Currently, 85% of new mortgages are guaranteed by Government backed entities( FHA, FNMA, GNMA, Freddie Mac) and the Fed buys 80% of the securities into which these government backed mortgages are packaged.  This dominance of the Fed and the reliance upon the Government to fund mortgages can not last forever. The Federal Reserve's $1.25 trillion special program to buy Fannie Mae and Freddie Mac securities is two-thirds complete and is scheduled to close at the end of the year. What happens then??? More than half of the country's home mortgages are now being originated by only 3 banks; Wells Fargo, Banik of America, and J.P. Morgan Chase. The problem is that these banks are acting only as originators of mortgages, and immediately sell most of the mortgages that they create to Fannie Mae a... 09/20/2009

 Few days pass without a contact from a hopeful buyer wanting a single family home in Palos Verdes at a price that simply does not exist, even in a real estate market that has slipped from the lofty pinnacle of 2006 prices.    So what does constitute a hot deal in Palos Verdes?  Here are a few things I look for in this market: Properties priced below $1,000,000 in Palos Verdes Estates:  It does not happen often, but when it does it is always worth the time to investigate the property.  I saw one yesterday and my guess is it will be in escrow within a week---maybe sooner. Houses with hidden views: It is surprising the number of times a stunning view is hiding behind a wall without sufficient windows, a chimney or overgrown shrubbery.  Homely houses with head-turner views:  Yes, the kitch... 09/16/2009

Rolling Hills neighborhood real estate statistics for August 2009: Active listings: 22 Homes are currently for sale in Rolling Hills priced from $1,299,000 to $18,900,000. Pending sales: 7 Properties are in escrow in Rolling Hills priced from $1,395,000 to $3,495,000. August sales: 1 Home sold in August 2009: Caballeros Rd $1,380,000 Previous Palos Verdes and San Pedro Market Reports Norma Toering & Team RE/MAX Palos Verdes Realty(310) 493-8333 / Office Phone: (310) 831-0800 PalosVerdesLifestyle - Nominated by Relocation.com as one of the top ten Los Angeles area real estate blogs. Ranked by Technorati in the top 1% of all blogs. As seen in the Daily Breeze newspaper. South Bay Los Angeles cities I sell real estate, property, houses and homes in: Palos Verdes Estates, Rolling Hills, Rol... 09/03/2009

Reverse Mortgages:For seniors, there is a relatively new mortgage available called a reverse mortgage. This type of mortgage is useful for people who have a large equity in their home, but who live on a fixed budget and find it difficult to live on their current income. Many seniors in this situation are forced to sell their homes. Instead of selling your home, a reverse mortgage pays the home owner a fixed amount each month while they own the home, with the mortgage amount thus increasing each month for the amount of the payment, plus interest. There are several types of reverse mortgage products, one of which, the Home Equity Conversion Mortgage which is used by 90% of reverse mortgage borrowers, is federally insured. All reverse mortgages are due and payable when the last surviving b... 08/26/2009

 Locking in an Interest Rate when Applying for a Home Loan:When applying for a loan, the borrower should obtain a "lock-in" of the quoted interest rate for a period adequate to close escrow. Lock durations can vary for mortgage financing, but most lenders lock in the interest rate for 60 days from the date the loan application is submitted. As long as the loan is closed within that lock-in period, the lender honors the agreed upon interest rate. Some consumers are misled by advertising that quotes unrealistically low rates based on 15- or 30-day lock durations. This is called 'short-pricing.' The lender basically knows the borrower doesn't have time to meet their conditions and have all the necessary paperwork in order within that brief time period. As a result, the lender is not obliga... 08/24/2009

Loan Terms:Interest only loans have become very popular due to the fact that the monthly payment requires only payment of interest, and does not require a principal amortization payment. Because of this, borrowers may be able to qualify for a larger loan, and therefore be able to purchase a more expensive home, than they would otherwise be able to. The problem with these loans, however, is that the interest-only feature only lasts for a limited time, usually 5 years. At the beginning of the 6th year, however, the lender will require a significantly larger monthly payment which will include principal amortization, with this monthly payment being even higher that that of a 30 year amortized mortgage, because it is being amortized over a shorter period, which is the 25 years remaining on t... 08/22/2009

Qualifying for a Home Loan:Mortgage lenders are chiefly concerned with your ability to repay your mortgage. To determine if you qualify for a loan, they will consider your credit history, your monthly gross income and how much cash you'll be able to accumulate for a down payment, which generally runs anywhere from 5 percent to 20 percent of the purchase price of the home. The lenders generally evaluate your credit worthiness by obtaining a FICO score from one or more credit rating agencies. So how much house can you afford? You can easily calculate the answer using two standard debt-to-income ratios: The housing expense, or front-end ratio, shows how much of your gross (pretax) monthly income would go toward the mortgage payment. As a general guideline, your monthly mortgage payment, in... 08/20/2009

Home Sales in Los Angeles County hit a 3 year high in July, as buyers are recognizing that now is a great time to buy with near historic low interest rates and sellers willing to make a great deal. Sales volume in Los Angeles County was up 23% in July over a year ago, and sales for the six county Southern California region have now increased for 13 months in a row., as reported by MDA DataQuick. Although the median sales price in Los Angeles County was down 20% compared to a year ago, it was up .3% over the previous month Buyers of homes over $500,000 also increased to 20% of all resale transactions, up from a low this year in March of 15%.  Although sales of more expensive homes have improved, this is still far below the 27% of homes sold last year.  The availability of jumbo loans in ... 08/19/2009

There are two basic types of home mortgages. With a fixed rate mortgage (FRM), your monthly payments will be steady. In contrast, with an adjustable rate mortgage (ARM) , your payments will vary over time. Adjustable rate mortgages typically have an initial fixed rate lower than the rate of a comparable fixed rate mortgage. The initial fixed rate period is followed by adjustment intervals. For example, a "3/1 ARM" is fixed at an initial low rate for the first 3 years, and then adjusts every year based on an index. Common ARMs are: 1/1, 3/1, 5/1, 7/1, and 10/1. Conforming Loans, FHA insured loans, and Non-Conforming Loans:Loans are generally categorized by either being "conforming" loans, or "jumbo" loans. Conforming loans are those loans that conform to the requirements of such secondar... 08/18/2009

Rolling Hills real estate statistics for July 2009: Active listings: 25 Homes are currently listed for sale in Rolling Hills priced from $1,375,000 to $18,900,000. Pending sales: 4 Properties are currently in escrow priced from $1,499,000 to $2,645,000. July sales: 2 Homes in Rolling Hills sold in July 2009: Packsaddle Road $2,650,000 Saddleback Road $3,500,000 Previous Palos Verdes and San Pedro Market Reports Norma Toering & Team RE/MAX Palos Verdes Realty(310) 493-8333 / Office Phone: (310) 831-0800 PalosVerdesLifestyle - Nominated by Relocation.com as one of the top ten Los Angeles area real estate blogs. Ranked by Technorati in the top 1% of all blogs. As seen in the Daily Breeze newspaper. South Bay Los Angeles cities I sell real estate, property, houses and homes in: Palos Verdes... 08/09/2009

Rolling Hills ( area 166 in map below )had the following real estate market activity during the 2nd Quarter of 2009 after having no sales for the previous 6 months: Properties Sold:  5 Address                                      Price       Bd Bth Sqft    $/Sq Built      ML#     Sold Date    Days on Mkt   36 Portuguese Bend RD           $1,610,000 4 3.00 2,608 $617 1940 V09019719 6/1/09     93 7 Roundup RD                          $1,770,000 3 3.00 2,738 $646 1953 S08114014 5/27/09   178 5 Buggy Whip                           $2,250,000 4 4.00 2,928 $768 1967 V08170269 4/23/09   136 26 Middleridge Lane South       $2,795,000 4 5.00 4,130 $677 1978 V08028160 5/29/09    45 25 Buggy Whip DR                    $4,125,000 5 8.00 7,200 $573 1978 S09032359 6/25/09     87                      ... 07/15/2009

Rolling Hills is enjoying a burst of real estate activity during the summer of 2009.  As a matter of fact, a prospective buyer asked where he could get the most value for his money in Palos Verdes.  That's not an easy question to answer but after listening to what he wanted: view, pool and enough land for a tennis court the answer was easy---Rolling Hills. Rolling Hills real estate statistics for June 2009: Active Listings:  23 Single Family Homes are for sale priced from $1,375,000 to $18,900,000. Pending Sales:  3 Properties are in escrow priced from $2,645,000-$3,975,000. June Sales:  2 Homes sold: Portuguese Bend Road:  $1,610,000. Buggy Whip Drive:  $4,125,000. If you're searching for a gated equestrian community Rolling Hills is not to be missed.  Call Norma Toering & Team to see ... 07/13/2009

If you're following my Rolling Hills Real Estate Reports you know sales have been very slow for the past year or so.  That may be changing.  May 2009 statistics show four properties in escrow and two closed sales.    Rolling Hills real estate statistics for May 2009: Active Listings:  23 Single Family Homes are for sale priced from $1,395,000 to $18,900,000. Pending Sales:  4 Single Family Homes are in escrow priced from $1,775,000 to $4,625,000. May Sales:  2 Properties closed escrow.  One on Roundup Road for $1,770,000 and one on Middleridge Lane South for $2,795,000.   Previous Palos Verdes and San Pedro Market Reports Norma Toering & Team RE/MAX Palos Verdes Realty(310) 493-8333 / Office Phone: (310) 831-0800 South Bay Los Angeles cities I sell real estate, property, houses and home... 06/12/2009

For weeks, I have been writing blog entries recommending to people to buy a home while interest rates are at historical lows.  I have also written several entries over the last several months asking the question "What Happens when the Fed Stops Buying Securities?" The Federal Reserve has been keeping long term rates low by purchasing large sums of mortgage backed securities, as well as purchasing Treasury Securities, to keep their prices , and therefore their low yields, artificially supported. Well, the time to pay the piper is approaching. Many economists have warned that the ultimate result of huge government deficits and borrowing is inflation accompanyed by high interest rates.  I believe that the recent increase in long term interest rates that we have seen over the last week is j... 06/06/2009

Many people move to Palos Verdes CA for the schools, others come for the location, but I believe the strongest card the Palos Verdes Peninsula has to play is the VIEW CARD.  It is a fantastic little decision maker when it is time to buy a house.  Right now I have two couples searching for the perfect view.  Fortunately, their idea of perfect is just enough different to keep both of them from coveting the same house with a view. One couple wants the wide open Pacific Ocean view with a bit of coastline, Catalina Island, cruise ships and a few lights at night.  The other couple prefer a few more lights at night to keep the view alive 24/7.  Of course, if the right house comes along and the view is a little off, most buyers will accept it as being close enough to perfect for them.  The reve... 05/30/2009

Jumbo loans, those loans over $729,750 in the Southern California area, are still relatively difficult to obtain, with only those buyers with extremely high credit scores and down payments of 30 to 40% able to qualify with many lenders.  The real problem here is a lack of competition among the banks and a lack of funding for these type of loans. Funding for conforming loans, those loans under $417,000, generally comes from FNMA or GNMA who purchase these loans with funding from the government, or are insured by the FHA.  The government has been very aggressive in funding these type of loans, and this has driven interest rates for these loans down below 5%. Interest rates for Jumbo loans, however, are generally in the mid to high 6% range. Prior to the mortgage meldown, the spread betwee... 05/19/2009

5 El Concho Lane in Rolling Hills, CA is my "Eye for Value" pick this week for the gated city of Rolling Hills on the Palos VerdesPeninsula.  There are currently 23 homes for sale in Rolling Hills and for a combination of location, condition and view 5 El Concho is my choice for best value.  Listed at $2,390,000 and offering 4 bedrooms, 4 baths in just under 3000 sq. ft. on a 144,578 sq. ft lot, it offers romantic views, remodeled house and prestigious location.  Now that's a view!   Shown by appointment only.  Call to arrange your private showing. Norma Toering & Team RE/MAX Palos Verdes Realty(310) 493-8333 / Office Phone: (310) 831-0800 South Bay Los Angeles cities I sell real estate, property, houses and homes in: Palos Verdes Estates, Rolling Hills, Rolling Hills Estates, Rancho Pa... 05/07/2009

There are seven pending sales in Rolling Hills!  After six months of nary a single sale, suddenly the buyers have arrived. Rolling Hills real estate statistics for April 2009: Active Listings:  23 Single Family Homes are for sale priced from $1,395,000 to $18,900,000. Pending Sales:  7 Single Family Homes are in escrow priced from $1,595,000 to $4,850,000. April Sales:  1 Single Family Home closed escrow:  5 Buggy Whip - $2,250,000. Previous Market Reports Norma Toering & Team RE/MAX Palos Verdes Realty(310) 493-8333 / Office Phone: (310) 831-0800 South Bay Los Angeles cities I sell real estate, property, houses and homes in: Palos Verdes Estates, Rolling Hills, Rolling Hills Estates, Rancho Palos Verdes, San Pedro, Long Beach, Torrance, Lomita, Redondo Beach, Hermosa Beach and Manhatta... 05/05/2009

  It was a race for the ages, and I'm sure somewhere in Hollywood the rights to the movie are being negotiated.  I saw it in televised real-time, but I would line up to buy a ticket to re-live the experience one more time.  It was that good.  Mine That Bird, The 135th Kentucky Derby winner, scored one for the underdogs of the world.      There were bigger horses with better odds, but Mine That Bird proved you do not have to be a favorite to win big.  The little gelding crossed the finish line first, but midway through the race he was dead last.  It was the most astonishing and inspiring Kentucky Derby I've seen in years, maybe the best ever.     Mine That Bird and his jockey, Calvin Borel, gave the world a two-minute lesson on suiting up for the race, no matter what the odds, the condit... 05/04/2009

I submit a cover letter with every buyer offer that I submit, and I have found them to be essential to gaining the upper hand when competing with multiple offers on a property. Just this last week, I have had two accepted offers for homes in Rancho Palos Verdes, both of which had multiple offers. Both of the agents commented to me after accepting my client's offers, that my cover letters were the deciding factor in the seller's decision to sell to my clients. The following are some of the things that I believe are important in preparing an offer cover letter: 1)  Let the seller know about your client. Make it personal, and not just an offer on a piece of paper. I always tell them a little something about every member of the family including the children. 2)  Tell the seller what it is a... 05/02/2009