Archive for the ‘equity’ Category

Refinancing a Jumbo Loan In Today’s Market

Monday, July 8th, 2013

Fewer and fewer homeowners with jumbo loans are underwater these days, making it possible for them to take advantage of today’s low . In fact, recent data from Zillow.com showed that during the first quarter of 2013, just 20.6 percent of all Americans with jumbo loans (those over the conventional loan limits of $417,000 in most parts of the country) owed more than their homes were worth. That’s down significantly from 32.3 percent one year earlier.

And in five of the nation’s major metropolitan areas, 10 percent or less of jumbo-loan borrowers are underwater. San Jose, Calif. Led the way with only 5.8 percent owing more than the value of their homes. Boston had 6.3 percent, Denver had 6.6 percent, Dallas-Fort Worth had 7.6 percent and San Francisco had a rate of 9.6 percent.

Plus homeowners are underwater by much lower percentages these days as well.

“Nationally most people in negative equity are in relatively shallow water, with less than 20% negative equity,” said Zillow chief economist Stan Humphries in a .

For those that have now cleared the barrier and have

positive home equity again, standard jumbo refinance loans are available. And with rates on larger mortgages averaging around 4.5 percent, borrowers can save thousands.

Mortgage modifications are the best option for those who still have negative equity. If homeowners have loans owned by Fannie Mae or Freddie Mac, they can take advantage of government programs that offer help to those who are have loan-to-value ratios of up to 120 percent. Most private lenders have their own mortgage modification programs as well. Wells Fargo, for example, is offering refinance loans to borrowers with up to 200 percent loan-to-value ratios. Underwater jumbo loan borrowers can contact their mortgage servicer to find out if they qualify for today’s historically low rates on a refinance loan.

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Investors Shifting Focus to New Mortgage Markets

Monday, January 21st, 2013

A year ago in the U.S. housing market, everyone seemed to be concerned about a looming shadow inventory of foreclosures that would flood the country and pull home prices back into a sinkhole. If that inventory even exists and is still coming, it seems there is a large investment crowd that is ready and willing to gobble it up, leaving little room for falling prices.

According to recent research from JPMorgan Chase, the nation’s largest investment companies have a combined total of roughly $10 billion that they are looking to pump into the single-family home rental market.

And the sale contracts back that up. In November, all cash-purchases made up 30 percent of all transactions and investors – who typically do most the cash deals – accounted for 19 percent of all the sales that month, according to the .

Investment sales have been so hot, in fact, that they have actually picked several cities clean of their distressed properties and are now moving on to others. Phoenix, for example, has been a major investment town for the past year, with investors making up 36 percent of the home sales in August at the peak. After being devastated by the housing downturn in 2008, Phoenix’s rock bottom prices and plentiful supply of foreclosed

homes, investors swooped in like vultures. And as more and more investors tried to get in on the action, the competition pushed prices up and helped clear out the distressed properties. But higher prices also make it a less attractive market to investors.

In November, only 28 percent of sales were made to investors and prices had climbed 24 percent since the previous year. Compare that to the national average home price gain of 7.4 percent and it is easy to see why investors have moved on to markets like Atlanta, Las Vegas and Tampa.

While all this investment is good for current homeowners who see their home equity increase as the foreclosure inventory dwindles, it is making it tough on many traditional home buyers, especially first-timers, to get into their own markets. Hopefully as the investors move on to other cities, the market will equalize with more inventory relative the prospective buyers.

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