Interest Rates Plunge for Homes in Santa Cruz

The hypocrisy kind of makes me sick – they’re all for government intervention to help out the banks and whatnot, but when it comes to helping out the middle and lower classes with, I don’t know, a tax cut or a single-payer health care system – forget it. bailout2.jpg But I digress – I’m totally for the bailout. … But let’s assume that on Friday, your rate would have been 6.5%, and today, it’s 6% – in other words, a 1/2% drop. … The median price these days is around $610,000 – so your loan would be $518,500 (yes, I’m assuming you have $91,500 handy for a down payment!). … So your true payment with a 6.5% rate would be around $3,911.27 a month, which puts your actual savings of $168.61 at somewhere around 4.3% per month.

More about Santa Cruz and the 2008 Housing Bill

Here’s a bit of a run-down on some of the acronyms used in my last post: A GSE is a Government Sponsored Enterprise – in this case, Fannie Mae and Freddie Mac, but there are and have been a few others. … It’s no surprise that a major piece of the legislation that President Bush just signed addresses the FHA – together with Fannie Mae and Freddie Mac, these institutions are pretty much the only things holding the real estate market together at the moment. … It used to be that we didn’t have too many VA loans in the area, but now prices have dropped in many parts of Santa Cruz and north Monterey County that VA loans are becoming increasingly more frequent.

…Don’t get me wrong – I love commie-pinko agitators as much as the next guy, but you can see from the article that the author very much favors competing legislation, H.R. 6116, the Saving Family Homes Act of 2008 .

Santa Cruz and the Housing and Economic Recovery Act of 2008

The effective date for reforms is immediate upon enactment, but the loan limits will not go into effect until the expiration of the Economic Stimulus limits (December 31, 2008). FHA Reform – including permanent FHA loan limits at the greater of $271,050 or 115% of local area median home price, capped at $625,500; streamlined processing for FHA condos; reforms to the HECM program, and reforms to the FHA manufactured housing program . … The effective date for reforms is immediate upon enactment, but the loan limits will not go into effect until the expiration of the Economic Stimulus limits (December 31, 2008). … Seller-funded downpayment assistance programs – codifies existing FHA proposal to prohibit the use of downpayment assistance programs funded by those who have a financial interest in the sale; does not prohibit other assistance programs provided by nonprofits funded by other sources, churches, employers, or family members.

Santa Cruz Gets Highest FHA Loan Limit – $729,750

Counties that get the $729,750 maximum for FHA loans are likely to get that same level for Fannie and Freddie mortgages, experts said.

… In California, the counties at the maximum level for FHA loans are Alameda, Contra Costa, Los Angeles, Marin, Monterey, Napa, Orange, San Benito, San Francisco, San Mateo, Santa Barbara, Santa Clara, Santa Cruz and Ventura. At the other end, Lassen, Modoc and Trinity counties are subject to a loan cap of $271,050 — a standard amount in an area with normal home prices.

…Oh, and if you do know anyone who was waiting to buy a house once the Guv’mint got its at together and raised the conforming loan limits – won’t you send ’em my way?