SDblog

Introducing our new feature, the "best of the blog".  We will mail/email out this new feature every month, featuring the best articles written by our staff and also written by YOU!  Be sure to participate and your article may be selected for the "best of" issue.  Your article doesn't have to be real estate related, or even San Diego related.  Anything of interest to you will be of interest to our readers and is eligible to be selected for publishing.  If we select your article, we will attempt to contact you before publishing to get a photo (which you can post with your article on the blog by the way) and to allow you the option to opt out of being published. 

Write something today about:  the Chargers playoff game, The Iowa Caucus, mortgage rates, something interesting happening in the area in which you live, anthing at all!  We can't wait to see what you write!

Thanks, Jan Farley       

The house has already passed a bill that was worked out with President Bush for a stimulus package that includes temporariliy raising the conforming loan limits and the FHA limits.  The Senate is now working on their version of the bill, and there is some speculation that it may not include increasing these limits.

Increasing the limits are imperative to helping to solve the mortgage and real estate crisis we are now experienceing.  Please take just moment (and I promise that is all it will take) to send a letter drafted by the National Association of Realtors to Senators Diane Feinstein and Barbara Boxer urging them to pass the bill including these provisions.  Please click this link to get there:

http://takeaction.realtoractioncenter.com/campaign/sen_econstimulus?rk=q1%5fv8VSqfzZsE   

And PLEASE do this today!

Thanks Jan Farley

Pricing a home in today's market has become very challenging.  We used to look at all the sales in the last 6 months of similar homes in the same area, and price the home maybe 10% above what those homes sold for.  That was before all the foreclosed bank-owned homes started hitting the market.  Now there is so much inventory, you have to differential your listing and the most effective way to do that is through price.

Our strategy for now is looking at what else is listed in the area with similar amenities and try to price just below what similar homes are listed at.  Listed homes today really compete with each other, and today's buyer is looking for VALUE.  They are very picky because they have their choice of a lot of homes, so you can't just expect to price your home higher or the same as other homes and expect to be noticed or to obtain a timely offer.  Call us for more info, 619-337-1700 x. 286/291.

Jan Farley

It looks like the congress and president will get a Stimulus package put together some time this week.  Besides giving out tax rebates to everyone, the package also calls for some tax cuts for small business, which generally creates spending, and spending is what we need to keep us out of a recession.

The part of the package that is the most interesting to me, as a mortgage broker, is the temporary increase in the conforming loan limit.  Presently, the conforming loan (loans that are purchased by Fannie Mae and Freddie Mac) is at $417k, where it has been for some time.  Anything over $417k becomes a jumbo loan with higher pricing and rates.  The fact that most loans in California and other high priced areas are larger than this is part of what has caused our mortgage problems.  Now it appears that the limits will temporarily be raised to $625k in most areas, and up to $725k in higher-end areas.  This is what Secretary Paulson had to say:

"When asked if raising the limit on conforming loans could lead to more defaults, with taxpayers ending up footing the bill, Paulson said the increase would only run through Dec. 31. He said if the measure was taken out, it could be more difficult to get mortgage reform later."

EEEK!   They are only raising the limits through the end of the year?  That means there is a short window for a lot of people to be able to buy a larger home or refinance to get a better fixed rate.  If you haven't started, now is the time.  Let's hope that raising the limits are a big success so they keep this measure in place.  It is sorely needed.

Thanks, Jan Farley

The stimulus package that congress and the president are working on contains a provision to raise the conforming loan limits substantially.  Check back with us tomorrow for much more information on this.  Also, I will be posting an article on how to know when its time to get off the sidelines and buy.

THanks, Jan Farley

Yesterday the Fed took some dramatic moves to intervene in what SHOULD be a free market.  Although this move may end up being good for us in the real estate/mortgage industry, is it good in general for the Fed to monkey with a free market?  Is this a good policy?  Will they do it on a whim, or is it a long-term strategy?  Did they do it because it is an election year?  Is a recession sometimes a good thing?  Should a recession always be averted if one has the power to avert it?  Should our eyes be averted when we see a hideous sight.... ha!  wanted to see if you were still reading.  he he....

But no, I am concerned that the Feds intervention in a supposedly free market is just avoiding the inevitable.  I hope my concerns are not valid.

Jan Farley, La Mesa, California

WOW! in a sweeping move intended to prop up the crashing stock markets, the Fed cut rates more than expected this morning, cutting the federal funds rate 3/4%!  Insiders are expecting another 1/2% cut next week.

What does this mean for you?  If you have a HELOC or home equity line of credit, your rate just went down 3/4 of 1%!  That is money in your pocket which will be reflected in your next payment.  And if the Fed cuts the rate again next week, you are saving another 1/2%!  That is awesome!

This also means that we are expecting long term 1st mortgage interest rates to go even lower than where they have been the last couple of months (and they have been great!).  In fact, they were lower by 1/4% this morning.

NOW is the best time to BUY we have seen in more years that one can remember.  Usually when home values dip, there are higher rates.  One is hard-pressed to remember a time when rates were at historic lows and accompanied by the lowest prices we've seen in 5 years. 

Do NOT delay  - if you've been thinking about buying, do it now while you get the most bang for your buck with these incredibly low rates and prices.  Call me and let's get out there!

Jan Farley

Can you feel it?  It is like a wave sweeping over San Diego today, and reaching proportions that are too big to surf!  San Diego is HYPED (and laid-back San Diego is rarely hyped!) and poised for sweet revenge over the dread hated New England Patriots.  Never mind that the temperature will likely be a balmy 18 degrees if they are lucky.  Never mind that New England beat us earlier this year or that they knocked us off in the playoffs last year.  The Chargers are on a roll after knocking off Payton Manning and making him cry last week (why else wouldn't he take his helmet off after the game???  I am just assuming...).  Lets see what they can do to Tom Brady, Junior Seau and Rodney Harrison!

Go Chargers!

Jan Farley 

Mortgage rates have fallen to the lowest levels since Summer of 2005!  A 30-year fixed rate this week at or under $417,000.00 with no points fell to 5.75%, and the 15 year rate fell to 5.25%. 

Rates started rising in October of 2005, which was the beginning of the housing slump (not coincidentally). 

This is a great time to refinance, and an even better time to buy a home or rental home.  Because of what happened with the Dow falling over 300 points today, we expect that tomorrow's rates will be even lower and will continue for a while. 

Jan Farley 

So you owe, say $400k on your home, but it is now only worth $300k.  Your interest rate just adjusted up and you can't afford the payments, or you got laid off at work.  Do you have options or are you just "stuck" with no way out?

You DO have options.  Sticking your head in the sand for too long should not be one of them, though!  You need to take inventory of your life and make some decisions.

The first thing to determine is if you can make your payments now (say you got a new job) but are behind in your payments at the bank.  If you can afford to stay in the home, by all means you should do it, even if the value has gone down.  It will go back up in time. 

The next step is talking with your lender.  Your lender does not want your home, they already have thousands most likely that they have to dump at ridiculously low prices.  Your lender SHOULD allow you to do a work out agreement.  SOme of the things you can accomplish in a work out agreement are:

1.  lower interest rates

2.  Your delinquent payments added on to the BACK of your loan so you show current now

3.  increasing the time you have an interest only option, or increasing the amount of time you have to pay the loan back.

If your lender plays hardball and you don't know what to say to them, CALL ME!  I will be happy to talk to your lender for you free of charge.  Why?  Because bank-owned properties are hurting the real estate business.  If we can stop the bleeding, it will help me and every other real estate professional.

Stay tuned for the 2nd installment tomorrow....

Jan Farley  

Against all odds and pundits, the San Diego Chargers brute-forced their way to a win against the reining national champion Colts and Payton Manning!  Without Phillip Rivers or LT or Antionio Gates!  Are we going to admit that the Chargers are for real yet?  Will anyone give them a chance against New England?

I do.  With every "win in a row", the odds of another "win in a row" are greatly diminished.  This should be a really exciting game!

Go Chargers!

Jan Farley  

Once again, the road to the superbowl for the San Diego Chargers must go thru Payton Manning and the Colts.  The Chargers have had a lot of success against the Colts, but this being only their 2nd playoff game in 13 years, it should be very interesting to see how they hold up.  Unfortunately for those of us in San Diego who go to church, this is a 10AM game on TV.  Oh well, less nail bitting - we will see the end of the game!

If the Chargers do hold on and knock off the favored Colts, the road to the Superbowl will turn north to the cold tundra of New England.  THe Chargers have had less luck with New England, but I guess that's why we bother to play the game - on any given Sunday.... yada yada yada.

Go Chargers!

Jan Farley

Good news for those faced with a "short sale" situation.  A short sale in Southern California is defined as selling a home for less than is owed on it, with the lender(s) involved agreeing to receive a short payoff.  As an example:

You owe $325,000.00 on your house

It is worth $250,000 and you get an offer of $250,000 from a buyer

We submit the offer to the lender and ask them to take the $250k, less all the costs of the transaction.

Prior to this year, the IRS considered this type of scenario as a windfall profit for the seller (forgiven $75k+ in financing).  But in a short sale, the seller gets NO MONEY from the sale, so we always called this a phantom tax.  Late in 2007, congress passed and President Bush signed a law eliminating the phantom tax for short sales and foreclosures, at least for the next 3 years, and retroactive to the beginning of 2007.

A short sale is preferrable to a foreclosure as far as your credit is concerned, and many of us feel that there will be changes made in the future to reflect a short sale as a "paid as agreed" on the seller's credit report, because the lender did in fact agree to be paid what they received.  This would really help the seller's credit recover much more quickly.

Don't be afraid of the short sale - Jocelyn and I take every opportunity to become as educated and proficient as possible in this process and currently are working on two short sales.  Call us today for a confidental consultation.

858-699-7480.  THanks! Jan Farley

How about those Chargers yesterday????  They finally got their first win in the post season in 13 years, in the rain no less!  Now it is off to Indy and Payton Manning, but the Chargers seem to be able to somehow deal with that bunch.  It figures on being a GAME if nothing else.  Unfortunately though, AFC roads to the superbowl go through New England, and I am afraid that's where all the roads will hit a roadblock.  But, we shall see.  That is why they bother to play the game.

PS for those of you who don't know, rates are getting insanely low right now for a 30 year fixed conforming.  Give me a call for details.

Jan Farley

How wonderful to be able to embark on a new year with hope and optimism that things will be better than last year!  I was watching fox news on television on New Year's Eve (yeah, I know - glamorous life!) and they had a poll.  84% of those who responded said they expected 2008 to be better than 2007.

Is it just plain ridiculous to think that at the stroke of midnight, all the bad of last year will recede into the past, making room for all the good things that will happen AFTER the stroke of midnight?  Maybe not.  As we are fond of saying in sales, "perception IS reality."  If we perceive 2008 to be a better year holding the promise of good things, our optimism will compel us to try to make it happen.  If we perceive it to be better, then it IS better.

I think its cool that we celebrate the end of one year and the beginning of the next.  It breaks the stream of constancy in our lives and gives us a glimmer of a fresh beginning.  Welcome, 2008!