Jumbo Conforming Limit Expiring 10/1/11

NEW -> Contingent Buyer Assistance Program
Downward price pressures was simply due to a combination of sellers unwilling to market at realistic prices, capitulation on the part of short selling banks (lot's of approvals coming in) and seasonal reduction of inventory making lower price homes appear to be the predominant product out there.

The spread between Jumbo portfolio loans and standard Conforming loans is about .375% in rate. If that narrow of a spread is going to push prices down, the real estate market is deeper in trouble than first suspected. I'm glad that FN / FR limits were kept where they are. It was the right thing to do if they are serious about winding them down. If you want to put less than 10% down on a property in a high cost area, you sure will have a very high payment to do so. My guess is that we won't see a huge number of FHA minimum down loans for prices above $650,000. Very few people remain upright when hearing they'll have to pay $600 per month (or more!!!)  in Monthly Mortgage Insurance on these FHA loans.

It's just more distractive noise to further confuse those agents often befuddled by shiny objects and small coins.

My .02c

SGIP
 
Soylent Green Is People said:
Downward price pressures was simply due to a combination of sellers unwilling to market at realistic prices, capitulation on the part of short selling banks (lot's of approvals coming in) and seasonal reduction of inventory making lower price homes appear to be the predominant product out there.

The spread between Jumbo portfolio loans and standard Conforming loans is about .375% in rate. If that narrow of a spread is going to push prices down, the real estate market is deeper in trouble than first suspected. I'm glad that FN / FR limits were kept where they are. It was the right thing to do if they are serious about winding them down. If you want to put less than 10% down on a property in a high cost area, you sure will have a very high payment to do so. My guess is that we won't see a huge number of FHA minimum down loans for prices above $650,000. Very few people remain upright when hearing they'll have to pay $600 per month (or more!!!)  in Monthly Mortgage Insurance on these FHA loans.

It's just more distractive noise to further confuse those agents often befuddled by shiny objects and small coins.

My .02c

SGIP
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I'm glad that they kept the FN/FR limits where they are.  For me personally, it's $417k or bust on the loan amount. :D
 
Do people in this market and economic climate really consider 3.5% down on a $750,000 home a viable finance option?
 
IndieDev said:
Do people in this market and economic climate really consider 3.5% down on a $750,000 home a viable finance option?
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When I was selling my old house, there was one buyer who sure thought so.  I did not sell to him....
 
How can a person like that sleep at night? I'd feel like a knife was hanging by a thin string over my face every second of the day.
 
my ex coworker bought a plan 3 sonoma house... FHA!    $900K+ house on an FHA loan...  what's the PMI on that?  dont recall how much they put down... 

i think people get caught up with the "jonses" thing.    she made it a point to let me know that her husband was making sooo much money and could "afford the mortgage payment easily on his income alone" when i thought to myself, "as opposed to what?" 

i'd be in favor of keeping the lower fn/fm limits if we could just convice crack-smoking sellers and developers to start offering nice homes at $781,875...
 
akim997 said:
my ex coworker bought a plan 3 sonoma house... FHA!    $900K+ house on an FHA loan...  what's the PMI on that?  dont recall how much they put down... 
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0 PMI.

If it was FHA, they had to get the loan down to $729k and that meant 20% down.

I think SGIP outlined something about if you have 20% down, FHA isn't really that good unless your credit isn't stellar.
 
akim997 said:
my ex coworker bought a plan 3 sonoma house... FHA!    $900K+ house on an FHA loan...  what's the PMI on that?  dont recall how much they put down... 

i think people get caught up with the "jonses" thing.    she made it a point to let me know that her husband was making sooo much money and could "afford the mortgage payment easily on his income alone" when i thought to myself, "as opposed to what?" 

i'd be in favor of keeping the lower fn/fm limits if we could just convice crack-smoking sellers and developers to start offering nice homes at $781,875...
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And you should have replied with.....would you like a cookie or something?  haha 
 
IndieDev said:
Do people in this market and economic climate really consider 3.5% down on a $750,000 home a viable finance option?
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Absolutely 3.5% down is the best thing to do right now - the average squatting time is 2 years - the rent you save over 2 years would be greater than the 3.5% down.
 
The Motor Court Company said:
IndieDev said:
Do people in this market and economic climate really consider 3.5% down on a $750,000 home a viable finance option?
Click to expand...

Absolutely 3.5% down is the best thing to do right now - the average squatting time is 2 years - the rent you save over 2 years would be greater than the 3.5% down.
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You are forgetting about the return of capital you get from the "cash for keys" program at the end of the squatting period.
 
The Motor Court Company said:
IndieDev said:
Do people in this market and economic climate really consider 3.5% down on a $750,000 home a viable finance option?
Click to expand...

Absolutely 3.5% down is the best thing to do right now - the average squatting time is 2 years - the rent you save over 2 years would be greater than the 3.5% down.
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Hehe... for a $729k loan... even 1 year would be greater.

Strategic FHA!
 
irvinehomeowner said:
The Motor Court Company said:
IndieDev said:
Do people in this market and economic climate really consider 3.5% down on a $750,000 home a viable finance option?
Click to expand...

Absolutely 3.5% down is the best thing to do right now - the average squatting time is 2 years - the rent you save over 2 years would be greater than the 3.5% down.
Click to expand...
Hehe... for a $729k loan... even 1 year would be greater.

Strategic FHA!
Click to expand...
You do have to pay an up front fee for an FHA loan (I think it's 1% now) whether you put 20%+ or 3.5% down but you can roll that into the loan.
 
First payment defaults tend to be scrutinized for fraud though.  Your best bet is to pay the first three payments to establish your history of paying the loan and then strategically default.  This should keep the lender's fraud investigation dept from looking too closely at you.  Then all you have to worry about is your conscience.
 
Liar Loan said:
First payment defaults tend to be scrutinized for fraud though.  Your best bet is to pay the first three payments to establish your history of paying the loan and then strategically default.  This should keep the lender's fraud investigation dept from looking too closely at you.  Then all you have to worry about is your conscience.
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That is true.  When I used to work in the Mortgage Servicing industry (IT  dept), there was a report which went out each month called "First Payment Default" which did go to several departments including Fraud.
 
Truthfully... in this climate... I would rather put less down than more.

Other than FHA, who else has < 20% down payment options? Borrow from your own 401k?
 
irvinehomeowner said:
Truthfully... in this climate... I would rather put less down than more.

Other than FHA, who else has < 20% down payment options? Borrow from your own 401k?
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You can do 5% to 19.99% down with conventional loans but you just have to deal with PMI (or pay upfront to get rid of it).
 
USCTrojanCPA said:
irvinehomeowner said:
Truthfully... in this climate... I would rather put less down than more.

Other than FHA, who else has < 20% down payment options? Borrow from your own 401k?
Click to expand...
You can do 5% to 19.99% down with conventional loans but you just have to deal with PMI (or pay upfront to get rid of it).
Click to expand...
At the $625k you can do 10%... but above that... I think FHA is the only option. Of course, at your magic $417k limit, it's more open but then you are putting 20%+ down for any larger SFR in Irvine to get to that limit.
 
We're expecting FHA to $729,750 to be universally available Tuesday, now that the Fed's have updated their guidelines. Will it help the market? Doubtful given the high MI expense. 2-3 additional sales per month does not a recovery make.

My .02c

Soylent Green Is Peopl
 
30 YR 95-96.5 is 1.15% annual.
30 YR 95% and lower is 1.10 annual.

15 year 90% you get .50
15 year 85% you get .25

Under 78% LTV 15 year is zero.

All loans have a 1.0% Up Front Mortgage Insurance Premium.

For the rare 15 year fixed deal under 78% LTV but over $625,500, the rate is pretty sharp for these loans relative to private lable jumbo mortgages. .0001% of all transactions though relative to the general market.

My .02c.
 
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