Real Estate Opportunity Abounds In Eastern Contra Costa County & The Bay Area by Cathie Marples
Holmes Publications
August 18, 2009
MarplesTeam.com
First-time homebuyers and those thinking about refinancing are in a great place.
Mortgage rates just fell for the third straight week, according to mortgage finance firm Freddie Mac.
"The credit markets are still tight, but they have loosened up significantly from 90 days ago", according to the Mortgage Bankers Association.
Here´s what you´re up against in specific mortgage situations and what you can do to increase your chances of getting a deal done.
If you´re buying a home
Get ready for paperwork. Have your bank statements, W-2 wage and tax statement and pay stubs organized.
Over documentation is the name of the game right now according to mortgage experts.
Having all the documents upfront will speed the application process.
Check your credit score. The most widely used score is the FICO, which ranges from 300 to 850. Your score, based on information in your credit report, helps lenders predict how likely you are to make your payments on time. The higher the number, the better the chance you´ll be approved for a loan at a low interest rate. "Clean up your credit score," Norman said. Catch up on any late payments and pay off or pay down your debt.
First-time buyers have a sweetener in the form of an $8,000 credit on federal income taxes for homes purchased before Dec. 1.
It´s critical that you have a down payment because lenders want to see that you have skin in the game. Mortgages insured by the Federal Housing Administration require a 3.5% down payment, which can come from a family member, employer or charitable organization as a gift. For a non-FHA-insured loan, lenders are requiring a 10% down payment, said real estate agent Brenda Rogers of Coldwell Banker Apex, Realtors in Plano, Texas.
If you´re refinancing
Have plenty of equity. Equity represents the ownership value you´ve accumulated over time by making payments, and lenders want you to have a financial stake in the refinancing. Lenders don´t want to lend 100 percent of the value of the property. Those days in the lending industry are gone.
Another reason to build equity is that you don´t want to owe more on your home than it´s worth, a situation some homeowners face today.
Also, consider how long you plan to remain in your home, because you need to stay long enough to recoup closing costs associated with refinancing. Those costs typically will total $3,000 to $5,000. "If an owner is going to move out of their home in five years or less, then typically it´s not going to be worth your doing. If you plan on staying longer than that, then one needs to look at the costs vs. the monthly savings to see how long it will take to recoup that cost.
Loan modifications
A loan modification is when a lender changes the terms of your loan so you can afford your payments.
That can be done by lengthening the term of your loan, lowering your interest rate or allowing you to skip payments and adding those to the end of your loan.
The Obama administration is prodding mortgage-servicing companies to bolster their efforts to modify troubled loans. The servicer is the company that collects and processes your mortgage payment. It may or may not be your original lender.
If you´re having trouble making your payment, contact your servicer immediately and ask about a loan modification. Unfortunately, most lenders are not modifying loans and are only giving the public and the government the false perception that they are open and willing to modify their loans.
If you are short selling your home
A short sale is the process by which an owner sells their home for an amount less than the total amount outstanding in loans against the property. More and more banks are now willing to accept and negotiate a short sale transaction. More than 50% of all sales currently pending in eastern Contra Costa County are short sales. We believe the short sale transaction will account for more than 60% of the total sales transactions in our region for the next 24 months. Depending on your lender, many banks have taken a progressive lead in accepting short sales and "fast-tracking" the escrow process. Most short sale transactions take for 90-120 days to complete. The best lenders, such as Wachovia, are completing these transactions in as little as 45-60 days.
When purchasing one of the most important and valuable assets you will ever own, your home, you should demand the finest real estate representation available. With 31 years experience, over $1.5 Billion in closed transactions and a full time staff of 5, Cathie Marples and her team continually provide their clients unparalleled commitment, attention and experience.
Please contact Cathie at (925)634-7774 or Instantresponse2@MarplesTeam.com for all of your real estate needs in the Bay Area. Also visit our web site at MarplesTeam.com to preview all active homes in the region.
Best Regards,
Matt Marples
Operations Manager
(925)634-7774
Instantresponse2@MarplesTeam.com
MarplesTeam.com
First-time homebuyers and those thinking about refinancing are in a great place.
Mortgage rates just fell for the third straight week, according to mortgage finance firm Freddie Mac.
"The credit markets are still tight, but they have loosened up significantly from 90 days ago", according to the Mortgage Bankers Association.
Here´s what you´re up against in specific mortgage situations and what you can do to increase your chances of getting a deal done.
If you´re buying a home
Get ready for paperwork. Have your bank statements, W-2 wage and tax statement and pay stubs organized.
Over documentation is the name of the game right now according to mortgage experts.
Having all the documents upfront will speed the application process.
Check your credit score. The most widely used score is the FICO, which ranges from 300 to 850. Your score, based on information in your credit report, helps lenders predict how likely you are to make your payments on time. The higher the number, the better the chance you´ll be approved for a loan at a low interest rate. "Clean up your credit score," Norman said. Catch up on any late payments and pay off or pay down your debt.
First-time buyers have a sweetener in the form of an $8,000 credit on federal income taxes for homes purchased before Dec. 1.
It´s critical that you have a down payment because lenders want to see that you have skin in the game. Mortgages insured by the Federal Housing Administration require a 3.5% down payment, which can come from a family member, employer or charitable organization as a gift. For a non-FHA-insured loan, lenders are requiring a 10% down payment, said real estate agent Brenda Rogers of Coldwell Banker Apex, Realtors in Plano, Texas.
If you´re refinancing
Have plenty of equity. Equity represents the ownership value you´ve accumulated over time by making payments, and lenders want you to have a financial stake in the refinancing. Lenders don´t want to lend 100 percent of the value of the property. Those days in the lending industry are gone.
Another reason to build equity is that you don´t want to owe more on your home than it´s worth, a situation some homeowners face today.
Also, consider how long you plan to remain in your home, because you need to stay long enough to recoup closing costs associated with refinancing. Those costs typically will total $3,000 to $5,000. "If an owner is going to move out of their home in five years or less, then typically it´s not going to be worth your doing. If you plan on staying longer than that, then one needs to look at the costs vs. the monthly savings to see how long it will take to recoup that cost.
Loan modifications
A loan modification is when a lender changes the terms of your loan so you can afford your payments.
That can be done by lengthening the term of your loan, lowering your interest rate or allowing you to skip payments and adding those to the end of your loan.
The Obama administration is prodding mortgage-servicing companies to bolster their efforts to modify troubled loans. The servicer is the company that collects and processes your mortgage payment. It may or may not be your original lender.
If you´re having trouble making your payment, contact your servicer immediately and ask about a loan modification. Unfortunately, most lenders are not modifying loans and are only giving the public and the government the false perception that they are open and willing to modify their loans.
If you are short selling your home
A short sale is the process by which an owner sells their home for an amount less than the total amount outstanding in loans against the property. More and more banks are now willing to accept and negotiate a short sale transaction. More than 50% of all sales currently pending in eastern Contra Costa County are short sales. We believe the short sale transaction will account for more than 60% of the total sales transactions in our region for the next 24 months. Depending on your lender, many banks have taken a progressive lead in accepting short sales and "fast-tracking" the escrow process. Most short sale transactions take for 90-120 days to complete. The best lenders, such as Wachovia, are completing these transactions in as little as 45-60 days.
When purchasing one of the most important and valuable assets you will ever own, your home, you should demand the finest real estate representation available. With 31 years experience, over $1.5 Billion in closed transactions and a full time staff of 5, Cathie Marples and her team continually provide their clients unparalleled commitment, attention and experience.
Please contact Cathie at (925)634-7774 or Instantresponse2@MarplesTeam.com for all of your real estate needs in the Bay Area. Also visit our web site at MarplesTeam.com to preview all active homes in the region.
Best Regards,
Matt Marples
Operations Manager
(925)634-7774
Instantresponse2@MarplesTeam.com
MarplesTeam.com
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