Just One Insurance Claim Can Prove Costly...Robert De La Rosa An Expert In Your Court 909.271.5640 CALL NOW!!!!

Just One Insurance Claim Can Prove Costly

DAILY REAL ESTATE NEWS | MONDAY, OCTOBER 20, 2014

In some states, all it takes is just one claim to a home owner’s property insurance to see premiums soar by hundreds of dollars. Filing a single claim can result in a monthly premium increase of 9 percent, according to a study by InsuranceQuotes.com. A second claim? Premiums climb an average of 20 percent. 

The claims can be for anything ranging from tornado damage to a stolen bicycle. Filing a small claim can increase your rates by just as much as filing a catastrophic one, according to the study. 

"Winning a small claim could actually cost you money in the long run," Laura Adams, InsuranceQuotes.com senior analyst, told CNNMoney. "Home owners need to be really careful. Even a denied claim can cause your premium to go up. ... The insurers have found that people who make a claim are more likely to make another. You've become a riskier customer."

Did you know?

The cost of homeowners insurance rose 36 percent from 2003 to 2010—nearly double the rate of inflation.

The most expensive type of claims that can result in the highest premium increases are liability claims—such as from personal injuries (averaging a 14 percent raise in premiums). Big premium increases also often result from theft and vandalism claims, the analysis shows.

Premium increases can vary greatly by state. Wyoming home owners see the largest hikes in their premiums, an average of 32 percent, after one claim is filed. However, the state tends to charge low premiums compared to other states—$770 a year compared to the nationwide national average of $978. Connecticut, Arizona, New Mexico, and California also saw large spikes after one claim, with premium increases of 18 percent or more, according to InsuranceQuotes.com. However, in some states like Texas, insurers are not permitted to raise premiums based on a single claim. 

Source: “One Property Insurance Claim Can Hike Your Premiums by Hundreds,” CNNMoney (Oct. 19, 2014)

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Lower Rates Revive Refinancing Boom

Wave of Singles to Make Big Impact on Housing...www.TheCaliforniaPropertyConnection.com

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DAILY REAL ESTATE NEWS | MONDAY, OCTOBER 13, 2014

Half of all American adults now live in one-person households, a rapidly growing number, according to the Bureau of Labor Statistics. The singles demographic is likely to reshape multifamily communities and single-family home designs going forward, according to Builder Online.

In 1976, only 37 percent of adults were single. As of August, that percentage has bloomed to 50.2 percent, or about 124.6 million singles. It marks the first time that single Americans make up the majority of the adult population since the government began tracking such data.

Get tips on how real estate pros can best serve this growing group.

“Thanks to the growth of single-adult households, floor plans will go from static to flexible as living arrangements change more frequently,” Susan Yashinsky, vice president of innovation trends for Waterford, Mich.-based Sphere Trending, LLC, predicts on Builder Online. “Analysts project that this group of adults will job hop more often, bring new types of living arrangements into the housing market (think friends buying homes together), and expect their environments to adapt to their frequently changing lifestyles as easily as picking a favorite Keurig coffee flavor.”

Affordability will be key, since single home buyers will have less income per household than dual-earner couples.

Also, “housing developments will need to embed elements of community that address the social aspects singles need, similar to what we have seen in multifamily new builds,” according to Builder. “Builders, developers, and designers who create housing for single consumers need to consider fresh concepts, such as communal sheds for lawnmowers and snow blowers, and even cars that can be rented as needed versus owned. Work/live spaces will evolve to reflect the growing number of entrepreneurs working from home. And, backyard cottages will bring solutions for related and/or unrelated adults sharing a single lot.”

Source: “More Americans Are Going Solo,” Builder Online (Oct. 6, 2014)

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Shared Listing

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Could This Mortgage Product Change Lending?

DAILY REAL ESTATE NEWS | MONDAY, OCTOBER 06, 2014

Two mortgage executives are hoping to overhaul the 15-year mortgage, making it more readily available to low and moderate-income people. They say the changes will help borrowers build equity at a much faster pace than they would with a standard loan.

Edward Pinto, a resident fellow at the American Enterprise Institute, and Bruce Marks, who heads the Neighborhood Assistance Corp. of America, have created a new product called the Wealth Building Home Loan. The new product has generated buzz since being introduced at a mortgage conference in North Carolina in early September. The loan will initially be available through NACA’s 37 offices, with plans to pilot it at other institutions in the coming months. NACA acts as mortgage originator for Bank of America.

Curious what else is new on the mortgage front?

The Wealth Building Home Loan is a 15-year mortgage with a fixed interest rate that requires little or no down payment and has no additional fees. In originating the loans, underwriters pay more attention to a borrowers’ income than the borrowers’ credit score. They will also ensure that borrowers have enough money left over after they make their mortgage payment to cover other monthly expenses, reducing the risk of foreclosure in case a financial setback strikes.

Typically, the monthly payment on a 15-year loan is higher than a 30-year loan, since the loan amortizes faster. In order to make the monthly payments more affordable, however, the Wealth Building Home Loan will have an offering rate that is about three-quarters of a percentage point below the 30-year FHA rate. Borrowers can bring the rate down even further. For example, for every 1 percent of the loan amount the borrower has as a down payment, the interest rate will be lowered by half a percentage point, with the possibility of bringing it to zero.

The Los Angeles Times cites an example of a $6,000 down payment on a $100,000 mortgage at 3 percent, which would bring the rate to zero. That means all of the borrower’s monthly payment would go toward the principal, not interest.

Pinto and Marks say the aim was to create a product that would allow low and moderate-income borrowers to build wealth, and get them away from high-risk loans.

"This is an opportunity to spend a little more each month but build wealth much more rapidly," Pinto says. "But even better, there is only a small probability of going into foreclosure. If house prices should go down, you're covered because you have some equity to fall back on."

Source: “Loan Gives Low-Income Borrowers a Chance to Build Equity Fast,” The Los Angeles Times (Oct. 5, 2014)

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Robert De La Rosa

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Freddie: Housing Market Stuck in a Rut...Robert De La Rosa An Expert In Your Court 909.271.5640 CALL NOW!!!!

DAILY REAL ESTATE NEWS | THURSDAY, SEPTEMBER 25, 2014

The housing market is struggling to maintain momentum as housing prices moderate and mortgage applications fall, Freddie Mac reports in its latest Multi-Indicator Market Index.

In July, Freddie's MiMi indicator showed that 8 of the 50 states and 11 of the 50 metros surveyed were on an improving three-month trend. That marks a stark difference from last year at the same time period, when every state, plus the District of Columbia, and every metro was on the improving trend, Freddie Mac reports.

Other Housing Indicators

• Consumers Aren't Losing Confidence in Home Prices
• Housing Market Shows Mixed Picture
• 3 Challenges Still Facing the Housing Market

"We will continue to see 'two-steps-forward-and-one-step-backward' movement in our housing stability index until the broader economy sees better growth, labor markets tighten further, and household formations pick up to bring more first-time and move-up buyers into the market," says Frank Nothaft, Freddie Mac's chief economist. "The good news is, overall, the housing market continues to improve and is up 5 percent on a yearly basis in the latest MiMi reading."

Thirteen of the 50 states, plus the District of Columbia, have MiMi values in the stable range. The top five are: North Dakota; District of Columbia; Wyoming; Montana; and Alaska.

Overall, the MiMi posted a slight decline in the latest month, at 73.4, which indicates a weak housing market. The all-time high for the MiMi was 121.9 in June 2008; the lowest point (when the housing market was considered at its weakest) was in September 2011, when the MiMi fell to 59.8. Since 2011, the housing market has made a 22.7 percent rebound, Freddie Mac reports.

The MiMi monitors and measures the stability of the nation's housing market at the state and metro level by evaluating the current versus long-term stable range of home purchase applications, payment-to-income ratios, on-time mortgage payments, and employment for each area.

"We didn't notice a large decline in any one market this month, but more of softening across the board," says Len Kiefer, Freddie Mac's deputy chief economist. "But the real drag on the most markets' housing recovery continues to be the lack of purchase application activity. Even the hot housing markets in the Northwest, which are back in their stable range of housing activity, are seeing their purchase application activity slow. The one area where momentum hasn't slowed is among the hardest-hit markets. Places like Las Vegas, Miami, Chicago, and Riverside, Calif., among others, are still showing double-digit yearly improvements, but that's largely a reflection of significant gains in the local employment picture as well as a real improvement in borrowers making timely mortgage payments."

Most Improving States

The states showing the most improvement year-over-year, according to the index, are:

• Nevada
• Illinois
• Florida
• California
• South Carolina

Source: Freddie Mac

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Lending Giants Shy Away From FHA Loans...Robert De La Rosa An Expert In Your Court 909.271.5640 CALL NOW!!!!

Lending Giants Shy Away From FHA Loans

DAILY REAL ESTATE NEWS | MONDAY, SEPTEMBER 22, 2014

The nation’s largest home lenders are curtailing their involvement in Federal Housing Administration loans, known for their small down payment requirements and help to first-time buyers and lower-income Americans. Lenders say they are concerned that they will be penalized if underwriting errors occur and the loans default. Therefore, they’re backing away from issuing the loans.

FHA loans have plummeted 19 percent in the nine months ending June 30 compared to a year earlier. Wells Fargo, the nation’s largest home lender, saw FHA originations drop 82 percent in the first six months of this year compared to the same time period in 2013, according to Inside Mortgage Finance data. Bank of America saw a 72 percent drop in that time, followed by JPMorgan with a 55 percent drop.

Another FHA lending hurdle?Rising FHA Costs Sideline Potential Buyers

In a earnings call with investors in July, JPMorgan CEO Jamie Dimon said: “The real question to me is, should we be in the FHA business at all? And we’re still struggling with that.”

Lenders’ attitudes toward FHA loans have turned sour after facing steep settlements recently from the Department of Justice and federal regulators. JPMorgan Chase & Co., Bank of America Corp., and others have already paid more than $3 billion in fines for originating faulty FHA loans during the housing bubble.

“A big issue is the DOJ settlements and their impact on the lending attitudes of the banks, which is clearly the elephant in the room,” says Brian Chappelle, a former FHA official and partner at Potomac Partners LLC, a consulting firm for lenders in Washington. “The government is worried about access to credit. They’re looking at volume numbers and they know it’s a serious problem.”

HUD and Treasury officials recently met with bank executives at the White House to talk about improving FHA processes. Julian Castro, secretary of the Department of Housing and Urban Development, which oversees FHA, says the agency does seek to ease credit by rewriting clearly when lenders will be forced to pay the cost from loans that go bad.

“With all our efforts, I want to send a simple message to lenders: Let’s work together,” Castro said in a prepared statement at the Bipartisan Policy Center Housing Summit on Sept. 16. “Many have been reluctant to lend because they fear unanticipated consequences. They need to be able to manage their risk better—and so does FHA.”

Anthony Hsieh, CEO of LoanDepot.com, the third largest FHA lender, urges government regulators to do something fast. “Access to credit is tightening across the board and the number of people who can get a home is shrinking to the point of code red,” Hsieh says.

Source: “FHA Loans Plunge 19% as Lenders Haggle with Officials,” Bloomberg (Sept. 19, 2014)

"Get Qualified Now By A Loan Professional" 

Robert De La Rosa

An Expert In Your Court

 909.271.5640 CALL NOW!!!!

www.TheCaliforniaPropertyConnection.net

9220 Haven Ave. Suite 100

Rancho Cucamonga Ca, 91730

BRE 01435824