Loan Limits Finally to increase for 14 California Counties
Santa Cruz area living
This news is old news, but finally getting clarifications on what has been discussed in Congress. It lays out just where in the state qualifies as a high cost area, and gives the loan amount for that area.
Also, on Wednesday, the government raised the conforming loan limit for mortgages guaranteed by the Federal Housing Administration, and has begun offering the maximum limit of $729,750 for 14 California counties, up from $362,790, for loans originated between now and Dec. 31, 2008.
The Fed’s economic stimulus package approved earlier this year called for the temporary increases on conforming loans to allow troubled borrowers to refinance out of sub-prime loans and make it easier for many new buyers to qualify for mortgages in high-cost areas, particularly in California where they remain among the highest in the nation."
The hi-cost areas are going to cover Santa Cruz and most of the areas you think of as high cost. Inland areas such as Stockton for instance will only go to $488,750, which for that place, I think is high. The area is immersed in foreclosures and the values have plummeted below that level for many many homes. Even Salinas which has a huge number of foreclosures is includes in the high cost area,because Monterey County has Monterey and Carmel, which definitely are high cost.
While the loan amounts will increase and this should help decrease some of the higher loan amounts necessary to purchase in the Santa Cruz area, talk with a local lender like Woodward-O'Connor Mortgage and see how the lenders really are dealing with this. Many will take a given property and decrease the values by 5% or more, because they are afraid. Find out what the lenders are really doing so you can strategize on what the true value they will lend you and you don't spin your wheels and get false hopes.
There are some great places for sale and the rates are good, but lending is tougher than it has been in years and you will need at least 10% downpayments, whereas before loans were so easy, it was a lark.
Santa Cruz real estate will remain a good value, and from a historical, the homes here appreciate at higher rates than most places due to the great year round climate, and the lack of effective supply in the market. With the market malaise, the smart buyers are stepping forward and getting the best values. To find out what I think are the best, call me, Gregg Camp at 831-818-7524 or visit my site at www.propertyinsantacruz.com
Read some of the other blog topics of Gregg Camp
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