Mortgage Blog

What a week! There are four short sale needs to be
closed in the past week. But there are a lot of
extra work because of the new regulation changes,
the most important one is that we can not extend
the rate after the loan docs prepared.

Here are some info of the purchases for the reference:
1)San Jose 95123. Purchase 460k. 3 Bedroom,
2 Bath with 1500 sqft. The interest rate is a little
bit higher because the market rate was
higher then and also because it's the 5th financed
property. Rental income $2000. This one is not cash
flow positive. It's negative of raound $400.

2)San Jose 95129. 750k purchase. 4 bedroom, 2 Bath
with 1600 sqft. PITI around $3400 with rental income
$2450. Cash flow is not good either.

3)West Sacramento 95691. Purchase Price 290k
3200 sqft with 4 bdrm 3 baths.

4)Riverside 95208. Purchase 250k. 3bdrm 2.5 bath
with 2400 sqft.

Just got a report this weekend, for most of the areas
in USA. The house will head lower. The low interest rate
will not help those with house price is underwater.
And some of them will choose strategic walk away.
Also, the appraisal will choose "lower" values
on the market will kill the RE recover as well.

There are some opinions about allowing the current home
owners to refinance lower rate no matter of the
property value. But there are a lot of difficulties,
especially the investors(the bond buyers) will not
agree.

So there is no easy solution for the RE recovery yet.