Tag Archive | "Princeton Capital"

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My Day From Hell: Appraisal Issues in San Carlos and the Surrounding Cities

Posted on 19 April 2010 by vvandervort

fire backgroundWatch out… appraisal issues in San Carlos and the surrounding communities are a real possibility right now.  A week ago today, I got a phone call from a mortgage person that I work with from Bank of America and received the terrible news that a home in Belmont that my buyers were in contract on, had the appraisal fall short.  And it wasn’t short by just a small amount, it was a BIG amount – over 9%!  To me, it appeared that the appraiser didn’t even look at higher sales to make the appraisal work.  One interesting thing, was that there were 5 offers on this property and there was another offer on the property that was pretty much the same as my buyers’ offer.  Of course, appraisers don’t have a way of using that information in their appraisals.

Bank of America does has a path to follow for disputing appraisals, but the time line for that was uncertain and my buyers were to remove their financing contingency on Friday.  We had three options.  We could wait and see if we could get new information(sales that were about to close) to the appraiser to increase their appraisal amount or we could do what we call a Double or Dual App or the buyers could just back out.  The buyers went for the double app because they really want to buy this home.

In a double app, you apply for a loan through a 2nd lender.  I have just one lender I go to when the shit hits the fan and it is Princeton Capital.  They have an amazing track record of keeping deals together that otherwise would have fallen apart.  My buyers did an amazing job of getting all of their financial details to Princeton Capital in a matter of hours on Monday afternoon (and if  you’ve been through the loan process lately, you know that is a huge feat).  On Tuesday, I got a phone call from the appraiser who thankfully lives in Belmont and understands our local market (some appraisers come in from east bay counties and do not understand our market) and we set up an appointment to meet at the property on Wednesday morning.  I left our appointment on Wednesday morning feeling pretty confident since the appraiser said to me that he does his homework before he goes out to a property for the appraisal and if he doesn’t think he can get a property to appraise, he calls the agent before he even goes to the property.  As a proactive agent, I love another proactive person.  Within 24 hours, I got word that the appraisal came through at the purchase price.  Right now, we are on track to close this deal on the same time frame that we were on before switching lenders – which means that from loan application to closing will be 18 days!

Buyers and sellers do need to be aware that appraisal issues are out there right now in San Carlos and the other mid-peninsula markets.  Our market has changed fairly rapidly and with the appraisal rules that are in place, it is no surprise that this is occurring.  Appraisers have to have 2 sales within the last 90 days that are within a mile of the subject property.  If they cannot find anything within 1 mile they can go out to 2 or 3 miles.  The appraiser also needs to use 1 pending and 1 active.  This is important information for sellers to be aware of when pricing their home and looking at offers.  Although the highest offer looks the most attractive, you have to weigh whether or not the home can appraise for that price.  As a seller, you certainly don’t want your transaction to fall apart 7 to 10 days into the transaction since you will have lost a lot of momentum.

Got questions? Contact Val, the San Carlos data gal!

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What Was Affecting Mortgage Rates This Week?

Posted on 30 January 2010 by vvandervort

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This information comes from a very professional mortgage broker/banker I work with, Mike Farrell with Princeton Capital.  Mike has several times saved buyers and sellers in transactions when other lenders couldn’t perform. 

The links in the “Economic Update” section will take you to great news articles about what happened with the listed reports that came out this week.  You should be well on your way to being an economist if you real through all of them! They are actually very interesting.

Timely Topic: Support for Bernanke Gains Momentum
The political winds appear to be shifting in Federal Reserve Chairman Ben Bernanke’s favor, as the White House escalated efforts to win the 60 votes needed in the Senate to confirm him for a second term and Senate Republican and Democratic leaders predicted those efforts would succeed.

But despite a flurry of activity over the weekend of January 23rd and 24th, confirmation wasn’t a certainty. As of late Sunday January 24th, 31 senators were publicly committed to voting for Mr. Bernanke, with 17 opposed, according to a Dow Jones Newswires survey. The Senate is expected to vote before Mr. Bernanke’s term expires on Jan. 31, Senate Democratic staff members said.

“He’s going to have bipartisan support in the Senate and I would anticipate he’d be confirmed,” Sen. Mitch McConnell of Kentucky, the Republican leader, said Sunday on NBC’s “Meet the Press.” But he wouldn’t say which way he would vote. The No. 2 Senate Democrat, Dick Durbin of Illinois, also predicted that Mr. Bernanke would prevail.

The drama surrounding Mr. Bernanke’s fate likely will eclipse attention to the meeting of the Fed’s monetary policy committee Tuesday and Wednesday. No major shift in policy is expected. The Fed has been holding short-term interest rates near zero since December 2008.

Economic Update:
Last Week:
Not only did Friday January 22nd mark the stock market’s third straight loss, but it also marked its worst single-session percentage drop in more than two months. The recent string of losses has been underscored by a sell-the-news mentality among investors.

What’s Ahead:
This week is extremely busy in terms of economic data scheduled for release and will likely be an active week for mortgage rates.

January’s Consumer Confidence Index (CCI) will be released Tuesday (the 26th) morning. This report is considered to be of high-importance to the bond market and therefore can move mortgage rates. Since consumer spending makes up two-thirds of the U.S. economy, market participants are very attentive to related data. A reading smaller than the expected 53.5 would be ideal for the bond market and mortgage rates.

December’s New Home Sales report, the sister release to Monday’s Existing Home Sales, will be posted late Wednesday (the 27th) morning. It is expected to show an increase in sales of newly constructed homes, but is not important enough to heavily influence mortgage pricing.

Wednesday (the 27th) is this year’s first FOMC meeting. It is expected to yield no change to short-term interest rates, but as is often the case, traders will be looking for any indication of the Fed’s next move and when they may make it.

Friday’s (the 29th) release is arguably the single most important reports that we see regularly. The initial reading of the 4th Quarter Gross Domestic Product (GDP) will be posted early Friday morning. This data is so important because it is considered to be the best measure of economic growth. Its’ results usually have a major impact on the financial markets and can cause significant changes in mortgage rates.

Overall, look for Tuesday or Friday to be the biggest days for mortgage rates. Friday’s GDP is the single most important piece of data this week, but we may see quite a bit of movement in rates Tuesday also.

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