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Archive for February, 2008
Sam Garcia overall residential regulations went from room $1 trillion in 1993 approximately $3 trillion in 2005 sub prime production soared from around 20 billion for more than 600 billion during that same period but its US whole appreciation slowed last year the most recent batch of new subprime borrowers who have riskier loan characteristics and little invested in their properties to get a wave of defaults next year’s subprime origination projected to be just 200 billion less than one third the level of 2005 around $263 million in multifamily loans were recently announced a 24 properties and mortgage daily dot-coms latest round of commercial mortgage activity retail deals amounted to nine transactions for 71 million well loans arranged on office properties amounted to four for 95,000,006 hotels were financed for 638,000,001 industrial property secured $1 million loan family first mortgage Corporation will be ending operations on December 31 according to a somber message posted on the company’s website family first was previously ranked as the fastest-growing mortgage company.Inc. Magazine Florida-based company operated as many as 211 branches the book value of the loan may be reduced by as much as $175 million because of ongoing operational losses parent popular Inc. reported Friday first Horizon national Corp. announced an estimated fourth-quarter goodwill impairment on its mortgage business and $70 million and a $40 million reduction in gain on sale margins and managing performance and South financial group think seven and eight K. Securities and Exchange Commission filing Friday a week ago at it expects a $32 million fourth-quarter provision for credit losses as well is up to $5 million of other mortgage related charges changes to the trading subprime loss forecasting assumptions lead to negative ratings actions on several 2005 deals structured asset investment loans fall classes for $873 million downgraded or classes of America West Argent and Park Place only several hundred $75 million were downgraded Fremont investment and loan classes by a $310 million were downgraded as were $192 million in classes from the start deals Southern Star mortgage process $1.7 billion in loans during 2005 according to HUD data on a job recruitment once I company said it had 100 branches in 27 states Southern Star has now filed for Chapter 11 bankruptcy protection quote this bankruptcy proceeding has been filed to ensure an orderly wind down of Southern Star’s business and provide the best possible return to its creditors countrywide financial Corp. announced a joint home retention initiative with the Association of community organizations for Reform now California-based countrywide reported 12,565 loan modifications were completed in November Arizona’s governor announced he met with several mortgage servicers and emerged with a plan to fight foreclosures quote as of September 30 of this year more than 24,000 loans in Arizona are either in foreclosure or seriously the link with the statement said the average 30 year fixed-rate mortgage was 6.2% and Freddie Mac’s latest primary mortgage market survey the 30 year rose slightly from a week earlier but was one basis point lower than a year earlier the mortgage bankers Association said its latest weekly mortgage applications survey that loan applications were lower than the part we Massachusetts enacted new legislation designed officials and regulators say to reduce the foreclosures that have become emblematic of the subprime mortgage meltdown in Kentucky State Senator is filed what he calls a homeowner protection bill at New York legislator has filed the fairness in lending act a bill that creates additional duties of mortgage brokers according to lost involvement the state of Washington as an act of the law that helps homeowners avoid foreclosure by giving them temporary relief from Texas property tax heartland wholesale mortgage that it would in operations in a message posted on its website about her account executive who had been with the company just three months and mortgage daily.com he found out about the closure on Wednesday quote they told everybody were closing down as of Friday and said Goldman Sachs released an analyst report indicating fourth-quarter write-downs and investment banking firms are likely to be significantly larger than investors are anticipated financial firms marks will come under intense scrutiny in the fourth quarter as investors of already seen some aggressor write-downs other firms in recent weeks the report said as a result many of the December year in firms are likely to be more aggressive with their marks in our view particularly those with high levels of exposure Webster Bank NA will reorganize its mortgage banking and its parent company announced as a result of the changes the company will close its wholesale lending operations statement said in addition to correspondent channel will be close to a securities Corp. sought $243 million in classes of 2006 — SL to downgraded by Fitch changes to pitch his subprime loss forecasting assumptions lead to downgrades on $145 million in classes of Pascoe series 2007 — a G2 while another 648 million was placed on ratings watch negative forecasting changes allow all selected to downgrade $974 million classes securitized asset-backed receivable series 2007 BR 2 And Place another 974 million on negative watch to sass good deals from 2007 also impacted by Fitch changes were $338 million in classes downgraded in $747 million placed on rating watch negative…
I call the original subprime loan which is the FHA loan now we’ve talked about that before with that stance towards the Federal housing administration and its administered by side which is the Department of housing and urban development so do the government-sponsored loan and mortgage talk about is the benefits of these lows though because I think in today’s market it’s really can help a lot of people out there and let me get right down to it the reason I called the original subprime loan is because of the about 10 years ago before there really was a subprime industry any time a borrower hadn’t yelled little if the credit or made it in a lot of money for down payment we would immediately think to put them in FHA loan anima giving some of the reasons why the main reason why the first reason is on the FHA loan typically you only need a 3% down payment and on this to a lot of people and heard of because are used to the average loan where you got up with at least 20% or even 10% with an FHA loan in these better out forever folks he only need to put down 3% which is a great part about also their little easier qualifier on typically years ago they allowed to go on higher underqualified ratios than any other loans did and what he do nowadays to the bailout is both real and written by a computer so you can go even higher underqualified rituals which means for the average homeowner you can have more dad was allowed to buy no slightly little bigger house than you fight my built Ford if you have a couple car payments with these days it typical homeowners have two car payments because most people releasing in a one car and/or maybe making payments on other cars that really helped out a lot of people now the other benefit to these is it allows you to get a loan if you’ve got some blemishes on your credit lets say you do have to have a clean mortgage is reappeared to buying another house for 12 months and you have to have a clean rental history if you’re purchasing a new home which means what I mean by that is you have to have no late payments in the previous 12 months but other now you can have a double collection accounts here there are maybe get a Sears car that have the point of the on it with an FHA loan at generally overlook some of those may can have no point collection account obviously but if you does have a couple blemishes were maybe you had some problems couple years ago that’s not a problem also an FHA loan you can have a bankruptcy that only two years old which is great if you had a public review for an eerie loop and if you for some reason you rattle foreclosure that only has to be three years old which typically on a normal loaned you have to have a bankruptcy gone for three years and a foreclosure for your own FHA that gives a year benefit on each of those when you would you be concerned wreck about people still even with these types won’t getting into home with a really key and to forward a with the still being likable as with the other subprime of a prime won’t let that in the good thing about that were as you don’t have that same probably have at most subprime loans on the subprime loans a 10 to push people harder in the qualifying areas because what they did is a big push their income higher and they did stated into model so that it really know what the person made the thing with FHA loans is you are doing full documentation so you do know what the person makes and telling him we don’t we counsel bars anyway and say you know your payments can be blank are you comfortable with that you make as much money and also what FHA does to Doug woodcutter brings in the little Mormon underwriting questioned but it looks at your disposal income when it runs these things for the automated engine and what disposal and penicillin to the average person out there it is how much money you have left after paying all your bills closely make $5,000 a month and your house payments and all your bills are 2500 large amount it’s saying that you have the schools will income of $2500 and what does it take that into account in the qualifying races of something yummy to worry about the homeowner is that the computers of forest but dumb it is it’s easy you have a lot of money left over after you’re making all your payments on those ability to payments or does calculate that into an in typically these perform much further than subprime loans and that will allow lower default rate you mentioned of course these are full documentation loan so I’m quite know we talked about that a little bit new had kind of a nice little rule for what you needed to get together when you were first applying for a loan to remember what that was all he surtout to them to rule and what that stood for what you need to years of W-2s and then you’re too late his pay stubs and in two months of bank statements that speak to two and two ruled out perfect and if people will block like to listen to the actual get a link for that in the show notes for the show so they can go back and check up on them if they’re actually thinking of a point only fault was a great idea and then on the next will elect benefits of the everyday loans is and they been following along the modesty in and listen to our episode on mortgage insurance are actually live it as a listener question on mortgage insurance to jointly 3% down you will need mortgage insurance effect he called something different on FHA loan is called MMI which is a government thing but it’s lower than it is on a typical loan on a typical loan it’s done on this private down payment the mortgage insurance on FHA loan is in the about half of what it would be on a typical the only difference though is on an FHA loan you can never get rid of the monthly mortgage insurance all it stays on forever as what does that he pays for the government program whereas on the and me a conventional mortgage.you can get rid of that mortgage insurance after your loan to value your equity in your house exceeds are goes below 80% to connect to get ready her for insurance on regular mobile missile and you can’t but upon the Dow falls so it’s a has an idea of what know what to pull MMI might be over the course of a long Kalyan Aion unless it was that a $300,000 loan if get it be about $125 a month roughly and so it’ll be about $1400 a year that you we pay on average loan you probably get rid of that in three to four years so on FHA loan really stuck with it for quite a bit longer so let’s were coming in to refinance my be a benefit to you on FHA loan after you’ve built up the value in the home he did his refinance into conventional and if it makes up for it sometimes though the rates will make a difference though it’s mostly to get away with your loan officer were getting ready to do a refinance so wreck what other benefits other to getting an FHA will give you a few more benefits does one is there’s more flexibility on the down payment now gradually had to make 3% down payment but you can actually did a second that goes behind the things they’ll idea of 3% or you can be give from gift fund them starting from a relative and they give funds of basically a clear uncle or cousin are parents won a LP out they can give you 3% gift and apply that torture home still more flexibility on that so he rightly don’t have to have any real money of violence of basically like 100% financing away how was it different from the getting defunct received traditional on a traditional in that loan you can still do it but they require the borrower and out five or so money into the deal also it if you delay alone if 100% financing on traditional and you still have no fibers in her own money which on the FHA only one have to do that wasn’t expected as a really great is an FHA loan allows you have a non-occupying toolbar and it felt like a big big Missouri felt like such a governmental term in one of departing home where you exactly hope for pray tell what is it to find homebuyer what that would be it let’s say for instance you don’t qualify let’s say an example that things were at sea a most often is when a younger person in an early point in buying a condominium for instance and they’re going to school analysts say they don’t like qualified for their work in her way through school in their ill or maybe work a part-time job what they can do is they can have a relative have a relative generally it does make far more sense of father mother uncle one out if they can they can cosign with them on the loan and what it does is it counts of their entire income it also counts her death so hopefully it’ll have a large health and but account their entire income toward the slump the benefits of this versus any other type of loan Doug Miller lone dove of is they only allow you to use certain parts are invalid if using a non-occupying toolbar on a regular loan it doesn’t use entire income is use the percentage of soap is allowed to qualify little easier than you would on a traditional on some benefits for a nontraditional kind of borrower someone who as you said this was with the original someone moments of the original people were having difficulty and its it’s kind of interesting to see us going back to it again yet I is the fighting is there’s been a Russian fact diverted FHA is backed up getting people approve for the project evolves on it in voter may want to get into it the other they as there is an than the one trick with every jail is a reason why they haven’t been popular lost years in the law limits are severely limited in California to high-cost areas really get your loan amount of over $360,000 but right now they have got a bill in Congress to raise those limits so that fire is running the approved as a figure once Congress raises those limits in every field to be the next greatest thing since sliced bread which you know the better we been doing since 93 so let’s what’s know 14 years and then they haven’t changed their still the same loan giving is really great about Doug is they have a really good adjustable-rate program for FHA loans the typical adjustable-rate loan and a average personal get nowadays as a 2% annual Which means he can’t go more than 2% a year and a half to 6% lifetime Which means it will go more than 6% over the wife alone will win the FHA adjustable loan if only 1% per year and 5% for wife alone so let’s say you start with alone units at 6 1/2 percent on FHA loan delivered over 11 & which Neil found rabbits are than the 12 & that you might hit with a regular adjustable-rate loan to write who don’t ever think about was the one percentage point when they can really add up especially over the the life of the loan of a searcher and the last really great benefit about FHA loan and this is only reroute re really like because it really helps out the bar a lot FH and with FHA loan have a little program called to streamline program and what the streetlight allows you to do is if you currently have an FHA loan and rates drop you can refinance into another FHA loan without having his appraisal without having a qualifier in getting the only core criteria is that you have 12 months publicly more iterating on the current loan you have so what does a really good for we do tone of these about three or four years ago is if LSA has does it have adults or an FHA loan and it went without a half while they can refinance into a new FHA loan on a fixed rate they could drop their naked author and three may be down with a 6 1/2 and get a 30 year fixed-rate loan that they say if they save money on it because it’ll have in appraisal and the qualifying is a lot easier to know happy to pay stubs W-2s are any that no appraisal use need to run your loan through it and they go like hotcakes are really great that let’s will know whether the three really like northern closing costs associated with home like a there are some clothing costs and the great thing is generally like what we do and we do an FHA streamline loan as we cover those closing cost for the bar because of such an easy loan to do theirs and there’s really no work come so we don’t make we’ll really make my flight on which no big deal and we do a lot on Zocor like a volume game and we pay for the clothing sophomore which is what typically most authors do a July refugees relies on something really to look out for why anything else on the FHA programs… it doesn’t leave me like I said in the beginning of really like before to help out a lot of people and have their full black memos and know that people are getting alone qualify for is this a free loan program looking and join you in that MP3 is negatively.about step is more advertising than is for more information visit the Pacificresidential dot com.
Last week the Senate and House passed the economic stimulus bill and what this really means for the economy is as really grateful we hope it will do is certainly increased confidence among consumers among the things a bill supposed to do and if they give tax rebates of $600-$1200 the most tax paper taxpayers and also give $300 rebate checks to disabled veterans the elderly and certain other low-income people that that’s the part that the present so excited about the hopes of $168 and $70 billion into the down economy with those checks so that to help stimulate the economy is what the hopeless and they are they really put her rush to pass this bill I think that he did it in about two weeks which is as you know for the Senate and House record time it is really great and having it’s time that they give the public knows the government asked the cares and have to get gets up moving to the economy’s really been sick if you’ve been watching some of the economic news release recently unemployment level that housing prices are down to salute across the country which is unusual conciliate housing prices will fall across the country journal in a fall in certain pockets of the country but they don’t necessarily always yell as a nation that the value doesn’t fall ill mental users does narrow down the certain counties are no certain areas of the country but is really great news because what it really allows people to understand why to mention is that the government cares and when you get this economy roaring apart the worst remakes out about his apart were the raise loan is because of course were located in California and if you’re in any of the other high-cost areas for housing in the country such as Florida Hillyer Eastern states New York and some part parts of Washington or what have you this is really really great is what it does it it it raises the loan At On the Fannie Mae lonely it is right now $417,000 what this bill does is get a raise that loan amount up to $729,750 I know too horribly hot if 729,750 so what is really a really helps out a lot in California is a median house price in California is right around 580,000 last on a check which is the weeks go so before it for an order for an immediate Fannie Mae loans they had a common with Neil over hundred $50,000 down payment which is mailed very difficult so what this allows people to do is get a Fannie Mae loan up to that level in the sonar and 29,750 it will really help out California in terms of that look that particular dollar amount for mortgages were people’s just to get a mortgage fewer back in August we did a podcast all open a link to a website but it was those entitled to anybody in the home and tell a lie or get anybody to Louisville for you is what happened in August is Wall Street stop buying a jumble mortgages that was any loan over $417,000 so it’s as really put a crimp in California loans of this is really really get help on California that that limit is going up on Fannie Mae loans as well as Freddie Mac loans resume may wonder what’s the big deal about Fannie Mae and Freddie Mac are we related to them a lot and basically the reason it’s important you loan bought by Fannie Mae is when investors go buy government bonds they know that if is a Fannie Mae loans that it’s its guaranteed by the government against default so they know that a secure investment so they don’t have to worry about if like on the subprime loans in Oso Primus when the lows are falling in value and all I can stuff they don’t have to worry about that with a Fannie Mae loans over the investor buys nothing but government mortgages to Fannie Mae loans FHA mortgages and Freddie Mac mortgages they’ll have to worry about their investment because they know that is ensured by the government power figure by different mortgage products mortgage backed securities like subprime loans and all that and they’re not guaranteed and there is no guarantee against loss so that’s really been a part of the problem two months with subprime loans know what it also does give the number my 729 something because you’re hearing a lot and they say they keep this until December 31 of this year published a shallow further fixing that it’s doing well in and it’s really helping economy so what they also are going to do is on FHA loans those of the Federal housing administration loans to make raise that loan the two same amount in the high cost there is FHA condos are loan amounts a little differently based upon what County properties located in sofas in LA or Orange county for instance it’s a higher loan amount women in the the bill says it will be 729 some 50 which is just insane for everything that’s always been a lot lower and other parts the country to be slightly lower but least is going up with his route is really a help out the better to an FHA loan of course versus a Fannie Mae loan is you can have a not as good credit he did have some leads on your credit and you can so they qualify for loan because FHA tends to look at alone a little more I was a commonsense like this Fannie Mae does that to it looks more like a bar or for instance if it’s seen it in a look at your senior circumstances to a safer instance you’ve got your return a refinance into an FHA loan and use major payments on time for five years and also knew got a mortgage late and with the maybe you hadn’t had a something out of the hospital for word something unusual happened with an FHA loan you can usually get approved up with some sort of unusual circumstance like a Fannie Mae loans usability that many not so much anymore because there are always computer underwritten at the computer doesn’t pass and generally they won’t another writer will try selling Fannie Mae is its it’s an uphill battle form but they could go to an FHA loan and what they do they manually underwrite it which means they don’t use the computer and a base the decisions about me upon her experiencing of this if they feel as bars to make their payments will prove alone that’s giving on FHA tends to take in consideration certain things with Neil certain that what the circumstance of the Monaco bar or so it’s really a fabulous news because we really feel as a desperate economy they been roaring about this for months now and I’ll finally they got it to go through the Senate and House really quickly they’re expecting President Bush to sign any time out there as rumors using a science Friday or Saturday but haven’t heard any and renews about that get overly excited about this because it really opens up the young housing market in California and certain other parts of the country so and then we really are really excited about this of your looking to buy home and it’s still a good lifetime by home housing prices of fallen up poor people think the nearly pretty much level off and I’m ever some doom and gloom or signal fall 50% but gosh if housing prices fell 50% and it we all been a major depression or so I thought I think that’s a little further off we are entering probably a mild recession but hopefully with the stimulus package that pulls out of that in and really help tell people you’ll get on her feet and get moving with those rebate checks come in Arab and a remix or come in June and they’re a open naked for it via zero lead early his unit as may the IRS has to get roll a matter planning it known that even before the president signs the bill so that’s a really great news for a number 729 750 were really excited about that.
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