Juan Cepeda

Recently the government has used all its power to help the consumer from lowering down rates and asking the lenders to modify the terms of loans that can not be refinanced. For those that couldn't be helped resulted in foreclosures that then became REO's. The wave in California is about to come. In CA, the SB1137 law exacted on Sept 5th forced a 60-day moratorium on Notice-of-Defaults and Notice-of-Trustee Sales. NOD’s are a very leading indicator to foreclosures by 4-6 months in addition to an indicator of future supply/price depreciation. The massive wave of NOD’s from Jan to Aug and then again in Dec (post-SB117) is still out there waiting to turn into REO beginning soon. Additionally, Fannie and Freddie are on full foreclosure moratorium. Add all this up and we are about to get a plethora of REO's. Luckily rates are down and combine with the incoming inventory it is the time for the consumer to buy, buy, buy.

It is getting really rough on Condo owners to refi their property. Effective April 1, 2009, once again, Fannie Mae is raising its loan fees. Condo and co-op mortgages over 75% LTV : Add 0.750 percent to fee. This means that lenders will start to implement these increases right now since loans originated today may be bought by Fannie around the effective date for the new increased pricing. Mortgage rates may fall in the future, but applicants subject to risk-based pricing may find that risk-adjusted interest rates aren't be lower at all. So even if you think rates will get lower, if your value drops and your loan to value is above 75% then you get the .75% hit. My question to you is will it be worth the wait, rates drop say .25% but the hits of .75%, because the value dropped.... In any case talk to your Mortgage Professional.

I have been advising my clients for the last few weeks to get at least a financial analysis done. We are in uncharted waters right now. I did an analysis for client just today who asked, just for kicks Juan why he should I refinance my 5.5% rate. We discussed his plans to stay in the property for another 5 years and maybe rent it out after that. So, just these 2 facts made my point to him. If we get him the 4.375% rate (4.617% APR)he would save $144 a month from that $200,000 loan he has. The closing cost, because he would be buying the rate down would be around $6,500 (1 point discount and 1 point origination) and would take him about 45 months or a little over 3 1/2 years to recover his money. On month 46 he is making a profit and his mortgage payment without taxes and insurance would be $1,039. This has giving him the flex-ability to stay in the property with a comfortable payment or rent it out with a low mortgage payment and a nice monthly positive cash flow. This scenario alone should illustrate the need to talk to me and see what options you have. These are rates based on Friday the 9th of January, 2009 imagine if rates come down where that rate will cost you half. The options are right there, be fiscal responsible.

Juan M Cepeda

818.749.6858

Hi All,

I have been in the industry for 10 years and lets say it is rare to come across a situation new to me. In the 10 years in the mortgage industry I had seen the values go up resulting in new homeowners to pay a supplemental tax (the difference from old value vs. new value). The values have dropped so much in recent years that buyers will pay taxes at escrow for the old values and have contact the tax collector to get reassessed taxes in order to get a refund for the over payment. My current buyer has to pay about $2,600 for the 2nd half taxes when the new tax for a whole year will be around $2,200. This is something we were not aware so the buyer will have to come up with extra money, so if you are in escrow contact your mortgage consultant or realtor to get your exact amount to bring in at the loan signing. This is because the tax bill is due next month.

Juan M Cepeda

818.749.6858

Hello All,

I hope everyone had a great Holiday season. We are ready to embark in a historic year in 2009. The beginning of the year is usually the time when we make our new years resolutions. The first should be to get your finances in order. Look into a mortgage check up, well there is no better time than the present. The government started to buy Mortgage Backed Securities this week and basically they will make sure this market will move along. Rates are still higher from the best we had last month, but look for us to reach these levels soon. What do we learn over and over in this volatile market? Lock, Lock, Lock! The last time we had 4.5% with 0 Points it lasted maybe for a 5 hour window. Here is the problem, your mortgage professional can not do this with out you the consumer filling out the application and giving us your income and loan paperwork. I have actually started getting paperwork and talked one on one with my clients to see what there objectives are and what rate and fees are acceptable. My advice is be pro active, start talking to your mortgage professional (Me) and get the ball rolling and lock the moment the rates hit what you are looking for. I hope you all the best in 2009 and beyond.

Juan M Cepeda

Area Sales Manager

818.749.6858