Enclosed is the update of
activity for September 1, 2010 through October 31, 2010, click here to view the updates. There were a total of 58 new listings.
There were 38 pending sales.
Of the residential sales there were 25 sales between $199,000 and
$600,000, 6 sales between $601,000 and $999,999, 6 sales over $1,000,000 and no
land sales. There were 32 sale
completes. Their were 86 price
decreases and no price increases.
The number of current listings are down slightly; however they are still
very high at 300 listings specific to the Santa Ynez Valley.
Rates continue to fluctuate on
a daily basis. Conforming 30 year
fixed rates up to $417,000 are at 4.125% at 1 point and Jumbo Conforming Loans
which are loans up to $729,750 are at 4.25% at .875 point and Super Jumbo Loans
are at 4.875% at .5 points for origination. The conforming 5 year ARM Interest
Only is at 2.75% at .75 points, the Jumbo 5 year ARM Interest Only is at 4.125%
at 1 point. The 11th District Cost
of Funds index (COFI) is down at 1.663 for the month of October. The 6 month LIBOR rate is at 0.45; last
month it was at 0.46; 12 months ago it was at 0.46.
Rates are amazing, aren't
they. At least for the time being
but as we all know nothing terrific lasts forever. But when is it going to
change. That's the million dollar
question. The lending landscape
has changed quite drastically over the past several years. Practices, approvals
and standards that were once widely accepted have either vanished or
transformed beyond the point of recognition. Many banks, which were once
extremely careless with their loan underwriting techniques and approvals, have
dug themselves into a significant hole that will take many years to climb out
of. Promotions such as "'100% Financing"and "No Doc Loans"' were both
major contributors to the financial crisis banks and consumers are facing
today. Today, banks are making sure they don't make the same mistakes again, so
loan underwriting standards have become more stringent than ever before. According to a recent Federal Reserve
survey, it was found that about 75% of the banks surveyed indicated they had
tightened their lending standards for prime, subprime and commercial mortgages.
That was up from about 60% in the previous survey. With this sharp increase in
lending standards, borrowers are being turned down for real estate loans at an
alarming rate.
Here are the
top seven reasons banks are denying home loan requests:
1. Poor
credit: The borrower may have a heavy down payment or excellent equity
built-up in their house, but if their credit score is under a certain
threshold, obtaining a new loan or refinance from a traditional bank is
challenging. Even FHA (Federal Housing Administration) loans, which have
traditionally catered to borrowers with lower FICO scores, have an average
borrower credit score of 693, according to CNN Money, which is above the
national average.
2.
Insufficient liquidity: If the borrower doesn't have a heavy down
payment (20%-30% for most banks) and strong excess liquidity, banks don't want
to take the risk on funding their loan.
3. Lack of
income: The borrower doesn''t have consistent proof of income for the
last two to five years. Regardless of how good their credit score is or how
much equity they have in their home, if they can't show the bank proof of
income, loan approval will be tough. This can be a big hurdle in the loan
process, particularly for retired borrowers.
4. Lying on
the application: Banks have learned their lesson and are no longer putting up with
borrowers stretching the truth on their applications.
5. Debt: Borrower has
excessive debt and their debt-to-income ratio exceeds the bank's guidelines.
6.
Unemployment: Most lenders will like to see at least two years of stable work
to issue loan approval.
7. Self
employment: Lenders are looking at self-employed applicants with a lot more
scrutiny these days, making it very tough for these borrowers to get approved.
Obviously some of these newly
structured standards are for the betterment of the industry, and our overall
economy, but at the same time, home buyers across the country are realizing
quickly that reputable credit and stable income aren''92t always enough in
qualifying for a loan through a traditional bank.
Be sure and check out our
Website and Property Search engines.
We have added Lompoc area properties to the Search through their MLS and
you can find everything available throughout the County. Looking for Short Sales and REO's. Just
indicate that on the bottom field of the form and you will get the most
up-to-date list available. We may be reached during the day at our office
805-688-2969, and in the evening at 805-688-2986. Our toll-free number is 1-800-300-7977. My cell phone is 805-689-4178 and
Marlene's is 805-689-2738. So
whether you need to buy or sell, call us. We would like to show you what we can
do! In the meantime we thank you
again for your loyalty and support in seeking us out when looking at properties
in the Valley and for choosing in 2010 to get your information about the Santa
Ynez Valley and other areas on the
beautiful Central Coast from.........
Your Real Estate Professionals
Providing
Old-Fashioned Service Using Today's Technology
David Macbeth and
Marlene Macbeth