Hard to imagine, but winter is starting to wind down. We are hopeful that everyone is enjoying the warm winter days and the refreshing winter nights that Los Angeles provides all of us!! No other place quite like southern California… Might we add, Los Angeles is perhaps the best overall city in the world!!
Our recommendation as it relates to the mortgage arena is to allow Centek to evaluate your existing mortgage profile and analyze if any alternative programs would be better suited for your overall financial strategy – reducing the amortization of your current loan, changing from an adjustable rate mortgage to a fixed rate or conversely changing from a fixed rate mortgage to an adjustable rate program. Mortgage rates have spiked above 4% and if rates continue down this path, our steadfast philosophy is to have your loan package in and ready to go in order to best take advantage of any rate decline or be prepared to “bite the bullet” and change out of an adjustable to a fixed rate or even a new adjustable rate to provide a longer fixed period even if this means increasing your current interest rate. If we start the process further down the line, we might not be able to catch the window of opportunity.
The Federal Reserve announced no change in rates at today’s meeting. The general consensus is that rates will continue to migrate up towards 3% on the 10 year treasury note. What this means for mortgage rates is that moving in tandem with treasury yields, rates will continue to increase as well. The overall economy and the stock market in particular continue to be performing well. One lens to view the increase in rates through is that one’s other assets and income are increasing and that the higher monthly payment is just a cost of doing business.
In regard to the real estate market, we feel the most prevalent issue is with the lack of inventory for sale. The lack of inventory is due to several interrelated factors that we have not recently experienced. The escalation of property prices in our California market (especially our SoCal & Bay areas),the vibrant California economy & the increases in the stock market. The combination of these and other factors including the demand from foreign investors, has limited the number of available properties on the market. The flip side to this equation is where is the seller of the property going to move? This point is a large reason as to why more properties are not for sale. Where does one move when they sell their home? This is a problem and a main reason why with elevated home values more properties are not on the market. The move up buyer is difficulty in selling their existing house and being able to afford the next level up in price….This by no means applies to everyone, but is a major point in the overall real estate market place. In our next newsletter, we will discuss the effect of the new tax laws on how it pertains to financing options.
Please feel free to contact us to discuss your financing or overall real estate acquisition or sales needs. We can review and strategize with you. Stay tuned!!
Gloria Shulman & Curtis Cohen
Some of our unique programs to help you close your deal or have a smooth refi…
- 3.5% – 5% down program up tp $636,100 loan amount
- 10% down program up to $1.450M sales price
- 15% down program up to $2M sales price. We can also go higher with larger down payment.
- With married couples, we are now able to utilize the highest credit score for qualifying purposes.
- In divorce situations with alimony paid involved, we are able to treat the payment as a reduction to income vs. liability; this has a dramatic affect for the qualifying process, especially with higher alimony payments.
- Fully blended ratios with borrower and co-borrower treated as 1 entity for loan qualifying. This translates to parents who want to buy for their children, with limited income, are now able to obtain owner occupied rates and terms.
- With some programs, we close with 1 year of tax returns and / or qualifying bank statements instead of the usual two.