The New York Times
Interest rates are the lowest in decades, enticing many borrowers to shop for a loan. Mortgage lenders adjust their rates based on perceptions of risk, so unless the borrower can show they’re a low-risk individual, the borrower is unlikely to qualify for a rate that matches those seen in recent advertisements and headlines.
Making sense of the story
- The rates quoted are averages drawn from a variety of financial institutions, and lenders use varied approaches to set them. Consumers who want to try for the lowest rates available need to consider basic factors, such as credit score, points, property type, down payment, and length of the loan.
- Credit score: The ideal borrower has a FICO score of 740 or higher, which puts the individual in the best place for pricing.
- Points: The lowest rates usually are decreased by paying a fee called a point, or 1 percent of the loan amount. Borrowers may buy points in order to get the best rates at many banks. Points might make sense depending on the borrower’s financial situation and how long they expect to stay in the home.
- Property type: Borrowers planning to buy a duplex or a four-unit build likely will have a higher interest rate. Condominiums also may have a rate premium rate, especially if they are newer or the down payment is less than 25 percent. Lenders also may charge more if the borrower is not planning to live in the home.
- Down payment: Borrowers who put down at least 25 percent are more likely to obtain the best interest rates. Lenders offer different breaks on rates if equity in the property is higher, so borrowers should ask what is available.
- Length of loan: Borrowers who are likely to move in a few years may want to look into an adjustable-rate loan with a low interest rate fixed for a few years, and adjusted afterword.
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http://www.nytimes.com/2012/01/15/realestate/mortgages-shopping-for-the-best-rates.html?_r=1&ref=realestate
Orange County Register
Beginning with the 2012 tax bill (the one due in April 2013), the state Franchise Tax Board will require property owners to break down their property taxes into deductible and non-deductible portions.Read the full story:
http://economy.ocregister.com/2012/01/09/state-targets-property-tax-payers/101799/
President Obama signed into law a bill directing the Inspector General of the Federal Deposit Insurance Corp. and the Government Accountability Office to study the effects of bank failures.
Rep. Lynn Westmoreland, R-Ga., introduced H.R. 2056, which passed the House in August. There were 97 bank failures in 2011, according to the FDIC, down from more than 150 the year before.
The FDIC inspector general will look into the effect of loss-sharing agreements between the FDIC and the receiver bank. It will consider if more loans could be modified without an LSA and if these agreements could be “phased out altogether,” according to the legislation.
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CNNMoney
Delinquent borrowers facing foreclosure are learning that they can stay in their homes for years, as long as they’re willing to put up a fight.
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http://money.cnn.com/2011/12/28/real_estate/foreclosure/index.htm?iid=Lead
California pending home sales fell 9.1 percent in November but were up from a year ago, according to C.A.R.’s Pending Home Sales Index (PHSI)*. The index was 109.8 in November, based on contracts signed in that month, down from October’s index of a revised 120.9. However, the index was up 11 percent from November 2010, marking the seventh consecutive month that pending sales rose from the previous year.
At 55.1 percent, equity sales made up more than half of home sales in November, up from 53.9 percent in October and 54.4 percent in November 2010.
The total share of all distressed property types sold statewide fell to 44.9 percent in November, down from October’s 46.1 percent and 45.6 percent in November 2010.
Of the distressed properties sold statewide in November, 21 percent were short sales, up slightly from the previous month’s share of 20.7 percent and up from last November’s share of 19 percent.
At 23.5 percent, the share of REO sales was down from October’s 24.9 percent, and down from the 26.2 percent reported in November 2010.
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