Long Beach, Ca. FHA loans may net you more when refinancing your home. Wherein, conventional Fannie and Freddie are limiting cash out refinances to 75% of a property's value. FHA loans may go as high at 95% of the homes value; however, if you cash out more then 85% of the homes value, you will definitely have to do a second appraisal. This can add a lot of costs to the regular refinance. For example, a typical FHA appraisal costs between $350-$400 and this must be paid up front. If you double that, you are expending between $700-$800 upfront before the loan closes. This is a considerable sum which is really only going to protect the bank by doing an extra certification of value on a home.
As an illustration, let's say you own a property that today appraises for $300000.00, pretty much the maximum you can get out of the property utilizing conventional financing is $225000.00; however, if you were to opt for an FHA loan should be able to cash out up to $285,000.00. This is a difference of netting $60,000.00 after the loan records.
Stock markets fell yesterday and Treasuries rallied after Treasury Secretary Geithner did not address the specific concerns on the minds of traders: what banks will do with toxic assets, how illiquid assets will be removed from balance sheets, and how to stem the decline in home prices. Currently, the Ten Year yield is at 2.82% (2.94% yesterday). 30 year fixed rate mortgages are about the same on where the market closed yesterday.
Yesterday was a "traditional" day where stocks went down and bonds went up. There's only so much money in the world, right? Locks volumes were heavy, but apparently the Fed buying mortgage-backed securities helped prices, and mortgage rates did well. A lot may happen in the next 3 business days, especially with an early bond market close Friday ahead of the President's Day Monday holiday.
Only economic news is the trade deficit. The U.S. trade deficit narrowed in December to the smallest in almost six years, with both exports and imports declining for the fifth straight month as consumers worldwide pulled back their spending. The gap between imports and exports shrank 4 percent to $39.9 billion, from a revised $41.6 billion deficit in November that was wider than previously estimated, the Commerce Department said today in Washington. "Trade is collapsing globally; whether it's imports or exports, there's a net benefit from trade that lifts all economies, and we're losing that now," said Christopher Low, chief economist at FTN Financial in New York. "We'll see a rise in protectionist sentiments."
As you know, the Senate passed the Stimulus bill yesterday. And now it goes to the conference committee to work out the differences between the House and Senate version. Assuming they are successful, the final bill is hammered out, and voted on by both the House and Senate and is then presented to the President to sign. And the President has asked for a final bill to be on his desk by this Monday. Here is a link for the summary of the bill.
Kirk Mulhearn, a Long Beach real estate broker and Professional Mortgage Planner may be contacted at: 562-989-4608 ext. 110
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