Sterling Mortgage Corporation

Arizona's #1 Manufactured Home Lender

Mortgage Rates Finally Begin to Fall

November 26th, 2008 11:43 AM

After the Federal Government injected billions of dollars into the banking industry, mortgage rates were expected to fall, but they didn't. For weeks, we have been shaking our heads in wonder while the banks just sat on the money they got from the government. It was obvious from the rate sheets that they didn't really want to lend out what they had. The rates could only be described as "defensive". In other words, they weren't letting go of it unless they got a very high rate of return.

HOWEVER, we finally started seeing rates getting down to what they should have been this week. If your current fixed rate loan isn't in the mid-5% range, you should be shopping for a new mortgage. These rates are for site-built homes. Manufactured homes continue to experience higher rates.

Obviously, equity may be an issue. But if you bought your home prior to 2004 or invested a hefty down payment, you may be fine. We can easily run a "comparable" scan on your home to see what similar homes have been selling for in your neighborhood.

It may be time for a MORTGAGE TUNE-UP. Call us today, the analysis is free.

Posted by Jon Laird, VP on November 26th, 2008 11:43 AMPost a Comment (0)

Existing-Home Sales Jump 5.5 Percent to a 13-Month High

October 24th, 2008 11:54 AM

Existing-Home Sales Jump 5.5 Percent to a 13-Month High

Buoyed by a flood of foreclosures and coupled with lower prices, home resales spiked in September to the highest level in more than a year. According to the latest report from the National Association of Realtors, sales of previously owned properties bounced up 5.5 percent to a rate of 5.18 million units on a seasonally adjusted basis. Besides weighing in as the largest volume in 13 months, last month's data also represented the biggest month-to-month percentage gain in five years and the first year-over-year improvement (1.4 percent) in almost three years.
More - May Require Free Registration | Return to Headlines

From "Existing-Home Sales Jump 5.5 Percent to a 13-Month High"
MarketWatch (10/24/08)

I thought you might enjoy a little good news for a change...JL

Posted by Jon Laird, VP on October 24th, 2008 11:54 AMPost a Comment (0)

Builders Say Less Is More

October 20th, 2008 12:20 PM

The housing slump has prompted many luxury home builders to alter their business models to provide smaller, more affordable dwellings. Last year, KB Home shrunk its floor plan to 2,400 square feet from 3,400 square feet, lowering the sales price to $300,000 from $450,000. The Los Angeles-based builder is going even smaller these days, offering 1,230-square-foot properties in Southern California for about $200,000. Home builders are making such changes to compete with discounted existing homes, to boost profitability amid falling home prices, and to respond to changes in buyer preferences. According to Deutsche Bank analyst Nishu Sood, "As you kind of reduce the floor plan size, we're getting back to more the way things were historically, kind of undoing the excesses, not just from a price perspective but home size and [fewer amenities]."
More - May Require Free Registration

From "Builders Say Less Is More"
Chicago Tribune (10/17/08) Veiga, Alex

Posted by Jon Laird, VP on October 20th, 2008 12:20 PMPost a Comment (0)

U.S. to Pump $250 Billion Directly Into Banks

October 15th, 2008 1:16 PM

In response to increasing volatility in stock markets worldwide, the Bush administration will announce plans on Oct. 14 to pump $250 billion directly into nine major banks--including Citigroup Inc., Wells Fargo & Co., JPMorgan Chase & Co., Bank of America Corp., Goldman Sachs Group Inc., and Morgan Stanley. Additionally, the plan will involve allowing the Federal Deposit Insurance Corp. to insure senior preferred bank debt, with both aspects of the plan aiming to recapitalize the banks and spur lending among them. The government would be given preferred nonvoting shares of the banks' stock, which ultimately could be sold at a profit. While the government still expects to purchase billions in troubled mortgage-backed securities, experts say that plan could take months to commence and likely will be pushed aside as the government focuses on the direct capital infusion.
More - May Require Free Registration

From "U.S. to Pump $250 Billion Directly Into Banks"
Los Angeles Times (10/14/08) Reynolds, Maura

Posted by Jon Laird, VP on October 15th, 2008 1:16 PMPost a Comment (0)

Survey Finds Expansion of Housing in the U.S.

October 7th, 2008 11:18 AM

The Census Bureau's 2007 American Housing Survey reports that total residential units across the United States hit 128.2 million last year, up about 4 million from 2005. Detached single-family homes accounted for 80 million units, with manufactured or mobile homes making up 6.3 million units. Of the total number of residential units, 68 percent were occupied by owners and 32 percent by renters. Another 27 percent had only one resident, while almost 3 percent housed three generations of one family. The report shows a 16-percent jump in the median home price to $191,471 last year from $165,344 in 2005 and a 20-percent jump in the number of units worth $300,000 or more. Occupants shelled out 24 percent of their incomes overall on housing last year, with shelter costs consuming 33 percent of renters' income. Co-op residents paying mortgages devoted 28 percent of their earnings to housing costs, while homeowners without mortgages spent 13 percent on this expense.
More - May Require Free Registration

From "Survey Finds Expansion of Housing in the U.S."
New York Times (10/07/08) Roberts, Sam

Posted by Jon Laird, VP on October 7th, 2008 11:18 AMPost a Comment (0)

Zero-Down Loophole for Home Buyers Ends Today

October 1st, 2008 11:34 AM

Seller-funded down-payment assistance is no longer allowed for FHA-guaranteed mortgages, and the nonprofits offering such help believe home buyers unable to secure nothing-down financing will be turned away at a time when they are crucial to the housing market's recovery. However, HUD insists that zero-down mortgages guaranteed by the FHA have default rates three times higher than FHA loans with down payments. Additionally, low- and moderate-income buyers still have access to down-payment aid through state agencies and traditional charities, both of which generally impose income guidelines and counseling requirements.
More

From "Zero-Down Loophole for Home Buyers Ends Today"
Lansing State Journal (MI) (10/01/08) Guest, Greta

Posted by Jon Laird, VP on October 1st, 2008 11:34 AMPost a Comment (0)

Affordable-Housing Goals Scaled Back

September 25th, 2008 1:04 PM

Fannie Mae and Freddie Mac will continue to support affordable housing, although the companies will finance fewer mortgages for people with low and moderate incomes for the second consecutive year, according to Federal Housing Finance Agency director James Lockhart. His comments came during testimony before the Senate Banking Committee. Lockhart did not reveal whether the companies would contribute to the housing trust fund that Congress set up earlier in the year to help low-income people buy and rent homes. He said he would make a decision "only after a careful and thorough review of existing conditions."
More - May Require Free Registration

From "Affordable-Housing Goals Scaled Back"
Washington Post (09/24/08) P. A11; Goldfarb, Zachary A.

Posted by Jon Laird, VP on September 25th, 2008 1:04 PMPost a Comment (0)

FHFA Appoints New Fannie and Freddie Chairmen

September 18th, 2008 11:22 AM

The federal government has named Philip Laskawy the new chairman of Fannie Mae and John Koskinen the new chairman of Freddie Mac. Laskawy is the former CEO of accounting firm Ernst & Young, and Koskinen is a corporate reorganization specialist who helped turn around Penn Central Transportation and Mutual Benefit Life Insurance. Both men will report to James Lockhart III, director of the newly created Federal Housing Finance Agency. "Both of these individuals have the types of skills and experience needed to ensure a healthy financial future for Fannie Mae and Freddie Mac," Lockhart said in a statement.
More - May Require Free Registration

From "FHFA Appoints New Fannie and Freddie Chairmen"
Washington Post (09/17/08) P. D7; Goldfarb, Zachary A.

Posted by Jon Laird, VP on September 18th, 2008 11:22 AMPost a Comment (0)

"Bridge" Loans - An Old Idea with New Appeal

September 9th, 2008 12:08 PM

The term "bridge loan" is not one we hear often these days. However, one of our institutions has brought back a program that may be just perfect for today's market conditions. There may be others outside Arizona willing to do the same.

If a homeowner wants to purchase another home, he/she usually needs to sell the current home before he or she can move. They simply need the equity for a down payment. This can be difficult in a slow market like the one we are experiencing now.

Just to add more insult, the current prices have dropped enough to make some fabulous deals available. The flip side is you may get "creamed" if you drop the price on your house for a quick sale. You want a "fabulous" price when you are the buyer NOT the seller.

A bridge loan creates a "bridge" between the two properties. By blanketing both properties, the lender can finance 100% or more of the new purchase. Then, when your home sells, you pay down the bridge loan and re-cast the lower balance, get the lower payments, etc. By making sure that the final loan amount (after pay down) is at or below 80% of the new home's purchase price, you also avoid mortgage insurance, which has become increasingly expensive.

The obvious drawback is that you need to be able to service both loans if you have a mortgage on the old house. If you don't, the bridge loan becomes a snap. If you do, the balance on the existing mortgage becomes part of the formula used to determine how much equity you can apply toward the new home purchase.

If you can make this work in your circumstances, you can afford to wait for your current home to sell in a slow market. Or, you can wait for the market to recover enough to get a really good price for your current home. This is a classic "buy low, sell high" scenario that may be just the ticket you need to move up.

Jon Laird - VP Sterling Mortgage Corp.

Posted by Jon Laird, VP on September 9th, 2008 12:08 PMPost a Comment (0)

Mortgage Applications Rose 7.5 Percent Last Week: MBA

September 4th, 2008 12:14 PM

The Mortgage Bankers Association reports a 7.5-percent increase in home loan demand during the week ended Aug. 29. The index indicates a 10.5-percent jump in purchase applications and a more modest 2.1-percent rise in refinancing requests. Additionally, the group's index tracking mortgages backed by the FHA surged 19.9 percent. Refi demand accounted for 34 percent of all application volume and adjustable-rate loans accounted for 6.6 percent--versus 35.2 percent and 7.9 percent, respectively, the prior week. The report also shows a drop in the 30-year fixed mortgage rate to 6.39 percent from 6.44 percent and a decrease in the one-year adjustable mortgage rate to 7.11 percent from 7.15 percent, while the 15-year fixed rate edged up to 5.96 percent from 5.94 percent.
More

From "Mortgage Applications Rose 7.5 Percent Last Week: MBA"
MarketWatch (09/03/08) Hoak, Amy

Posted by Jon Laird, VP on September 4th, 2008 12:14 PMPost a Comment (0)