17 Feb 09 20% Northern California Home Mortgages Underwater
A huge percentage of Northern California homeowners suddenly owe more on their home mortgage loans than their homes are actually worth. A recent mortgage relief report indicated just how quickly and far house values have tanked in, Silicon Valley. Mortgage industry groupies call this “underwater.” That is when you owe more on the total home mortgages than the home’s current fair market value. In a recent article, mortgage financing expert, Jason Cardiff said, “The homeowners that can afford their mortgage need to look forward and avoid getting caught up in the home devaluation crisis of 2009.” Cardiff continued, “California home values will rebound in a few years once the housing market receives the measure it needs for correction.” “California is still the greatest place to live on the planet and that why West coast homeowners need to stick it out if they can afford their mortgage.”
This new housing report shows that 20% of homeowners in Silicon Valley owe an outstanding mortgage balance that is greater than their property value. According to real estate news company zillow.com, during the 4th quarter of 2008, nearly 20% of homeowners in the San Jose metro area were experiencing “negative home equity.” Home values vary greatly in some Santa Clara County neighborhoods. This is the most significant decline in over a decade. Many home financing evaluators are predicting that mortgage modifications will reduce foreclosures in 2009.
When people are concerned about their income and savings disappearing, fewer will purchase homes despite low mortgage interest rates and falling prices. It is a difficult time for homeowners with these drops in values, but most real estate experts believe that home values will rebound eventually. Until then, FHA continues to extend a great opportunity for 1st-time homebuyers previously priced out of the market. Low interest rates along with lower home prices, especially foreclosure properties, are encouraging more new home buyers.
Tags: FHA, foreclosure properties, foreclosures, home financing, Jason Cardiff, Mortgage interest rates, mortgage modifications, mortgage relief, mortgages underwater, negative home equity, Northern California homeowners, real estate news
11 Feb 09 Fed Agrees to Purchase Bad Credit Securities and Keeps Key Interest Rates Near Zero
Federal Reserve committed to buy bad credit mortgage securities and treasuries if deemed effective; Fed believes that mortgage interest rates to remain low for “some time”. The Fed is committed to mortgage relief expansion that includes the purchase of housing debt and bad mortgages.
Watch the Mortgage Relief and Financing Analysis by Richard Dekaser of National City Bank.
Tags: bad credit mortgage, Mortgage interest rates, mortgage relief
11 Feb 09 20% Silicon Valley Homes Have Negative Equity
A report out Tuesday morning gives a fresh look at just how quickly and far home values have plunged in Silicon Valley. A huge percentage of South Bay homeowners now owe more on their mortgage loans than their homes are worth. It is called “underwater.” That is when you owe more on the home mortgage than the home’s market value. This new report shows that 1 out of 5 homeowners in Silicon Valley is in this situation. The reason is a great decline in the prices of these homes.
According to real estate valuation company Zillow.com, during the fourth quarter of 2008, nearly 20% of homeowners in the San Jose metro are upside down with “negative equity.” Property values range significantly in Northern California neighborhoods. In Gilroy, for example, the median home value dropped 38%. Los Altos declined only 5.4%. But, in Palo Alto, the only city to post an increase, median home values jumped about 5%. This one of the major reasons that California loan modification plans have become so popular with local residents.
Overall the value of homes in the San Jose metropolitan area fell just over 17% in the final three months of 2008, compared with the same period in 2007. This is the steepest drop in more than a decade. Because of the economic downturn the effects of growing insecurity really started to show during the last October-to-December period.
When people are worried about losing their jobs and their stock market investments crumbling, fewer will buy homes despite low mortgage rates and falling prices. It is a tough time for homeowners with these drops in values, but they will eventually rise again. In the meantime, this is a great opportunity for first-time homebuyers previously priced out of the market. Low mortgage interest rates along with lower home prices, especially foreclosure properties, are encouraging more buyers.
Tags: California loan modification, foreclosure properties, home mortgage, Mortgage interest rates, Negative Equity, Northern California, Property values, San Jose, Silicon Valley, underwater
05 Jan 09 Rates Drop and More Lenders Offer Mortgage Relief
Mortgage interest rates have dropped dramatically ever since the Federal Reserve unveiled a plan last month to buy up to $500 billion of mortgage securities backed by government-sponsored enterprises, Fannie Mae and Freddie Mac. The program also entails buying up to $100 billion of debt issued by Fannie Mae, Freddie Mac and the Federal Home Loan Banks. The Fed cutting rates benefits home refinancing and mortgage relief and foreclosure prevention alternatives.
Direct Mail Marketing Company, Kelly Media Group president, Jason Cardiff said in a statement yesterday, “Conversion rates for mail pieces targeting troubled homeowners with loan modification offers have received phenomenal double digit numbers.” Cardiff continued, “We have not seen mail to call ratios in the mortgage business since the 125 second mortgage boom in the late 90’s.” We are seeing positive results for mortgage brokers, law firms and loan modification companies. banks need to trust restored as well and the only motivating reason for consumers to start borrowing again will be low mortgage rates.”
Federal Reserve Leaves Interest Rates Unchanged
Fed Maintains Rate at Range of 0-0.25%.
Can borrowers with bad credit refinance into an affordable payment or will they lose their home to foreclosure? In a recent report, Freddie Mac chief economist Frank Nothaft said, “Interest rates for thirty-year home loans with fixed rates declined for the tenth straight week.” Mortgage rates dropped to 5% but how many distressed homeowner will actually qualify for a refinance loan with these 5% rates?
Former Ditech executive, Jeff Morris said, “Loan modifications give these rejected homeowners a new opportunity to negotiate a lower mortgage rate and in many cases the interest rate the lender agrees to is less or equal to the prime rate that mortgage lenders are offering “A” paper borrowers with 740+ fico’s with equity and full documentation.” Morris continued, “What it means in laymen terms I that struggling borrowers that can’t qualify for a refinance loan, still qualify for a loan workout that actually has a lower interest rate.”
Tags: bad credit refinance, direct mail marketing company, loan modification companies, loan workout, Mortgage interest rates
