Danny Salas

Archive for the 'Mortgage Industry Updates' Category

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Freddie Mac Event A HUGE Success

Over 100 Real Estate Agents poured into The Big Room, at Sierra Nevada Brewing Company, to listen and learn from one of the nations largest purchaser of real estate loans; Freddie Mac’s, Governing Board Member, Scott St. John.  Sponsored by Access Real Estate Lending, the event lured participants from Red Bluff, Orland, Willows, Chico, Paradise, and as far away as Roseville, California.  Sr. Partner of Access, Daniel C. Salas, said, “It’s a real pleasure to have Scott St. John, here, to educate the real estate agents in our area.  With the exception of the Federal Open Market Committee Members, you don’t get much bigger than this!”

St. John discussed the reason banks are having more difficulty closing loans, these days.  He also talked about reasons why banks are slowly releasing their foreclosure inventory, as opposed to releasing it all at once.  Another key subject he talked about was where the lending and real estate industry is expected to go, through the remainder of 2010 and even into 2011.

Some of the positive points, brought up by St. John, were that even though the United States Government would stop buying Mortgage-Backed Securities, at the end of March, Freddie Mac felt as though there were many investors, sitting on the sideline, waiting to get into the market, and purchase these investments.  Therefore, even though rates are expected to move upwardly, resulting from this buying halt, it shouldn’t be too worrisome; as these investors haven’t been on the sidelines for years, and now we’re seeing them start to sit on the sidelines.  Another positive point was that Mortgage Insurance Companies are starting to become more flexible with their underwriting guidelines, and even have relaxed their loan amounts, compared to real estate prices, in Santa Cruz County.  This could just be a precursor to the rest of California.  ”It’s been difficult to obtain conventional financing with less than 10% Down (excluding FHA loans), until this recent development, in Santa Cruz.  It’s quite promising,” stated Salas.

St. John noted the lending industry saw about $3.5 Billion in loans, in 2009, while the industry expects anywhere from $1.3 – $1.6 Billion for 2010.  Eighty percent of these loans will be first-time home buyers.  ”What’s interesting about the eighty percent figure,” stated Salas, “is that seventy percent, of that eighty percent, is categorized as ‘first-time home buyers,’ because the industry’s definition of ‘first-time’ is somebody who hasn’t owned a home in the last three years.  So, people who owned a home, then lost it during the mortgage credit crisis, will be eligible to purchase another home, with only 3.5% down (FHA).  It’s an interesting situation, as these buyers were of the old-style qualification standards, and they’ll have to be ready to understand that loan qualifications have changed.  But, we’re ready to educate them.”

Scott St. John indicated, “financing a home, using FHA, will become more difficult, unless using a HUD Approved FHA Direct Lender, like Access Real Estate Lending.”  As one of the areas premier mortgage bankers, Access has financed over $665 Million in loans, in just ten short years.  ”We’re excited about the future, about the Chico Market, and that Scott St. John would come to our wonderful community, enjoy Sierra Nevada Brewing Company’s Big Room, and say such wonderful compliments about Access Real Estate Lending.  We’re quite honored.”

FHA MI Premium Increasing

1.75% Financed Premuim Is Going Away

Per HUD Mortgagee Letter 2010-02, the upfront mortgage insurance premium for FHA loans will increase to 2.25% on all loans for which the case number is assigned on or after April 5, 2010.

Chico, CA Interest Rates Market Report – Economic Influences – March 5, 2010

Nailed It!

Right on the Button!  We watched rates, yesterday, until the afternoon.  Gained 19 basis points…had a re-price for the better two times, for a total of .25% and Locked!  On a $200,000 loan that would save a client $500 in fees, to get into a loan.  Not to mention that it transitioned us into a lower interest rate, by .125%.  So, again, saving clients over $5,400 in monthly payments, through the life of a 30 year fixed rate loan.  That’s why we watch the market, so closely.  I LOVE saving clients money!

Unemployment Rate Holds Steady

The Labor Department reported that the U.S. Economy only lost 36,000 jobs, last month.  They expected well over 50,000 loses, however, the bigger surprise was that the unemployment rate held at 9.7%.  That was surprising, as there are so many claims for Emergency Unemployment Benefits.  So, we’ve dropped over 50 basis points, this morning.  That’s $1,000, on a $200,000 loan.  A lot of money, for a first time home buyer!

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