Analysts are all excited about the new housing numbers - unfortunately they don't mean anything positive for the market. Let's break this down.
1. There is an $8000 tax credit for “first time” home buyers. From May to June, the percentage distribution of sales of homes with prices under $150k rose from 14% of sales to 20% of sales. (For homes priced in the $150k-199.9k range, the percent of total sales went up from 26% to 28%.) The tax credit ranges are where more sales are. Houses have to be purchased before Nov 30 2009 to qualify. This is impacting sales in the low end.
This is a case of some economist forecasting a low number, and even though it's even lower than last year, people are happy that it's higher than the prediction from the Commerce Department.
2 Hardest hit areas are still hit hard. The increases were in the Midwest of over 40% and the northeast at 29%. The areas struggling are still struggling.
3 REALITY - 11% rise yes, BUT -- this is 384,000 - expected was 352,000. This is where percentages can be deceiving. This is 32000 more homes. There are over 3,000,000 homes on the market. The 32000 homes represents .0106% change in that inventory number.
4. Median home price is down this month (May to June) -- had risen previous 2 months. Price destabilization or downward trend isn't good. We need several consecutive stable months.
5. Still have an 8.8 months supply of inventory in a conservative measure.
6. Single family home sales are 21.3% lower than this time LAST year!
7. The homes sold during spring buying season close usually May-June, so this is to be expected...
8. There is also some fear of rising rates in the Fall that may be driving some buyers into the market.
9. 1 out of 4 homeowners today in default are defaulting on purpose! Once the owner owes 15% more than the house is worth, the rate of defaults that are intentional go up to the 25% level. (Chicago School of Business)
10. Still to come - 22% of homeowners have a mortgage bigger than the value of their home. We WILL see more defaults. This will push prices down. Jumbos haven't begun to show up in the markets yet. Banks will stop lending again, and we will face crisis #3.
Showing posts with label banks doing jumbo mortgages. Show all posts
Showing posts with label banks doing jumbo mortgages. Show all posts
Monday, July 27, 2009
Wednesday, April 1, 2009
Bank of Obama stopped doing Jumbo's
Houston, we have a problem. OK, nation, we have a problem. (yeah yeah Young Astronauts program from grade school, still a geek at heart)
I'm in the quest to refinance a property out in Cali that qualifies as a Jumbo mortgage. BofA is freaking me out with their delays, so I decided to do some of my own research. In most of the nation, a Jumbo is about $729,750 or above .. in some areas $417,000 or more to be considered a non conforming loan or a Jumbo. Before I get started, LTV is Loan to Value, which means the amount of principle balance of all outstanding mortgages divided by the value of the home by appraisals (see story on appraisers in my last blog!)
Bank of Obama and team has created a situation where if the government wont buy a loan, the bank won't lend it. End of story. I have the proof.
With the secondary market dead, Fannie, Freddie and Ginnie are getting lots of bucks from the government for conventional loans - those for less than the numbers I noted above. There is no political support for helping jumbo borrowers.
Let me say something right off the bat - I'm not for propping up any of them - but right now the government is yet again creating a gap between what they perceive as the haves and have-not's (there are no political bucks for helping so called rich people), and they are missing a tidal wave of foreclosures about to hit the market with jumbo borrowers unable to refinance. You think conventional homes caused a ruckus? Think what will happen when 15% of the bigger homes fall into foreclosure, too. Talk about devaluing home prices.
Lenders staged when loans would reset. Most in the conventional market are resetting first.. Jumbo's this year and next. Prices are still at least a point higher too on jumbo's than conventionals, even if you can get one. Most lenders want 75% LTV or BETTER! Yes, better. And lookout, but prepayment penalties are coming back!
So I thought it was my imagination that the jumbo market was getting tougher, and went out and did my own research. Thanks to my team of researchers, a lot of phone calls and some dirt digging, here is the scoop as of today on Jumbo mortgages - and who is doing what to even allow you to talk to them.
So here they are, the good, the bad and the ugly - 18 banks and the outcome of the hunt for a Jumbo:
Hanmi Bank (866-654-2664 – Amy Lee)
***Not approving any jumbo/non-conforming loans
Union Bank of CA (866-UB-LOANS, Option 1,3)
***Max loan amount is $417,000 (no non-conforming/jumbo loans)
HSBC (888-346-1717)
***Not approving any jumbo/non-conforming loans
First Commercial Bank US (949-654-2888)
***Stopped personal RE loans. Commercial and industrial only right now.
Bank of the West (800-563-1852)
***Max loan amount is $729,750.00
California Bank and Trust (866-840-4158)
***Not approving any jumbo/non-conforming loans
Citizens Business Bank (714-919-7131)
***Jumbo program only for existing customers
EverTrust Bank (626-854-9700)
***Not approving any jumbo/non-conforming loans
Wilshire State Bank (866-972-2265)
***Not approving any jumbo/non-conforming loans
Chinatrust Bank (949-262-7168)
***Not approving any personal RE loans at this time - commercial and industrial only.
Community Commerce Bank (714-314-9052, Randy)
***Commercial, Industrial, and Retail only right now. Special circumstances apply that will allow for personal RE loans (houses that are on joint residential and commercial zone, fire restoration of home that no other bank will touch, etc.) Other than special circumstances, no personal RE loans!!!
United Commercial Bank (866-821-3899)
***Not approving any jumbo/non-conforming loans…unknown when they will be in the future.
Farmers and Merchant Bank (866-649-3863)
http://www.fmb.com/
***Only 55% LTV on non-conforming loans but may be willing to consider more, credit dependent
Cathay Bank (949-559-7500)
https://www.cathaybank.com/
***Max LTV is 75%, current rate of 6.5
US Bank (800-365-5001)
http://www.usbank.com/cgi_w/cfm/personal/products_and_services/mortgage/home_mortgage.cfm
***95% LTV at 4.5-4.8% interest. -- They are currently ONLY doing this for EXISTING CUSTOMERS! What they say on the phone and what happens are entirely different.
Comerica Bank (866-476-6521)
http://www.comerica.com/vgn-ext-templating/v/index.jsp?vgnextoid=8888577d17a31010VgnVCM1000004302a8c0RCRD
***Here is what they say: Max LTV is 90%, if not in declining market, 80% if declining market. No fixed 30…only fixed 3,5,7, or 10 years. Refused to give interest rate unless I gave them actual numbers of potential loan. Upon further info, only if you give them $250,000 in "other business" (like CDs) will they talk to you.
Wells Fargo https://www.wellsfargo.com/mortgage/ -- not doing anything now.
***Max LTV is 70%. Offering 30 year fixed with no points at 6.5% (aprox., based on limited information). Offering 5 year fixed at 5.3%.
Affinity Bank - only doing conforming loans.
Who does that leave if you need to go to 75 or 80 LTV? Bank of America. And don't even get me started on these guys. That is another blog for another day!
Dani
I'm in the quest to refinance a property out in Cali that qualifies as a Jumbo mortgage. BofA is freaking me out with their delays, so I decided to do some of my own research. In most of the nation, a Jumbo is about $729,750 or above .. in some areas $417,000 or more to be considered a non conforming loan or a Jumbo. Before I get started, LTV is Loan to Value, which means the amount of principle balance of all outstanding mortgages divided by the value of the home by appraisals (see story on appraisers in my last blog!)
Bank of Obama and team has created a situation where if the government wont buy a loan, the bank won't lend it. End of story. I have the proof.
With the secondary market dead, Fannie, Freddie and Ginnie are getting lots of bucks from the government for conventional loans - those for less than the numbers I noted above. There is no political support for helping jumbo borrowers.
Let me say something right off the bat - I'm not for propping up any of them - but right now the government is yet again creating a gap between what they perceive as the haves and have-not's (there are no political bucks for helping so called rich people), and they are missing a tidal wave of foreclosures about to hit the market with jumbo borrowers unable to refinance. You think conventional homes caused a ruckus? Think what will happen when 15% of the bigger homes fall into foreclosure, too. Talk about devaluing home prices.
Lenders staged when loans would reset. Most in the conventional market are resetting first.. Jumbo's this year and next. Prices are still at least a point higher too on jumbo's than conventionals, even if you can get one. Most lenders want 75% LTV or BETTER! Yes, better. And lookout, but prepayment penalties are coming back!
So I thought it was my imagination that the jumbo market was getting tougher, and went out and did my own research. Thanks to my team of researchers, a lot of phone calls and some dirt digging, here is the scoop as of today on Jumbo mortgages - and who is doing what to even allow you to talk to them.
So here they are, the good, the bad and the ugly - 18 banks and the outcome of the hunt for a Jumbo:
Hanmi Bank (866-654-2664 – Amy Lee)
***Not approving any jumbo/non-conforming loans
Union Bank of CA (866-UB-LOANS, Option 1,3)
***Max loan amount is $417,000 (no non-conforming/jumbo loans)
HSBC (888-346-1717)
***Not approving any jumbo/non-conforming loans
First Commercial Bank US (949-654-2888)
***Stopped personal RE loans. Commercial and industrial only right now.
Bank of the West (800-563-1852)
***Max loan amount is $729,750.00
California Bank and Trust (866-840-4158)
***Not approving any jumbo/non-conforming loans
Citizens Business Bank (714-919-7131)
***Jumbo program only for existing customers
EverTrust Bank (626-854-9700)
***Not approving any jumbo/non-conforming loans
Wilshire State Bank (866-972-2265)
***Not approving any jumbo/non-conforming loans
Chinatrust Bank (949-262-7168)
***Not approving any personal RE loans at this time - commercial and industrial only.
Community Commerce Bank (714-314-9052, Randy)
***Commercial, Industrial, and Retail only right now. Special circumstances apply that will allow for personal RE loans (houses that are on joint residential and commercial zone, fire restoration of home that no other bank will touch, etc.) Other than special circumstances, no personal RE loans!!!
United Commercial Bank (866-821-3899)
***Not approving any jumbo/non-conforming loans…unknown when they will be in the future.
Farmers and Merchant Bank (866-649-3863)
http://www.fmb.com/
***Only 55% LTV on non-conforming loans but may be willing to consider more, credit dependent
Cathay Bank (949-559-7500)
https://www.cathaybank.com/
***Max LTV is 75%, current rate of 6.5
US Bank (800-365-5001)
http://www.usbank.com/cgi_w/cfm/personal/products_and_services/mortgage/home_mortgage.cfm
***95% LTV at 4.5-4.8% interest. -- They are currently ONLY doing this for EXISTING CUSTOMERS! What they say on the phone and what happens are entirely different.
Comerica Bank (866-476-6521)
http://www.comerica.com/vgn-ext-templating/v/index.jsp?vgnextoid=8888577d17a31010VgnVCM1000004302a8c0RCRD
***Here is what they say: Max LTV is 90%, if not in declining market, 80% if declining market. No fixed 30…only fixed 3,5,7, or 10 years. Refused to give interest rate unless I gave them actual numbers of potential loan. Upon further info, only if you give them $250,000 in "other business" (like CDs) will they talk to you.
Wells Fargo https://www.wellsfargo.com/mortgage/ -- not doing anything now.
***Max LTV is 70%. Offering 30 year fixed with no points at 6.5% (aprox., based on limited information). Offering 5 year fixed at 5.3%.
Affinity Bank - only doing conforming loans.
Who does that leave if you need to go to 75 or 80 LTV? Bank of America. And don't even get me started on these guys. That is another blog for another day!
Dani
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