Fall Mortgage News

Fall has finally arrived…after a long,hot summer which I thoroughly enjoyed!

MARKET UPDATE

We watched rates continue to drop throughout the year, and they hit bottom right around October 1st. Currently rates have moved just off their lows, but realistically are still extremely attractive whether you are buying or refinancing. As I write this the election is tomorrow, so we are unsure what effect the result may have on rates… only time will tell. They have to start marching up at some point though.

Loan approval is certainly attainable for most borrowers, as long as your credit is relatively good (no FICO scores in the 500’s please and over 680 is better, 740 is considered perfect) AND if you can document adequate income to qualify for a loan within standard debt-to-income ratios which are still running around 45%. There are some exceptions to this figure (HARP loans, or FHA loans will both go higher in the debt ratios) You just need to have the constitution to survive the process of handing over lots more paperwork than in the past, including divorce documents, trust documents, explanations for deposits to your accounts, etc….

I have handled more than a few transactions recently for clients who started out working with their bank or current lender, only to find out more than 60 days into the process that it was going to take another 30 to 60 days. I closed a purchase for a client who was told by the BofA that they could not close in less than 45 days. I had the loan approved in 14 days from the date of application. Whatever you do, don’t work with a big bank, use a mortgage banker or broker. The banks are too big to be efficient and are overwhelmed. My average refinance closes in 30 days depending on how responsive the client is to requests for documentation.

Boys & Girls Club of Tustin

As some of you may know, I was a member of the Board for the B&G Club in Tustin, and had the privilege of serving as President. I am deeply committed to these clubs that provide such a valuable service to children all over the US. I have heard more than one alum state that the club “saved my life.” Here in Tustin, our club provide free transportation to schools for homeless children among many other programs. Yes, they pick up children from shelters and hotels, and taxi them to school programs. I have made a commitment to donate $100 for every loan I close in the community served by our Tustin club and invite any refinance or purchase loans to that end. Plus, Catalyst is underwriting their newsletters!

NOW, FOR THE FUN STUFF and BABIES

MEXICO

In September I visited San Jose del Cabo for a quick trip with two girlfriends, for R&R. We stayed at the Hilton in a timeshare (2 bedrooms, 3 bathrooms) which was a lovely top-notch property with fabulous service.

Highlights were:

A visit to Mango Deck on El Medano, buying “stuff” from the beach vendors;

Dinner at Agua, the fine dining restaurant at the One and Only Palmilla… I hadn’t been there since 1978! Service and food were both outrageously good;

Dinner at my new favorite farm-to-table restaurant in San Jose, Flora Farms. Check out their website www.flora-farms.com/ or you can find them on Facebook.

DALLAS

I’ve had a couple of quick weekend trips to Dallas with Steve. I was luckily able to locate a Trojan Club there for game watching on Saturdays.

The new NYLO Dallas South Side hotel www.facebook.com/NYLODallasSouthSide?fref=ts just opened less than a block from Steve’s loft. It offers a fun bar and dining scene on the building roof- top complete with swimming pool , great views of downtown (the same as from Steve’s balcony) and great music. My last visit they had a fabulous jazz trio playing in the lobby bar and we danced.

Favorite eats this trip: Trulucks http://trulucks.com/pages/dallas-texas for seafood, and The Cedars Social, for down home eclectic cooking and marvelous cocktails. www.thecedarssocial.com/index.php

We attended opening events at the new Klyde Warren Park, which is built over a freeway, and bridges the Dallas Arts District to Uptown. The park is a true community gathering place offering a playground for children, a dog park, a reading area complete with periodicals and books, a game area, and a stage for productions and events. They have yoga classes, Zumba and more. Opening night had a free concert with great music including Trombone Shorty from New Orleans.

The weather was pretty strange, it went from 85 high to a 35 low over my four day visit. That’s Dallas!

THE BIG HOUSE

Steve and I visited my daughter Katie in Ann Arbor in October. We were able to watch a football game – for Homecoming-- in The Big House. The weather was a bit on the cold side and it rained most of the day! We were pretty bundled up, so we kept warm but maybe a little wet.

Best eats: Vinology on Main Street, with great wine selections www.vinowinebars.net/vinology/index.html and Pacific Rim for the Asian influence. http://pacificrimbykana.com/

Katie introduced me to her newest exercise class: Pure Barre, which was extremely difficult and left me hobbling around for a week or so afterwards. Yikes!

She is coaching water polo at a local high school and planning to begin a Master’s in Education program in the spring.

We also visited new friends we met in the Cayman Islands at their lovely home on a lake in West Bloomfield, and enjoyed a sunset cocktail cruise on their pontoon boat. It was a blast!

BABIES!

My grand niece Kentyn was born a few weeks ago in Fresno to my nephew John and his wife Paige. I can’t wait to see her at Thanksgiving. My son Drew and his wife MaryGrace are expecting to welcome baby Theodore, my very own grandson, on or about December 4th, and she is looking Very Ready! Finally, I got to hold my new 2nd cousin Benjamin at the shower for MaryGrace. He is beautiful, and it provided me a little early practice.

GREENHOUSE

Kenny's greenhouse has been completed, which he'd begun building at Marlboro College before he left for Germany. He spent many months and a lot of hard work to obtain permits, funding, donations, pouring the foundation etc. before he left for Germany. The building is beautiful and the College held a grand opening ceremony in October. He was present from Berlin via Skype. Here is a photo of the completed Greenhouse. Beautiful!

The holidays are quickly going to be upon us. Early Happy Thanksgiving to all!

Rates, Foreclosures and BeachFire

Interest Rate Update

The end of the government’s purchase program –on March 31st—of mortgage-backed securities, was widely heralded as the precursor of a steep rise in mortgage interest rates. However, after an initial steep decline in MBS prices (pushing rates up) rates have improved and stabilized for the time being. Scott Simon, managing director of PIMCO says “We are unlikely to see a significant market disruption in the agency market stemming from the Fed’s retreat.” Translation: he doesn’t think rates are going to rise. Much.

30 year fixed rates are currently ranging from the high 4’s to the low 5’s depending on loan size, fico score, property type, loan purpose and loan-to-value. FHA rates are in the same range and go up to 96.5% loan-to-value (3.5% down.)

There is a new purchase program called HomePath requiring only 5% down on properties currently owned by Fannie Mae. The rates are a bit higher, but there is no requirement for mortgage insurance which is a big plus.

The BIG news is that true “jumbo” financing is returning to the market place. We are suddenly seeing very competitive rates from Chase, US Bank, Wells Fargo and GMAC. Great news for those with loan balances over the current high-balance Agency limit of $729,000. However, be warned, these programs are very conservative in terms of credit, personal liquidity, and loan-to value.

Foreclosure Activity Report

8.33% of all mortgages in Orange County are more than 90 days late. The national average is 8.78% and the California average is at 11.68%. Government programs to prevent foreclosures are slowing foreclosure rates…but most of these homes will likely convert to “short sales.”

My clientele’s purchases this year have primarily been short sales requiring bank approval…which is hard to come by, and can takes months to achieve. Then, when they finally agree to a price, they typically want to close the purchase within 15 to 21 days making for a mad dash at the end! Banks are not easy to deal with!

The highest percentage of distressed sales in the U.S. is in the Riverside SMSA, then Las Vegas and Sacramento.

Happy Hour at BeachFire

Friday evening I went to the BeachFire Bar & Grill in San Clemente. BeachFire opened in 2002 and is credited with the revitalization of downtown San Clemente.

They host a regular Friday evening Happy Hour all night, if you show up in “island” attire…whatever that means. I wore my yellow shell necklace from Maui and it did the trick. I had an aloha shirt in my purse as a back-up though. Drinks are $4 to $5 each, and appetizers range from $4 to $6. What a deal! Any time it rains, they also offer Happy Hour prices….otherwise known as “When it rains we pour.”

In addition to great drinks and appetizers at discounted prices, they have live Reggae music every Friday. We were rockin’… or whining, rather! (Jamaican-style dancing) The band manager treated my friends and I to Jaeger shots which was a hoot. See, you can still have fun over 50. http://beachfire.com/home.asp

My favorite Reggae band had performed the prior week…Smoothie Jones and the RedX. Now they play authentic Jamaican Reggae! I was sorry we missed them. http://www.myspace.com/smoothiejones
They used to play regularly in Dana Point, on the summer cocktail harbor cruises.