The Office of Federal Housing Enterprise Oversight (OFHEO) today announced it has temporarily increased limits on conforming loans offered by government-sponsored enterprises, Fannie Mae and Freddie Mac, from $417,000 to as high as $729,750 in fourteen counties in California for loans originated between July 1, 2007 and Dec. 31, 2008. Fannie and Freddie are reported to be working out new underwriting standards and expect to begin offering the new loans soon.

Also, on Wednesday, the government raised the conforming loan limit for mortgages guaranteed by the Federal Housing Administration, and has begun offering the maximum limit of $729,750 for 14 California counties, up from $362,790, for loans originated between now and Dec. 31, 2008.

The Fed’s economic stimulus package approved earlier this year called for temporary increases on conforming and FHA loan limits to allow troubled borrowers to refinance out of sub-prime loans and make it easier for many new buyers to qualify for mortgages in high-cost areas, particularly in California where home prices remain among the highest in the nation.

To view a list of the new FHA Mortgage Limits by county, go to:

FHA Loan Limits by County

For a list of the proposed loan limit changes for Fannie Mae and Freddie Mac, go to:

Fannie Mae and Freddie Mac Proposed Loan Limit Changes

Fed’s interest-rate cuts will benefit ARM, HELOC borrowers
Effect on long-term rates remains to be seenTuesday, January 22, 2008

By Matt Carter
Inman News

The unscheduled and dramatic cut in short-term interest rates announced today by the Federal Reserve will provide immediate relief for borrowers with home-equity loans or facing interest-rate resets, mortgage market experts say.

But long-term rates — which were at 2 1/2-year lows before today’s 75-basis-point reduction in the discount rate and the target for the federal funds overnight rate — could move in the other direction if bond market investors get nervous about inflation.

For now, the Fed seems to have decided that the threat of a recession far outweighs the risk of inflation, making in a single day cuts in short-term rates some observers had expected would be stretched out over months.

“Just a few weeks ago, the consensus was that the Fed would cut no more than 75 basis points, and 3.25 percent would be trough,” said Freddie Mac’s chief economist Frank Nothaft. “We’re there already. So are we at the low point? It’s really hard to say.”

Nothaft said the Federal Reserve’s Open Market Committee could cut rates again when it holds its scheduled meeting Jan. 29-30. Or its members may want to wait and see how to today’s dramatic move affects economic indicators.

The rate cuts are “certainly good news for people who have mortgages, or are shopping for a mortgage,” Nothaft said. For those with adjustable-rate mortgages (ARMs) indexed to the prime rate or home-equity lines of credit (HELOC) loans, “this shows up right away in terms of lower interest rates,” as banks follow suit and lower the prime rate to 6.5 percent. For ARM borrowers facing interest-rate resets, Nothaft said, that translates into a smaller increase in payments, and “maybe even a decline.”

According to Freddie Mac’s most recent weekly survey of mortgage rates (see Inman News story), the 5.69 percent rate on a 30-year fixed-rate loan was the best in 2 1/2 years. While it remains to be seen what effect the cut in short-term rates will have in the long run, rates on 10-year Treasurys fell today as stocks bounced back from earlier losses, Nothaft said.

Although rates on 10-year Treasurys are not linked directly to mortgage rates, they tend to move in the same direction, as they play a similar role in investor’s portfolios.

“It helps more than it hurts,” said Doug Duncan, the chief economist for the Mortgage Bankers Association. “It’s probably not going to bring long rates down much further, but it certainly brings short rates down, and has some positives for the whole economy and housing.”

Duncan said what happens with long-term rates depends largely on whether market participants think the Fed has gone far enough with short-term cuts.

If today’s cuts are seen as adequate, “that increases expectations of future economic growth, and may establish a sort of bottom where the 10-year Treasury yield is going to go,” Duncan said. “I don’t expect the 10-year Treasury yield to go much (lower), unless there were a whole bunch more difficult financial announcements made in the next couple of months.”

What the rate cuts probably won’t do is restore investor confidence in the secondary market for mortgage loans not guaranteed by Freddie Mac and Fannie Mae. That means borrowers seeking subprime and so-called jumbo loans will continue to pay much higher rates than offered during the housing boom. 

Although the secondary market for loans within the $417,000 conforming loan limit “is working just fine,” Nothaft said, rates on jumbo loans are about a full percentage point higher than those for conforming loans.

The National Association of Realtors and some Democrats in Congress are pushing for a 50 percent increase in the conforming loan limit to allow Fannie and Freddie to buy or guarantee loans that are now considered “jumbo.”

The Bush administration wants stricter oversight of Fannie and Freddie in place before it will go along with an increase in the conforming loan limit, saying the bigger loans may involve more risk, and reduce the number of smaller loans the government-sponsored enterprises can back (see story).

Are you looking for pristine, under-market, remodeled unit that overlooks a Valencia golf course?
CLICK HERE for the virtual tour (including price, amenities, etc.)
Here’s a sneak peak below…

Contact me if you, or anyone you know, is interested! 

I just listed THIS ONE!
CLICK HERE for the virtual tour/pics/features etc.

With all of the frenzy over whether or not Countrywide is going under, here is a GREAT article that makes sense.

Our in-house lender, Tom Obrien, emailed this out today,
“Because of the current market with a lot of lenders going out of business, rates on Non Conforming loans ( loans over $417,000), and Alt A (stated, on full doc loans), their rates are going up quite a lot to cover their losses in the market and because of their high risk.  If you’ve got buyers that don’t have locks on their loans, please make sure they do now.  
Rates have  moved up .625% in rate this week on 30 year fixed loans, and ARM’s have moved up .25% – .50% in rate.  The conforming loans (loan amounts up to $417,000 and under) have actually gotten better this week.  Please don’t hesitate to contact me with any questions.”
CLICK HERE FOR HELPFUL ARTICLE

Do you want the Nordstrom in customer service in your General Contractor?  Then call my guy, Jeff Wilson-Made In the Shade  at (661) 212-9593.  While he and his crew are still scraping my ceilings etc., I have been thoroughly impressed:  they arrive everyday at 8am, they work hard all day with scheduled breaks, the crew members are polite and courteous, they shop vac the work area everyday before they leave, I can always get Jeff on his cell, his price is right and best of all…he’s a highly skilled good ole boy whose reputation is the most important thing to him and therefore he conducts his business accordingly.  An affiliate after my own heart!

While personally I’m growing weary of the entire house being under construction, furniture still in the garage, dust everywhere from the acoustic ceiling removal, it makes it all worth it knowing that I am getting a job well done and NOT getting ripped off.

If you need ANYthing done in your home, you should call Jeff.  Just so you know, he’s in demand, so call him for a quote the moment you know you need him and he’ll work you in the rotation.  Tell him I sent you! 

*As a sidenote, there is another contractor in SCV who has a company called Made In the Shade.  These are not the same companies and the level of skill and service are different (per clients who have confused them).  Make sure that you’re talking to JEFF WILSON of Made In the Shade.  If it’s Jeff,  it’s the guy I’m recommending.  If it’s not Jeff, I can not give my endorsement. 

With the cost of real estate in Santa Clarita Valley (and most of California) usually being pretty steep, buyers some buyers attempt to ‘get creative’ about how to own a home.  The most common ideas I hear from buyers are finding a ’steal’ of a foreclosure (which is not usually the reality), a manufactured home (which have ‘no-ceiling’ land lease fees) and buying land to build a home themselves. 

I am a fan of creativity and ingenuity, however, often times buyers are not aware of the immensity (and danger) of their ‘creative ideas’.  

If you or anyone you know is thinking of buying land and building (and are inexperienced), please CLICK HERE for a tiny window into costs of just permits with the City of Santa Clarita.  Then add the cost of the land, the cost of service providers, the cost of building materials, the cost of finishing touches…it all adds up. 

Buying land and building can be a great step for you or it can be one of the biggest financial mistakes ever.  If you go that route, be wise and do your homework ahead of time. 

Good clients are priceless.  I’ve been blessed to have more good clients than bad clients in my real estate endeavors.  Trust me, the good ones are worth their weight in gold! 
Here are some qualities that make good clients and invite a pleasurable transaction: reasonable, teachable, decisive, yielding, respectful, willing to negotiate, kind, clean, willing, financially wise, truthful, humane, ethical, legal, etc.  Clients who think they know more than the expert can grate after a very short while (and the ‘know-it-all ism’ always leaves me wondering why THEY don’t have a RE license…if they know more?).  Sooo, my 1st point…

I currently have a delightful couple who are about to list their beautiful home with me.  They contacted me several months ago, but wanted to make some improvements before we listed in order to fetch top dollar.  In early December they called me and asked if they could leave me a key and if I would walk through their house while they were gone and note any/all advice I would give to improve on staging etc.  ?!?!?!?!  A dream come true….someone actually asking the agent BEFORE they do major changes!?!?!?!  I dutifully and gleefully did it.  I emailed them my long list that included jobs like de-wallpaper and re-paint, replace X,Y,Z fixtures, omit A,B,C furniture.  They called me a couple weeks later and asked me to come back over wherein they showed me 90% of it completed!!!!!  And skillfully completed!!!!!  I was so impressed and so thankful!  Their home looks great and I hope a buyer can see themselves in the home and that we’ll have a quick sale! 

My 2nd point…I was just thoroughly impressed with the sellers willingness to take advice from someone, find it valuable and to not take it personally.  It’s the sign of a truly great client: valuing the expert’s advice.  Through the course of the follow up visit, Mrs. Seller said something that I thought was terrific (and I wish we were all this open).  She said (paraphrased), ‘You know, this process has been really hard to do all at once.  It’s made me wish that I had a good friend who would come over about every 6 months and walk through my house and tell me what needs to change.  We just get used to it and we don’t see the clutter or see what you’re seeing (or the buyer).  It would just be nice to have a good friend to come over and I woudl go to their house to do the same thing and where we could help each other in that way’    What a great, teachable, and humble perspective.  While I am ALWAYS in favor of less ’stuff’ around the house and in our lives, I am even more in favor the humble spirit behind it. 

I’m pretty sure we’re going to have a GREAT transaction.  I’ll keep you posted!

A great agent is so hard to find…that’s why most great agent’s business is based on 90% referrals…someone else has used them and found them to be worthy of recommendation. 
If you’re looking in Santa Clarita, then you already know that I’m a great agent and I look forward to your email or phone call .  However, if you’re relocating to Idaho, it’s with great confidence that I introduce you to my friend and fellow real estate colleague, KASEY BOLES.  She, like myself, grew up in real estate, knows her business, is attentive to detail and will take GREAT care of you…especially if you tell her that I sent you!  

We’ve known each other for a decade now and I have recommended my very own family to her and now to you!