New Listing!

3078 Carfax

4BR / 3 BA / 1,657 SQFT
$574,900

If you know anybody looking for a beautiful home, please call or email us.

DeMille Middle School Closing

One of our local schools is closing. Read more from the Press Telegram article:

http://www.presstelegram.com/news/ci_15320241


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After shopping for a home, tired buyers often make poor mortgage choices

From LA Times...

New research suggests buyers applying for mortgage loans immediately after house hunting often make poor choices—sometimes selecting the first loan option presented, regardless of the terms with which it is associated.

MAKING SENSE OF THE STORY FOR CONSUMERS

• The research, conducted by two George Washington University instructors, found “cognitive resource depletion” to be a determining factor in why some borrowers make poor choices in selecting a home loan. Cognitive resource depletion implies willpower is a limited resource that can be exhausted. The study suggests the depletion of willpower may be one reason borrowers choose loan products such as pick-a-pay mortgages, interest-only loans, loans with balloon payments, and mortgages with negative amortization.

• To test the theory of cognitive resource depletion, two test groups were created. One was presented with an online-shopping simulation, the other was not. The group completing the simulation then was tasked with selecting a set of mortgage alternatives. The second test group only was asked to select a mortgage product. Almost half of those participating in the house-shopping exercise selected a higher-risk mortgage, while less than one in five of those who did not participate in the experience selected a higher-risk mortgage.

• Although most sales contracts require buyers secure financing within a designated time period, the authors of the study recommend even financially savvy borrowers institute a waiting period of at least two days after selecting a home to purchase before applying for a home loan. To address this, the authors and most real estate professionals advise home buyers apply for a home loan and receive preapproval prior to searching for a house.

Fast Facts

Calif. median home price: April 2010: $306,230 (Source: C.A.R.)

Calif. highest median home price by C.A.R. region April 2010: Santa Barbara So. Coast $879,000 (Source: C.A.R.)

Calif. lowest median home price by C.A.R. region April 2010: High Desert $127,300 (Source: C.A.R.)

Calif. First-time Buyer Affordability Index - First quarter 2010: 66 percent (Source: C.A.R.)

Mortgage rates: Week ending 6/10/2010 30-yr. fixed: 4.72 Fees/points: 0.7% 15-yr. fixed: 4.17% Fees/points: 0.7% 1-yr. adjustable: 3.91% Fees/points: 0.6% (Source: Freddie Mac)

Mortgage rates at all-time lows

From ClarkHoward.com

MONEY-SAVING MOMENT: With mortgage rates at all-time lows, now may be a great time to refinance -- if you meet new stringent criteria.

The national average for 15-year mortgages is 4.1 percent, according to The Los Angeles Times. (Editor's note: Figures accurate as of June 11, 2010.) That means some people are getting in the upper 3s fixed for 15 years! Those who want to avoid closing costs might be getting in the low 4s. Meanwhile, the national average for 30-year mortgages is around 4.75 percent.

With the purchasing market having fallen off a cliff, lenders are eager to get you in a refi to drum up some business. They're desperate for those origination fees.

Right now, there's a bigger spread than normal between 15- and 30-year rates. You'll still need good credit; you'll have to intend to stay in your home to make a refi worthwhile; and you must appraise out.

Because of new stringent rules, if you don't have a lot of equity in home, appraisers are no longer erring on the high side for property valuations. That makes it much harder to qualify.

If you can, though, this is a phenomenal opportunity. It's also an ironic one because interest rates were trending higher before the European financial crisis of 2010.

Could mortgage rates go lower? No one knows.

But when world markets are unstable, foreigners pour their money into our debt instruments because we are still the safest place to hang with your dough. So that suggests it's possible for mortgage rates to drop further, but we'll have to wait and see...

After foreclosure: How long until you can buy again?

From CNN Money

Financing a home after foreclosure is possible for most homeowners. Those who default on their mortgages due to economic hardships, such as job loss, may receive approval for another mortgage in as little as two years, while it may take more than seven years for strategic defaulters to be approved.

MAKING SENSE OF THE STORY FOR CONSUMERS

• Lenders utilize several methods in determining whether to grant mortgages, including the amount of money borrowers have saved; employment histories; and payment history.
  
  
• According to the chief economist with the Mortgage Bankers Association, lenders may be more willing to finance a mortgage for a borrower who defaulted on their mortgage as a result of factors beyond their control.
  
  
• Some homeowners who strategically default—intentionally not meet their mortgage obligations although they have the financial means to do so—assume they can raise their FICO scores by paying their others bills on time. However, most future loan underwriters will scrutinize their records very closely, and if they determine the borrower strategically defaulted on their previous mortgage, the repaired credit score will not overshadow the walkaway.
  
  
• Although not impossible for strategic defaulters to finance another home purchase, it likely will be more difficult. Lenders may ask for down payments of 30 percent or more to provide sufficient collateral to enable the bank to recoup most of its money in a foreclosure. These borrowers also may be charged higher interest rates, even above the levels other borrowers with similar credit scores would receive.

Fast Facts

From the California Assc. of Realtors

Calif. median home price: April 2010: $306,230 (Source: C.A.R.)

Calif. highest median home price by C.A.R. region April 2010: Santa Barbara So. Coast $879,000 (Source: C.A.R.)

Calif. lowest median home price by C.A.R. region April 2010: High Desert $127,300 (Source: C.A.R.)

Calif. First-time Buyer Affordability Index - First quarter 2010: 66 percent (Source: C.A.R.)

Mortgage rates: Week ending 5/27/2010 30-yr. fixed: 4.78 Fees/points: 0.7% 15-yr. fixed: 4.21% Fees/points: 0.7% 1-yr. adjustable: 3.95% Fees/points: 0.6% (Source: Freddie Mac)