Eisrael Gomez Realtor - Monterey County Blog

The Office of Federal Housing Enterprise Oversight (OFHEO) announced Tuesday it will keep conforming loan limits at current levels of $417,000 for single-family mortgages in 2008, and also hinted it could lower the limits in 2009 if home prices continue to decline.

The conforming loan limit determines the maximum size of a mortgage that Fannie Mae and Freddie Mac can buy or guarantee. Non-conforming or jumbo loans typically carry a higher mortgage interest rate than a conforming loan, increasing the monthly payment and negatively impacting affordability for households in California.

"At more than $568,000, the median price of a home in California is more than 2.5 times the U.S. median of $221,000, yet California is not recognized by OFHEO as a high-cost state," said C.A.R. President William E. Brown. "California still has the third highest home price in the nation, compared with Hawaii at seventh, and Alaska, which ranks 39th in terms of median home price. Yet Alaska, Hawaii, Guam, and the U.S. Virgin Islands are recognized by OFHEO as high-cost areas."

"Now is the time for the U.S. Senate to pass legislation allowing regional adjustments to Fannie Mae and Freddie Mac loan limits and to modernize FHA loan programs," Brown said. "This critical legislation is a key step to allowing families in California an opportunity to climb the first rung of the homeownership ladder."

To read the OFHEO press release, go to http://www.ofheo.gov/newsroom.aspx?ID=397&q1=1&q2=None .
Article courtesy - California Association of Realtors

There was much talk in the local real estate community that the feds were going to up the limit, at least in high cost states, such as California.  Many veteran Monterey County lenders I had spoken with were expecting the limits to go up.  

Their hopes were that the refinance market would pick up as many homeowners who are above the limit are desperately searching for a way to refinance out of current loans they can't afford.  This may push many more into foreclosure or to seek a short sale.  This would be inventory in addition to the already slow moving units.  There are over 2,700 homes already for sale in Monterey County. 

The great news is when I did a search this morning there were 792 properties that matched the limit. Foreclosure Homes and homes for sale under the $417,000 confirming limit mark in Monterey County:

659 Single Family Homes

133 Condos

So buyer's can still buy at great interest rates at some of the lowest prices in years!

Eisrael Gomez

(831) 809-8266

PS  Many persons are asking about Monterey County foreclosures.  To receive regular updates and lists of foreclosures just email me at egomez@gomezhomes.com.

It's hard to beat a person who never gives up.

- Babe Ruth

If you have a great quote.  Feel free to email egomez@gomezhomes.com it or post it here!  Thanks!

Eisrael Gomez

831-809-8266

On Saturday Nov 10, 2007 the Salinas Californian Published an article entitled Housing fraud Alleged by Victor Calderon vcalderon@thecalifornian.com

https://verify1.newsbank.com/cgi-bin/ncom/CLFB/ec_signin

In the article it was noted that a federal lawsuit was filed against an east Salinas housing developer and 10 other businesses and lenders using predatory lending, fraud and unfair business practices.  Article named the following companies: 

• Tuscany at Monte Bella, a housing development
• Valley Community Homes
• Norm Yop Realtors
• Universal Mortgage
• IRA Mortgage
• Creative Mortgage
• Countrywide
• New Century
• Cameron Financial Group
• Wells Fargo Bank

Could this be the tip of the iceberg as Federal investigators sort through the myriad of complaints on their desks?  Based on the number of persons trying to sell their homes, as loans "reset" to higher rates resulting in higher payments, I would venture to say YES! 

How does a consumer protect themselves?  According the California Association of Realtors legal department, be sure the following are clear and included in your loan quote:

1. Rate & any increase in interest rate
2. Term
3. Points (AKA prepaid interest)  (How much are you paying for the loan?)
4. Balloon Payment
5. Negative Amortization
6. Rebates
7. Prepayment penalties
8. Repayment ability (reasonable test- should the bank really be extending credit based on your ability to pay?)
9. Prepaid (Advance) payments. 
10. Home improvement Contractor Payment.  Creditors can't make a payment to a contractor under a home improvement contract from the loan proceeds.  There are some exceptions.
11. Understand your Due on Demand Clause?
12. Refinancing within 1 year?
13. Notice of Assignee of Mortgage.  Lender has to notify you this will happen. 

 The Home Ownership and Equity Protection Act of 1994 (HOEPA) is an early anti-predatory lending federal law that imposes disclosures requirements and other restrictions on certain high cost loans.  It is a precursor to the broader reaching 2002 California Covered Loan Law (CCLL) discussed in the C.A.R. legal article, Predatory Lending: the California Covered Loan Law. 

The above is not meant to replace professional lending or  legal advice.  Please check with a realtor who does not sell loans, an attorney and of course it doesn't hurt to check with a trusted lender.

• Eisrael Gomez
• Full Time Real Estate Agent
• I don't sell loans, but  I do sell homes!
• (831) 809-8266

One of the most common questions asked of me is "Should I really buy or sell right now?"  Here are my current recommendations to clients:

Sellers:  Answer is simple, don't sell if you don't have to. Consider renting the property if you can and ride out the current slump.  If you must sell, call me to discuss options.  Maybe a lease option will work.  Maybe some bank negotiation tips can help.  Unless you have a pressing financial, medical or employment reason for selling, most sellers would do better by holding out for a better market.

Buyers:  Buy if you can.  Remember economics back in high school?  Buy low sell high.  Once the slump is over you'll be glad you bought.  Right now if you write an offer on a property you will most likely not have any competing offers!  That may not be the case in a few months.  Historically the media turns positive during an election year. Once the media changes it's tune, so do most markets.  The good deals will be gone quickly.  Don't try to time the market, instead look at your real estate investments as a long term proposition.

Also, if you are buying to "flip" a house, stay out of the market if you can't stomach a continued downturn.  If you really, really need a list of local Monterey County, Salinas, Gonzales, Soledad, Greenfield, or King City area foreclosures you can email egomez@gomezhomes.com and request automatic foreclosure updates from me.

If you are looking to buy and stay in the market long term, then this is the best time to buy.  Just ask someone who bought in the downturn 10 years ago & who has held on to the property. With low fixed rates and low property prices, this is a good time to buy.   So, if you are one of the few investors picking up deals, I know you love articles like the one below because they are keeping your competitors out of the market!

The Associated Press: Housing, credit markets may hurt economy
By Jeanne Aversa
11/19/2007
Economists project the softening housing market and credit woes will impact economic growth in the final three months of the year and keep the economy lagging through much of 2008.

Monterey County Home Sales

OCTOBER 2007 Statistics!

COURTESY OF REINFOLINK & Monterey County Association of Realtors

Wondering what your home is worth?  Find out Fast, Free and with no obligation  at www.GomezHomes.com Your privacy always guaranteed.

Want to take your mind off of home shopping or selling?  Try one of the following:

November 23- December 31
Ice Skating at the Monterey County Fair Grounds
Monterey County Fair Grounds
2004 Fairground Road
Monterey
Tel: (831) 372-5863
www.montereyonice.com

Golf lovers!  November 13 - 18
Callaway Golf Pebble Beach Invitational
Presented by Merrill Lynch
Del Monte Golf Course, Spyglass Hill Golf Course and Pebble Beach Golf Links
For information, please call (831) 625-8575

I know these are just a couple of things going on in the next few weeks.  This is a busy time of year and Monterey County can be enjoyed all year long, rain or shine!  If you have a local event you would like to post, please post, call or e-mail me.