Changes in Reverse Mortgages

With tightening of credit qualifications, there have been many who are trying to refinance and finding it difficult to qualify..especially Seniors on fixed incomes. Remember with a reverse mortgage, a borrower doesn't have to worry about income, credit, or health qualifications. By using a Reverse Mortgage, you can purchase a new home, an investment property, or even assist a family member to buy their first home.
We have seen some big changes for the FHA Reverse Mortgage, which are very helpful during these tough economic times.
1. HECM for Purchase- This new option allows home owners to use a reverse mortgage for the purchase of a new home. This is ideal for those who may be looking at downsizing, relocating closer to families, or planning to move into a 55+ community...without selling their original home.
2.Increase in the Maximum Lending Limits- The new Stimulus Package signed by President Obama in February brought us a new limit of $625,500 for the FHA HECM, really helpful in our high-priced area.

When Clients Move

Whether my home sellers move early so that we can stage their houses, or if they move when the houses are sold, my clients are faced with many challenges. Now more than ever they are looking for ways to cut costs, cut down necessities, and still have everything that they want. Below are some tips from the Move Advocates that can cut down the cost of their moves and at the same time get them the service they need:
De-Clutter – Now is the time to clean out closets and get rid of anything that you don't need...that old heavy desk in the corner not being used and the treadmill that doubles as a clothes hanger. Having a garage sale or giving things to charity will help reduce the weight and cost of a move.
Get a ‘Binding Not-to-exceed’ estimate – One of the costs contributing to a move is the weight of the shipment. With this estimate, if your actual weight is more than the written estimate, you still pay for only the amount of the estimate. But if your actual weight is less than the estimate then your costs can go down.
Get full replacement ‘valuation’ coverage – When you move, things can get damaged. This coverage is what will protect your goods in the event of any damage.
Do you need furniture assembly & reassembly? – If you have a large desk, entertainment center, or table that has to be taken apart and put back together, do it yourself to cut down on costs. If that is not possible then make sure the company you use offers these services.
Get a reputable mover – It is important to use a mover that is going to provide the level of service promised to you. Check out the better business bureau website to make sure they are what they say they are.
The Move Advocate is a no cost service that helps people when moving. They provide a dedicated coach to coordinate all aspects of the move, from getting estimates to settling into their new home.

Some Good Housing News

I heard someone earlier this week say that the housing market has gone from a slow crawl to a brisk walk. That is the perfect metaphor to explain the recent changes in the real estate market. The market is coming back. It’s not roaring, but it’s coming back.
This week, according to Reuters.com, U.S. mortgage applications jumped as record low interest rates spurred a surge in demand for home refinancing loans. The Mortgage Bankers Association said its seasonally adjusted index of mortgage applications, which includes both purchase and refinance loans, increased 32.2 percent for the week ended March 20. Refinancing accounted for 78.5 percent of all applications.
The Mercury News headline this morning was "Mortgage Rates Drop to a Record Low."
Meanwhile, according to Realty Times, housing starts took a surprise jump of 22 percent in February over January's depressed levels.
Existing home sales are also seeing some good trends, and the West is leading much of the nation’s recovery, with California leading the charge. Our median listing price is beginning to rise for the first time in three years. Existing home sales in the West increased 2.6 percent to an annual rate of 1.2 million in February and remain 30.4 percent higher than a year ago.
After a week of positive indicators, the best advice is for buyers to get out there. There are some fantastic deals right now and as more people begin to realize it, competition will come back and begin to drive activity. You know what they say about the early bird!

'Tis the Season

Springtime....or whatever the reason, sales seem to be picking up in Santa Clara County. This morning at our Realtors' tour meeting, we were asked, "Who sold a house last week?" In past weeks, there were one or two responses, but today, a half dozen hands shot up, including mine. Also, these were not short sales or bank owned properties, and one was even a longtime listing in Los Altos Hills. Another healthy sign is that inventory numbers are not going up, in fact, the number of "distressed properties" is headed down. Our tour list remains at a consistent 30-35 new listings each week in the area combining Cupertino, Sunnyvale, and Santa Clara.

Jumbo Loans are Returning

I just received a loan information flyer for an open house I'm holding this weekend on a Sunnyvale listing priced at over $800,000. That puts most loans on the property in the "Jumbo Conforming" range...between $417,500 and $729,750. Thirty year fixed loans with a one point loan fee, run 6.5%, and with a 30% down payment, only 5%.
Kenneth Harney recently wrote in his real estate column that major banks such as
B of A will be rolling out a large new program to finance loans between $730,000 and $1.5 million, true jumbo loans) at fixed 30 year rates in the upper 5% range, also available through its Countrywide Home Loans subsidiary (soon to be renamed Bank of America Home Loans.) These mortgages require great credit and substantial reserves, but at last we are seeing an alternative to FHA, Fannie Mae and Freddie Mac....urgently needed in our area.

Sometimes Bigger IS Better

First there was the individual Brokerage. If they were willing to cooperate, we had to arrange to pick up a house key at their office, and return it. Then we had the first Multiple Listing Services. For a long time, we needed to be members of both the San Jose Board of Realtors and our local Board...in my case, Sunnyvale...in order to have any flexibility. If a master key was lost, we had to re=key the system for security. Then the local boards began combining, and now our membership in SILVAR (the Silicon Valley Association of Realtors) gives us access to electronic key safes throughout the Bay Area.
It has long been the vision of California REALTORS® to have one database to input and search all California real property, regardless of property type, location, or status. Today marks an historic day on our shared journey to a statewide Multiple Listing Service (MLS).
CALMLS announced that four local REALTOR® associations -- the Fresno Association of REALTORS®, the Lake County Association of REALTORS®, the Madera County Association of REALTORS®, and the Merced County Association of REALTORS® -- have become charter providers of calREDD™, an acronym for California Real Estate Dynamic Data. The initial REALTOR® associations will begin delivering calREDD™ to their members early this summer. We're on our way!

More on the Sunnyvale Redevelopment

I was hoping that our new downtown would not be impacted too much by the current economy. Target is "on target" (sorry, I couldn't resist) for late this year, and the opening of the project has already been delayed until late 2010. Now, Peter Pau, the developer says that he needs an additional $450,000,000 in loans to complete construction, and negotiations could take several months. In the meantime, plans for a hotel are put on hold. One more victim of the economy, but at least the numbers are not in the billions.