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FHA & Conventional Loans About To Evaporate For Some Benicia, Vallejo Homebuyers?

June 18th, 2011 categories: Benicia, Buying, Loans / Financing, Solano, Vallejo

How Much Can You BorrowUnless Congress steps in soon, some Benicia, Vallejo homebuyers may find it impossible to get an FHA or conventional loan by early Fall.

That’s because loan limits for the two loan programs that cover probably at least 90% of the loans originated in Solano County are set to change come Oct. 1.

And barring Congressional action, the maximum you can borrow under both programs is going to drop substantially, which means that many Benicia, Vallejo and Solano County home buyers could suddenly find themselves needing to come up with tens of thousands more in down payment or accept a costlier “jumbo” loan.

Right now, the maximum you can borrow with an FHA or conventional loan is $557,500. But as it stands right now, after September 30, the conforming loan limit in Solano County will drop to $417,000 and the FHA limit to $400,200, which is certain to impact local borrowers who are planning to finance a home with a loan amount that exceeds the new limits.

In plain English, that means that any borrower in Solano County who is today planning to buy a home for more Read the rest of this entry »

Written by Rod Herman | Discussion: No Comments »

What The End Of The Rainy Season Means For Some Benicia-Vallejo Short Sale Buyers

March 31st, 2011 categories: Buying, Foreclosures / Short Sales

March-MayIf you’re buying a vacant short sale property in Benicia, Vallejo or elsewhere in the Bay Area, it’s important to know that we’re getting close to the time of year when what you see today may not be exactly what you see the day escrow closes.

That’s because in another month or so, we’ll be at the end of the rainy season, which means that the yards of many of those short sale listings will go from lush and green to dry and brown — and often within a matter of days.

Green Today, Brown Tomorrow

While the hills are still green and the ground is still moist from last week’s downpours, the warm, sunny weather of the last few days reminds us that we’re nearing the end of the rainy season.

In another month or so, it will be time to start watering, mowing and pruning on a regular basis, which often doesn’t happen when the responsibility falls on the shoulders of a short sale homeowner who’s already moved out.

If you buy and close escrow on a short sale between October and April, you usually get a free pass, since mother nature keeps things moist. But when the warmer weather arrives, unless someone’s there to water, fertilize, trim, mow, edge and pull the weeds, that lush green lawn you saw in March can quickly turn to a dry brown carpet by early May.

And if you’re buying a short sale, where you might be waiting two, three, four months or more for the seller’s lender to approve the sale, you could end up in a situation where a big chunk of the money you had allocated for carpet, paint, cabinets or appliances might end up going to unexpected landscaping instead.

It’s In The Contract, However…

On page 4 of the standard California purchase contract, it says that the seller shall maintain the property “in substantially the same condition as on the date of Acceptance.” But I can Read the rest of this entry »

Written by Rod Herman | Discussion: No Comments »

.600 Is A Pretty Good Batting Average…Unless You’re Talking About Short Sales

March 14th, 2011 categories: Buying, Foreclosures / Short Sales, Viewpoint

BB Shortsale

A few days ago, our state association, the California Assn. of Realtors, released the results of a recent survey which claims that only three out of every five attempted short sales in the state actually went through.

A .600 batting average may be great if you’re Barry Bonds, but it’s not so great if you’re talking about the percentage of short sales that were successfully completed.

The report lays blame with the banks for dragging out the process for months and months on end. And to be sure, with some banks, that’s definitely an accurate statement. But others, like Bank of America and Wells Fargo have made great strides in streamlining the process over the past 12 months.

In fact, on all of the short sales I’ve negotiated with Bank of America since last summer, I’ve gotten responses in about 30 days or less. That’s a far, far cry from what was happening a year ago — when their norm was a good 6-8 month wait (if you were lucky).

I don’t dispute CAR’s findings, but based on my own personal experience with representing short sale clients here in Benicia, Vallejo and elsewhere in  Solano and Contra Costa counties, I think it’s fair to point out that while many banks are definitely the root of the problem, some of the blame for that 40% failure rate lies with sellers or their agents.

Now, I certainly haven’t had a 100% success rate and anyone who tells you they have isn’t telling the truth.

But by the same token, I’m sure I’m well above the 60% figure that CAR’s survey suggests.

What’s more, I’m sure colleagues of mine who know what it takes to successfully negotiate a short sale would say the same thing.

In my experience, if an agent is only successful on 3 out of every 5 short sales, they’re either not doing something right, are plagued by sellers who aren’t really committed to the short sale process or are in the midst of a run of incredibly bad luck.

Most of the time, the handwriting’s on the wall for all to see, with plenty of tell-tale signs that this particular short sale has little chance of going through.

Here are some signs you may be in for a bumpy short sale road: Read the rest of this entry »

Written by Rod Herman | Discussion: No Comments »

What Obama’s Mortgage Reform Plan Means For Solano County Home Buyers & Sellers

February 17th, 2011 categories: Buying, Contra Costa, Loans / Financing, Selling, Solano, The Economy

You may have heard that President Obama unveiled his plans to reform the mortgage industry last Friday. Since then, his proposal has taken a lot of heat in real estate circles, especially since one of his recommendations is to reduce the maximum loan limits on conventional mortgages in high-cost areas by more than $100,000 as early as this fall.

Among some of the proposals in Obama’s plan:

  • Drop the maximum loan amount in high cost areas (which includes much of the Bay Area) from $729,750 to $625,500.
  • Phase out both Fannie Mae and Freddie Mac by reducing their loan portfolios by 10% a year
  • Raise fees for borrowers
  • Increase minimum down payments borrowers

What This Means To Solano Home Buyers & Sellers

It’s still unclear whether the White House’s proposal to lower the maximum loan limit would really impact Solano County. Currently, for most of the U.S., the limit is $417,000. The majority of the Bay Area, though is at $729,750 — which is the amount that Obama’s plan wants reduced by about $105,000.

pull quoteIn Solano County, however, our limit is $557,500, which is higher than the rest of the U.S., but lower than most other Bay Area counties.

So if the White House plan reduces the loan limit for all high cost areas on a proportionate basis, then Solano County buyers and sellers could definitely feel a pinch, since buyers of homes priced above the new loan limit would be forced into higher-rate “jumbo” loans, which would no doubt kick some buyers out of the market or force some sellers to lower prices to attract conventional loan buyers.

But if the White House plan keeps our limit at $557,500, since it’s already below the proposed $625,500 ceiling, then Solano County Read the rest of this entry »

Written by Rod Herman | Discussion: No Comments »

April 2010 Benicia & Vallejo Home Sales

May 18th, 2010 categories: Benicia, Buying, Market Update, Selling, Vallejo

Ben-Vjo Home Sale Reports - AprilCurious what that Benicia home down the street sold for last month? Wonder how much your Vallejo neighbor sold his home sold for? Or how long it took a certain Vallejo or Benicia home to sell?

Just download our April Benicia and Vallejo Home Sale Reports for those answers and more. Some highlights from April’s Benicia & Vallejo Home Sale Reports appears below. Read the rest of this entry »

Written by Rod Herman | Discussion: No Comments »

April Solano Home Sales Report: Prices Holding Steady And Up County-Wide Over Last Year

May 11th, 2010 categories: Benicia, Buying, Fairfield-Gr Valley, Market Update, Selling, Solano, Suisun City, Vacaville, Vallejo

April’s home sales numbers are in for Solano County and on a county-wide basis, the median price last month was $200,000 — exactly the same as it was in March.

Vacaville, Vallejo and Suisun all reported median prices that were almost the same as the previous month, while Benicia’s median was way up and Fairfield’s was noticeably down.

April Median Sales PriceThe huge jump in Benicia’s median price is probably Read the rest of this entry »

Written by Rod Herman | Discussion: No Comments »

Why There May Be Almost Twice As Much State Tax Credit Money As Everyone Thought

May 10th, 2010 categories: Buying

$100 MillionAs  you’ll recall, back on Apr. 15,  I wrote that our state association, the California Assn. of Realtors, projected that the state’s new first-time and new-home buyer tax credits might all be gone within a matter of days, once May 1 arrived and eligible buyers started sending in their tax credit paperwork.

Well, it’s still too early to know for sure, but based on ‘early returns,’ CAR’s doom-and-gloom prediction may turn out to be rather exaggerated.

$100 Million Or $175 Million?

All along the state has been saying that only $100 million was allocated to fund the tax credit. But is that really true? Well kinda-sorta. Read the rest of this entry »

Written by Rod Herman | Discussion: No Comments »

Benicia Going Green…But Not For Much Longer

May 8th, 2010 categories: Buying, Fun Stuff, Local Stuff

Benicia is very green these days, but that’s all about to change…and probably well before the end of May.

No, I’m not talking about the city’s environmental efforts. I’m talking about Benicia’s gorgeous green hills.Hastings Read the rest of this entry »

Written by Rod Herman | Discussion: No Comments »

Solano Home Buyers Get 2-Month Extension On 3.5% Fannie Mae Closing Cost Credit

April 28th, 2010 categories: Benicia, Buying, Fairfield-Gr Valley, Foreclosures / Short Sales, Solano, Suisun City, Vacaville

Fannie Mae 3.5 Credit Non-Investors Who Buy A Fannie Mae Repo Can Still Get The Credit If They Close By June 30


In what amounts to an unexpected gift to buyers of Fannie Mae bank-owned homes in Solano County, the secondary mortgage market giant just announced that its 3.5% closing cost credit incentive program, which was scheduled to end Apr. 30, has been extended to June 30.

So if you buy one of the 96 Fannie Mae-owned homes in Solano County that are either presently for sale or about to come on the market and can close escrow in the next two months, you could be eligible for up to 3.5% in credits at close of escrow.

Of the 96 homes for sale in Solano, 89 are Read the rest of this entry »

Written by Rod Herman | Discussion: No Comments »

Solano Pending Home Sales Up, Inventory Down As Tax Credit Draws To A Close

April 28th, 2010 categories: Benicia, Buying, Fairfield-Gr Valley, Market Update, Solano, Suisun City, Vacaville

Whether it’s due to the impending federal tax credit deadline or just the normal spring real estate market surge, home sale activity has definitely picked up in recent weeks in Solano County, which in turn weekly-solano-home-reporthas caused the supply of homes for sale to drop.

This past week marks the first time all year that all five cities in our Solano County market area have seen their inventory of homes decline in the same week.

Vallejo (-20) and Fairfield (-24) both experienced double-digit drops in their housing supply, while the other three cities saw a nominal decrease (Benicia & Fairfield -4 and Suisun -2).

Yet, even that is a significant change from Read the rest of this entry »

Written by Rod Herman | Discussion: No Comments »