Luxury Finance Blog

Daily Mortgage News

2009-03-04T14:00:00.000-08:00

Today's rundown:
The nail in the coffin for the government-sponsored 4.5% 30 year fixed mortgage.
Luxury builder Toll Brothers managed to narrow some losses in the first quarter.
Fannie may marry Uncle Sam instead of just shacking up.
President Obama's new mortgage plan was revealed.

Toady's sample approval: 660 FICO,$725k cash out refinance. Qualifying for 5.5%, 30 year fixed rate FHA with 1/2 point origination fee.

Have any questions? Looking to apply for an FHA or jumbo mortgage in Washington DC, Virginia, Maryland, or Florida? Just email me or reach me on Twitter and I'll be in touch.

Interview with Ron Howard of Re/Max Sails

2009-02-20T10:34:00.000-08:00

Two weeks ago I linked to a Baltimore Sun article that took a look at the innovative measures some area real estate agents were taking to boost attendance at open houses. I recently spoke with one of the Realtors mentioned in the article, Ron Howard, about his views on the market and his strategies for winning in such a challenging sale environment.

Luxury Banker: How long have you been in the business?
Ron Howard: Since around 2004.
LB: What areas do you mostly cover?
RH: For the most part Baltimore City, Baltimore County, and Anne Arundel.
LB: In this sale environment, what marketing adjustments have you had to make?
RH: I’ve had a larger focus on banks owned properties and short sales.
LB: I first saw you mentioned in a Baltimore Sun article that mentioned a collaborative effort between you and agents from other companies to attract attention to listings you had in a Canton neighborhood. Do you see more of these partnerships occurring in the future?
RH: Well we’ve always had those kinds of relationships up here; there’s been that camaraderie in this area. So I can definitely see that becoming more common, where we can support each other.
LB: Care to offer any insight on the direction home values in the area?
RH: I won’t make any predictions, but I hope that things smooth out soon and hopefully we’ll have a good year.
LB: Have you seen any pockets of strength in the market?
RH: Theres so many markets within a market, so there’s still some price resilience out there. But most areas are still going to be affected by the large amount of supply available.
LB: What advice would you offer to someone trying to sell their house?
RH: Well of course the home should be in good shape and clean, so sellers should make any necessary repairs; presentation still matters. The best advice I can give is for the seller to set a realistic price. I’d say unjustifiable price expectations are one of the reasons so many houses are sitting on the market for three, six, and nine months; you can't set your price near the top and expect it to move quickly these days. I’d also suggest that you pick an agent that’s going to get the attention of genuine buyers- someone who can make your house sound great. That, be willing to pay your Realtor a fair commission, and you’re in the game.
LB: What do you think the outcome of the stimulus package will be, specifically the first time home buyer tax credit?
RH: I think it will increase the volume of buyers, certainly.
LB: How has your target market shifted over the past year and a half?
RH: Well the price range has widened significantly. Previously we were more focused on the upscale segment, now we’ve broadened that to include more mid-range deals.
LB: I noticed on your site that you have multiple specialized certifications. Which of these do you see being the most useful in the near future?
RH: I’d say that being a Certified Distressed Property Expert has been the most helpful. That certification has allowed me to succeed in the ever changing world of short sales. When it comes to short sales, if you don’t have that experience and training, you’re really doing a disservice to the client and yourself. I think the main reason only 1 in 10 short sales actually makes it through is because the Realtor involved doesn’t know to handle them, so my expertise with these unique transactions has been a great benefit to me.

Here's one of Ron's recent listings in Baltimore,Maryland:

Interested in a home featured on Luxury Finance? Email me or contact me on Twitter to get pre-qualified.

Quick news and a million dollar approval

2009-02-06T13:28:00.000-08:00

Democrats defeated a plan for government-subsidized 4%, 30 year fixed mortgages. I can't see their constituents celebrating this victory.

Senator Patty Murray wants to raise Fannie Mae loan limits.

The Treasury overpaid for assets? I think the standard used should be subjected to more scrutiny.

Finally, Fannie Mae is easing some lending requirements.

Sales have been brisk at the Moderno, a local luxury condo development

Today's sample approval:

A 1million dollar purchase. 723 credit score, 20% down payment. The rate will be 8% for a 30 year fixed, with 1.5 points for the origination fee. The client can choose between that and 7.125% for a 10 year ARM, with a 1 point origination fee.

Have any questions? Looking to apply for an FHA or jumbo mortgage in Washington DC, Virginia, Maryland, or Florida? Just email me or reach me on Twitter and I'll be in touch.

Slow news day and a rate update

2009-02-03T16:10:00.000-08:00

A pretty slow day news-wise, except for this nugget of disclosure from Citi on its TARP fund use.

Todays sample rate: $400,000.00 refinance with 30% equity. 680 credit score. The rate for this would be 5.75% for a 30 year fixed mortgage with 0 points for origination.

Have any questions? Looking to apply for an FHA or jumbo mortgage in Washington DC, Virginia, Maryland, or Florida? Just email me or reach me on Twitter and I'll be in touch.

Industry News and Rate Update

2009-02-02T17:26:00.000-08:00

Today's dose of news on the luxury housing market:

Some Realtors in the area have taken the upscale, VIP approach to holding open houses. I think its a great tactic for differentiating oneself in this tight market.

A new investment vehicle will soon be available to those who are bullish on mortgage backed securities.

Today's sample approval: $525,000.00 purchase. 742 FICO, 20% down payment. Qualified for a 5.5% 30 year fixed mortgage, with 1/2 point origination fee.

Have any questions? Looking to apply for an FHA or jumbo mortgage in Washington DC, Virginia, Maryland, or Florida? Just email me or reach me on Twitter and I'll be in touch.

Jumbo mortgage news and a sample prequal

2009-01-29T16:30:00.000-08:00

A new report shows delinquencies are up in the jumbo mortgage sector. My gut tells me these are concentrated in the 500k to 1.5M range.

A post at the Wall Street Journal points out some of the challenges in the jumbo market.

Todays sample prequal: $400,000.00 refi, 745 FICO. 5.375%, 30 year fixed w/ 0 points.

Have any questions? Looking to apply for an FHA or jumbo mortgage in Washington DC, Virginia, Maryland, or Florida? Just email me or reach me on Twitter and I'll be in touch.

Todays Luxury Listings

2009-01-28T17:30:00.000-08:00

With the the snow and ice we had to endure today, I thought it would be a good time to link to these properties, courtesy of The Wall Street Journal:

Going island shopping

News roundup and rate updates

2009-01-28T17:10:00.000-08:00

Some major industry news today:

The economic stimulus plan passed, fortunately without the cramdown proposal attached.

The President has proposed using $250 billion to establish a "bad bank" to buy the under-performing assets from banks. Ironically this was the original intent of the TARP so many months ago.

Some loans approved today:
Loan #1: $525,000 refinance. 5.75%, 30 year fixed . One point origination fee. The credit score on this one was 685.
Loan #2: $380,000 purchase. 5% down payment, 680 credit score. The rate on this one will be 5.125%, with one point for origination.

Have any questions? Looking to apply for an FHA or jumbo mortgage in Washington DC, Virginia, Maryland, or Florida? Just email me or reach me on Twitter and I'll be in touch.

Mortgage rates,news and updates

2009-01-27T14:06:00.000-08:00

Some accountablility may be on the way for the Federal governments bailout buffett. Neil M Barofsky has been assigned the task of finding out what TARP recipeints have been doing with their emergency funds.

Just in time, too, as it seems many TARP recipients actually reduced lending after recieving the funds.

And President Obama has a plan to make room under the TARP for borrowers

A late day improvement in pricing brought rates back down to 4.75% on a conventional 30 yr fixed, 5.5% for an FHA 30 yr fixed jumbo up to $625,500 and 6% for a 5 year ARM up to $1 million.

Have any questions? Looking to apply for an FHA or jumbo mortgage in Washington DC, Virginia, Maryland, or Florida? Just email me and I'll be in touch.

Jumbo Mortgage Predictions for 2009

2009-01-27T09:49:00.001-08:00

Given the turmoil in the real estate business last year, I thought it would be helpful to give an outlook for what to expect in the overall mortgage market this year and what to expected in the luxury sector:

I see rates being driven by two primary factors: downward pressure on Treasury yields and the expansion of mortgage liquidity in the secondary market.To the extent that these forces coincide with each other, interest rates will remain at their present levels or lower. Consider:

Low Treasury yields
Government issues continue to be a safe haven for investors since equity values plummeted in 2008. Late last year, yields on the 10 year and 30 year Treasuries were near generational lows, and since the new year have remained in a close range. With disappointing 4th quarter reports coming in for major Dow components (and the broader market for that matter) and no evidence of recovery in leading economic indicators, the flight to quality can be expected to continue through the next two quarters.

Mortgage liquidity
The two major players in restoring liquidity to the credit markets will be the federal government and eventually private equity:

The purchase of mortgage backed securities by the federal government ($53 billion of a $500 billion commitment to date) to buy troubled assets has lead to a significant narrowing in the spreads so far this year, unleashing a flood of refinance applications over the past 3 weeks.

The return of private equity has already begun, and can be expected to continue as these securities remain available at steep discounts. I’ll reference moves like the acquisition of IndyMac by Michael Dell, George Soros, and others high profile investors to back up this prediction. And given the better than expected performance of the Bear assets manged by BlackRock, mortgage backed securities will look more attractive as investors lose their appetite for low yielding fixed income products and disappointing returns in stocks and commodities.

So what does this mean for the high end real estate market? If sustainable, the mini refi boom generated by the above actions should translate into a refi echo in the jumbo mortgage market by the 3rd quarter as more funds become available. In the meantime, you can follow me on Twitter for day to day updates on mortgage rate movements and breaking industry news.

Have any questions? Looking to apply for an FHA or jumbo mortgage in Washington DC, Virginia, Maryland, or Florida? Just email me and I'll be in touch.

Just an intro

2009-01-27T09:42:00.000-08:00

I'll provide a more detailed bio later today. For right now, lets get down to business.