Temporary Suspension of CALHFA Programs

The following information is from CALHFA.
If you need down payment assistance or any other buyers assistance please contact us.

Temporary Suspension of CalHFA Programs
Effective immediately, CalHFA is suspending the following active CalHFA First Mortgage Fixed
Rate Loan Programs and Down Payment Assistance Programs:
• 30-Year Fixed Mortgage products, including:
Moderate Income
Low Income
Nonprofits & Affordable Housing Partnership Program (AHPP)
Extra Credit Teacher Program (ECTP)
• California Homebuyer’s Down Payment Assistance Program (CHDAP)
• Extra Credit Teacher Program (ECTP)
• School Facility Fee Down Payment Assistance Program (SFF)
These programs are being temporarily suspended as a result of the action taken by the Pooled
Money Investment Board (PMIB) on December 17, 2008. The PMIB loans money to state
agencies to advance program funds which will later be repaid through bond issuances. CalHFA
uses a PMIB loan to initially fund its Conventional 30-Year Fixed Mortgage and down payment
assistance programs. The recent PMIB action froze all such PMIB loans. It is anticipated that
this situation will continue until the State’s budget crisis is resolved.
The PMIB will meet again in early January, 2009. At that time, we may receive information as to
when these programs will be restored.
CalHFA will continue to accept reservations for loans under the Community Stabilization Home
Loan Program (CSHLP) and SMART Loan Program. However, please note that CHDAP funds
will not be available for use with these programs.
CalHFA’s Homeownership Division thanks you for your business and we look forward to
continuing to support your affordable housing loan needs. For questions about this bulletin,
contact CalHFA Homeownership Programs by phone 916.324.8088; by fax 916.324.6589; by
email at homeownership@

Another Bailout?

Okay,
I couldn't resist posting this. This is one of those emails that gets sent around so I don't know who the author is. However is so apropos for what is happening right now and any of us who have worked in business can surely relate to the possibilities of truth to this story as it is sadly humorous;

Toyota and Ford - Canoe Race on the Missouri River

A Japanese company (Toyota) and an American company (Ford Motors) decided to have a canoe race on the Missouri River both teams practiced long and hard to reach their peak performance before the race.

On the big day, the Japanese won by a mile.

The Americans, very discouraged and depressed, decided to investigate the reason for the crushing defeat. A management team made up of senior management was formed to investigate and recommend appropriate action.

Their conclusion was the Japanese had 8 people rowing and 1 person steering, while the American team had 7 people steering and 2 people rowing.

Feeling a deeper study was in order; American management hired a consulting company and paid them a large amount of money for a second opinion.

They advised, of course, that too many people were steering the boat, while not enough people were rowing.

Not sure of how to utilize that information, but wanting to prevent another loss to the Japanese, the rowing team’s management structure was totally reorganized to 4 steering supervisors, 2 area steering superintendents and 1 assistant superintendent steering manager.

They also implemented a new performance system that would give the 2 people rowing the boat greater incentive to work harder. It was called the ‘Rowing Team Quality First Program,’ with meetings, dinners and free pens for the rowers. There was discussion of getting new paddles, canoes and other equipment, extra vacation days for practices and bonuses. The pension program was trimmed to ‘equal the competition’ and some of the resultant savings were channeled into morale boosting programs and teamwork posters.

The next year the Japanese won by two miles.

Humiliated, the American management laid-off one rower, halted development of a new canoe, sold all the paddles, and canceled all capital investments for new equipment. The money saved was distributed to the Senior Executives as bonuses.

The next year, try as he might, the lone designated rower was unable to even finish the race (having no paddles,) so he was laid off for unacceptable performance, all canoe equipment was sold and the next year’s racing team was out-sourced to India.

Sadly, the End.

Here’s something else to think about: Ford has spent the last thirty years moving all its factories out of the US , claiming they can’t make money paying American wages.

TOYOTA has spent the last thirty years building more than a dozen plants inside the US. The last quarter’s results: TOYOTA makes 4 billion in profits while Ford racked up 9 billion in losses.

Ford folks are still scratching their heads, and collecting bonuses…and now wants the Government to ‘bail them out’.

700 Billion dollar bailout

Today, the Senate Banking, Housing, and Urban Affairs Committee held a hearing to discuss the U.S. Dept. of the Treasury’s proposal to stabilize the U.S. financial system. The panel consisted of Treasury Secretary Henry Paulson; Federal Reserve Chairman Ben Bernanke; Christopher Cox, chairman of the Securities and Exchange Commission; and James Lockhart, director of the Federal Housing Finance Agency.

Now that Congress has had a chance to dissect the Treasury proposal, we’re seeing pushback to the plan in its current form from both sides of the aisle, and this was evident during today’s hearing. Members of Congress are asking for several additions or refinements to the proposal, including:


- Legislation to help homeowners avoid foreclosure;
limiting compensation to executives of troubled firms receiving assistance;
- greater oversight than the limited bi-annual reporting mechanism in the current proposal;
- allowing the government to take an ownership stake in companies;
- decreasing the timeframe for the Treasury workout from two years to one; and
- limiting the initial outlay followed by a reassessment early next year prior to deploying additional resources.

With the general election in November a little more than a month away, there also is a certain amount of to-be-expected political posturing going on this week. Members of Congress will soon return to their home districts for recess and will be expected to explain their positions to constituents. However, some of the pushback is philosophically driven from both liberals and conservatives in both parties.

Corona City Council Down Payment Assistance

Amidst all the banking and lending turmoil, The Corona City Council is considering offering Down Payment Assistance to Corona residents. The Corona Redevolpment Agency is onsidering offering $1.5million in interest free loans for First Time Home Buyers.

We view this as a great step to helping Corona Families purchase one of the hundreds of vacant homes in Corona due to all the foreclosures. As of today, there are 523 homes under $300,000 compared to under 50 a few years ago. We believe this will be a great catalyst to the Real Estate Market in Corona. Although we think the Market is doing Great right now with Supply of Homes the lowest since spring of 2005 and the Sale of Homes the highest since the same time period.

They also offer a great incentive to keeping the buyer to stay in the city for up to 7 years. This allows the resident to get established in this great city. To qualify, buyers must meet income guidelines, be able to pay 3 percent of the home's value, and live in the home at least seven years or pay the city a share of any profits if they sell.

One of the main questions we have is how FHA will handle this Down Payment Assitance from Corona. FHA announced a few weeks ago that they will no longer consider Down Payment Assistance for FHA loans.

We will all have to stay tuned...

Click here to learn more fron the Press Enterprise article

If you are a First Time Home Buyer, please visit our website RobertandChristy.com and click on the Buyers Assistance tab for helpful information on buying a home.

Take care everyone and have a Blessed Day!
:)

Mortgage Rates DROP below 6%

Mortgage Rates Drop Below 6%

For the first time since early spring, mortgage rates have fallen below the 6-percent threshold.

Freddie Mac reports that 30-year fixed loans came in at an average of 5.93 percent this week, down from 6.35 percent a week ago and 6.31 percent at the same time last year.

A borrower taking out a $200,000 mortgage at 5.93 percent would pay $1,190 for monthly principal and interest payments, which is $54 less than the payments on last week's rate.

"Consumers see a five in front of mortgages, and they get excited," says Keith Gumbinger, a vice president at research firm HSH Associates.

Source: The Washington Post, Dina ElBoghdady (09/12/08)

Corona & Riverside to clean up Vacant Properties

Finally!!!
Code Enforcement for Vacant Properties:

A new state law in effect now gives cities and counties the ability to enforce codes and fine lien holders of vacant property. The cities of Riverside and Corona are issuing citations to force the properties to be cleaned up and repaired.

The County of Riverside has a new ordinance that forces all lenders to maintain and repair all property. If not completed in a timely manner the County will send a crew out to clean up and then will put a lien on the property.

Let's hope the banks will take responsibility on this one and not force the real estate agent to pay for the home the bank's own. It's pretty sad driving down the street and viewing all the dead lawns and trashed properties.

Housing & Economic Recovery Act

Higher permanent loan limits for conventional conforming and FHA will become effective Jan. 1, 2009; the Act calls for limits to increase to a maximum amount of $625,500, depending on the metropolitan area. Note: The temporary limits established in March will expire on Dec. 31, 2008.

§ FHA floor limits will remain the same at $271,050.

§ The VA guaranty will increase.

§ Minimum cash investment for FHA loans will increase to 3.5%.

§ A moratorium on risk-based pricing for FHA loans will go into effect Oct. 1, 2008.

§ Seller-funded Down Payment Assistance Programs with FHA loans will be terminated Oct. 1, 2008.

§ Condo processing for FHA loans will be streamlined.

§ FHA reverse mortgages (HECM): changes, among others, include higher loan limits, availability with purchase transactions, and a modification to the origination fee.

FHA lifts 90 day flipping rule on foreclosed homes

HUD has announced that in order to help foreclosed properties be immediately marketable they will lift the 90 day flipping rule for the term of one year.

This allows properties marketed and sold by property disposition firms on behalf of lenders to be sold without the 90-day waiting period.

This does not include properties which have transferred to others in non-foreclosure transactions.

The news release is available for viewing at www.hud.gov/news/.

Senate Passes Stimulus Package -- Final Bill Includes Increased Loan Limits

Senate Passes Stimulus Package -- Final Bill Includes Increased Loan Limits

Thanks in part to the lobbying by C.A.R. and NAR members; the Senate passed their version of an economic stimulus package on Thursday, February 07, 2008. The Senate version expands rebate checks for seniors and disabled veterans and includes the same increases to the conforming loan limits for both GSE and FHA found in the House stimulus package. The House has already announced that they plan to vote on the Senate version of the stimulus package and expect to quickly pass the stimulus package with a bipartisan vote. The President is expected to sign the legislation early next week, ahead of the Congressional self-appointed deadline of February 15th. The increase in the conforming loan limits will last through 2008, but C.A.R. and NAR continue to lobby for FHA and GSE reform, making these increases permanent.

The U.S. House of Representatives passed a stimulus package last week that raised the FHA and conforming loan limits to as high as $729,750 in high-cost areas. By increasing the loan limits, borrowers will see immediate relief with new liquidity in the mortgage market and the nation will see an additional 300,000 home sales. Research shows that an increase in the FHA limit would enable an additional 138,000 Americans to purchase homes, and 200,000 families to refinance their homes safely and affordably.

Increasing the FHA loan limits is critical to bolstering California’s housing market. Current law restricts FHA loans to levels well below the median home price in many areas of the country and caps loans in high cost states at $363,790. These limits are preventing many homebuyers from using FHA to purchase or refinance their loan. The proposed provision will increase FHA loan limits nationwide by raising the floor to $271,050 and the limit to 125% of local median home prices.

Additionally, raising Fannie Mae and Freddie Mac’s (GSEs) conforming loan limit will provide immediate relief to borrowers and alleviate downward pressure on current housing markets. For instance, increasing the GSE loan limit could result in more than 300,000 additional home sales and strengthen current home prices by 2-3%.

The critical role that GSEs play in providing liquidity to the mortgage market has never been more evident than it is today. The national subprime meltdown has had a dramatic impact on both the cost and availability of mortgages in many markets. Since August 2007, the interest rates for jumbo borrowers have been more than 1 percentage point higher than conforming loans, which can cost homeowners up to $400 month in higher interest payments.

Bank Owned Property - Open House Saturday Only!

REO Bank Owned property.

This lovely 4 Bedroom home has New Carpet, New Paint, New Dishwasher, New Range/oven, and New Microwave. This home also contains and upgraded kitchen with Granite countertops and Tile floors. The family room contains a a fireplace. Formal Dining Room and Living Room with cathedral ceilings. Bedrooms have ceiling fans. The backyard has block wall, covered patio, relaxing above ground spa and no rear neighbors. Located in a low tax area and in a nice neighborhood this home contains a 3 car tandem garage with storage cabinets. The bank priced this one to sell!


Call 1-800-385-9140 ext 2096 for proper forms to make offer.

POSSIBLE INCREASE TO THE CONFORMING LOAN LIMITS

On January 24, 2008 House Speaker Pelosi (D-CA), House Minority Leader Boehner (R-OH), and Treasury Secretary Paulson announced a bipartisan deal on an economic stimulus package. After heavy lobbying by C.A.R. and NAR, included in the House economic stimulus package is an increase in the loan limit for Fannie Mae, Freddie Mac, and FHA.

There is still not a clear consensus on how high the GSE conforming loan limit increase will be. There have been rival press releases, with Speaker Pelosi saying the cap would be at $729,750 and Minority Leader Boehner saying the cap would be at $625,000. Either way, the GSE loan limit would be increased to 125% of a Metropolitan Statistical Area (MSA), with the cap either at $625,000 or at $729,750. As of now, no legislative language has been formalized or released, so C.A.R. is unable to have a definitive GSE cap figure.

Additionally, the FHA reform included in the stimulus package is expected to be permanent, including an increase in the FHA loan limit to $729,750, and a decrease from the current 3% downpayment required; however, at this time we have not heard whether it will be reduced to 1.5% or 0%. The GSE loan limit increase would be temporary, most likely only until the end of 2008. In the meantime, C.A.R. will continue to lobby for permanent GSE reform which would include an increase in the conforming loan limit for high-cost areas, such as California.

The House is expected to vote on the economic stimulus package on January 29, 2008 and the Senate has expressed their interest to introduce and vote on their version of an economic stimulus package shortly thereafter.

Tax Break for Mortgage Debt

President Bush signed into law a new measure giving tax breaks to homeowners who have mortgage debt forgiven. Under preexisting law, the debt forgiven by a lender, such as for short sales and refinances, was generally taxable to the borrower as debt discharge income. With the passage of the Mortgage Forgiveness Debt Relief Act of 2007, a taxpayer does not have to pay federal income tax on debt forgiven for a loan secured by a qualified principal residence.
This tax break applies to debts discharged from January 1, 2007 to December 31, 2009. Qualified principal residence indebtedness is debt incurred in acquiring, constructing, or substantially improving the residence (up to $2 million for refinances).
For purposes of calculating capital gains, any debts discharged excluded from income under the new law must be subtracted from the basis of the taxpayer’s principal residence (but not below zero). However, taxpayers may generally exclude from capital gains income up to $250,000 (or $500,000 for married couples filing jointly) for properties owned and used as their principal residence for at least two of the last five years.
This is great news for homeowners who have gone through either a short sale or deed-in-lieu of foreclosure. Prior to this act, not only did the homeowner not have enough equity to sell their home and took a big hit on their credit score, but they were taxed on the differential between what they owed on the house and what it sold for (because it was treated as income). Now they can at least know that Uncle Sam will not come after them to pay taxes on that differential.
For a copy of the Mortgage Forgiveness Debt Relief Act of 2007, go to http://www.govtrack.us/congress/bill.xpd?bill=h110-3648.

Special Alert - Suprise Fed Cut

Fed Surprises with Deepest Cut since 1984
The Federal Reserve surprised everyone Tuesday with an emergency intersession rate cut of .75%, the deepest cut in the Fed Funds Rate since 1984. The Fed Governors are acting in direct response to recent reports that the country is on the brink of recession.
If you have credit cards, auto loans, HELOCs, or an Adjustable Rate Mortgage, the Fed's decision to cut this key interest rate is great news. For long-term mortgage rates however, this could signal the beginning of the end for the lowest 30-year home loan rate borrowers have experienced since 2005.
Let's look at the impact of a few recent Fed Funds Rate cuts and the corresponding impact to home loan rates to see what this could mean for you:

Period

Period Fed Funds Rate Cut Impact to Home Loan Rates January to June 2001 Down 2.25% Rose 0.10% October to December 2001 Down 0.75% Rose 0.45% May to August 2003 Down 0.25% Rose 0.78%

Rates are predicted to be cut again when the Federal Reserve meets at the end of this month. Many believe Tuesday's action was taken because of a dramatic downturn in the stock market, where the Dow dropped 464 points, the worst single day drop since September 11, 2001. Since the Fed's announcement, the Dow has recovered much of those losses but volatility is likely to remain a consistent theme throughout the week.
If you are waiting for long-term mortgage rates to fall further from here, don't count on it. Your best chance to lock in the lowest mortgage rates since 2005 is now. Getting your application in process will allow you to capture a rate near all time lows and, with many experts predicting home values could continue to decline, waiting could kill your chance to capture a great rate if your home doesn't appraise.
This is an unprecedented market and things are moving fast. Regardless of your current mortgage, please give me a call so that we can review your current financial situation in light of these market movements.