Just bought a house in Woodbury

NEW -> Contingent Buyer Assistance Program
<p>IR,</p>

<p>Youa re dead on about the # of REO's NOT on the market right now. Some of the banks are just too backed up (taking a while to get them out there), some are in the 'hold and hope' portfolio's (LOL), and many are being negotiated in 'bulk REO transaction' deals as well (Investors with SERIOUS cash sometimes negotiate with banks who have LARGE amounts of REO holdings to buy 10, 20, 100, whatever units IN BULK for 60-70% of the banks obligation).</p>

<p>However, IMHO the real REO attack hasn't even started in OC. The reason? Good credit borrowers & a lack of subprime loans.</p>

<p>The vast majority (80%+) of home in the Irvine area are 'Alt-A' loans. Over 35% of these are option-arms. The majoirty of them are Interest Only ARM's with varying terms (3, 5, 7, 10 year tems). This is due to the high home prices and large loan amounts (way outside conforming range for the past 5 years).</p>

<p>The IO arms are just starting to recast. The option ARMS are all recasting between 2008-2010. These are all D.O.A. (especially the option ARMs). No programs are available for these people to go into without MASSIVE payment increases (and that's only if they actually HAVE some equity - which they don't). It takes 6-12 months before these will actually go through the NOD, Auction, REO process. We haven't seen the prime victims from this yet, but it is a MUCH LARGER percentage of the homeowners here, and they are in MUCH worse shape than a subprime borrower who resets.</p>

<p>When a subprime borrower resets, their payment goes higher. However, they WERE subprime to begin with. They generally had a higher starting rate, and a lower LTV. With these folks, refinancing to a conforming or FHA fixed (if they can) will actually LOWER their payments!</p>

<p>When the Alt-A reset, there will be MANY, MANY more of them. Also, for the Alt-A people, there is NO WAY currently to refi into something with a lower/similar payment. They are faced with no option but MUCH HIGHER payments (for option arms, 2-4x the current payment, best case scenario). I could go on and on about this... but you get the picture.</p>
 
Masterofdamoney,





If you would ever like to write a post for the main blog, I would work with you to publish it. Because of the work you do, you have a unique perspective on the scope and scale of the problem -- a problem being intentionally hidden by the lenders I might add. There are a lot of people under the delusion that because Irvine isn't subprime, there isn't a problem. Most do not understand the dynamics of the Alt-A problem you outlined above.
 
CommentAuthoripoplaya,



Believe me or not, i checked out both condos that you listed.

One is being right next to Freeway 241. Freeway noise was unbearable for me eventhough i was checking the place on sunday afternoon when the traffic is supposed to be the least.

Other one is attached unit. I dont like the layout. BTW, they list 16xx sqrt feet including the garage. So it is about the same size as The cortile residence 3 (1275 sqr feet of living w/o counting garage and patio).
 
<p>Neither of the Cal Pac condos is anywhere near the 241 and neither is attached. You can see that plainly from the satellite photos:</p>

<p><img style="WIDTH: 462px; HEIGHT: 479px" height="486" width="469" alt="" src="http://www.ipoplaya.com/soren.jpg" /></p>

<p><img alt="" src="http://www.ipoplaya.com/meadow.jpg" /></p>

<p>Wisteria and San Simeon, both by Cal Pac, are detached quad-style units. The both are proximal to the 261, with Meadow Valley being around 500ft. or so away and Sorenson perhaps around 400ft. </p>

<p>I live around 800ft. away from the 261 in the same development in West Irvine as Sorenson (and in the same model) and rarely ever hear anything on the 261. I can hear Jamboree and even the 5 freeway at times and I am much further from both. The noise from the 5 is constant, white noise like, which people truthfully describe as "sounds like the ocean". With regards to that, your mileage may vary...</p>

<p>The square footage of these units does NOT include the garage. Excluding the stairs and landing, there is approximately 1400sf of usable living space in these units. I just had mine appraised and have the plan measurements... Everything is a little bit smaller in Cortile, i.e. smaller closets, no tub in the master bath, smaller great room, etc. We looked at the exactly plan you are buying for my father in-law quite some time back.</p>

<p>I respectfully submit that either 1) you haven't really checked out these places or you would definitely have realized neither is detached and very similar in construction to Cortile, or 2) you aren't paying very good attention when you do check out places and as such aren't making a very informed buying decision.</p>

<p>Good luck to you though and good luck with the baby. They are a hand-full!</p>
 
catchupifyoucan,



I am one of the very few non ultra bears on this blog. I moved into woodbury just last year after owning in a similar size home elsewhere in OC since 2000. I love woodbury. I have also been to the plan you just contracted. I actually think the plans are nicely laid out, and feels much bigger than the actual sq ft on paper.



As much as a non bear myself, and as much as I disagree the rent vs. own calculation on this blog (not that the match is wrong, I just don't believe rent and own is a pure math calculation), I am not sure it is a good idea to buy a condo right now. I think the Condos still have more down side risk (% wise) then the more expensive single families at woodbury.



If I were you, I will rent a nice place from Irvine Company, and sit tight. With a baby coming, you don't want to put yourself in a situation that you will lose a lot of equity. some of us, like myself, most of the equity came from the inflated housing price during the last 7 years. so you can say easy come easy go. But for first time buyers like you, what you will lose is your hard earned $$$.



With a baby coming, you might feel the pressure to have your place. I was there, and I completely understand. I am not saying you should not buy at all. I will suggest you that find a REO...take some work, but you might get a deal...what is the hurry? sometimes "hunting" is part of the fun.



Congrads on the baby! and best of luck on everything!
 
I checked these out. I couldn't afford them, I have almost the exact same take home but no wifey to help me out. ;-)



The probelm was I kept seeing a cortile plan 4 pop up on the MLS for 550, fully upgraded! Doesn't make sense to me to buy a plan 3 when you can get a plan 4 for the same price.
 
ipoplaya



I am sorry mistype the name of the freeway. It's 261 toll road. I just looked at both houses, you are right they both are attached. I got confused with another one. But I actually checked out "Sorenson" one. It is 7 or 8 houses (400 ft) away from the freeway. The other one is also pretty close to 241 but on the other side.



Thanks for your input.
 
catchmeifyoucan - First, congratulations on the baby. What a blessing.<p>

Second, congratulations on your condo purchase. I hope things work out well for you and your family and the condo is a good fit for you.
 
catchme, congrats... my wife and i seriously considered that exact house you bought... we love the layout, it feels much bigger than the listed 1275 sq ft., but since we planned on being there 5+ years and planned on having at least 2 kids 1275 wasn't going to cut it.



one thing to watch out for... with what you are pulling in after tax +bonus, i'm assuming you and your wife make > 175k gross, thing is the child tax credits start to phase out at 110k... not a big deal, but i just wanted to point that out, people think they get to write off so much when they buy a house or when they have a kid... at our income level a lot of what we think we are eligible for, tax credits, benefits, etc, are phased out.
 
villagepeople



I really appreciate your input. Our gross income last year was little more than that last year and we got taxed badly.



You see I work in a "recession proof" company. The more houses go into default, REO, FC, Loss Mit, Pre FC, the more business my company gets.

BTW, I am a software developer for company (DRI Default Management WWW.DRIDEFAULT.COM Inc located in Newport Beach) that builds software process to handle LM, FC, REO, Pre FC and BK. Some of our clients include Chase Prime in Columbus Ohio, Chase Subprime in San Diego, Citi Financial in Dallas, Citi Mortgage in Saint Louis, Wachovia (World Savings..) in SF... So I know a thing or two about current market.

I do talk to those default managers from these banks weekly since I manage their default system maintenance. They all give me indication that market wont bottom untill the end of this summer. California especially high demanded area like newport beach, irvine, hb will go down at most another 10%. However, it's definitely buyer's market so I find a place I like and I plan to stay in for at least 5 years, they recommend me to get it.

BTW, these same managers told me 2 years ago to expect a mortgage melt down in 2007.
 
[quote author="now.buying" date=1207484287]catchme,



Can you tell me what type of mortgage rate are you getting or being offered by the builder?</blockquote>


Due to our high fico scores (my wife and I have fico above 800) with decent income and 20% down, I already qualify for A paper loan with interest rate around 6% or lower.
 
I guess you are getting a conforming loan right? $417k or lower? 6% or lower - zero points?



That looks like a pretty good rate... much better than what is shown on the website that IPOplaya likes to link to.



Looks like you got a good rate?
 
[quote author="now.buying" date=1207484870]I guess you are getting a conforming loan right? $417k or lower? 6% or lower - zero points?



That looks like a pretty good rate... much better than what is shown on the website that IPOplaya likes to link to.



Looks like you got a good rate?</blockquote>


Yes, we are getting conforming loan. In fact we have to down a little more than 20% to get a loan at 417k for low rate.
 
[quote author="now.buying" date=1207485931]congrats to you. that looks like a good rate - My lender quoted me a jumbo 30-yr fixed at 7.5% no points..</blockquote>


Jumbo loan is usually 1 % higher than conforming.



may i ask who's ur lender and what house, area you buy?
 
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