Thursday, February 14, 2008
2/14/2008 Quick Question...
How much of the devastation caused by the “Housing Bubble and Unethical Lending" practices would have never reached these levels if there were open discussions and proactive education aimed at consumers and professionals for the sole purpose of their protection their well being?
Wednesday, February 13, 2008
2/13/08 Economic Stimulus Bill Signed in by the President.
As of today the Economic Stimulus bill was signed into law by the President. We would like to let you know what to expect.
Several steps listed below, must occur before anyone can lock in loan applications with the
higher loan amounts.
• First, the GSEs and FHA must assess their internal impacts to determine the delivery approach they will require of mortgage lenders and investors.
• Second, GSEs and FHA must communicate their requirements to mortgage lenders and investors.
• Third, Lenders will work to identify impacts and implement the changes as quickly as possible.
Due to these necessary steps, the higher limits offered by GSEs and FHA as a result of this bill will not be immediately available to our clients (higher loan limits are still available through non-conforming product offerings.)
High-level Details of the Stimulus Package
Details of the GSA/FHA requirements are not finalized; however, outlined below is some information regarding what is expected as a result of the new law:
Overall
• The increases are a temporary solution for some high-cost areas based on Metropolitan Statistical Areas (MSAs).
• The Higher loan limits will not be immediately available.
• Changes related to FHA Modernization were not included in the Economic Stimulus Package.
GSE Loan Limits
• Loan amounts may be as high as $729,750; however, $729,750 will not be the nationwide loan limit.
Increases will be available in high-cost areas based on the median area sales prices and will follow the standard HUD mortgage loan limit calculation process.
• To determine high-cost areas, the calculation factor will increase to 125% of the area median sales price.
• The temporary increase applies to loans originated from July 1, 2007, through Dec.31,2008.
FHA
• Loan limits in high-cost areas may increase to as much as $729,750..
• To determine high-cost areas, the calculation factor will increase from 95% to 125% of the area median sales price.
• The increase applies to loans with credit approval issued prior to Dec. 31, 2008.
• Floor will increase to $271,050.
2/13/08 Stimulus Bill to be Signed Today!!
A message from CAMB Government Affairs Chair Ed Smith, Jr.
regarding the Economic Stimulus bill.
President Bush to sign the Economic Stimulus bill Today!
On Thursday of last week, as CAMB members lobbied the halls of the congressional offices in Washington, D.C., the U.S. Senate and House of Representatives passed a final version of the Economic Stimulus bill that includes provisions to increase the FHA and GSE conforming loan limits. Essentially, the loan limit would be 125 percent of the area median home price, but in no case will exceed 175 percent of the conforming loan limitation for 2008 ($729,750). The bill gives HUD 30 days from enactment to set the loan limit by area. An analysis of how the increase will work for the GSE and FHA loan limit is attached below.
Attached Analysis
regarding the Economic Stimulus bill.
President Bush to sign the Economic Stimulus bill Today!
On Thursday of last week, as CAMB members lobbied the halls of the congressional offices in Washington, D.C., the U.S. Senate and House of Representatives passed a final version of the Economic Stimulus bill that includes provisions to increase the FHA and GSE conforming loan limits. Essentially, the loan limit would be 125 percent of the area median home price, but in no case will exceed 175 percent of the conforming loan limitation for 2008 ($729,750). The bill gives HUD 30 days from enactment to set the loan limit by area. An analysis of how the increase will work for the GSE and FHA loan limit is attached below.
Attached Analysis
Tuesday, February 12, 2008
2/4/08 REALTOR UPDATE
Many of you have clients that will need 100% financing. Not to worry; there are still several STRONG programs that are available for your clients.
There are available 100% financing programs in California regardless of the declining market factor.
NOTE* The FHA and CalHFA loan limits are subject to the areas New Construction and Resale Targeted and Non-Targeted assessments from HUD.
Loan limits for Sacramento, Placer and Yolo counties for CalHFA Non-Targeted Resale and New Construction are $429,619. For those with targeted areas the loan amount increases to $525,090.
Final Thought…
Don't waste life in doubts and fears; spend yourself on the work before you, well assured that the right performance of this hour's duties will be the best preparation for the hours and ages that will follow it.
~Ralph Waldo Emerson
There are available 100% financing programs in California regardless of the declining market factor.
NOTE* The FHA and CalHFA loan limits are subject to the areas New Construction and Resale Targeted and Non-Targeted assessments from HUD.
Loan limits for Sacramento, Placer and Yolo counties for CalHFA Non-Targeted Resale and New Construction are $429,619. For those with targeted areas the loan amount increases to $525,090.
Final Thought…
Don't waste life in doubts and fears; spend yourself on the work before you, well assured that the right performance of this hour's duties will be the best preparation for the hours and ages that will follow it.
~Ralph Waldo Emerson
01/16/08 Economic Stimilus Package Update
Here is a recap of the “Stimulus package” that our government has been working on…
Once this is passed, it will generate hundreds of thousands of home sales. This is much needed and wonderful news.
Congress, President Agree to Loan Limit Hike in Stimulus Package stimulus
California will see federally guaranteed mortgages as high as $730,000 if pending emergency legislation, now awaiting action in the U.S. Senate, is approved. Late last week Congress and President Bush reached agreement on the contents of a so-called "economic stimulus" package, which after several days of lobbying and negotiation, now includes an increase in the limits placed on federally guaranteed loans, which should help revive California's slumping housing markets.
The limit on what are referred to as "conforming" loans is set by the federal government and serves as the cap under which "government sponsored enterprises" (GSEs) such as Fannie Mae and Freddie Mac may purchase mortgage loans and turn them into marketable "securities" which private investors buy.
GSEs were established by the federal government over 70 years ago to keep mortgage credit markets "liquid" and help deliver lower interest rates to homebuyers. But the limit now as well as those set over the past several decades are far too low to provide at least half of California homebuyers the lower-financing-cost benefits this Depression-era program intended. CBIA has long complained that these limits don't work in California and force homebuyers in the state to finance their purchases using "jumbo" loans which carry higher interest rates.
It's estimated that over the life of a 30-year jumbo loan a California homebuyer spends $150,000 more in financing costs on the purchase of a median-priced home. If the current agreement between the White House and Congress is enacted - something that's expected to happen in the next two weeks - high-cost markets around the country - and most of those in California - will see conforming loans go from the current $419,000 to $730,000. CBIA was joined in its advocacy for including the conforming loan limit change in the stimulus package by NAHB, the California Association of Realtors and their national association, the California Mortgage Bankers Association and by Governor Schwarzenegger. Indeed, the Governor sent a letter to congressional leaders last week, saying "No issue is of greater importance to California's economy than raising credit for our housing market."
Most economists lauded the proposed changed, confirming that it will give a much-needed shot in the arm to the nation's sagging real estate sector. The National Association of Realtors estimated that a sizeable increase in the loan limit like the one now being pushed in Washington will generate hundreds of thousands of additional home sales nationwide and produce over $40 billion in economic activity.
So, in a nutshell… The activity that this legislation will generate, is going to pump some life back into the market which will also (hopefully) get the majority of consumers “off the fence” and it will create huge oppurtunities for consumers to buy more home for less money and ease higher payments for people that are currently in Jumbo financing.
Final Thought…
"The secret of success in life is for a man to be ready for his opportunity when it comes."
Benjamin Disraeli (1804-1881)British statesman and prime minister
Once this is passed, it will generate hundreds of thousands of home sales. This is much needed and wonderful news.
Congress, President Agree to Loan Limit Hike in Stimulus Package stimulus
California will see federally guaranteed mortgages as high as $730,000 if pending emergency legislation, now awaiting action in the U.S. Senate, is approved. Late last week Congress and President Bush reached agreement on the contents of a so-called "economic stimulus" package, which after several days of lobbying and negotiation, now includes an increase in the limits placed on federally guaranteed loans, which should help revive California's slumping housing markets.
The limit on what are referred to as "conforming" loans is set by the federal government and serves as the cap under which "government sponsored enterprises" (GSEs) such as Fannie Mae and Freddie Mac may purchase mortgage loans and turn them into marketable "securities" which private investors buy.
GSEs were established by the federal government over 70 years ago to keep mortgage credit markets "liquid" and help deliver lower interest rates to homebuyers. But the limit now as well as those set over the past several decades are far too low to provide at least half of California homebuyers the lower-financing-cost benefits this Depression-era program intended. CBIA has long complained that these limits don't work in California and force homebuyers in the state to finance their purchases using "jumbo" loans which carry higher interest rates.
It's estimated that over the life of a 30-year jumbo loan a California homebuyer spends $150,000 more in financing costs on the purchase of a median-priced home. If the current agreement between the White House and Congress is enacted - something that's expected to happen in the next two weeks - high-cost markets around the country - and most of those in California - will see conforming loans go from the current $419,000 to $730,000. CBIA was joined in its advocacy for including the conforming loan limit change in the stimulus package by NAHB, the California Association of Realtors and their national association, the California Mortgage Bankers Association and by Governor Schwarzenegger. Indeed, the Governor sent a letter to congressional leaders last week, saying "No issue is of greater importance to California's economy than raising credit for our housing market."
Most economists lauded the proposed changed, confirming that it will give a much-needed shot in the arm to the nation's sagging real estate sector. The National Association of Realtors estimated that a sizeable increase in the loan limit like the one now being pushed in Washington will generate hundreds of thousands of additional home sales nationwide and produce over $40 billion in economic activity.
So, in a nutshell… The activity that this legislation will generate, is going to pump some life back into the market which will also (hopefully) get the majority of consumers “off the fence” and it will create huge oppurtunities for consumers to buy more home for less money and ease higher payments for people that are currently in Jumbo financing.
Final Thought…
"The secret of success in life is for a man to be ready for his opportunity when it comes."
Benjamin Disraeli (1804-1881)British statesman and prime minister
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