on 85% of all days
4. Phoenix, AZ : Sunny on 85% of all days
5. Tucson, AZ : Sunny on 85% of all days
6. El Paso, TX : Sunny on 84% of all days
7. Fresno, CA : Sunny on 79% of all days
8. Reno, NV : Sunny on 79% of all days
9. Flagstaff, AZ : Sunny on 78% of all days
10. Sacramento, CA : Sunny on 78% of all days

The sunshine rankings of other noteworthy cities include Key West, FL (#12 with 76% sunshine); Denver, CO (#30 with 68% sunshine); and Seattle, WA (#165 with 43% sunshine). 

At the bottom of the list is Juneau. Just 30 percent of the Alaskan capital city’s days are sunny.

The complete Sunshine Rankings as listed by Metropolitan Area is available on the NCDC website.

Revamped HARP : Unlimited Loan-to-Value And Same Great Rates

The government’s new, revamped HARP program is 6 weeks from release. Homeowners in California and nationwide are gearing up to refinance.

HARP is an acronym. It stands for Home Affordable Refinance Program. HARP is the government’s loan product for “underwater homeowners”. HARP makes current mortgage rates available to households which would otherwise be unable to refinance because the home lacks equity.

This is a big deal — especially today. Mortgage rates are at an all-time low and millions of U.S. homeowners have been unable to take advantage. HARP aims to change that.

HARP originally launched in 2009. Its first iteration failed to reach a meaningful percentage of U.S. homeowners, however, because costs were high and loans were high-risk. With its re-release, the government has removed the hurdles to HARP, putting refinancing within reach for millions of U.S. households.

To qualify for HARP, homeowners must first meet 3 qualifying criteria.

First, their current mortgage must be backed Fannie Mae or Freddie Mac. FHA- and VA-backed loans are HARP-ineligible, as are jumbo loans and loans backed by portfolio lenders.

• To check if your loan if Fannie Mae-backed, click here.
• To check if your loan if Freddie Mac-backed, click here.

Second, the existing mortgage must have been securitized by Fannie Mae or Freddie Mac prior on, or before, May 31, 2009. If you bought your home or refinanced it after that date, you are HARP-ineligible.

There are no exceptions to this rule.

And, third, the existing mortgage must be accompanied by a strong repayment history. Mortgage payment must have been paid on-time for the last 6 months, at least, and there may not be more than one 30-day late payment in the last 12 months.

If these 3 qualifiers are met, HARP applicants should find the approval process straight-forward : 

• Fixed rate mortgages allow unlimited loan-to-value
• The standard 7-year “waiting period” after a foreclosure is waived in full
• Except in rare cases, home appraisals aren’t required 

Furthermore, HARP mortgage rates are expected to be on par with non-HARP rates, meaning that HARP homeowners in Pleasanton will get the same rates and pay the same fees as everyone else. There’s no “penalty” for using HARP.

The revamped HARP is expected to be generally available beginning Monday, March 19, 2012.

To get a head-start on HARP, check with your loan officer for the complete list of HARP eligibility requirements.

Today's Mortgage Market Update

Despite the selloff, mortgages have continued to outperform treasuries; actually, mortgages seem to tighten no matter what happens these days. 

Since Thanksgiving, mortgage rates are 40bps tighter to Treasuries, suggesting an insatiable demand for mortgage paper. We’re just now starting to see widen as an austerity deal in Greece could lead to more stability in Europe and lessen the probability of a QE3 mortgage purchase program. The Fed has been in today doing the usual buying from originators, but I’m hearing money managers and hedge funds taking profits in mortgages at these levels.  The selling is pushing mortgages lower in price and higher in rate.

Currently, I see Fannie 3.5s down 5/32nds. Weekly jobless claims were better than expected this AM and we continue to see strong domestic economic news putting upward pressure on mortgage rates.  News out of Europe continues to drive the direction of rates, but at the moment I believe we may be testing the lower end of the new trading range in mortgage prices

Greece and Foreclosure Agreements Announced

There were many deals being agreed upon this morning. Over in Greece, it has been reported that they have finally agreed on a debt swap deal, including new austerity measures, and avoiding a near-term, very disorderly market event. The European market soared today, hitting levels it hasn't seen since December 2011.

In closer news, an agreement has been finalized with five large banks, Ally Finance, Bank of America, Citigroup, JP Morgan Chase and Wells Fargo, to settle alleged foreclosure abuses. This $26 billion deal is the largest government vs. business settlement since the tobacco lawsuits back in 1998. It's expected to include $1.5 billion in cash payments to borrowers who were foreclosed between September 2008 and December 2011, but more importantly, to help thousands of homeowners who currently have loans, but own more than their homes are worth.

Click here for more information on the Foreclosure Agreement.

Quick Tips : Boost Your Credit Score For Better Mortgage Rates

Credit scores play a huge role in today’s mortgage market — larger than at any time in recent history. Blame it on the high default rates of the last half-decade. Lenders are reserving their lowest rates for the customers most likely to make on-time repayments.

Mortgage rates are at an all-time low in California. However, the low rates you see advertised on TV and online are only available to the home buyers and would-be refinancers whose credit scores are pristine. Having a high credit score is often the difference between getting “the best rates” from your lender, and getting something worse.

The first part of improving your credit score is understanding how it works. In this 5-minute piece from NBC’s The Today Show, you’ll learn the basics :

• Why you shouldn’t close a credit card after you pay off a large debt
• What is the maximize balance to leave on your credit cards, relative to your credit limit
• What types of credit checks harm your credit scores, and which ones don’t

You’ll also learn how to shop for a mortgage with multiple lenders without having your credit score “dinged”, as well as several proven methods to raise your credit score quickly.

In the end, good credit scores are the result of paying bills on time and staying with your means. Those with the best scores, get the best rates.

Federal Tax Deadline Extended To April 17, 2012

Traditionally, federal income taxes must be filed with the IRS on, or before, April 15 each year. The date has become such a part of U.S. culture that many people simply call it “Tax Day”.

This year, however, for the 3rd time in 7 years, your federal income taxes will not be due April 15. Instead, because of a combination of the calendar, a holiday, and tax law, Tax Day 2012 is delayed until Tuesday, April 17.

You will have two extra days to prepare and file your federal income taxes this year. 

Here’s why.

First, April 15 is a Sunday and all federal offices are closed on Sundays. This means that that taxes can’t be filed on April 15, as regularly scheduled. Rather, the tax due date should roll over to the first available business day — Monday.

However, Monday, April 16 is Emancipation Day, a holiday in the District of Columbia since 2005.

Emancipation Day honors President Abraham Lincoln’s April 16, 1862 signing of the Compensation Emancipation Act. All of Washington, D.C. is closed for the local holiday — including the offices of the IRS. Taxes can’t be due on this date because there will be nobody at the Internal Revenue Service to receive them.

Therefore, Tax Day rolls over to the next available business day, and that’s Tuesday, April 17. Despite the 2-day change, as a reminder, the deadline to file a federal tax return with extension has not changed. That filing date remains October 15, 2012. 

Also, note that most states have chosen to mirror the IRS’ tax deadlines this year even though Emancipation Day is a Washington, D.C-specific. Be sure to check with your accountant to confirm your local filing deadline.

Obama Demands More HARP Changes

After the original changes made to the Home Affordable Refinance Program, or HARP 2.0, back in October, the Federal Housing Finance Agency (FHFA) bragged about how it would allow different lenders to refinance borrowers who had loans controlled by another shop, thus increasing competition between lenders.

However, after evaluating the status of mortgages done due to the HARP 2.0 program, the Obama administration doesn’t think the FHFA went far enough. According to National Mortgage News, a new report from the Amherst Securities Group claims that “HARP 2.0 still provides ‘special benefits’ to the controlling servicer when it comes to underwriting requirements and protections from loan buy-back requests.”

The Obama administration suggests that there should be more relaxed rules around different servicer refinances. However, many wonder if Congress would act upon loosening these regulations. These new demands may be designed to just put further pressure on FHFA to re-evaluate HARP 2.0.

Lock An Instant 13% Savings On Your Monthly Mortgage Payment

Falling mortgage rates make owning a home more affordable. Mortgage rates are directly tied to monthly mortgage payment so as mortgage rates drop, so does the cost of home-ownership.  

It’s a money-saving time to buy a home in Pleasanton — or to refinance one. Mortgage rates have never been this low in history.

According to Freddie Mac, last week, the average 30-year fixed rate mortgage fell to 3.87% nationwide for borrowers willing to pay an accompanying 0.8 discount points plus closing costs. 0.8 discount points is a one-time closing cost equal to 0.8 percent of your loan size, or $800 per $100,000 borrowed.

This represents an incredible value as compared to February of last year. 

It was exactly one year ago that mortgage rates begin their long slide lower. On February 11, 2011, the 30-year fixed rate mortgage reached its peak for the year, reading 5.05% in Freddie Mac’s nationwide survey. If you are among the many U.S. households that bought or refinanced a home around that time, you could choose to replace your current home loan with a new one and save close to 13% on your monthly mortgage payment.

13 percent saved on your mortgage is a noteworthy statistic.

Look at this 30-year fixed rate mortgage payment comparison over the last 12 months :

• February 2011 : $539.88 principal + interest per $100,000 borrowed
• February 2012 : $469.95 principal + interest per $100,000 borrowed

Because of falling mortgage rates, a homeowner with a $250,000 30-year fixed rate mortgage would save at least $175 per month just by refinancing into a new loan at today’s mortgage rates. That’s $2,100 in savings per year. 

Even after accounting for discount points and closing costs, the “break-even point” on a mortgage like that can come relatively quickly.

We can’t predict mortgage rates so there’s no promise rates will stay like this forever. If you’re planning to buy a home or refinance one, the best way to keep your monthly payments down is to lock your rate while rates are still low.

The market looks ripe for that now.

Should You Refinance Now or Later?

With mortgage rates hovering at record lows the past couple weeks, now is a fantastic time to refinance your home and save yourself money! However, because interest rates have been dropping so frequently, homeowners are holding out on refinancing, with hopes that rates will drop lower.

If you’re one of those homeowners not wanting to spend money on a refinance now in case rates end up falling later on, you’ll find yourself quickly disappointed. Economists have been discussing how it’s going to take “heroic” measures to lower interest rates any more. Mortgage rates already don’t have much room to fall as it is, and with the economy improving, if anything, you’ll begin to see rates move upward.

So if your interest rate will be reduced by at least one point, you could be saving thousands of dollars by refinancing. The refinancing process is much simpler than when you originally bought your home, and we at Guaranteed Rate can help you through it. Contact one of our loan officers and they can give you a quick scenario with your current rate and program then suggest to you new money-saving options.

Don’t wait – take advantage of these record low interest rates today! Call Robert Sinohue at 800-650-6097

The 10 Longest Commutes In The United States

According to the Census Bureau, more than 3.2 million U.S. workers spend over 3 hours commuting to and from work each day.

Commutes exceeding 90 minutes in each direction are known as “extreme commutes” in Census Bureau parlance. As compared to typical commute times nationwide, they’re aptly named.

The national, average commute time is just 25.1 minutes.

For home buyers in Danville or in any U.S. city, make sure to make commute times a consideration before placing an offer on a property. The length of your daily commute will make an impact on your life.

Studies shows that shorter commutes are linked to higher levels of life satisfaction. Long commutes are linked to low levels of life satisfaction.

As ranked by the Census Bureau, here are the 10 cities with the longest average commute times, where commuting is defined as the total time to arrive at work, inclusive of all modes of transportation (i.e. automobile, train, subway, foot, or other) :

1. New York / North New Jersey / Long Island : 34.6 minutes
2. Washington, DC / Arlington / Alexandria : 33.4 minutes
3. Poughkeepsie / Newburgh / Middletown, NY: 32.2 minutes
4. Bremerton / Silverdale, WA : 30.8 minutes
5. Chicago / Naperville / Joliet, IL : 30.7 minutes
6. Winchester, VA : 30.3 minutes
7. Atlanta / Sandy Springs / Marietta, GA 30.1 minutes
8. Riverside / San Bernardino / Ontario, CA : 30.0 minutes
9. Stockton, CA : 29.8 minutes
10. Baltimore / Towson, MD : 29.7 minutes

By contrast, the shortest commute belongs to residents of Great Falls, Montana. The average commute for the city’s 58,000 residents is 14.2 minutes.

A long commute to work should not deter you from moving to a particular home or neighborhood, but your time-en-route should be a consideration. Before making an offer on a home in Blackhawk , therefore, practice the rush hour commute from your potential new neighborhood in the morning, and back to it again that evening.

Then, imagine making the commute every day.

Unemployment and Interest Rates Both Fall

This morning it was announced that the US added 243,000 more jobs in January, the most jobs added since March and April of 2011. Unemployment followed suit and dropped to 8.5%; marking January as the fifth consecutive month unemployment has fallen. With these stats exceeding economists’ expectations, the market got off to a great start.

To add onto the good news, mortgage rates dropped to the lowest they’ve ever been in the entire 40 year history of the Freddie Mac Primary Mortgage Market Survey, shortly after the president announced details about his proposal to enable millions of homeowners the chance to refinance. At this time last year, borrowers were ecstatic to get a rate around 4.8%, and today we find rates almost a whole point lower.

Banks Start To Loosen Up In Underwriting

After a half-decade of tightening mortgage guidelines, banks are starting to “loosen up”.

The Federal Reserve conducts a quarterly survey of its member banks and, last quarter, not a single responding bank reported having tightened its mortgage guidelines for prime borrowers.

A “prime borrower” is defined as one with a well-documented credit history, high credit scores, and a low debt-to-income ratio.

53 banks responded to the Fed’s survey and none said that mortgage guidelines “tightened considerably” or “tightened somewhat” between September and December 2011; 50 said that guidelines remained “basicaly unchanged”; 3 said that guidelines “eased somewhat”.

Mortgage applicants sometimes remark that the mortgage approval process can be challenging. Last quarter’s Fed survey hints that looser standards are coming. 

Not since before the recession have banks lowered mortgage approval standards like this and it bodes well for this year’s Danville  housing market. Real estate agents report that 1 in 3 home sale contracts fail with “declined mortgage applications” as a leading cause.

Looser mortgage lending standards should mean more home loan approvals for buyers, and fewer contract cancellations. This can spur the housing market forward.

Make note, though. “Looser standards” should not be confused with ”irresponsible standards”. It remains more difficult to meet bank standards as compared to 5 years. Today’s underwriters are more conservative with respect to household income, overall assets and credit scores. 

Even as compared to one year ago:

• Minimum credit score requirements are higher
• Downpayment/equity requirements are larger
• Maximum allowable debt-to-income ratios are lower

For buyers and refinancing households gaining approval, though, the reward is the lowest mortgage rates in a lifetime. Mortgage rates in California continue to fall, helping home affordability reach new highs.

If you’re in the market to buy a new home or refinance one, your timing is excellent.

What must I do to get pre-approved for a loan?

Trying to buy a home without a mortgage loanis next to impossible, for most people. A mortgage allows the homeowner to pay off the amount of the loan over a long period of time, in most cases its 30 years. Lenders make their money on mortgage loans from the interest that is charged on the loan throughout the payback period. Lenders will pre-approve a potential buyer before the fact so that the buyer can have a definite price range to consider. This gives the buyer confidence when searching for a home.

The first step in getting pre-approved for a loan is finding a trusting loan officer. If you don’t know where to find one, Real Estate agents usually have good relationships with loan officers they trust. Another way would be to search the internet, now days spending a few minutes on the doing a little research on loan officers in your area is probably a smart thing to do.

Once you find a loan officer, they will review your financial status to determine where you stand. For this you will need to provide pay stubs, bank statements, W-2’s, and possibly tax returns. The loan officer will do a basic credit check and calculate the mortgage amount you can most likely handle. This process is usually free of charge and can be done over the phone or online.

Once the loan officer determines your status they will then explain what options are necessary to move forward in the home buying process, as well as the different programs that are being offered and which ones you qualify for.

If you decide to move in the home buying process and get a full approval for a loan. The mortgage professional will then run a more detailed analysis of your financials, which may involve presenting additional paperwork specific to your situation. At this point in the process you may start to incur fee’s that are payable to the lender.

When you want the loan for a specific property, the process will include an appraisal, possibly an inspection, and of course the final underwriting.  If everything goes right and underwriting approves, you can close.

If you have any questions, or are ready to start the home buying process today, give Robert Sinohue with Guaranteed Rate a call. He is one of the top mortgage originators in the United States. With over 18 years of experience and over $750 million in mortgage loans funded throughout his career, He is a well known professional that focuses on building strong and long lasting relationships with each and every one of his clients.

Give Robert a call at 800-650-6097 or email rsinohue@guaranteedrate.com

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Four Steps To A Stress-Free Refinance

With all this news about FHA helping lenders like Guaranteed Rate qualify more borrowers for refinances and the government instituting new refinancing programs, you may be considering looking into refinancing your home to take advantage of today’s record low rates. However, make sure you’re aware of the top four refinancing mistakes so that you can avoid them!

1. Refinancing When You Shouldn’t
Maybe your neighbor told you about the amazing low rate they refinanced with, or the news you’re seeing on our Facebook and Twitter is just making you anxious to join the party. Before you jump the gun, do some homework and make sure it’s the right move. Figure out the breakeven point for when savings outweighs the cost of refinancing. More importantly, determine how long you plan to stay in your current home – it’s usually a mistake to refinance on a home you’re not planning on staying in for several years.

2. Choosing the Wrong Loan Type
After you figured out you want to refinance, take time to establish what your objective is. Do you want to lower your overall payment regardless of the length of the loan? Do you want to be debt-free by a certain year? Consider the cost of the refinance in comparison to the financial benefits – is it worth it? Once you’ve answered these questions, talk to one of our loan officers to hear what type of loan will help you accomplish your goals.

3. Not Knowing Your Real Rates
When you’re looking at rates, make sure you’re comparing your APR (annual percentage rate) to know what your true rate will be. Check out our website to see a comparison of rates from various lenders to see which lender offers you the best rate.

4. Not Keeping Up With Your Borrower Responsibilities
As your lender, you rely heavily on us; however there are some obligations you have to take care of on your own. Make sure you have decent credit and avoid taking on any more debt, even after the refinance has been approved. Also, to make sure you get that low rate you worked so hard to find, check your lock-in dates so that you secure that interest rate, and make sure you turn in all documentation that’s needed as soon as it’s requested so you don’t delay your closing date, jeopardizing your interest rate.

Home Affordability Threatened By Friday’s Jobs Report

This week, once more, we find mortgage rates are on a downward trajectory. Conforming mortgage rates have returned to near all-time lows. After Friday morning’s Non-Farm Payrolls report, however, those low rates may come to an end.

It’s a risky time for California home buyers and would-be refinancers to be without a locked rate.

Each month, on the first Friday, the Bureau of Labor Statistics releases its Non-Farm Payrolls report for the month prior. More commonly called the “jobs report”, Non-Farm Payrolls provides a sector-by-sector employment breakdown, and the nation’s Unemployment Rate.

In December 2011, the government reported 200,000 net new jobs created, and an Unemployment Rate of 8.5%.

For January 2012, economists project 135,000 net new jobs with no change in the Unemployment Rate and, depending on how accurate those predictions are proved, FHA and conforming mortgage rates for homes in Blackhawk are subject to change. The monthly jobs reports tends to have an out-sized influence on the direction of daily mortgage rates.

The connection between jobs and mortgage rates is fairly direct.

Job growth is a key cog in the economic growth engine and mortgage rates change daily based on short- and long-term economic expectation. As more people join the workforce, economic expectations change; the economy tends to expand, breeding optimism among investment. When this occurs, it often spurs investment in the stock market, which tends to leads mortgage rates up.

In short, in a recovering economy, when job growth is strong, all things equal, mortgage rates rise. Home affordability suffers.

So, for today’s rate shoppers, Friday’s job report represents a risk. The economy has added jobs over 15 straight months, a streak that’s added 2.1 million people to the workforce. Although the jobs market remains weak and well off its peaks from last decade, a 15-month streak is worth watching. More jobs means more more income earned nationwide, more money spent by households, and more taxes collected by governments.

This items build a foundation for economic growth and Wall Street is watching.

If tomorrow’s Non-Farm Payrolls shows more jobs created than the estimated 135,000, mortgage rates are expected to rise. If the jobs figures falls short, mortgage rates should fall.

The Non-Farm Payrolls report is released at 8:30 AM ET.

FHA Adjusts Neighborhood Watch For Obama’s Refinance Plan

The Federal Housing Administration (FHA) announced that it will no longer rank mortgage lenders based on performance of “streamlined” loans in its Neighborhood Watch system, in an effort to open up the program for more families.

Currently, FHA borrowers are allowed to refinance under the existing streamline program without a new appraisal, credit report or documentation, which is customary for standard refinances. However, as Guaranteed Rate reported earlier, due to FHA’s Neighborhood Watch, lenders have been denying some of these borrowers because it could compromise their status as FHA-lenders. By removing these streamlined refinance loans from lenders’ “compare ratio”, FHA has removed this problem for both borrowers and lenders.

“This will open the program up to many more families with FHA-insured loans” the White House stated. This is all a part of the president’s plan to increase refinances and help struggling borrowers.

Case-Shiller Index Says Detroit And Washington DC Lead The Market

Standard & Poors released its November 2011 Case-Shiller Index this week. The index measures the change in home prices from month-to-month, and year-to-year, in select U.S. cities.

According to the data, for the second straight month, home values fell in 19 of the Case-Shiller Index’s 20 tracked markets. In addition, also for the second straight month, Phoenix, Arizona was the lone Case-Shiller-tracked city in which home values rose.

Overall, November’s Case-Shiller Index showed a 1 percent decrease in home values between October and November 2011, and a near-4 percent decrease between November 2010 and 2011, putting home values at roughly the same levels as 8 years ago. Don’t read too far into it, however.

The Case-Shiller Index, though widely-cited, remains widely-flawed.

As a buyer or seller in Ruby Hill, for example, , relying on the Case-Shiller Index for market research can lead you to improper conclusions. To understand the Case Shiller Index’s methodology is to understand why.

First, the Case-Shiller Index draws its data from a very limited geography.

There are more than 3,100 municipalities nationwide. The Case-Shiller Index tracks just 20 of them. And they’re not the 20 largest, either. Four of the Top 10 Most Populous U.S. Cities are excluded (Houston, Philadelphia, San Antonio, San Jose) whereas Minneapolis and Tampa are not.

Minneapolis is the 48th largest city in the United States. Tampa is #55.

Next, when Case-Shiller Index gathers its data from its 20 cities, it only includes the home sale data of single-family, detached homes. This means that sales of condominiums and multi-unit homes are specifically excluded from the index. There are some cities — Chicago and New York, for example — where condominium sales represent a large percentage of the overall market.

The Case-Shiller Index ignores that.

And, lastly, when the Case-Shiller Index is published, it’s published on a 60-day delay. Its data is not “current”, therefore, and does little to tell buyers and sellers of Pleasanton and the country what’s happening in their home markets right this minute. Instead, the Case-Shiller Index tells us how the housing market looked two months ago.

If you’re active in the real estate market, either as a buyer or a seller, the Case-Shiller Index does you little good. For real-time data that actionable, speak to a real estate professional instead. It’s where you’ll find your best, most reliable and relevant information.

How To Avoid The Four Most Common Mistakes Made When Buying A Home

Buying a home is one of the biggest purchases of your life and you want to be cautious that you don’t make any mistakes that you’ll regret later on. Here are the top four most common mistakes made when buying a home, along with tips on how to prevent yourself from doing them or how to recover if you have already made them.

Mistake #1: Not Getting Pre-Approved
The biggest mistake made by homebuyers and is the first thing you should do if you plan on buying a new home!
How to Prevent: Easy, get pre-approved! By getting pre-approved, you’ll be able to search for homes that affordable for you, while also putting you in a strong negotiation position when you make an offer.

Mistake #2:  Not Using a Qualified Agent
If you’re not sure why you should use a buyer’s agent, click here. Ask friends, family or your loan officer for recommendations of who to use.
How to Recover: It’s never too late to get an agent, even if you’re already at contract, they can help with all the legal and negotiation aspects.

Mistake #3: Not Getting a Thorough Inspection
Getting a thorough inspection is the only way you’ll know you have real knowledge about the house.
How to Prevent: Hire a licensed home inspector. They take the emotion out of inspecting a home and give you a real, critique about the home you’re thinking to purchase.
How to Recover: If you didn’t hire a home inspector, try to get a good home warranty in case any issues do arise in the future.

Mistake #4: Focusing on Wants, Not Needs
This mistake is usually made by first-time homebuyers, but can happen to even the most experienced homeowner.
How to Prevent: Make a list of must-haves and refer to it when you’re house hunting. Make sure it is a list of NEEDS not WANTS.
How to Recover: If you’re in negotiations and realize you made this mistake, try using provisions of contract to either get out of the deal or fix the issues before you close.

Supply Of New Homes At 6.1 Months Nationwide

New Home Sales slowed into the New Year but the market for newly-built homes remains strong. For home buyers in California and nationwide, December’s New Home Sales report is yet one more signal that the housing market recovery may be underway.

According to the Census Bureau, the number of new homes sold in December 2011 slipped 2 percent to 307,000 units on a seasonally-adjusted, annualized basis nationwide.

A “new home” is a home that is considered new construction; a home for which the buyer will be the first owner and tenant.

As compared to December 2010, last months’ sales volume fell seven percent. It’s a statistic that suggests housing market weakness. However, in looking at a different component of the New Home Sales report — the supply of homes for sale — we’re forced to reconsider.

At the current pace of sales, every new home for sale nationwide would be “sold” in a matter of 6.1 months. 

Economists believe that a 6.0-month supply defines a market in balance — anything quicker is termed a “seller’s market”. Statistics like that are enough to create urgency among today’s Pleasanton home buyers. 

Unfortunately, the Census Bureau’s data may be wrong.

Although December’s New Home Sales report shows sales down 2 percent, the government’s data was published with a ±13.2% margin of error. This means that the actual New Home Sales figure may have been as low as -15.2 percent, or as high as +11.2 percent. And, because the range of possible values includes both positive and negative numbers, the Census Bureau had no choice but to assign its December data “Zero Confidence”.

It will be a few months before final revisions are made to December New Home Sales data. Until then, therefore, buyers should take cues from the market-at-large and the market-at-large hints at recovery. One example of this is homebuilders showing more confidence in their product than at any time in the last 5 years.

If your plans for 2012 call for buying new construction, therefore, consider using this lull to “make a deal”. As the year progresses, the great values in housing may be gone.

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This Week’s Economic Outlook

In an attempt to speed up a solution for the European debt crisis, European economic officials met today in Brussels, the first of 2012. While many believe this meeting is a step in the right direction, others are hesitant of the outcome. While nothing has happened as of yet, Greece and its private investors announced on Saturday that they expect to complete a deal in the coming days.

In addition to Europe’s economic meeting, the other big economic factor will be the January employment rates that are set to be released on Friday. Currently, the estimates are at 160K for non-farm jobs, +170K private non-farm jobs and unemployment at 8.5%.

Keep an eye on our Facebookor Twitter profiles for the results on Friday.

5 Simple Ways To Declutter Your Home

When a home is listed for sale, its “clutter” can be the difference between a rapid sale and no sale at all.

Clutter, in its strictest sense, is defined as anything untidy; or in a disorderly state. In real estate, the term is broadened to include unnecessary furniture pieces; unwieldy artwork or collections; stacks of papers and/or magazines; and anything that otherwise restricts the open flow of a home’s floor plan.

In other words, clutter is anything that distracts from your home’s natural footprint.

As a home seller in Pleasanton , understanding how your home’s clutter can affect a buyer is paramount to helping your home sell faster, and at a higher contract price.

First, there’s the psychological angle. A potential home buyer may see clutter and think “mess”. Few people want to buy a house they find messy or otherwise disorganized.

Second, there’s the practical angle. A home that appears full of “things” also appears as if its lacking in storage space. This, too, can turn off buyers.

When you list your home for sale, here are basic tips to de-clutter your home. Some of this advice may not be practical with respect to your home, in particular, so make sure to ask your real estate agent for follow-up help.

1. In each room, remove photos, trophies, plaques and other personal items on display.
2. Remove large collections such as dolls, cars, miniature cans, and the like.
3. Remove worn throw rugs
4. Remove items from kitchen countertops, including small appliances
5. Remove items from bathroom countertops

You should also consider removing distinctive artwork from your walls, or replacing pieces with items that are more bland.

The over-reaching goal of de-cluttering is to depersonalize and neutralize your home so a buyer can visualize himself/herself living there. De-cluttering your home can also make your home appear larger, accentuating the features of each room. 

It’s no wonder that minimally-cluttered homes tend to have a wider appeal among buyers.

Housing Crisis Forecasted to End 2012

Housing Crisis Forecasted to End 2012

On Tuesday, Capital Economics announced that they expect the housing crisis to end in 2012. What makes them feel so confident? Loosening credit by banks.

Currently, the average credit score for a new approved loan is 700, a figure that was much lower prior to the crisis, but has been the norm for the past year. However, banks are now lending 82% loan-to-value ratios, rather than the low 74% they were lending in 2010. This is one of the clearest signs that point to the stabilization of mortgage lending and the improvement of mortgage credit conditions.

If you want to see if your credit qualifies you for a mortgage, click here. Or contact one of our many loan officers, located in over 44 states.

Pending Home Sales Index Posts Second Best Month Since April 2010

8 Tips Towards Purchasing An Investment Home

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It’s known that buying a home can be a secure option to invest in. And lately, many are taking advantage of today’s low rates and home prices to buy investment homes.

If you’re thinking about getting another property, keep in mind the following 8 tips to make sure your home purchase goes with the greatest of ease. And of course, call your Guaranteed Rate loan officer to make sure you qualify!

1. Location
Make sure you invest in the best location you can afford. This will determine how much you’ll earn on your house, whether you’re renting it out or holding onto it to sell at a later time.

2. Control How Much You Fix Up
If you’re planning on making your investment home a rental, those renters will give your home some wear and tear, so don’t go crazy when fixing it up. Just stick with simple, light, bright and clean units to please possible tenants.

3. Be Prepared with Cash on Hand

4. Think Long Term
By planning to keep the home long term, you’ll be able to ride out any swings the housing market might throw your way over the years.

5. Consider All Options
Decide what you’re going to use the property for. Is it a vacation home, condo for your child in college or are you going to rent it out? Once you figure this out, consider what type of property would be best for your needs.

6. Calculate Cost of Ownership
Make sure you factor in all the expenses of owning and managing a home. Click here to help calculate what you can afford.

7. View a Property’s Potential
When viewing properties, make sure you see what the property can be, not what it is right now. With a little imagination, you could find yourself with a great deal and property!

8. Familiarize Yourself with Landlord Rights and Potential Tenants

Attorney Advice If Wallet or Purse Stolen

ATTORNEY'S ADVICE

Read this and make a copy for your files in case you need to refer to it someday. Maybe we should all take some of his advice! A corporate attorney sent the following out to the employees in his company:

1.Do not sign the back of your credit cards. Instead, put 'PHOTO ID REQUIRED.

2. When you are writing checks to pay on your credit card accounts, DO NOT put the complete account number on the 'For' line. Instead, just put the last four numbers. The credit card company knows the rest of the number, and anyone who might be handling your check as it passes through all the check processing channels won't have access to it.

3. Put your work phone # on your checks instead of your home phone. If you have a PO Box use that instead of your home address. If you do not have a PO Box, use your work address. Never have your SS# printed on your checks. (DUH!) You can add it if it is necessary. But if you have It printed, anyone can get it.

4. Place the contents of your wallet on photocopy machine. Do both sides of each license, credit card, etc. You will know what you had in your wallet and all of the account numbers and phone numbers to call and cancel.. Keep the photocopy in a safe place. 

I also carry a photocopy of my passport when I travel either here or abroad. We've all heard horror stories about fraud that's committed on us in stealing a Name, address, Social Security number, credit cards.

Unfortunately, I, an attorney, have first hand knowledge because my wallet was stolen last month. Within a week, the thieves ordered an expensive monthly cell phone package, applied for a VISA credit card, had a credit line approved to buy a Gateway computer, received a PIN number from DMV to change my driving record information online, and more.

But here's some critical information to limit the damage in case this happens to you or someone you know:

5. We have been told we should cancel our credit cards immediately. But the key is having the toll free numbers and your card numbers handy so you know whom to call. Keep those where you can find them.

6..File a police report immediately in the jurisdiction where your credit cards, etc., were stolen. This proves to credit providers you were diligent, and this is a first step toward an investigation (if there ever is one).

But here's what is perhaps most important of all: (I never even thought to do this.)

7.Call the 3 national credit reporting organizations immediately to place a fraud alert on your name and also call the Social Security fraud line number.. I had never heard of doing that until advised by a bank that called to tell me an application for credit was made over the Internet in my name.

The alert means any company that checks your credit knows your information was stolen, and they have to contact you by phone to authorize new credit..

By the time I was advised to do this, almost two weeks after the theft, all the damage had been done. There are records of all the credit checks initiated by the thieves' purchases, none of which I knew about before placing the alert. Since then, no additional damage has been done, and the thieves threw my wallet away this weekend (someone turned it in). It seems to have stopped them dead in their tracks..

Now, here are the numbers you always need to contact about your wallet, if it has been stolen:

1.) Equifax: 1-800-525-6285 1-800-525-6285

2.) Experian (formerly TRW): 1-888-397-3742 1-888-397-3742

3.) Trans Union : 1-800-680 7289 1-800-680 7289

4.) Social Security Administration (fraud line): 1-800-269-0271 1-800-269-0271

If you are willing to pass this information along, it could really help someone that you care about.

-passed along from a friend