Brodie Stephens- Broker Owner | Selling Homes in Folsom | Placerville | Pollock Pines | El Dorado Hills | Elk Grove | Roseville | Rocklin

Source: The Wall Street Journal
A number of government agencies and private organizations provide housing assistance to low-income families. Now, more banks and employers are offering financial help to jumbo-mortgage borrowers.

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http://online.wsj.com/article/SB10001424127887323789704578443191845080704.html?KEYWORDS=%22A+helping+hand+for+jumbo-loan+borrowers%22

The New York Times

The so-called jumbo mortgage market is strong, competitive, and growing, with more lenders, and more loan products now being offered, which means it’s more important than ever to comparison-shop.

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http://on.car.org/Muz04r

The Wall Street Journal
Loans closed by banks and mortgage lenders in February had borrowers with a credit score of 750, up from 740 six months earlier, and an average loan-to-value ratio of 76 percent.  The average denied loan had a credit score of 699 and a loan-to-value ratio of 83 percent.

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http://blogs.wsj.com/developments/2012/04/04/are-mortgage-credit-standards-loosening-hint-no/

Closing costs can increase the price of a home by as much as $10,000, sometimes more.  Borrowers who are “cash-poor” can ask for assistance, or talk to their lender about a lender credit toward closing costs.

Making sense of the story

• Some lenders advertise that if borrowers agree to accept a mortgage interest rate from a quarter to a full percentage point higher than they would ordinarily qualify for, they can receive credit toward their closing costs.
• These mortgages are sometimes called no-closing-cost loans, though the term is misleading.  The credit usually covers only fees charged by the mortgage broker or bank, like the loan origination fee, the underwriting expense, and the appraisal.  That generally leaves title insurance, mortgage-recording taxes, insurance, and escrowed taxes to cover.
• The amount of credit depends on total closing costs and other loan details.  Generally, for every one-eighth of a point increase in interest rate, borrowers receive a credit worth half a percentage point of the principal amount.
• While these mortgages can be helpful to some, borrowers should carefully review all the details.  There are pluses and minuses to these loan types.  A downside is the higher rate and monthly payments remain in place through the life of the loan.
• Doing a side-by-side comparison of loans with and without the credit can be helpful.

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http://nyti.ms/svzEBM

The drop in the homeownership rate from an all-time high of 69.2 percent in 2004 to 66.4 percent in the first quarter of 2011 reflects a decline from unsustainable levels to something closer to historical averages, according to a study released by the Mortgage Bankers Association’s Research Institute for Housing America (RIHA). While the homeownership rate may have bottomed out, it could fall another one or two percentage points because of tightened credit and other factors, the study says.
Key findings from the study include:
A combination of changes in mortgage credit standards and attitudes towards investment in homeownership likely contributed to much of the rise and fall in homeownership over the decade.  As credit conditions loosened in the first part of the decade, many people of all ages who would have remained renters instead became homeowners.  With the financial crash, the recession, and tighter credit conditions, homeownership rates have fallen back to levels close to those of 2000 for most age groups.
Individuals appear to have been more risk-seeking in their approach to home buying in the first half of the last decade.  This changed to a more risk-averse posture following the real estate meltdown.
Between 2000 and 2009 there was a one percentage point increase in the homeownership rate.  But, were it not for the shifts in access to homeownership through easier credit and the changes in socioeconomic conditions, the homeownership rate would have actually fallen between 2000 and 2005, rather than increasing.
To view the full report, please visit the RIHA website at http://www.housingamerica.org
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