Ok, so you’re a homebuyer and you’ve been going out every weekend looking at homes and writing offers on homes in California. How’s that working out for you?
Are you just hoping and praying that your agent will write an offer that gets accepted that’s 10, 20 or even 30 thousand dollars more than the listing price only to find out that your 25% downpayment and half a million in assets STILL got beat out by 13 other offers? Well, here’s a little strategy I’m seeing more and more homebuyers use to help give your offer a little more consideration. It’s called the appraisal contingency waiver. Right now sellers know that if they list their home at a reasonable price, they’re most likely to get a bidding frenzy on their home. And because appraisals are necessary to close a loan on most homes, the bank will always look at the true value of the home versus what you are willing to pay for it, and this can affect your ability to get a loan.

For example, you find a house listed for $400k and you figure to be competitive you’ll have to offer $420k and put 20% or $84k down so you don’t have to pay mortgage insurance by keeping your loan to value at 80%. However, if the appraisal comes in at only $400k, your 80% LTV just became 84% LTV which means you’re gonna get mortgage insurance unless you put another $16k down, because the bank cares about the actual loan to value, not the loan to purchase price.

Waiving the appraisal contingency means that even though you’ve given your deposit, if the appraisal comes in lower than your offer, you’re not going to freakout and back out of the deal or try to re-negotiate for a lower purchase price from what you agreed upon originally. It will be your responsibility to honor your offer AND make sure you meet the lender’s guidelines to be able to close the loan. Even if it means putting more money down. It’s a risky option because once your deposit is in, the only way to get out of the contract is for some other reason OTHER than the results of the appraisal. Now I’m not advising you one way or the other on if you should do this, but the feedback I am getting is that some homebuyers who waive the appraisal contingency are having more success in getting their offers accepted, but be sure to talk to your Realtor before making your decision. If you want any more information on ways to help write an offer in California that gets accepted, feel comfortable giving me a call.

The new Mortgage Ability to Repay rule will now determine what is a qualified mortgage and if a borrower has the ability to repay a loan. What you should know about this rule is the new limits it puts on your total debt to income ratio. In the past, you could go up to 45% DTI, but the new rule will have banks capping your debt ratio at 43%. What does this mean to you or someone you know looking to buy a home in California? Let’s take an annual income of $75,000, that 2% reduction means you’ll have to show $125 less on your monthly debt.  That may not seem like much, but that translates to about $28,000 less on the qualifying loan amount and, therefore, less buying power. Also keep in mind if you’re putting less than 20% down, that private mortgage insurance companies impose their own, more restrictive DTI guidelines on top of the lender’s guideline. At the moment, 41% is the maximum allowable DTI by most private mortgage insurance companies. FHA loans in California can still get by up to a 49% debt ratio but that is expected to change to 43% as well. Now here’s the good news. While this new rule went into effect at the beginning of this year, it’s not expected to be enforced by most banks until January 2014. Hence another reason to buy or refinance your house right now.

We all know the secret to real estate investing is buy property when it’s cheap! I mean, imagine if you could have bought Manhattan for $24. You would have done it, right? Well Dennis Hope believes he’s got a great deal for you to by land in the next great real estate frontier…The Moon.
In 1980, he filed a declaration of ownership with the United Nations, and he’s been selling 1 acre lots on the moon ever since for $24. For that price, you get a Lunar Deed and a map showing you where your property is located. Now while some people may say he’s a kook, he insists that he’s “grown up with a work ethic based on honesty because he’s from Oklahoma”, and of course, no one crazy has ever come out of Oklahoma, right? Ya know, this guy might be on to something. I mean, why spend $19.95 to name a star after yourself, when you know that star has already burned up an doesn’t even exist anymore? But the moon, well that’s gonna be there forever…and what a great investment to leave for your pet rock one day! Along with the moon, he also claims ownership of several other planets including Mars. I wonder what William Shatner thinks about that…

Good news Realtors. a recent survey shows 87% of renters dream about owning a home and 75% of them say owning a home in California is crucial to raising a family. Are you getting the word out to them that now is a great time to buy a house with still low interest rates in San Jose? If you need help getting them qualified, I can help you with that. Just give me a call or send me an email, and if you’re watching this video and you like what you see, do me a favor, click the “thumbs up” or “like” button and leave me a comment below, but most importantly, please share it with your friends on Facebook or whatever social media sites you use. Thanks for watching, I’ll see you next time.

FHA mortgage insurance is going up again on April 1, 2013. The FHA annual mortgage insurance premium will increase on most FHA loans in California from 1.25% to 1.35%. However the biggest change to getting an FHA loan in San Jose or any other California city happens on June 3, 2013. That is when FHA will require mortgage insurance premium or MI on their loans for the life of the loan. The only way to avoid MI for life of the FHA loan is to have your loan to value to be under 90%. But even at that, FHA will require you to carry the mortgage insurance for 11 years. Finally, even though FHA loan limits in most major California cities is $729,750, if you expect to get an FHA loan that is over $625,500, you will be required to increase your down payment from 3.5% to 5%.

As you can see if you have been wondering when is the best time to buy a house in California with an FHA mortgage, the time is right now before these changes take effect.

2012 ended with a cliff hanger, but our country avoided going over the fiscal cliff when President Obama signed the Taxpayer Relief Act at the last minute helping us avoid the biggest disaster since….December 21st. It appears that there is some cool stuff in this act that will help homeowners and homebuyers in 2013, and that’s why 2013 may be the best time to buy a house in California and put more money in your pocket if you already own a home. The first benefit is the MI or mortgage insurance premium deductions have been extended. What makes this exciting is up until the fiscal cliff was avoided, if you bought a house in 2012, you didn’t have this deduction before, and now you can claim it whether you bought in 2012 or plan on buying in 2013, so if you know anyone in that situation, please share this video with them. Another benefit you have is an extension through 2013 of the Mortgage Tax Relief Act, where you wont be hit by the IRS on taxes on forgiven debt on a foreclosure or short sale for a loss up to 2 million dollars. Your also gonna still have tax credits for energy efficient improvements on existing homes, and as long as you’re making less than $400k a year, your taxes aren’t going up, and with rates this low, it’s easy to see why the fiscal cliff has been great for real estate and why 2013 just might be the best time to buy a home in California.

We all like the idea of making the right financial investments, but many times there’s a risk involved that can wipe you out overnight. Well a millionaire in India better be careful he doesn’t lose his shirt. That’s because he spent $230k on a 22 karat solid gold shirt weighing 8 lbs which he wore on New Years eve because he says gold is his ultimate passion, which personally I think is veering into super-villian territory, and he also says the shirt will make him quite the chick magnet. Dude, I’m sure if the shirt doesn’t work, you can always fall back on that Magnum PI mustache you got going on there. Seriously though, he believes buying anything gold is a great investment. Well if this shirt is an investment, I feel sorry for the next fashionably challenged man with the same desire to look as stupid as he does.

Like I said earlier, 2013 may be the best time to buy a house, but it’s also a great time to refinance and get a lower interest rate. Even if you’re upside down on your mortgage, you might still be able get a lower mortgage payment. I have time to help you or someone you know looking to save money, so give me a call or send me an email.

As sure as I can count on this song playing every time I turn on your radio this time of year, You can always count on major California FHA loan changes to raise their mortgage insurance premiums every year at this time too, and 2013 is no different. FHA has decided to raise monthly MI by 10 basis points, which will raise the monthly payment for buyers in California using an FHA loan by about $8 per every $100,000 borrowed. Now, we’ve gotten used to FHA’s MI creeping up each year, but they are dropping a bomb on you now, because we all know that right now you can remove the monthly mortgage insurance after 5 years of being in your loan. Federal Housing Authority has decided that some time in 2013, they are going to keep the monthly mortgage insurance in effect for the LIFE of the loan.
It does not go away until your mortgage is paid off completely. Sure you can refinance in 5 years if you want to get rid of the MI, but do you know where conventional interest rates are going to be in 5 years? Neither do I. That’s why the time to take advantage of lower MI premiums and low FHA rates is right now. I’d like to hear from my realtor friends, Let me know your thoughts about this FHA change in the comment section below.

In a sign that the zombie apocalypse might soon be upon us, a study came out this week saying that 32% of all americans would consider getting a mortgage from Walmart if they started doing loans. A survey spokesman said more consumers are focusing on price and customer service guarantees, and one respondent said, “I trust Walmart could point me in the right direction when getting a mortgage. Really? Cause when I go into Walmart, they can’t even point me in the right direction to the bathrooms? The thought that WalMart could help cure the housing crisis by putting more people into homes than traditional lenders is preposterous. Do you see the people who are pretty much living at Walmart now? Look here 1/3 of the population, Walmart will not help you buy a house. They’ll let you park your trailer in their parking lot for free for 3 weeks, but they’re not interested in getting into the mortgage business, so quit holding your breath.

This week, I helped a family who just bought their house 2.5 years ago save an additional $739 per month on their mortgage. That’s over $230k in interest over the life of the loan that they won’t have to pay. And now I have time to help you or someone you know get a low rate like you see below. Could be a neighbor, a co-worker, maybe even that family member that tries to outdo you at the gift exchange during the holidays. Give him the gift that he’ll appreciate for the next 30 years. More money in his pocket. If you want to see what I can do for you, just give me a call right now.

Now that Barack Obama has been re-elected president, people want to know how a second term Obama presidency will help the real estate housing market and mortgage rates. If you recall during the campaign and debates, very little was mentioned about how he plans to solve the housing crisis. However, he did jump start the HARP or home affordable refinance program to help underwater homeowners refinance their homes. But, the banks put caps on what was supposed to be an unlimited loan to value program, and as a result, many people are still finding themselves shut out from getting the help they need. He says in his second term he hopes to remove the red tape so that everyone can refinance, but first he has to come up with a plan and then convince a republican controlled house to pass it. So it remains to be seen what the next 4 years are going to hold for the real estate market, but as soon as changes happen, I’ll be sure to let you know about them.

A Detroit woman bought a house last year at a great price, but moved out after discovering the amount a repairs that were needed. She returned to live in the house recently, only to discover that a woman named Missionary-Tracey Elaine Blair had the home fixed up and was living there. Now the alleged squatter refuses to leave the house, and since the law states a homeowner cannot remove a squatter by force, the owner will have to seek an eviction in civil court, but until then, both women are living under the same roof. Now believe it or not, Missionary-Tracey Elaine Blair Crazy Train whatever her name is, was a write in candidate for president this past week. Get this, She said, “I’m an advocate for affordable housing. That’s part of my campaign,I signed an oath pledging that I would fight for affordable homes.” Well, you can’t get much more affordable then stealing one. Why did she run for president at all? Under her thinking, just squatting in the White house WOULD make her president. You better believe that if I had to share a house with a squatter, I’d be waking them up each morning like this…

Interest rates in California are holding steady this week after the election. If you own a home in San Jose or anywhere in California and your rate is higher than what you see here below, give me a call or send me an email, and let’s see in less than 5 minutes if I CAN save you money. If you liked today’s show, please share it with your friends on Facebook or Twitter and be sure to leave me a comment below.

With the recent drop in interest rates in California, I decided to give the former mayor of Carmel, CA. Clint Eastwood a call and let him know how low mortgage rates are in California. Check out this funny mortgage video of my phone call. Will rates stay this low forever? No! So the time to act now on buying a home in San Jose or  refinancing one anywhere in California is right now.

The FED last week committed to QE3 and buying another $40 billion each month through at least the end of this year in mortgage backed securities. They extended their program “operation twist” to help stimulate the economy and bring down unemployment numbers through quantitative easing. They believe purchasing long term bonds will help drive prices up and yields down. The thought being with lower long term yields, getting a mortgage loan will be less expensive which might make this the best time to buy a house. Now I don’t know how lowering already super low interest rates in San Jose or California will do much for unemployment numbers, but at least the rates are staying low. I’d love to get your thoughts about the big FED announcement last week, so let me know in the comments below.

An elderly woman by the name of Su Wan is on the loose scamming multiple San Francisco real estate agents, while posing as a potential client just to get free meals, rides to appointments, free groceries and lavish gifts by desperate real estate agents hoping to make a commission. She even conned one agent into buying her a $1300 Louis Vuitton purse with the promise that she’d sign the listing contract to sell her $3 million dollar apartment buildings the next day, and of course she never did.
Now, I can understand taking a client to coffee, or lunch, maybe a round of golf to get a big deal, but $200 worth of groceries? a $1300 purse? Look for those of you Realtors in the bay area who aren’t going to heed this warning because, “you know how to close the deal”, I included a link here for 24 ridiculously expensive everyday items because sometimes you just have to know how to wine and dine them, right?

Take a look at this week’s interest rates buy a house in San Jose and refinance San Jose. Give me a call and let me help you or someone you know with our no closing cost refinance programs with fixed rates from 30 years all the way down to 8 years. That’s right, you can pay off your house sooner. Be sure to leave us a comment below and share it with your friends. Thanks for watching, now make it a great day!

Sure, getting your loan approved when buying a house has gotten a little tougher. Bank underwriters are now asking for more documentation than ever before, so being prepared with the proper documentation will help get your loan approved. Imagine if things were worse though. In this video parody of the Twilight Zone episode of “It’s a good life”, we’ll take a look at a very unreasonable monster who tries to keep homebuyers from their dream of buying a house in San Jose or in this case, the fictional town of Buyersburg. The key to a successful loan approval is to work with a San Jose mortgage broker who knows the ever changing bank underwriting guidelines, and helps guide you through a quick and easier loan process. Before you buy or refinance a house in San Jose or anywhere in California, before you begin your loan search, be sure to call Rich Iacovetta with RMI Lending, or you just might enter the Twilight Loan.

With San Jose mortgage rates at all time lows, many people are looking for an American Idol for direction when it comes time to buy a house in San Jose or do a San Jose refinance. One mortgage broker is impressing his clients with low interest rates, quick turn times, and excellent communication. You may have heard, “it’s impossible to get a loan“, but Rich Iacovetta with RMI Lending will help consult with you, negotiate a low interest rate, and oversee all the details of your San Jose home purchase or refinance so that you will have the best interest rate and the best experience during the process. You deserve to get great quality service and the best interest rates in San Jose. Give us a call today.