The Lending Landscape?

effenheimer_IHB

effenheimer_IHB

New member
<p>So what does the market look like for a prime/conforming borrower? Can someone with a 750 FICO still get a $417,000 loan at 95% LTV? What will they pay? What ratios are needed? Are CalHFA products still available?</p>

<p>I'm trying to get a feel for where the market stands today. </p>
 
<p>What will you buy with @ $417k anyway? Wouldn't you want to know if you could qualify for at least $600k?</p>
 
the current calhfa limits for OC (considered high cost area) are:





sales price limit 601k


income limit (for 1-2 person household): $98.7k (moderate), $62k (low)


30-yr fixed mortgage: moderate income - 6.375%, low income - 5.625%





you are required to bring 5% down and closing costs (they typically charge 1 pt)
 
If you are above 80% LTV you'll have to pay PMI. PMI is very expensive right now and getting worse by the day. Fannie Mae and Freddie Mac will give you an approval up to 95% LTV one loan with stellar credit and assets. You can possibly qualify for a 100% purchase loan under their "My community mortgage" program, but you need to have sub-par income.
 
i'm often surprised that more people dont take advantage of calhfa loans. the income and sales limits might be hard for established families with high income looking for SFRs, but i cant count the number of single/DINK condo-buying friends that could have benefited from the lower calhfa rates instead of interest-only or teaser rates. usually they didnt know about the program, or the ones that did were scared off by the recapture tax (9 yrs). they all assumed they would sell their home in a few yrs time anyway.
 
Eff,





I am not 100% sure it can be done, because looking at rate sheets is one thing, and getting the loan approved right now is another thing. According to the rate sheet 95% can be done, but since the market for second mortgages are dead, it will have to include MI. By looking at just one lender the rate on the loan would be 6%.





So, if you want a $417k loan at 6% and with the MI cost of 30% it would look like this:





$2500 a month mortgage.





$271 a month MI. .78% of $417k = $3252.60/12 = $271.05.





Would it get approved, without a hassle? I dunno, but back in the day a 750 FICO would get a DU approval in second, and probably no income docs would be required either.




 
Thanks, those are interesting numbers. $2771 plus HOA, Mello-Roos, and taxes makes a $420k Irvine condo cost at least $1100/mo more than renting a similar unit. Even with the HMID, it doesn't pencil out. That $420k condo was $520k in early 2006 and it clearly has further to fall. Rent x 160 would put it around $305k. We're almost halfway to sanity and even further from the bottom.
 
Eff, keep waiting.





Even if you can get a loan, houses are still overpriced.





Sanity will return to the market. It always does.
 
From a Rick Reiff column at the OC Business Journal (online pay subscription so no link):


...


Mortgage brokers are buzzing over the latest bad news for the local housing market: Wells Fargo has designated all of OC and L.A. as “severely distressed”—putting the two counties in the same bottom category with San Diego and the Inland Empire. Wells becomes the first major lender in OC to completely eliminate stated income, stated asset (“liar”) loans, even for highly qualified borrowers. <strong>Jason Grange of Premier Mortgage Lending says other lenders are sure to follow: “There are officially no more lenders offering 100% financing in OC</strong> ...





<strong>Most borrowers can expect to put down 10% or even 15%” ...</strong>
 
Caliguy2699 Wells Fargo announcement is old news, this was posted last week. Suggest you read this blog instead of the OC Business Journal
 
alan - You may have missed the point of the post, which was not the Wells announcement...but the part I <strong>bolded</strong>, which is relevant to the topic about the local state of financing and how much downpayment a buyer should expect to have.
 
"Jason Grange of Premier Mortgage Lending says other lenders are sure to follow"



that's what I call a "no sh%^ sherlock" duhh remark that doesn't need bolding.



Sorry, or as Simon would say "not good enough"
 
Well I hadn't read about the info that caliguy posted....and I'm glad he did. Isn't all info, good info (even if it's posted twice by mistake ?) so, thanks caliguy.
 
Are there any other vets out here who have used to CalVet VA loan? Experiences? I've been reading up on it and getting ready to start the process. Unless I misunderstand, it appears the CA VA will let you go 0 down up to $521k with no PMI, at 6.5..



In light of the new lending standards and cratering prices, I am just thrilled that it looks like I can use this bene which I previously thought all but worthless in CA because of the max loan cap vs. home prices. How times have changed.
 
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