Welcome to the "Z" Team!

As the housing market continues to struggle for stabilization, many homeowners are turning to strategic default.  Almost 11 million homes are now underwater, according to Corelogic.  Around 3.5 million homeowners are behind in their payments and another 1.5 million homes are already in the foreclosure process, according to RealtyTrac.

Aside from the moral quandary of whether strategic default is the right decision, there also are other factors we suggest be considered. Plus, obtain advice from professionals.

The borrowers’ credit scores will take a hit. According to FICO, someone with a 680 credit score would see their score decline anywhere between 85-100 points after a strategic default, and someone with a 780 credit score could lose 140-160 points.

Borrowers who are considering strategically defaulting on a house should look at it as a last resort, not a first option.  Financial troubles could be eliminated by refinancing, especially if the Obama administration’s program is implemented.

Each state has its own rules and regulations regarding foreclosures, which affect both the length of the process and what the borrower could be liable for in the end.

Other news from the “Sierra Foothills” of El Dorado, Placer, Amador and Sacramento Counties of California at: www.sierraproperties.com or email: zteam4u@gmail.com

According to the sales numbers furnished by the El Dorado County Association of Realtors, county homes sales increased 14 percent during 2011 over 2010 ending the year with 2,400 homes closing escrow.

REOs accounted for one third of all sales while short sales made up another 25 percent. The percentage of shorts and REO sales will increase during the coming year. Some lenders have finally developed more streamlined procedures for handling short sale requests. Perhaps the delayed backlog of foreclosures is working its way through the pipeline? 

The number of homes available for sale is declining. By the end of the year there were 770 active residential listings (excluding active short sales with accepted offers called “active contingent.”) Based upon our current number of sales, averaging 220 a month for the last six months, that’s a three and a half month’s supply of homes on the market. During 2010 the county had a six months supply.

Source: Ken Calhoon, Real Estate Broker, Placerville, California

FICO has launched myFICO en Español, the first Spanish-language website where consumers can obtain their personal credit report, credit report analysis, FICO Score and FICO Score analysis in Spanish.

The new site enables users to toggle between Spanish and English, a format that is preferred by many bilingual speakers. More than 600 pages of Spanish-language consumer financial educational materials are available to visitors.

Si tiene ud. interes en comprar una casa o conseguir un prestamo, llamenos ahora y nuestro equipo que habla espanol le puede ayudar. Este es el primer paso para comprar una casa!

To access the site, visit http://espanol.myfico.com

More information at: http://www.fico.com/en/Company/News/Pages/01-24-2012.aspx

Call us at (530) 409-8351 or email: zeller123@gmail.com for personal assistance.

Many in the real estate industry were concerned that a change announced last year to the maximum seller contributions allowed for Federal Housing Administration-insured loans have made more sales to fall apart. The FHA announced last year that it would cut seller contributions from 6 percent to 3 percent for purchases using FHA-insured loans. Seller concessions, such as seller assistance to buyers in closing costs, can play a big part in FHA-financed home sales and in closing transactions.

We believe the previous higher seller contributions helped a lot of families buy a home. Our suggestion is to reinstate 6 percent for the “Sierra Foothills” region of Placerville, El Dorado County, California. What would you recommend for your area? 

Inman News reports that the FHA may be rethinking its seller contribution cap and will likely announce changes to its policy in April. 

“Rather than an across-the-board 3 percent ceiling on all FHA mortgages, the new policy would permit higher seller contributions, probably between 4 and 5 percent, on smaller loan balances,” Inman News reports. “Meanwhile, the 3 percent cap would be mandatory on all loan amounts above some yet-to-be-specified limit.”

Inman News also speculates that a dollar ceiling on seller concessions might be announced, like a maximum cap of $6,000 instead of a percentage.

Source: “FHA Concessions on Seller Concessions?” Inman News (Jan. 25, 2012)

Nearly three out of every four home owners say they are satisfied with their purchase – and the No. 1 reason for their satisfaction is pride they feel about owning a home, according to HomeGain’s 2012 National Home Ownership Survey.

In addition to pride, home owners also said they enjoy the freedom and control they have to make improvement and upgrades to their home. Positive thoughts like these reflect what we are hearing here in the “Sierra Foothills” region of Placerville, El Dorado County, California.

Of the 1,400 home owners surveyed nationwide, satisfaction was found to be highest in the Northeast at 77 percent, followed by the Southeast at 73 percent, the West at 71 percent, and the Midwest at 68 percent.

“The HomeGain 2012 National Home Ownership satisfaction survey shows in spite of declines in the values of homes nationwide, satisfaction among home owners remains high at 72 percent,” said Louis Cammarosano, general manager of HomeGain.

Source of data is Erica Christoffer, REALTOR® Magazine.

More information at: www.sierraproperties.com or email: zeller@realtor.com

Great to report that loan rates hit another all-time low this week, marking the seventh straight week it has averaged below 4 percent, Freddie Mac reports in its weekly mortgage market survey.

Here’s a closer look at rates for the week ending Jan. 19: 

• 30-year fixed-rate mortgages: averaged 3.88 percent, with an average 0.8 point, a new all-time low and dropping from last week’s previous record of 3.89 percent. A year ago at this time, 30-year rates averaged 4.74 percent. 
• 15-year fixed-rate mortgages: averaged 3.17 percent, with an average 0.8 point, up slightly from last week’s record low of 3.16 percent. Last year at this time, 15-year rates averaged 4.05 percent. 
• 5-year adjustable-rate mortgages: averaged 2.82 percent, with an average 0.7 point, the same as last week’s average. Last year at this time, 5-year ARMs averaged 3.69 percent. 
• 1-year ARMs: averaged 2.74 percent, with an average 0.6 point, dropping from last week’s 2.76 percent average. Last year at this point, the 1-year ARM averaged 3.25 percent. 

Source: Freddie Mac

More news from the “Sierra Foothills” of El Dorado, Placer, Amador and Sacramento Counties of California at: www.sierraproperties.com or email: zeller123@gmail.com

Record-low mortgage rates sparked a wave in mortgage applications for home purchase and refinancings last week, increasing more than 20 percent in a week, the Mortgage Bankers Association reports. 

for the week ending Jan. 13, mortgage applications for refinancing applications jumped 26.4 percent while home purchase applications, a future gauge for home buying, increased 10.3 percent.  

“With mortgage rates reaching new lows, refinance volume jumped,” Michael Fratantoni, MBA’s vice president of research and economics, said in a statement. “Purchase activity also increased as buyers returned to the market after the holiday season.”

Freddie Mac reported that 30-year fixed-rate mortgage averaged a record low of 3.89 percent for the week ending Jan. 12. For six consecutive weeks, 30-year fixed-rate mortgages — the most popular choice among home buyers — has averaged below 4 percent. 

Source: “Mortgage Applications Surge on Refinancing Demand,” Reuters (Jan. 18, 2012)

More news from the “Sierra Foothills” of El Dorado, Placer, Amador and Sacramento Counties of California at: www.sierraproperties.com or www.dougandbudzeller.com

A new Spanish-language property search website that offers Spanish-speaking home buyers MLS listings based on the California Living Network’s database.   Powered by NAR’s REALTOR.com® (www.realtor.com/california), home buyers can search for California homes using common sorting characteristics such as city, price range, and number of bedrooms and bathrooms. Results appear in a list or on a map, and driving directions are available in Spanish. The website also is a useful tool for REALTORS®, allowing agents to forward their clients a link to a specific property in Spanish.

Si usted esta interesada en comprarar o vender una casa, podemos ayudarle. Hablamos espanol. Llamenos hoy con sus necesidades!

To view the site, please visit www.sucasa.net.

For more Spanish-speaking assistance in the Placerville, El Dorado County or Sacremento regions, call (530) 409-8351 or email: zeller123@gmail.com.

Due to falling home prices and record low mortgage rates, pushing home ownership in reach to more families, according to the U.S. Department of Housing and Urban Development (HUD).

Home owners are bringing in nearly double the median income they need to cover the cost of an average home, HousingPredictor reports. 

“With interest rates at historically low levels and markets across the country beginning to improve, home ownership is within reach of more households,” Bob Nielsen, chairman of the National Association of Home Builders, said in a statement.

However, some consumers are finding more stringent lending standards for getting a mortgage a roadblock to home ownership, and some housing experts have blamed tighter underwriting standards in recent years for continuing to hold back the housing market. 

Source: “Home Affordability Reaches 1971 Level,” HousingPredictor (Jan. 11, 2012)

More news from the “Sierra Foothills” of El Dorado, Placer, Amador and Sacramento Counties of California at: www.sierraproperties.com or www.dougandbudzeller.com

Three years ago Mark and Julie lost their home through foreclosure. Last week, they closed escrow on their newer, larger, nicer home in the same neighborhood. Their new home was about half the price as what they had paid for the home they lost. They are among a new category of buyers this year who are reentering the market after a two or three year respite.

Although thousands of families have left the region after losing their home to foreclosure, short sale or bankruptcy, many remained. Most have been rebuilding their credit, paying down debt and some have been saving to buy another home. After three years and in some cases less, mortgage financing is again available.

REOs and short sales will be the new normal. Two years ago, REO and short sales accounted for one-third of all the sales in El Dorado County, California. Of the 200 home sales during December, about half were shorts or REOs. This next year, distressed sales will account for the majority.

Portion of an article by Ken Calhoon, Placerville, California Real Estate Broker. Ken@KenCalhoon.com