It’s an increasingly competitive market out there and we’ve just learned a fabulous secret to get your FHA or VA offers accepted when you are up against other conventional/cash buyers!  Chase Bank just spent part of the morning with The Ruth Pugh Group, explaining the advantages of their new “Chase Home Buyer Advantage Program”. This really is a wonderful strategy that we are sure more lenders will catch on to – but for now, Chase is the only bank we know of offering the program.

Let’s step back for just a moment and look at the standard process.  Typically, the buyer meets/emails the mortgage banker, gives them a summary of their income/debt and authorizes their credit to be pulled – and the mortgage banker issues a pre-approval letter.  The pre-approval is what allows you to make an offer BUT it is contingent on the lender getting all your other documentation and running the file through underwriting.  This process usually doesn’t begin until your offer has been accepted and escrow is opened.  It then generally takes 14-30 days for underwriting approval to be issued. All the waiting around makes everyone nervous; from you the buyer, to your agent and most importantly – the seller.

The seller is who you want to impress with your offer, especially when there are multiple offers, which is all too common today. Surprisingly, over 19% of traditional 2012 sales in California fell out of escrow, and 45% of short sale sales (according to the 2012 CAR Annual Housing Marketing Report).  That’s not a very pallatable statistic for a seller to digest:  more than a 1 in 5 chance your financing will not be approved and they have to go back on the market and start all over again!  You have to think of it from the seller’s perspective; they want a solid deal that won’t fall apart, sometimes price isn’t as much of an issue as knowing a deal will close.  So how do you make the seller feel better and give yourself an advantage against the competition … read on my friend!

With the Chase Homebuyer Advantage Program, they not only provide you with the pre-approval letter but they also get all the other detailed paperwork from you in order to run your file through underwriting, get final approval and issue a Conditional Approval Letter (which is good for 90 days).  In addition, this allows you to REMOVE THE LOAN CONTINGENCY on your offer.  This is huge in a competitive offer situation.  Can you see how this will give you a huge edge to get your FHA or VA offer accepted?  You’ve already had your lender do almost all the work on the file, all you need is a contract and an appraisal and you are as good as closed – the seller is going to love this!

You are essentially giving the seller peace of mind knowing there is no loan contingency and the only thing left for them to worry about is the appraisal (which is beyond the sellers/agents/buyers control).  The “Chase Homebuyer Advantage Program” is also great for Conventional buyers who want to be even more competitive and be able to remove the loan contingencies on their offers, but they are generally already at an advantage being a conventional buyer with 20%+ to put down.  FHA and VA offers are often viewed as not as strong as Conventional loans due to the small down payments of Zero to 3.5%; and of course, it’s pretty difficult to compete with cash.

Another important strategy to get your FHA or VA offer accepted is working with an amazing group of agents and mortgage bankers who know about these programs and stragegies for your success!  The Ruth Pugh Group is committed to being your advocate in the real estate market and I, for one, am so happy we have partnered with Chase and brought them in to speak with our office today. In addition, you need a great Chase Mortgage Banker like Holmes T. Bennett (aka HT) in the Chase Hillcrest office, 619-248-3759.  

If you’d like to get more information, on how to get your FHA or VA offer accepted, please contact our office via our website or call 858-467-4727.

7356 Park Village Road

The Ruth Pugh Group is proud to announce their newest listing at 7356 Park Village Road in Rancho Penasquitos. Listed at a very competitive price point of $649,900 to $669,900 – this 4 Bedroom, 2.5 Bathroom, 2,069 sq. ft. beauty is sure to be popular with buyers and will sell quickly.

The home is located in the desirable Park Village development which was built in several phases by Greystone Homes in the mid-1990′s (also the builder of Torrey Del Mar).  This carefully planned community offers well-manicured streets and common spaces set among hills and canyons, along with easy access to some of the areas best nature and bike/running trails – check them out at Rancho Penasquitos Preserve.

7356 Park Village Road is also within the South Western border of the acclaimed Poway School District and the Park Village Elementary School is just two blocks away. Click the highlight to learn more about the Poway School District. You’ll also love being centrally located with easy access to the 5/15 off Ted Williams Parkway; great shops and restaurants in Del Mar & Carmel Valley and just 10-15 minutes to the stunning Pacific Ocean!

Step inside 7356 Park Village Road and you’ll instantly appreciate the vaulted ceilings, open flow and great light that you can enjoy year-round.  This home has recently been renewed with fresh paint and new flooring throughout, a remodeled kitchen with dark cabinets, granite counters AND backsplash, and new stainless appliances. The front yard boasts new sod and the rear yard has great patio space plus additional grass space not found in all the homes in the area.  The rear yard is very private and fenced for your safety and enjoyment.

This property just came onto the market on 02/23/2013.  An Open House is scheduled for 02/23/2013 & 02/24/2013 from 1-4pm and will be hosted by Sarah Wilkey with the Ruth Pugh Group of Century21 Award.  For more more information about this Ruth Pugh Group listing, or to search all properties listed in San Diego, please contact us or call 858-467-4727

The money your client puts “down’ or the down payment on your client’s home can be one of the biggest challenges for many first-time homebuyers.   That’s why CalHFA offers several options for down payment and closing cost assistance through a select few approved government lenders like, Mountain West Financial.    This type of assistance is often called a second or subordinate lien.

CalHFA’s subordinate loans are “silent seconds”, meaning payments are deferred so your client does not have to make a payment on the assistance until the home is sold, refinanced or paid in full.   This helps to keep your clients payment manageable and will  allow them to aquire a home with as little as a .50% down payment.

Know all your options right now for down payment assistance. We would love to help with any questions you may have! 858-467-4727

“This spring will be the litmus test for housing demand,” says Steven Ricchiuto, chief economist for Mizuho Securities USA.

The spring season typically runs March through June but may have started early this year because of unseasonably warm weather.

While last year was dismal for existing home sales, this year is looking better. Existing home sales in February were up 9% from the same time a year ago, as was the Pending Home Sale Index, which reflects signed contracts leading to sales, says the National Association of Realtors.

Meanwhile, Realtors’ confidence in the single-family home market is the highest in four years, according to a late February NAR survey of 4,300 agents. Coldwell Banker says its website’s traffic was up 47% in February from last year.

This spring season “will be the best in four or five years,” says economist Paul Dales of Capital Economics.

But not all markets will move together, and spring sales may signal which ones are improving or still declining, says Eric Fox, Veros Real Estate Solutions economist.

Veros forecasts that U.S. home prices overall will drop 0.85% in the next 11 months but that 40% of 321 metropolitan areas will see prices rise.

Phoenix will do best, Veros says. Given a 42% drop in home supply and a relatively strong economy, Phoenix homes will see a 5% price gain this year, Veros says.

A similar-size drop in supply is also helping Denver, says Scott Webber, president of Fuller Sotheby’s International Realty. “We’ve returned to a much more balanced market,” he says.

Denver prices rose 0.2% in January year-over-year, the Standard & Poor’s Case-Shiller index shows. Of 20 cities, only Denver, Phoenix and Detroit posted annual gains, S&P says.

Webber says non-distressed homeowners still hesitate to sell, but others see a shift. In Central Pennsylvania, Coldwell Banker saw a 30% jump in new listings in February over a year ago. March was strong, too, says manager Naomi Fredlund.

“People were holding off,” hoping for stronger prices, Fredlund says. “Now, they’re selling.” She expects flat prices.

Spring sales could disappoint because a mild winter drew some buyers into the market earlier, Dales says. Also, investors bought a record 25.4% of homes in February, says aCampbell/Inside Mortgage Finance survey. They buy all year and may mute the impact of the spring season this year.

Any hits to consumer confidence could also curtail sales in what’s “poised to potentially be a good season,” says Mark Fleming, CoreLogic economist.

The FHA upfront mortgage insurance premium will increase to 1.75% from 1% of the base home loan amount. This will apply regardless of the term or loan-to-value ratio beginning in April.

The annual mortgage insurance premium will increase by 10 basis points for loans under the $625,500 limit beginning April 1 and by 35 bps for home loans above that amount starting in June, the FHA said Monday. Authority for these raises come under the payroll tax cut extension agreed to last fall.

The FHA said the changes will boost the Mutual Mortgage Insurance Fund by $1 billion.

The UFMIP can still be financed into the mortgage. The increase to the upfront premium will cost new borrowers roughly $5 more per month.

Reverse mortgages and borrowers in special loan programs would be exempt from the changes, according to the FHA.

Last week at the Mortgage Bankers Association servcing conference in Orlando, FHA Commissioner Carol Galante said there would be upcoming insurance premium changes for the streamline refinance program. An FHA spokesman said these changes would be included in a letter to lenders due soon.

The MMI fund slipped below the Congressionally mandated 2% threshold in 2008, and in slipped to 0.2% last year. According to an analysis of President Obama’s budget, the fund could have declined further in 2013 and possibly needed a bailout from the Treasury Department. Nearly $1 billion in revenue from settlements with mortgage servicers announced in the last few weeks will also keep the fund from needing assistance, according to FHA.

“After careful analysis of the market and the health of the MMI fund, we have determined that it is appropriate to increase mortgage insurance premiums in order to help protect our capital reserves and to continue encouraging the return of private capital to the housing market,” Galante said. “These modest increases are one of several measures we are taking towards meeting the Congressionally mandated 2% reserve threshold, while allowing FHA to remain a valuable option for low- to moderate-income borrowers.”

Source: HousingWire.com

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In a situation like divorce, the general truth is that economic hardship and financial stress tend to be a chief cause. So you’d think that during the recession and housing slowdown that divorce is on the rise. But you’d be wrong.

I stumbled across a discussion of a new economics paper last week that finds the opposite – that economic turmoil today is keeping couples together, and that low house prices are the reason. Although it may seem like low house prices would enable couples to break up and buy on their own more easily than when the market is hot and prices are high, it seems that couples instead would rather stay in their unhappy marriages than sell their homes at a loss.

For those couples whose home values may have fallen below their mortgages, selling may not be an option if the bank won’t approve a short sale. But, even if that’s not the case, the research notes what economists call “loss aversion,” an emotional barrier to selling at a loss. It seems we humans for the most part can’t get over that.

Just how much did the recession and drop in house prices pull down the divorce rate? The research found that a 10% decrease in home prices pulled down the divorce rate of college-educated households from 11.6% to 8.22%.

What exactly does this mean? Well, it’s interesting data to understand when examining the dynamics of the housing market, what affects it and how it affects other parts of the economy and everyday life. For some couples, who knows – maybe the extra years they spend together because of avoiding a loss on their home sale will actually help them reconcile. Or, maybe it makes it worse.

I think a big take away from this is that it shows the emotional component of the housing market that can’t always be predicted. Data and forecasts are great; they’re helpful to understanding the various factors and impact of economic events. But, sometimes in housing there is good old human emotion that comes in and throws all the data and forecasts for a loop.

consider selling your house now rather than waiting.

Here are five reasons why:

1. This is when your house will get the most exposure.

There is currently an increase in the number of buyers attending open houses and searching online for a home. This surge dramatically increases the exposure for your house. The best chance of getting quality offers (perhaps even multiple offers) is RIGHT NOW!

2. Foreclosures and short sales will increase in about 90 days.

The good news is that the number of people paying their mortgage on time is increasing. This will lead to less distressed property sales later this year and throughout 2012. The not-so-good news is that there is still a large inventory of existing foreclosures and short sales that will still be coming to market.

As an example, LPS reported in their latest Mortgage Monitor that:

- There are still twice as many loans going 90+ days delinquent as are starting foreclosure.

- There are almost three times the number of foreclosure starts as there are foreclosure sales.

- Distressed property inventory levels are almost 45 times the rate of monthly foreclosure sales.

This means that there is a backlog of properties which will start coming to the market in about 90 days as banks clear up their paperwork challenges. These properties sell at dramatic discounts. They will be your competition. Both Fannie Mae and Freddie Mac have recently discussed the magnitude of this challenge.

3. Interest rates have risen over the last six months.

Interest rates have stabilized recently. However, in the last six months, interest rates have climbed over 1/4%. Every time the rates increase 1/4%, approximately 250,000 buyers are eliminated from qualifying for a mortgage. In an environment of volatile rates, waiting could mean that there will be fewer buyers eligible to purchase your house. It also could mean that you will pay a higher rate on the next home you buy.

4. Qualifying for a mortgage is about to get even more difficult.

Besides increasing rates, there are other factors that will hinder a buyer’s ability to qualify for a mortgage as we move forward. Lending standards have been getting tighter over the last year. And as the government debates the new proposed guidelines (QRM), banks are gearing up for even more stringent standards.

Morgan Stanley recently stated:

“Recent developments in issues such as GSE reform, Dodd-Frank securitization rules, and foreclosure settlement issues suggest a tighter and more expensive environment for mortgage credit.”

This may impact any potential purchaser for your property and may also impact your next purchase.

5. It’s time to get on with your life.

Probably the most important reason to sell is so you can get on with your life. You placed your home on the market for a reason. Do not allow a less-than-stellar housing market prevent you from reaching your goals as an individual or as a family. Think about the reasons you decided to move in the first place. Are these reasons still important to you? If you have to take less than you were originally hoping to get for your house, your family has a question to ask each other: Is the dollar difference in sales price worth putting off our plans? Only you and your family know the answer to that question.

If you plan to sell this year, the reasons above prove that selling now makes more sense than waiting to later in the year. Sit with a real estate professional in your area today to fully understand your best option.

There are some limited exceptions such as if the borrower is a corporation, an LLC, an LP or a political subdivision. Also, if the lien is secured by a bond, a public utility lien and there are additional provisions is the loan is cross collateralized. Lastly, although lenders cannot require a borrower to pay any additional compensation in exchange for a short sale approval , the new law allows for the borrower to voluntarily offer a monetary contribution to a lender in hopes of receiving a short sale. It goes on to state that contributions from other parties such as lenders, Realtors, and family members are allowed.

The odd thing about all these questions is that survey after survey keeps telling us that price is not the reason families actually buy a home. When money is considered at all, it is in light of not paying rent to a landlord. Let’s look at two recent surveys as examples:

National Housing Survey

The top five reasons given in the survey for buying a home, in order, are:

• It means having a good place to raise children and provide them with a good education
• You have a physical structure where you and your family feel safe
• It allows you to have more space for your family
• It gives you control of what you do with your living space (renovations and updates)
• Paying rent is not a good investment

The Myers Research and Strategic Services Survey

The top five reasons given in the survey for buying a home, in order, are:

• Home ownership provides a stable and safe environment for children and other family members
• Home ownership means the money you spend on housing goes towards building equity, rather than to a landlord
• Home ownership creates the opportunity to pay off a mortgage and own your home by the time you retire
• Home ownership creates the opportunity to live in a neighborhood that you enjoy
• Home ownership allows you the right to decorate, modify and renovate your home as you see fit

Bottom Line

Price dominates conversation when we talk about buying a home. However, when it comes down to it, we actually buy for the same reasons our parents and grandparents did – we want a better lifestyle for ourselves and our families.