Investment Property Loans

One of the lenders that I work with for Non-Owner Occupied rental property loans offers these unique loan aspects on 1-4 units:

1. No prepayment penalties
2. Up to 5 properties loaned on by the bank
3. Borrower can have up to 15 residential loans (commercial loans not counted)
4. Cash out loans up to 10 financed properties
5. Can use rental income for subject property with no history of managing a rental
6. Interest only payments
7. Investment property loans up to $2,500,000
8. Recoup funds from all-cash purchases as Rate & Term refinance up to 6 months
9. Full documentation & Alternative doc loans to qualify

Let me know if you are looking for new or refinance loans for your rental properties. I have great sources for best rate or alternative financing options as needed.

Owner Occupied Duplexes for Sale in Silicon Valley

Today there are 25 duplexes for sale in Santa Clara County that are listed under the maximum loan amount for FHA financing. What does this mean?

For 3.5% down payment, you can buy a duplex in Silicon Valley, live in one unit and rent out the other unit. This provides you with maximum financing ability, a tenant who will pay you rent to offset the mortgage and tax depreciation on the rental unit to offset taxes. This is a great way to start your investment portfolio. Call me for details - Mario Pinedo, CCIM 415-269-6249

Financing Available for Rental House Portfolios

We have access to a strong lender offering one loan portfolio financing for single family, condo, townhouse, duplex and fourplex rental portfolios. Many investors who have purchased 5, 10, 20+ rental houses are experiencing problems getting additional financing for their next deal. Fannie Mae and others have put maximum loan restrictions above 10 financed properties or sometimes less. By aggregating your rental property portfolio into a LLC and financing the whole package with one loan provides an exciting solution,  Minimum aggregate loan amounts of only $1M. This is 4 houses or less in California. This lending platform is available throughout the 50 states. Call me for details 415-269-6249

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My Guys at CS Commercial Score Again!

Did I mention I have great commercial financing sources?  Chris Farlow and Brett Twente are my lenders of choice from CS Commercial.  They just closed financing on a 14 unit apartment building purchase loan for a client in San Mateo.  Chris has been in the business for 10+ years and is an expert at placing loans with the right wholesale lender depending on a variety of factors - condition, location, equity, cash flow, REO, class, property type, etc.  Not one bank can finance all of your commercial lending scenarios.  Chris is the best choice because he can find the right bank to finance your next investment property - wherever and whatever it is.

Update on Apartment Loans for Bay Area Real Estate Investments

Kari Noomen of Chase Commercial lending spoke to the Bay Area Apartment Brokers Forum last week. Her update included the following rates for apartment loans that she is facilitating through Chase Bank. For an average "B" quality building, the best rates are 5 year fixed at 4.97% with 75% loan to value and qualifying at that rate to a 1.15 DCR (debt coverage ratio). For years in this area, the LTV of 75% was a non-issue since the DCR would cap the amount of loan to a building to 50-60% of the purchase price. Now Kari is actually doing 75% LTV loans because the interest rates are so low. This is a very good time to get solid financing on great apartment assets in the San Jose / Silicon Valley area.

FHA & Conventional Loan Rates San Jose

Here is the weekly update from Tony Guaraldi of The Loan Source on FHA and conventional rates in the San Jose marketplace:

Mortgage rates for today are about the same as last Friday. We had some improvements though out the week and then getting slightly worse this morning. Things are still looking amazing historically! With the Fed ending the mortgage security purchase program at the end of the this month this would be a great time to capture a refinance or get into contract to buy a home.

The Jobs Report numbers are in, and the headline numbers were not as bad as expected. The media is spinning this as a good number, Stocks are moving higher and Mortgage Bonds are moving lower. The Jobs Report showed 36,000 jobs lost in February, better than the 68,000 loss that was estimated. The Unemployment Rate remained at 9.7%, as the number of people unemployed remained unchanged at 14.9 Million – this was better than expectations of a rise to 9.8%. Adding to the positive tone of the report were upward revisions to the prior two month's reports showing 35,000 fewer jobs lost. These headline numbers were not so great, but exceeded the low expectations, and avoided a potential disaster that some had feared. Helping the numbers were 15,000 temporary census worker hiring. Without this, actual job losses would have exceeded 50,000 for February.

And a deeper look beyond the headlines of the report showed what many consider to be the Real Unemployment Rate to be at 16.8%, a rise from last month’s 16.5%. This rate of unemployment, which the government calls U6, includes both discouraged workers and those who are working part-time that would rather have full time employment. In fact, a large portion of those accepting part time work are doing so out of necessity, to earn whatever they can. And just last month, another nearly 500,000 people accepted part time work, citing economic reasons for doing so. Overall, the report indicates that the labor market continues to struggle, but has shown improvement from its worst levels.

FHA is still available up to a $729,750 loan amount with 3.5% down payment. There is some talk that the down payment requirements and MI costs may increase in the future, so again it would be wise to jump on FHA with today’s guidelines and pricing. You can still buy a condo with FHA but the whole complex must be FHA approved. Townhomes do not need FHA approval. Below a link to look up local FHA approved condo complexes. I suggest filtering the search by State and then by City. If you have a buyer who must use FHA and they are looking at condos, don’t even bother showing them properties unless they are on this list.

https://entp.hud.gov/idapp/html/condlook.cfm

That’s the update for this week! Have a great weekend!
Tony Guaraldi
Mortgage Consultant
The Loan Source

First Time Home Buyer Workshop January 21, 2010

Our next Intero First Time Home Buyer Workshop is on Thursday, January 21, 2010 from 6:00-7:30pm. Located at Intero, 10275 N De Anza Blvd, Cupertino.

Home Purchase Process Step by Step
Pros and Cons of Bank Owned and Short Sale Properties
New Tax Credits from Federal Government
Credit Scoring Explained
Mortgage Options Currently Available
* Jumbo loans to $2,000,000
* Conforming loans with 5% down
* FHA with 3.5% down
* Min Credit Score 620
Title and Escrow
Tax Benefits of Owning a Home

Please RSVP as soon as possible - this workshop fills up.

Mario Pinedo
415-269-6249
mario@interorealestate.com

Loan Mortgage Update 9-25-09 from Tony Guaraldi

The Fed held the short term Federal Funds rate steady at 0.25% this week which was no big surprise. They will likely keep the short term rates low for several more months. One key piece of news from the Fed meeting this week that everyone was waiting for is their policy on the purchase of mortgage backed securities from Fannie/Freddie. They said they will extend the program through the end of March 2010. However, they will not increase the amount of dollars they will spend on the program. Instead they will slow down the frequency and volume of their purchases to allow the program to last longer. They committed 1.25 Trillion dollars for this program earlier this year, and that dollar amount has not changed. It is a given that once the Fed ceases its purchases, that interest rates will climb significantly higher…most likely back above the 6% area. So instead of a hard transition with a large bump in rates, the Fed is attempting to allow rates to gradually rise.

The funny thing is the bond market had a good day on this news and continues to be in rally mode today even though the Fed did not commit any additional dollars to the program. Most likely the reason is because the headline with the word “extended” gets the people excited and the market reacted to it. In actuality it is likely that the gradual reduction in purchases will bring rates higher and produce more volatility! Rates will be on the rise soon and any delays by consumers will likely result in higher mortgage rates. I would expect that the average 30 year fixed mortgage rate will be in the low to mid 6% range by end of Q1 in 2010, and I expect a gradual rise to get there over the next six months.

Well as a result of this week’s Fed announcements and other negative economic reports rates are looking better than we have see in the past several months! Great time buy a home, great time to refinance, great time to get moving!!!

Tony Guaraldi
Mortgage Consultant
Intero Mortgage
408-342-8644
tguaraldi@interomortgage.com

Wachovia or Wells Fargo loans in default? Let's talk short sale

Wachovia bank which has approximately 25% of it's loan portfolio in default status has a very aggressive stream lined process for short sales. They are processing short sales within 10 business days of a ratified offer being submitted to the bank. Their intent is to eliminate the possibility of a future foreclosure which will cost everyone more money. Wachovia's process (which was taken over by Wells Fargo) has proved so successful that Wells Fargo is considering the use of the Wachovia short sale team to handle the Wells Fargo defaulting loans too. I wish all banks get to this state of proactive loan processing. And if you know of anyone with a loan in default (or sometimes not even in default) and they are upside down in their home, have a true hardship (now or in the future) and want to consider a short sale - call me - we can evaluate the situation and very likely provide a solution.

San Jose Silicon Valley Real Estate First Time Home Buyer Seminar

Our very informative first time home buyer seminar is scheduled for Thursday August 20th from 6pm - 7:30pm at the Intero Cupertino office. Tony Guaraldi of Intero Mortgage will talk about current financing options and our manager Jess Wible will talk about buying opportunities in the REO, short sale and conventional markets. Buyers in 2009 will do very well in my opinion. Get to the class and let's start looking at your first home.

RSVP please as seating fills up every meeting.

Mortgage Update July 2, 2009

Rates have been holding and slightly improving over the past week. Adding fuel to the fire for mortgage bonds today was a stinker of a jobs report. The Labor department reported a loss of 467,000 jobs in the month of June. The national unemployment rate rose to 9.5%, its highest since 1983. Any time there is negative economic news the safer fixed income investments such as mortgage bonds get the benefit.

On Monday of this week China, the largest holder of US debt, announced they will continue to purchase our Bonds as part of their current foreign-currency reserve policy. China holds $763B of the $6.45T in US debt. This was great for mortgage bonds as China’s buying has really helped to keep our interest rates low over the past several years. Why do they do it? They wish to devalue the Yuan against the dollar so their exports to the United States are cheaper for the American consumer. The United States is the largest buyer of manufactured goods from China, and they want to keep it that way! By weakening the Yuan against the dollar it helps to ensure that American demand for Chinese goods will remain strong. Mortgage bonds get the benefit of this when China buys our debt.

Turn times are starting to improve for conventional loans, which is great news for the purchase market. The reason is that the refinance boom came to a halt when rates went up and origination volume decreased significantly. Conventional underwriting is much faster than the past several months, but there are still delays from the new appraisal process started on May 1st of this year. Over all it’s good to see lenders getting caught up with underwriting. I would still allow extra time for condo deals and FHA. Contact us with specific scenario questions as it’s always case by case for turn times.

That’s it for this week. Have a great 4th of July!

Tony Guaraldi
Mortgage Consultant

Loan - Purchase Perspective - It's not all about rate

From Yulin Lee of Opes Advisors, Yulin is one of my trusted advisers in the lending world:

Since January we've been seeing historically low conforming loan interest rates. It seems we've almost gotten used to having them around.

Most recently we've been seeing some incredible rates for jumbo loans. This is great news for the high cost Bay Area and it opens up new opportunities for both purchases and refinances.

It's easy to get enamored by great rates. But rates aren't the whole story. The rest of the story includes having the chance to consider the many other variables involved and to reveal opportunities and potential threats that aren't immediately apparent.

In fact, all the buzz about low rates led a client to contact me about a purchase he was considering. Rather than immediately jumping into a rate conversation, I suggested we take a broader look at what he wanted to accomplish.

Taking advantage of Opes' blended expertise of Wealth Management and Mortgage Banking; we looked further into his financial situation and discussed his financial goals. Through this planning, we assessed that increasing his down payment somewhat would enable him to get a considerably lower rate. We were also able to demonstrate that he would be receiving the equivalent of a guaranteed return of 8.25% on the additional down payment money.

Whether securing a home loan for a purchase or a refinance through Opes Advisors, we provide our clients key financial advice. And, because comprehensive financial advice is so important to meeting financial objectives, we do this at no additional charge. Here is a link to some of our client case studies.

Please contact me to discuss a specific situation or to review the potential impact of options that are being considered.

Best regards,
Yulin

Home Buyer Workshop April 21, 2009

Intero Mortgage is hosting their monthly Home Buyer Workshop
Tuesday April 21st, 6pm - 7:30pm
10275 N De Anza Blvd, Cupertino, CA 95014

* Home Purchase Process Step by Step
* Credit Reports Revealed
* Mortgage Options Currently Available
* Jumbo Loans to 2 Million
* Conforming with 5% Down
* FHA with 3.5% Down
* Min Credit Score 620
* Title & Escrow Process
* New Tax Credits From Fed. and CA

Tony and Jason give a very informative talk on how to finance a home in this market. This is well worth the time for anyone looking to buy a home. Please email me or call to RSVP.

Mortgage Update April 10, 2009

The big news this week was Wells Fargo announcing that earnings a positive number for the 1st quarter of this year to the tune of 3 billion dollars. The was largely due to high mortgage origination volume and also some profit taking by the bank. The mortgage bonds improved big time this past quarter, and the lenders have dropped rates as a result. But at the same time they are taking fatter profit margins per deal because the demand for loans is so high, they can price in more profit per deal and still have more than enough business. Additionally, a major reason that earnings were higher for them this past quarter is due the change in “Mark to Market” accounting earlier this month. I think we will see a positive trend here with other banks major US Banks as a result of the change in Mark to Market accounting. The bank also went on to say that the Wachovia acquisition is exceeding expectations.

In other news, Initial Jobless Claims were reported at 654,000, still a bad number but better than expectations. The Bank of England left their benchmark interest rate steady at a record low of 0.5% today and said it will continue to buy government bonds in an attempt to keep the UK from falling into a deeper recession. This is more good news for the global financial system.

The market is closed today for Good Friday. We’ll be around this weekend. Gave a good one!

Tony Guaraldi
Mortgage Consultant

Loan Update from Tony Guaraldi of Intero Mortgage

Rates are up quite a bit this week as Fannie/Freddie mortgage securities traded lower six days in a row, which lead to higher rates each day. Things are abnormal these days with mortgage rates. Typically rates are influenced most heavily by inflation and demand for bonds. Lately it’s been different. Here’s why.

The lenders spent most of 2008 either going out of business, merging with other banks, or laying off employees to cut costs as business came to a grinding halt. All of a sudden the US Treasury starts buying mortgage securities from Fannie & Freddie at a low 4% coupon, and this action dropped interest rates in the beginning of December. The lenders were instantly slammed with new refinance business, and now are at the point where they can not keep up with work load. So when you have too many loans in your pipeline the best way to slow down the flow of new loans coming in the door is to raise your interest rates! But people are still applying! Raise them again! Let’s take some profits while we’re at it, we can use it!

The second phenomenon in this environment is the lenders are changing the way they price zero point loans. They are strongly encouraging borrowers to pay points to get lower rates by increasing the spread between zero point rates and 1.0 point rates. You will see this on the rate sheet for conforming loans. The reason for this is a buyer/borrower is more likely to keep the loan for a longer period of time if they pay the points to get the loan and have a lower rate. The bank loses money if the borrower keeps the loan for only a few months. To encourage the behavior they desire, they are pricing the 1.0 point rates much better than zero point rates. This is of course the opposite of what the client thinks they need, so it’s our job to educate them on the benefit of paying points and show them the large amount money they will save by investing in lower monthly payments. This is a generalization on the market right now, but there are exceptions to this rule.

The third thing holding back the jumbo/conforming rates from dropping further is the rule created with the 2009 Jumbo/Conforming loans. A given bank is not allowed to have more than 10% of all of its conforming loans be jumbo/conforming. That means that 90% of all their loans must be below 417k and only 10% and go up to 625k. Well there is such a huge demand for jumbo/conforming loans that the lenders maxed out of it in a couple weeks. So most of them have greatly increased the rates on jumbo/conforming to stop the new submissions from coming in. This will hopefully normalize soon as the bundling and selling cycle starts over, and jumbo/conforming will come back down again.

In order to minimize this risk for rate volatility, with Intero Mortgage we are signing up new lenders constantly. This is a big advantage of being a broker, and not just any broker. A broker with some good volume and professional loan officers who submit clean files and act with integrity. The lenders are starting to really realize that not all brokers are good to partner with, and they are being very picky about who they will do business with. This way we have a better chance of having a lender that is not “full” already and can be competitive for rates and turn times.

That’s all for today. Give us a call this weekend if you need anything. We’ll be around! Have a good one!


Tony Guaraldi
Mortgage Consultant

30 year fixed rate near 5%

Conforming rates for a 30 year fixed were at 5.375% with zero points on Friday. This is a payment of $5.60 per $1,000 borrowed. If you pay one point, then your rate is 4.875% or a payment of $5.29 per $1,000 borrowed. This is a great time to refinance into a historically low rate.

Need a Lender For Your Rental Properties

Many investors are not able to take advantage of this great rental investment market. The reason is an arbitrary new rule that many banks have imposed. Most lenders are not making new loans to borrowers that have 4 mortgages over their whole portfolio. Heck, I have some clients with 40+ mortgages. All of those loans were taken out before this credit clamp down. We have researched and have found a good lender who is willing to lend with no limit on the number of loans. Yes, they are strict as to cash flow, debt to income, FICO, etc. And for a strong investor, this lender is ready to step up.

The interest rates would be about 5.5% full adjusted. Please call or email me and I can set you up with our great loan broker who has access to this lender.

Home Buyer Seminar-Thur, Oct 16th

Topic: How to Buy In This Current Market

The current economic conditions create a lot of confusion for many people, especially those who have been thinking about buying a house, whether it's 1st-time homebuyers or someone needing to move up.
- “Should I buy now? Will the housing prices go down even more?”
- “Should I wait for mortgage rates to go down a bit?”
- “I see the current crisis as an opportunity, how do I get in as a 1st time home buyers now? Can I even qualify without much downpayment?”
- “I'm thinking about buying a bigger home, how can I buy before selling my existing house?”
- “What are some of the strategies that I can use to take advantage of the current economic situation?”

These are common questions that I get asked all the time. If you find yourself asking the same questions, then come and invest 2 hours of your time to get educated. The truth is that the answer to all these questions is "it depends". But you need to know "it depends on WHAT?"

At Opes Advisors, we help clients navigate through the home buying maze by integrating debt management strategies with overall long term financial planning. The real question you should yourself is "How does buying a house affect my short-term and long-term financial planning?”

Event details:
6:45pm - 7:00pm Registration & Networking
7:00pm - 8:00pm Presentation
8:00pm - 8:30pm Q & A
Drinks and light refreshment will be provided.
RSVP by Oct 15th - Email: Krasmussen@interorealestate.com

WaMu Update

Yes, WaMu is still in the game AND they have a sense of humor

Fannie Mae & Freddie Mac

Interesting how two pseudo-government agencies, are now owned by the US Government. Seems as if they were guaranteed by the Fed, that it would suffice. Of course not. Guarantees were only for a small amount of loans - which was the assumed risk factor. The guarantee was never for a system that was about to implode due to wild speculation being generated from Wall Street (for the rationale and map of this statement - it was covered months ago). The FDIC too was formed to give confidence to bank depositors - that security as we all know now was like a carefully worded insurance policy with many limitations and outs for the insurer.
OK, enough Monday morning rambling - what does this mean for you and me? Interest rates will come down - confidence in the market has just improved. Lower interest rates will boost home sales. And more loan products will eventually enter the market. The loans that are highly anticipated are short term loans for people who lost their homes to foreclosures. This is always the case after a downturn in the market. When that happens, the market will again begin to percolate.