by admin on October 18, 2011
I came across an article in the OC Register of a lawyer that has been advising clients to break in to their foreclosed homes, change the locks and take them back from the bank…. are you kidding me? Yes, this is a true story!
Needless to say, a whole bunch of charges were filed against him and the California Bar suspended his license to practice law. The court handling the case ordered him for psychiatric evaluation (you think?).
This economic climate pushes people to their limits and makes them do things that leaves you scratching your head. It is a sign of the times and until this economy turns around, we will continue to see and hear about off the wall things that people are doing. It is sad and we hope that things will get better. What are your thoughts?
It appears that the House of Representatives will not be extending the expiration of the high balance loan limits beyond the 9/30/2011 expiration date. What does that mean to the home buyer?? let me first start by saying that the government implemented a program to try to stimulate the housing market when the market had collapsed. The decision was made to create a “High Balance Conforming Loan Limit” which would help extend loans to buyers looking in higher priced areas without having to worry about the strict guidelines and higher rates of Jumbo financing. Furthermore, the increase in balances meant that FANNIE MAE and FREDDIE MAC would be involved in purchasing the loans from the banks issuing them. FANNIE and FREDDIE do not purchase jumbo loans. The high balance loans were increased from $417,000 to the $729,750 mark. The FHA loans were also increased in Orange County to the same loan levels and only requires buyers to put 3.5% down. What does the expiration on September 30, 2011 mean to you? It could mean thousands of dollars!
After the expiration date, the high conforming loan balance will be rolled back to $625,000 from the $729,750 number. Once expired, say you buy a home and your loan is $650,000. Instead of getting the High Conforming loan pricing, which is typically alot lower than the Jumbo pricing, not only will you be required to put 20% down, but most likely you will be paying about .5% higher in rate.
If you are in the market for a home, this is important information that you must factor into your decision. If you would like further information or would like to discuss, feel free to give us a call.
Jose & Chris
