The Real Folsom Blog

Five Reasons Why You Want To Avoid Foreclosure At All Cost

More than a third of the homes currently for sale in Folsom are short sales. Although it's sad to see that number realizing it represents neighbors in distress, the good news is these residents are being pro-active about resolving their mortgage woes. Too many homeowners still take a "head in the sand" approach to their housing problems and wait too long to address them and wind up being foreclosed on. This is unfortunate. As painful and stressful as short sales can be, I can give you five good reasons why you want to do all you can to avoid a foreclosure.

1. Foreclosure Follows You. Credit inquiries specifically ask about foreclosure. And there is no seven-year time limit on this one. So you will have to keep disclosing on mortgage applications or job applications that you went through a foreclosure.

2. Negative Impact on Your Credit Score. Did you know your credit scores will be lowered by 300-plus points (per loan) if you went through a foreclosure?

3. Ineligible for a Government-Insured Loan. You will be ineligible for a government-insured loan for between 5-7 years after a foreclosure. Homeowners who go the short sale route can apply for a government-insured loan after only 2 years!

4. Deficiency Judgement. Even if your lender forecloses, they can still seek a deficiency judgment against you and try to recuperate any amount they didn't get back at the bank sale.

5. Employment Credit Checks. Many employers run credit checks on prospective employees. A foreclosure on your record could be a strong negative for some employers.

As you see, a foreclosure will follow you a long time. Not that a short sale instantly gives you a clean slate, but it'll sure be easier to get beyond it.

Folsom Real Estate this Sept 28 '09

Finally! We are getting some cooler, actually fall-worthy, weather. As of this morning, there were 305 properties for sale (up 5 from last week), ranging in price from $95,000 to $2,500,00 and with a median price of $379,900 (no changes here) and an average days on the market of 91. Of those 305, 139 are short sales and 24 are bank-owned. Still just over 50 percent of the properties selling in Folsom right now are distressed sales. The bank-owned properties range from $140,000 to $695,900 and have a median sales price of $339,900. And the short sale properties range from $95,000 to $810,000. That's it for the quick snapshot of Folsom real estate this Monday morning.

Are Home Buyers Getting a Reprieve?

Guest blogger, Barbara Van Duyn, explains why the historic low interest rates we're seeing may not last. Read on. Barbara is a certified mortgage planner with First Priority Financial. If you have any mortgage questions, you can reach Barbara through her Web site, www.BarbaraVanDuyn.com.

Yes! Home loan rates would have shot higher at year’s end if the Federal Reserve continued with plans to stop their semi-monthly buying of mortgage-backed securities (MBS) in December. Not good for a struggling housing market. Instead, after the September Federal Open Market Committee meeting, the Federal Reserve announced they would gradually wind down their purchase of MBS and stretch it out through the first quarter of 2010. This reprieve is good news for both home buyers and homeowners considering a refinance.  The bottom line ... once the Fed reaches their target spending of $1.25 trillion, the buying will stop and home loan rates will go up. They’re just hoping the housing market will be in better shape next year when it happens. 

You only need to look back to last year before the Fed stepped in to buy up mortgage bonds to see the positive impact this policy has had on rates. I pulled out a rate sheet from September 25, 2008, and found a 30-year fixed-rate conventional mortgage was costing 6.25% with NO Points. Today it’s 5.00%. Since the Fed began their purchase of MBS in January, home loan rates dropped to 4.50% initially. Since then they been running anywhere between 5.0% and 5.5%.  

If you're planning to buy and have no reason to wait, take advantage of these historic low rates while they are available. Until the next time, take care. Barbara

Recent Folsom Home Sales Sept 1-5 '09

Not to bad a start for September, as 14 home sales were recorded by MetroList, our local multiple listing service, in the first five days of the month. The properties were listed and sold by various multiple listing service brokers. DOM stands for days on the market and cumulative DOM reflects how many days the property has been on the market, whether with the current agent or previous listing agent. Only a sale or the property being off the market for 30 days will reset the DOM number. Here are the details of those sales:

* 2317 Farndon Court, 3 bed/2 bath, 1313 sq ft, sold 9/01/09 for $265,000 (96 percent of list price) after 126 days on the market for $202 per sq ft.
* 129 Royalton Circle, 3 bed/3 bath, 1602 sq ft, sold 9/01/09 for $322,000 (99 percent of list) after 120 DOM for $201 per sq ft.
* 118 Chesterfield Way, 3 bed/2.5 bath, 1913 sq ft, sold 9/4/09 for $350,000 (96 percent of list) after 18 DOM for $182 per sq ft.
* 222 Gainsborough Circle, 3 bed/2 bath, 2221 sq ft, sold 9/3/09 for $360,000 (103 percent of list) after 367 DOM for $162 per sq ft.
* 1909 Wesley Drive, 3 bed/2 bath, 1753 sq ft, sold 9/2/09 for $375,000 (94 percent of list) after 9 DOm for $214 per sq ft.
* 1544 Hammond Court, 3 bed/2 bath, 1803 sq ft, sold 9/4/09 for $375,000 (96 percent of list) afer 133 DOM for $208 per sq ft.
* 118 Laurelwood Drive, 4 bed/3 bath, 2570 sq ft, sold 9/2/09 for $384,900 (100 percent of list) after 9 DOM for $150 per sq ft.
* 1522 Thurman Way, 3 bed/2 bath, 2082 sq ft, sold 9/3/09 for $415,000 (98 percent of list) after 112 DOM for $199 per sq ft.
* 143 Teceira Way, 5 bed/3 bath, 2930 sq ft, sold 9/2/09 for $415,000 (97 percent of list) after 83 DOM for $142 per sq ft.
* 1961 Tyndrum Lane, 4 bed/3 bath, 2337 sq ft, sold 9/4/09 for $417,000 (105 percent of list) after 9 DOM for $178 per sq ft.
* 1026 Mallard Circle, 4 bed/3 bath, 2350 sq ft, sold 9/4/09 for $420,000 (93 percent of list) after 31 DOM for $179 per sq ft.
* 645 Fisher Circle, 5 bed/2.5 bath, 2483 sq ft, sold 9/2/09 for $425,000 (99 percent of list) after 18 DOM for $171 per sq ft.
* 107 Briggs Ranch Drive, 4 bed/3 bath, 2687 sq ft, sold 9/1/09 for $525,000 (96 percent of list) after 28 DOM for $195 per sq ft.
* 1525 Manasco Circle, 4-6 bed/4 bath, 3449 sq ft, sold 9/4/09 for $565,000 (97 percent of list) after 77 DOM for $164 per sq ft.

Of the 14 homes sold, 3 were a short sale and 3 were bank-owned. Median sales price was 399,950 (average days on the market: 81).That's it for today. Make it a great day!

Green With a Dollar Cap

A couple of years ago, I earned the EcoBroker certification. My goal: to be ready for clients concerned about their carbon foot print when purchasing a home. I learned about environmental issues and hazards, mitigation options, and also about the latest in home energy efficiency. To my surprise, although I've been able to share some of what I learned during the EcoBroker course, there just hasn't been that much obvious interest from home buyers. A recent study by the National Association of Home Builders helps shed some light. Bottom line, even though prospective home buyers want the benefits of more efficient homes, they are unwilling to pay much more for a “green” home, according to the NAHB member survey. So the interest is there but people aren't likely to pay more than an additional two percent in for the green features. Also from the study, in the west, builders report more interest in water efficiency than in other areas. Now you know.

Real Estate Market Snapshot This Monday, Sept 21

It's been a while since I took a quick snapshot of the Folsom real estate market. I find them useful to get an overview of what's going on in town. As of this morning, there were 300 properties for sale in Folsom, ranging in price from $95,000 to $2,500,00 and with a median price of $379,900. Of those 300, 139 are short sales and 25 are bank-owned. So just over 50 percent of the properties selling in Folsom right now are distressed sales. The bank-owned properties range from $249,900 to $895,900 and have a median sales price of $339,900. And the short sale properties range from $95,000 to $810,000. Here is where the numbers get interesting--the median price of the short sales is $320,000, almost $20K below REOs! Are the short sales a better deal than the bank-owned properties right now? In some cases, yes. So, as a buyer, if you can afford to wait around for one of these short sales to close, it is worth your while to at least check them out.

$75 billion Dollars Later… The MHA Report Card Is Out

Guest blogger, Barbara Van Duyn, sent in a long post today that's well worth reading if you are considering asking your lender for a loan modification. Read on. Barbara is a certified mortgage planner with First Priority Financial. If you have any mortgage questions, you can reach Barbara through her Web site, www.BarbaraVanDuyn.com.

Remember when our government was passing one housing rescue plan after another beginning in late 2007? Banks were “encouraged” to help struggling homeowners modify loans. That didn’t work as foreclosure continued to climb. After taking over Fannie Mae and Freddie Mac they imposed a six-month foreclosure moratorium that lasted from November 2008 through April 2009. It just delayed the inevitable. That brings us to the $75 billion Making Home Affordable plan.
 
Making Home Affordable: MHA was announced in February 2009 by the U.S. Treasury to help stabilize the housing market. Under this umbrella two separate programs with different objective were established. So let’s get you up to speed on HAMP (no ... I'm not blowing smoke) and HARP and see if there is any hope for you.

Home Affordable Modification Program: HAMP offers financial incentives to mortgage servicing companies for offering trial loan modifications to an estimated 2.7 million at-risk homeowners. To be considered for the program, a homeowner must be at least 60 days behind on their mortgage or already in foreclosure. According to a July 31 Treasury report card, $20 billion has been doled out to more than three dozen large and small servicing companies participating in HAMP with results showing 15 percent or 400,000 homeowners out of the 2.7 million eligible have been offered trial modifications that involved reducing the interest rate on a loan for several years and/or extending the term of the loan. Homeowners who have contacted their loan servicing company asking for a loan modification with little success may find better results by going back to their mortgage servicer and asking for help under the HAMP program. 

Home Affordable Refinance Program: HARP is designed to help responsible homeowners who pay their mortgages on time, be able to refinance out of a risky loan into a stable loan and lower their mortgage payment. With declining home values preventing a traditional refinance, HARP allows homeowners to refinance up to 125 percent of their home’s value. To give you an idea of what that would mean, assume a home value of $300,000 with a mortgage of $365,000. Applying 125 percent to $300,000 = $375,000. That’s well below the loan-to-value (LTV) ceiling. Other loan qualifying factors will apply. A key feature of this new 125 percent LTV refinance program is … the homeowner will not be required to get private mortgage insurance (PMI) if their original LTV ratio was 80 percent or less.

Up to this point, Fannie and Freddie had been allowing a HARP refinances up to 105 percent. To help more homeowners, Fannie and Freddie will increase their LTV requirement to 125 percent, effective September 19, 2009. It may take time for mortgage companies to begin offering the 125 percent LTV refinance program so be prepared. Follow these links to find out your mortgage is owned by Fannie Mae or Freddie Mac. You can also double check with your existing mortgage servicer to find out who owns your mortgage. Qualified homeowners have the option to apply for the 125 percent LTV refinance with their existing mortgage servicer or shop for a competitive rate with a new lender. Until the next time, take care. Barbara
 

Recent Folsom Homes Sales Aug 23-31 '09

Despite the uninspired August home sale stats (see previous post), August finished with a bang as 25 Folsom home sales were recorded by MetroList, our local multiple listing service. The properties were listed and sold by various multiple listing service brokers. DOM stands for days on the market and cumulative DOM reflects how many days the property has been on the market, whether with the current agent or previous listing agent. Only a sale or the property being off the market for 30 days will reset the DOM number. Here are the details of those sales:

* 310 Mormon Street, 2 bed/1 bath, 898 sq ft, sold 8/28/09 for $165,650 (128 percent of list price) after 6 days on the market for $184 per sq ft.
* 116 Perraud Drive, 3 bed/2 bath, 1254 sq ft, sold 8/26/09 for $185,400 (103 percent of list) after 308 cumulative DOM for $148 per sq ft.
* 151 Glenn Drive, 3 bed/2 bath, 1079 sq ft, sold 8/27/09 for $213,500 (115 percent of list) after 5 DOM for $198 per sq ft.
* 104 Prospector Court, 3 bed/2 bath, 1075 sq ft, sold 8/25/09 for $219,900 (122 percent of list) after 8 DOm for $205 per sq ft.
* 3103 Esplanade Circle #3103, 2 bed/2.5 bath, 1501 sq ft, sold 8/27/09 for $228,000 (100 percent of list) after 6 DOM for $152 per sq ft.
* 118 Cradle Bar Court, 3 bed/2 bath, 1592 sq ft, sold 8/28/09 for $238,000 (97 percent of list) after 76 DOM for $149 per sq ft.
* 107 Austin Drive, 3 bed/2.5 bath, 1671 sq ft, sold 8/26/09 for $290,000 (97 percent of list) after 2 DOM for $174 per sq ft.
* 803 Spiva Court, 3 bed/3 bath, 2105 sq ft, sold 8/25/09 for $296,000 (103 percent of list) after 5 DOM for $141 per sq ft.
* 100 Fithian Way, 4 bed/2.5 bath, 1800 sq ft, sold 8/25/09 for $298,000 (99 percent of list) after 13 DOM for $166 per sq ft.
* 1598 Latherton Way, 3 bed/2 bath, 1339 sq ft, sold 8/28/09 for $315,000 (106 percent of list) after 6 DOM for $235 per sq ft.
* 183 Bittercreek Drive, 4 bed/3 bath, 2076 sq ft, sold for 8/27/09 for $325,000 (93 percent of list) after 97 cumulative DOM for $157 per sq ft.
* 112 Gilded Rock Circle, 3 bed/2 bath, 1446 sq ft, sold for $329,000 (99.85 percent of list) after 3 DOM for $228 per sq ft.
* 1575 Latherton Way, 4 bed/2 bath, 1607 sq ft, sold 8/26/09 for $340,000 (85 percent of list) after 12 DOM for $212 per sq ft.
* 730 Agostini Circle, 4 bed/3 bath, 2020 sq ft, sold 8/26/09 for $340,000 (103 percent of list) after 53 cumulative DOM for $168 per sq ft.
* 98 Whistle Stop Way, 3 bed/2 bath, 1652 sq ft, sold 8/28/09 for $365,000 (99 percent of list) after 14 Dom for $221 per sq ft.
* 1845 Greenlaw Way, 4 bed/3 bath, 1988 sq ft, sold 8/28/09 for $371,500 (97 percent of list) after 35 DOM for $187 per sq t.
* 1053 Huntly Drive, 3 bed/2 bath, 1773 sq ft, sold 8/28/09 for $385,000 (96 percent of list) after 147 cumulative DOM for $217 per sq ft.
* 1170 Galston Drive, 3 bed/2 bath, 2090 sq ft, sold 8/31/09 for $405,000 (105 percent of list) after 16 DOM for $194 per sq ft.
* 2041 Branding Iron Court, 4 bed/3.5 bath, 3602 sq ft, sold 8/28/09 for $440,000 (97 percent of list) after $122 per sq ft.
* 9824 VAlley Pines Drive, 3 bed/3 bath, 2115 sq ft, sold 8/28/09 for $463,000 (93 percent of list) after 112 DOM for $219 per sq ft.
* 1121 Golden Eye Court, 4-5 bed/3 bath, 2593 sq ft, sold 8/31/09 for $487,500 (94 percent of list) after 42 DOM for $188 per sq ft.
* 101 McHugh Court, 4 bed/3 bath, 2361 sq ft, sold 8/26/09 for $495,000 (97 percent of list) after 51 DOM for $209 per sq ft.
* 109 Gloucester, 4-5 bed/2 bath, 3073 sq ft, sold 8/25/09 for $525,000 (95 percent of list) after 72 DOM for $171 per sq ft.
* 155 Red Ridge Court, 5 bed/4.5 bath, 4396 sq ft, sold 8/26/09 for $650,000 (104 percent of list) after 68 DOm for $148 per sq ft.
* 771 Lorena Lane, 5 bed/4 bath, 4220 sq ft, sold 8/27/09 for $765,000 (100 percent of list) after 237 cumulative DOM for $181 per sq ft.

Of the 25 homes sold (median price: $340K, average DOM: 44), 4 were short sales (median price: $351,500, average DOM: 71) and 9 were bank-owned (median price: $238K, average DOM: 31). Of the 25 homes sold, 12 sold in under 30 days. That's it for today. Make it a great day!

August '09 Real Estate Stats Are In for Folsom

Looks like August was not such a hot month after all. The median price of homes sold in Folsom in August dipped to $340,000--the second lowed monthly median price in the last two years. The record for low median price is still January of this year when it hit $320,500. Overall the median price of homes sold is down 23% from two years ago. The number of homes sold last month (57) was also markedly down from the 80 Folsom homes sold in July and the 70 sold in June. Where will this end? Wouldn't we all like to know. This has been one of those very-tough to predict markets from the get-go. Interestingly the actual number of homes sold this August is only down 5 percent from August 2007 when 60 homes sold. The dramatic difference comes in the number of Folsom homes for sale in 2007 (647) versus the number for sale this August (432). So people are still buying, they just have less selection to work with (which is why the average days on the market for homes sold dipped to 47 days). Now for potential sellers who have good equity in their home and can afford to sell, this shows there is demand out there. And, finally going hand in hand with those statistics is the Months' Supply of Inventory. The number is down 43% from two years ago when we had about 10 months' supply of inventory in Folsom. Although the supply has been inching up a bit (we're now at 5.7 months, up from last month's 5 months' supply). That's it for the look at the real estate market statistics for Folsom. Will be interesting to see what September brings, as traditionally fall sees a slow down of activity. But as I said earlier who can predict anything anymore in this market!

Mortgage Rates Continue Steady Decline

Some good news on mortgage rates from guest blogger, Barbara Van Duyn. Barbara is a certified mortgage planner with First Priority Financial. If you have any mortgage questions, you can reach Barbara through her Web site, www.BarbaraVanDuyn.com.

It was a great week for mortgage rates. In fact, with the exception of 1 day in the past 2 weeks, mortgage rates have been on a steady decline reaching their lowest levels since May. The Treasury continues its huge semi-monthly sale of debt, which has been used to finance our government’s spending spree since January. During the past three days, the Treasury auctioned $70 billion in 3- and 10-year notes and 30-year bonds (MBSs).
The popularity of FHA and VA loans to finance home purchases continues to increase and so does the appetite of investors to buy these government-insured mortgages, a.k.a. Ginnie Maes. According to a recent article in the Wall Street Journal, banks are exchanging their junk mortgages with government-guaranteed Ginnies. It’s that demand that keeps FHA and VA loans rates competitive and in demand. Until the next time, take care. Barbara