MortgageSmart Blog

Are you looking to capitalize on low home prices and rates? This a new program with one of our lenders, it's a 97% loan split into a 1st and 2nd. 

 The 2nd is deferred for 5 years.
 
Who is eligible  ....
Anyone who receives a paycheck from a public school or community college.
·         Any member of the California State Teachers' Retirement System. (does not have to currently be employed can be retired)
 
What type of property:
·        Any owner occupied California property currently acceptable to lend on by FNMA guidelines
 
What are the MAX loan amounts:
·        Conforming 1st 80%LTV up to $417,000
·        Conforming 2nd 17% LTV up to $88,612
o       Max combined loan amount = $505,612
o       Max purchase price = $521,250
·        Non-conforming 1st up to $536,082
·        Non-conforming 2nd up to $113,918
o       Max combined loan amount = $650,000
o       Max purchase price = $670,103
 
Basic Guidelines:
·        Borrower can not own any other homes.
·        Home buyer education is required for 1st time home buyers
·        Occupying borrowers only
·        3% seller concessions allowed
·        3% down: only 1% needs to be borrowers own funds, additional funds may come from:
o       Gift from a relative if repayment is not required

If you are interested in more details, please do give me a call at 818-378-8669 or email me at Liz@mortgagesmart.biz

Posted by egmaldonado at 08:49 PM | Permalink | Comments (0) | TrackBacks (0)

The Internal Revenue Service is reminding homeowners to keep taxes in mind even if it is a long way to the next April 14 – it could save them money.

Under the new American Recovery and Reinvestment Act (ARRA), making green changes between now and the end of the year can not only lower energy bills, it can save some real money on the 2009 tax bill.  And the same will be true in 2010.   The legislation provides a lot of new or expanded tax benefits for changes that reduce energy use or create new energy sources and the IRS wants taxpayers to plan ahead and take advantage of these benefits.

Tax credits have had a tendency to come and go depending on the mood of Congress in any given year and the amounts available, while helpful, didn’t provide a real incentive to make costly changes.  But under the new law, a tax credit of 30 percent of the cost of qualifying improvements is available up to a maximum for years 2009 and 2010 of $1,500.   Under the old legislations there were several levels of credit depending on the energy improvement and there was a lifetime cap of $500.

Credits are available for improvements such as adding insulation, replacing windows with energy efficient models and energy-efficient heating and air-conditioning systems.

ARRA also increased the efficiency standards required for many products to be eligible for a credit; however those guidelines have not yet been released.  Until they are available later this spring homeowners who are itching to get started on green home improvements are advised to rely on existing manufacturer certification and Energy Star labels when purchasing products.  These certifications will be honored by the IRS until the standards are released.

Higher credit limits are also available for qualified residential alternative energy equipment such as solar hot water heaters, geothermal heat pumps, and wind turbines.  Taxpayers are now eligible for credits equal to 30 percent of the cost of the qualified product and many of the maximum limits to these credits have been removed.  An investment in some of these improvements can be substantial and these more realistic incentives may be the key to getting homeowners to take the plunge.

ARRA offers other credits for automotive related improvements and there is a whole category of benefits available to businesses.  For more information see the IRS publication Fact Sheet 2009-10.

Posted by egmaldonado at 08:22 PM | Permalink | Comments (0) | TrackBacks (0)

By: Catherine Brock | May 01, 2009

Seller financing is becoming more prevalent as home sellers bend over backwards to lure in purchasers. Homebuyers may be surprised to learn, however, that seller financing isn't always the perfect arrangement.

If you've been out shopping for homes, you've probably seen the "seller will finance" pitch. Aggressive home sellers are so eager to attract buyers that they're doing what many mortgage lenders won't: they're offering to finance the deal. Under the right circumstances, this strategy is a true win/win; you get your loan plus a new home, and the seller gets to convert his property investment into a mortgage investment.   But the right circumstances don't always come along.

A mortgage loan solution that works

As a prospective homebuyer, you should take a moment to learn what seller financing can and can't do for you. On the plus side, seller financing can:

Expedite the time it takes to secure financing. Traditional mortgage loans and FHA loans are the alternatives to seller financing. The approval process for either alternative can drag out for weeks, because traditional lenders are too skittish these days for quick approvals, and FHA loans have always had notoriously long processing times. Seller financing can go much more quickly, because the seller is motivated to close the deal as quickly as possible or move on to other prospects.

Make it easier for you to get a home. If your credit qualifications aren't strong enough for regular financing, sellers may be willing to offer lease-to-own programs or other creative financing solutions.

Down payments and mortgage refinancing

Here's the other side of the story. For the record, seller financing cannot:

Help you when you have no mortgage down payment. Sellers typically ask for at least 20 percent of the purchase price as a mortgage down payment. If you don't have it, consider an FHA-insured mortgage instead, which only requires 3.5 percent as a mortgage down payment.

Get you the best deal. The best real estate bargains available right now are short sales and distressed properties. But the owners of these homes can't afford to offer you financing. People who can afford to enter into a financing deal aren't desperate; they're just getting aggressive about selling their property. Don't expect them to wheel-and-deal on the asking price, and then give you a loan, too.

The pricing on your seller-financed loan may not be dirt cheap, either. Most sellers would probably prefer that you pay them off with a mortgage refinance sooner rather than later. For that reason, they aren't going to give you a rate so low that you'll hold onto it for 30 years. Many sellers will even require that you get a mortgage refinance within a certain timeframe.

Seller financing can be a good or a bad idea. It's your job to know which applies to you-before you start shopping.  It's a strategy that you can discuss with your mortgage professional to see if it is the best option for you.

If you are interested in more details, please call me at 818-378-8669, or email at Liz@mortgagesmart.biz.

Posted by egmaldonado at 03:21 PM | Permalink | Comments (0) | TrackBacks (0)

Phoenix has achieved the unwelcome distinction of becoming the first major American city where home prices have fallen in half since the market peaked in the middle of the decade, according to data released Tuesday.

Home prices in the Sun Belt city, the 12th-largest metropolitan area in the United States, dropped 4.5 percent in February, according to the Standard & Poor’s Case-Shiller Home Price Index. Prices in Phoenix are now down 50.8 percent since the market peaked in June 2006.

For the country as a whole, the Case-Shiller numbers offered the thinnest of silver linings: things are still getting worse, but more slowly.

Home sales in Southern California and the San Francisco Bay area, where foreclosures dominate many markets, have snapped back this spring as prices dropped. But sales have slowed to a crawl in other markets like New York City, where prices declined 10 percent from a year ago.
“We’re seeing very strong sales in a few states and weak sales across 40 states,” said Patrick Newport, United States economist at IHS Global Insight. “The key factor driving them right now is just the excess inventory. Even though prices are undervalued, they’re still going to drop because of the excess. Even if we were at full employment we’d still see prices dropping.”

As prices have dropped, frozen housing markets in hard-hit areas like Southern California, Phoenix, Las Vegas and South Florida have begun to thaw. Record-low mortgage rates and huge inventories of foreclosed homes and other fire-sale properties have enticed first-time buyers to the market and lured others who had been sitting on the sidelines.

Inventories of unsold homes are edging down slightly, but there was still a glut of 3.7 million unsold homes in March, the Realtors’ group reported, representing a supply of nearly 10 months.

In February, the price of single-family homes in 20 major metropolitan areas fell 18.6 percent from the year earlier, compared with a record drop of 19 percent in January.

“Finally, we’re seeing a touch of moderation,” said David Blitzer, chairman of S.& P.’s index committee. “This is the kind of thing one might see if we’re beginning to see a bottom. I would not run out and celebrate, but I would not dig the bunker any deeper.”

Mr. Swan, the realty agent, said inventories of lower-priced homes were already dwindling in Phoenix as investors snapped up bank-owned properties at bargain prices.

“I’ve got Canadians coming here who are putting together investment pools of millions of dollars to buy houses by the hundreds,” he said. “They’re going to rent them out to all the people who were foreclosed and need a place to live. This is going to be a good year for us.”

Posted by egmaldonado at 02:33 AM | Permalink | Comments (0) | TrackBacks (0)