Wells Fargo Jumbo Loan 9% 30-year fixed

NEW -> Contingent Buyer Assistance Program
Anonymous said:
Wells Fargo: Jumbo Loans – Amounts that exceed conforming loan limits

30-Year Fixed 9.000%

https://www.wellsfargo.com/mortgage/rates/
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Move up luxury homes will be difficult to sell because most buyers would need a jumbo loan for the purchase. Laguna Crossing and Orchard Hills would be a challenge for TIC to price. $730k conforming+ $200k down would set the selling price at $930k for move up luxury. $200k down is the number from most surveys.
 
Astute Observer said:
I think I read some data from IR2 the other day about the all-cash transactions in Irvine.... If they can pay 800K with cash, why the TIC will have problem selling things more than 930K?
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All past cash transactions were from Asian buyers mostly. Asian buyers represent 1/3 of all new home transactions but only a portion of that 1/3 were the $800k cash down buyers. Asians' money are from sources oversea or local business. Both are affected greatly with the bad US economy. Asians would have a hard time getting a loan from stated income as most of them cook their book.

The rest of the 2/3 were using proceeds from the sale of previous homes and we all know that resale market sucks. They no longer have the cash from the equity cushion.

Cash is king but only a few hid it beneath a mattress (apparently the safest place right now) and even non english speaking Asian old ladies got screwed by putting money in stock market or banks.
 
bkshopr said:
Astute Observer said:
I think I read some data from IR2 the other day about the all-cash transactions in Irvine.... If they can pay 800K with cash, why the TIC will have problem selling things more than 930K?
Click to expand...

All past cash transactions were from Asian buyers mostly. Asian buyers represent 1/3 of all new home transactions but only a portion of that 1/3 were the $800k cash down buyers. Asians' money are from sources oversea or local business. Both are affected greatly with the bad US economy. Asians would have a hard time getting a loan from stated income as most of them cook their book.

The rest of the 2/3 were using proceeds from the sale of previous homes and we all know that resale market sucks. They no longer have the cash from the equity cushion.

Cash is king but only a few hid it beneath a mattress (apparently the safest place right now) and even non english speaking Asian old ladies got screwed by putting money in stock market or banks.
Click to expand...

Bk’s right,

Financing for high-end $1.5M+ is very tough right now, even with a substantial down payment.

The highly leveraged buyer for these types of properties is gone.
 
tenmagnet said:
bkshopr said:
Astute Observer said:
I think I read some data from IR2 the other day about the all-cash transactions in Irvine.... If they can pay 800K with cash, why the TIC will have problem selling things more than 930K?
Click to expand...

All past cash transactions were from Asian buyers mostly. Asian buyers represent 1/3 of all new home transactions but only a portion of that 1/3 were the $800k cash down buyers. Asians' money are from sources oversea or local business. Both are affected greatly with the bad US economy. Asians would have a hard time getting a loan from stated income as most of them cook their book.

The rest of the 2/3 were using proceeds from the sale of previous homes and we all know that resale market sucks. They no longer have the cash from the equity cushion.

Cash is king but only a few hid it beneath a mattress (apparently the safest place right now) and even non english speaking Asian old ladies got screwed by putting money in stock market or banks.
Click to expand...

Bk’s right,

Financing for high-end $1.5M+ is very tough right now, even with a substantial down payment.

The highly leveraged buyer for these types of properties is gone.
Click to expand...

IR2 broke my MLS searches up by square footage and the 2700+sf search is dead in terms of activity despite making up 25% of inventory. The lower end is where all the action and activity is...
 
Isn't this sudden and dramatic rise in interest rates for jumbos the death of the high-end market dependent on jumbo financing?

This market already had about a 3 year supply of homes.
 
IrvineRenter said:
Isn't this sudden and dramatic rise in interest rates for jumbos the death of the high-end market dependent on jumbo financing?

This market already had about a 3 year supply of homes.
Click to expand...

There’s no doubt the cost of borrowing has increased significantly.

In addition to that, many of the high-end sellers still refuse to budge off asking price.

At least that’s what I’m seeing at this point in time.
 
tenmagnet said:
IrvineRenter said:
Isn't this sudden and dramatic rise in interest rates for jumbos the death of the high-end market dependent on jumbo financing?

This market already had about a 3 year supply of homes.
Click to expand...

There’s no doubt the cost of borrowing has increased significantly.

In addition to that, many of the high-end sellers still refuse to budge off asking price.

At least that’s what I’m seeing at this point in time.
Click to expand...

This standoff will probably continue until the Alt-A and Prime loans start to reset and nobody can refinance. The bid/ask spreads will widen, and when foreclosures start to come on the market, the price drops will be breathtaking.
 
IrvineRenter said:
tenmagnet said:
IrvineRenter said:
Isn't this sudden and dramatic rise in interest rates for jumbos the death of the high-end market dependent on jumbo financing?

This market already had about a 3 year supply of homes.
Click to expand...

There’s no doubt the cost of borrowing has increased significantly.

In addition to that, many of the high-end sellers still refuse to budge off asking price.

At least that’s what I’m seeing at this point in time.
Click to expand...

This standoff will probably continue until the Alt-A and Prime loans start to reset and nobody can refinance. The bid/ask spreads will widen, and when foreclosures start to come on the market, the price drops will be breathtaking.
Click to expand...

I agree.

Until then, the inventory will remain and continue to build with very little going under contract.
 
skek said:
tenmagnet said:
IrvineRenter said:
Isn't this sudden and dramatic rise in interest rates for jumbos the death of the high-end market dependent on jumbo financing?

This market already had about a 3 year supply of homes.
Click to expand...

There’s no doubt the cost of borrowing has increased significantly.

In addition to that, many of the high-end sellers still refuse to budge off asking price.

At least that’s what I’m seeing at this point in time.
Click to expand...

ten, that is exactly what we are seeing, too -- a stubborn refusal by sellers to lower prices, coupled with a lending environment that is evaporating before our eyes. A few of the sellers are actually asking for 10-20% more than their 2005-06 purchase prices. It's insanity.
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It’s crazy, yet some sellers still don’t get it.

This particular seller kept getting his asking price, would go under contract only to have the deal fall apart do to financing.

Happened to him multiple times.

Meanwhile, my offer which was under asking price was totally discarded.
 
Astute Observer said:
Obviously, somebody is in no hurry to sell his/her house.

One of my neighbors had her place went into escrow, and after several weeks, it fell apart. She then just ask her sister to move in. Don't know if the sister is paying her mortgage, but sounds like she is in for the long haul (all new appliances and carpeting). You be amazed at how lay back some sellers are. Not everyone is motivated to sell.
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That’s entirely fine.

No one, buyer or seller wants to waste time or resources.

Coming from my side of the table, I’m in no hurry to buy.

There’s certainly no shortage of properties out there.
 
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