Thanks Scott,
Good to know!
Greg
---------------------------------
This week's treasury auctions were poorly received by US and international investors. Additionally, for the first time in decades, private issued bonds by institutional lenders like Warren Buffet are paying a lower rate of interest to their investors than are US Treasuries. These issues are causing US Treasury rates to rise. This causes mortgage interest rates to jump.
This from Todd Johnson, the President of Homeservicing Lending:
The stability we've had in bonds, mortgage-backed securities and similar fixed-income instruments have traded in a very narrow range for a long period of time. When we think about the Federal Reserve buying $10 to $25 billion dollars a week in mortgage related securities, as well as direct debt of Fannie and Freddie, the Fed's purchases combined were over $1.4 Trillion dollars as of a couple of weeks ago [which helped to keep rates artifically low over the last year]. We're only a week away from the Federal Reserve completing its Mortgage Backed Securities and debt acquisition subsidy [the tool which as kept rates so low].
From a U.S. deficit perspective, our country will issue over $2.4 Trillion this year [in bonds], $1.4 in new spending and the rest to refinance other U.S. debt that is coming due. This week, the U.S. Treasury was selling over $110 Billion in new issuance, and the way they do this is that they start the week with the short term paper and finish their sales by the end of the week with the longer end of the curve. Yesterday, the $42 Billion dollar sale of 5 year notes went quite poorly, and Tuesday's $44 Billion dollar sale of the 2 Year notes were weaker than expected as well. On Thursday, the U.S. Treasury will complete its sale of the week with a $32 Billion large block of 7 Year debt [which was also received very poorly today].
All this poor performance by Government debt means the Government will have to 'sweeten' the deal at the next treasury auction by paying higher interest rates to attract potential investors. This, in turn, causes mortgage rates to rise.
Additionally, the FHA has announced that as of April 5th, the cost of FHA loans, and price of the mortgage insurance associated with these loans will increase substantially.
This information, along with the elimination of the first time home-buyers credit which is currently set to expire at the end of April, means a more costly loan for our clients.
What can we do?
* As always, get your clients pre-approved with Homeservices Lending as early in the process as possible. These higher rates and fees are going to be a reality of our market and clients need to re-examine what they can afford. A rate increase of 0.500% on a $600,000 mortgage increases payments by about $250.00 a month
* Lets work as a team and let your clients know about the importance of locking in a rate as soon as possible once they have an accepted offer
* Talk to your clients who may be on the fence or trying to "time the bottom of the market". Waiting to buy may cause their mortgage costs to increase more than the savings they make on further declines on property values.
I realize this is a lot of information, please do not hesitate to call or email with your questions.
Scott L. Groves
Mortgage Consultant
Homeservices Lending
MAC M0923-011
Thursday, March 25, 2010
Multi-Unit: 1716 GRIFFITH PARK BLVD LOS ANGELES, CA 90026
Listed by Michael Slater of Prudential California Realty - Los Feliz
Listed for $995,000.
Listed for $995,000.
-
 | GREG BENDER LA REALTOR | |
| 323.868.6040 | ||
| GregBenderLA@gmail.com | ||
| www.LAHomesByPrice.com |
| STATUS: Active | ADDRESS: 1716 GRIFFITH PARK BLVD , LOS ANGELES 90026 | LP: $995,000 |
 |  | |||
| RESIDENTIAL INCOME | DOM: 1 | AREA: (21) Silver Lake - Echo Park | MLS#: 10-437651 | LD: 03/24/2010 |
| APN: 5429-016-011 | ADP: | STYLE: | MAP: 594/C5 | SP: 0 |
| NUM UNITS: 3 | APX LSZ: 8,842/AS | POOL: No | CVD PKG: | SD: |
| APX SF: 1,646/AS | APX LDM: | TRASH: | NUM PKG: 1 | |
| YB: 1938 | GI: $0 | GRM: 0.00 | SCHED/ACT: Actual | WATER: |
| RC: | GOI: 0 | CAP: | TAXES: | VAC: 0 |
| CONST: | AOE: | INS: | GRDN: | MGMNT: |
| NUM STO: 1 | ATE: $0 | ELEC: | MAINT: | POOL EXP: |
| ZONE: LARD1.5 | NOI: $0 | GAS: | MGR: | ELEV: |
| ASSED IMP VAL: $204,000 | ASSED TOT VAL: | ASSED LND VAL: $775,200 | LT: 299 | |
| Type | Number of Units | Bedrooms | Baths | Furnished(y/n) | Revenue |
| Unit 1 | 1 | 1 | 1.00 | No | $0 |
| Unit 2 | 1 | 0 | 1.00 | No | $599 |
| Unit 3 | 1 | 0 | 1.00 | No | $1,575 |
| DIRECTIONS: North of Sunset, East of Hyperion |
| REMARKS: Unique 1930's Silver Lake artist's compound featuring a house plus detached duplex. Sitting high above street level, the separate one bedroom and one bathroom house currently used as the owners unit, features a deck with stunning city and hillside views. The rustic interiors include hardwood floors, redwood beamed ceilings, brick fireplace, gated entry, large private patios and backyard. The street level duplex features artist studios including hardwood floors, polished concrete floors, a sleeping loft and large private patio. All units have 1 bathroom each. Owners unit can be vacant at close of escrow. |
| AIR: Wall/Window | HEAT: Floor Furnace |
| ROOF: | FIN: Cash To New Loan |
| WATERFRONT: | DISC: As Is |
| SEWER: In Street | TYPE: Triplex |
| EQUIP: Built-Ins,Dishwasher,Range/Oven,Refrigerator | TENANT PAYS: |
| OWNER PAYS: | OCC/SHOW: 24-hr Notice,Appointment w/List. Office,Listing Agent Accompanies |
| SPA: | |
| LP: $995,000 | DOM: 1 | LD: 03/24/2010 | SP: | SSP: | BLOG Y/N: Yes |
| OLP: $995,000 | CD: | SD: | WD: | AVM Y/N: Yes |
| Broker/Agent does not guarantee the accuracy of the square footage, lot size or other information concerning the conditions or features of the property provided by the seller or obtained from Public Records or other sources. Buyer is advised to independently verify the accuracy of all information through personal inspection and with appropriate professionals. Copyright © 2010 by Combined L.A./Westside MLS, Inc. Information deemed reliable but not guaranteed. Prepared by: Greg Bender DRE# 01725209 |
-
Wednesday, March 24, 2010
BofA Debuts Plan for Underwater Mortgages
BofA Debuts Plan for Underwater Mortgages
Bank of America will announce a program Wednesday to allow underwater borrowers to systematically reduce the principal they owe over five years, as long as they stay current on payments.
The program targets borrowers who owe more than 120 percent of their home’s worth.
BofA is also expected to reduce principal balances on "payment option" ARMs with negative amortization to as low as 95 percent of property’s value.
Beginning in May, BofA is expected to identify and notify homeowners it believes are eligible for these adjustments.
Source: Reuters News, David Lawder (03/24/2010)
and Stan Smith - Prudential California Realty
Manager - Los Feliz
Bank of America will announce a program Wednesday to allow underwater borrowers to systematically reduce the principal they owe over five years, as long as they stay current on payments.
The program targets borrowers who owe more than 120 percent of their home’s worth.
BofA is also expected to reduce principal balances on "payment option" ARMs with negative amortization to as low as 95 percent of property’s value.
Beginning in May, BofA is expected to identify and notify homeowners it believes are eligible for these adjustments.
Source: Reuters News, David Lawder (03/24/2010)
and Stan Smith - Prudential California Realty
Manager - Los Feliz
UCLA economists: no 'double dip' - Inman New Article
GOOD READ, uplifting.
Greg
Subject: UCLA economists: no 'double dip' - Inman New Article
Rejecting the possibility of a "double dip" recession, economists with the
University of California, Los Angeles, Anderson Forecast say they expect
economic growth to remain on track even in the face of continued high
unemployment.
"Simply put, the financial emergency of 2007-09 is over, and we believe the
Fed will soon recognize this reality" by tightening monetary policy, UCLA
Anderson Forecast <http://uclaforecast.com/> Senior Economist David Shulman
said.
In their first quarterly report of the year, economists with the forecast
predict the nation's economy will grow at an annual rate of 3.2 percent
during the first three months of the year before leveling off to 2 percent
for the remainder of 2010.
Economic growth -- as measured by gross domestic product (GDP) -- is
expected to average 2.3 percent in 2011 and 3.2 percent in 2012, propelled
by strength in business equipment and software production, exports, and a
revival in home construction from postwar lows.
But job growth is expected to remain anemic through 2012, with unemployment
averaging 9.7 percent this year and not dipping below 9 percent until 2012,
when it's expected to average 8.6 percent.
The forecast predicts that California's unemployment rate, currently 12.5
percent, will ease a bit and average 11.8 percent for the year.
California?s economic prospects depend on demand for manufactured and
agricultural goods from outside the state, public works construction, and
investment in business equipment and software.
Although the state's economy is expected to grow, it won't generate enough
jobs to bring unemployment back into single-digits until 2012, the forecast
predicted.
Some pundits have the called the current trend of economic growth coupled
with high unemployment a "jobless recovery." Shulman has coined his own
term: "The Bipolar Economy."
Government stimulus programs -- including tax cuts, spending programs, and
near-zero short-term interest rates -- have spurred growth, he said.
But unemployment may be so persistent because companies aren't going to base
long-term hiring decisions on "temporary tax and spending programs coupled
with a nonsustainable zero interest rate policy," Shulman said. ...CONTINUED
Shulman identified inflation as the greatest risk to the economy, but said
he expects the Federal Reserve to tighten monetary policy to keep inflation
under control.
The Fed?s monetary policy "has strewn kindling wood throughout the economy
that could ignite into inflation at any time," Shulman said. Economists at
the UCLA Anderson Forecast "believe that the Fed understands this risk and
that is why we believe policy will be tightened this year."
The forecast anticipates that the Fed will gradually raise its target for
the federal funds rate -- the rate banks charge each other for overnight
loans -- from zero to 0.25 percent now to 3.4 percent by the second quarter
of 2012. Yields on 10-year Treasury bonds are expected to increase from 3.8
percent to 4.8 percent during the same period.
The Fed has already announced that it will wrap up $1.25 trillion in
purchases of mortgage-backed securities this month, a move that's expected
to gradually push mortgage rates up (see
story<http://www.inman.com/news/2010/03/17/fed-end-mbs-purchases>
).
In a March 15 forecast<http://www.mbaa.org/files/Bulletin/InternalResource/72219_.pdf>,
economists with the Mortgage Bankers Association said they expect rates on
30-year fixed-rate mortgages to rise from an average of 5.1 percent during
the first three months of 2010 to 5.8 percent in the final quarter of the
year.
That forecast anticipates that rates for 30-year fixed-rate loans will
average 6.2 percent in 2011 and 6.4 percent in 2012.
The MBA expects sales of existing homes will grow nearly 4 percent this
year, to 5.34 million, and reach 5.72 million in 2011. Sales of new homes
are expected to rebound from a record low of 372,000 in 2009 to 398,000 this
year and 528,000 in 2011.
Stan Smith - Prudential California Realty
Manager - Los Feliz
Monday, March 22, 2010
TheMLSPro(TM) Saved Search "A FEATURED LISTING BY GREG BENDER" Results Auto-notification
| Your Agent Contact Information | |||||||||||||
|
Reply To: GregBenderLA@Gmail.com
Your real estate agent would like you to know that The Saved Search: "A FEATURED LISTING BY GREG BENDER" has returned the following listings:
| New Listing | $129,000 | 2 Beds | 1.00 Baths | ||||
 MLS Number |
| ||||||
Broker/Agent does not guarantee the accuracy of the square footage, lot size or other information concerning the conditions or features of the property provided by the seller or obtained from Public Records or other sources. Buyer is advised to independently verify the accuracy of all information through personal inspection and with appropriate professionals. Copyright © 2010 by Combined L.A./Westside MLS, Inc. Information deemed reliable but not guaranteed.Prepared by: Greg Bender DRE# 01725209
Friday, March 12, 2010
TheMLSPro(TM) Saved Search "A FEATURED LISTING BY GREG BENDER" Results Auto-notification
| Your Agent Contact Information | |||||||||||||
|
Reply To: GregBenderLA@Gmail.com
Your real estate agent would like you to know that The Saved Search: "A FEATURED LISTING BY GREG BENDER" has returned the following listings:
| New Listing | $3,200 | # of Units: 1 | 3 Beds | 1.25 Baths | |||
 MLS Number |
| ||||||
Broker/Agent does not guarantee the accuracy of the square footage, lot size or other information concerning the conditions or features of the property provided by the seller or obtained from Public Records or other sources. Buyer is advised to independently verify the accuracy of all information through personal inspection and with appropriate professionals. Copyright © 2010 by Combined L.A./Westside MLS, Inc. Information deemed reliable but not guaranteed.Prepared by: Greg Bender DRE# 01725209
Thursday, March 11, 2010
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