5/16/24 – Interest rates lower – what does that mean? and condo update

We have reached the halfway point in May, and change is in the air. We are starting to see interest rates back down to the levels we were at in April and nearing the lowest levels since May of last year. Inflation is still the key reason rates have not dropped further, but I am confident we will continue to see slight rate drops as we finish the year.

Interest rates have come down about .625% since the start of the month, which means some savings to most buyers who have yet to find a home. There must be more than the rate drop to push prices higher, but time alone will do that! Significant demand and prices could continue to rise with or without lower rates.

So, what does this mean for your buyers?

A savings of .50% on your interest rate will save a buyer about $33.00 monthly per $100,000 borrowed. A $600K loan saves about $200.00 monthly, while an $800K loan will save them about $264.00 monthly.

I am available the rest of the week and all weekend if you need anything. Let me know if you have any questions or if someone is interested in buying a property! My cell is 661-714-6258, and my office line is 661-260-2970 ext. 2222. My direct line is 661-291-2222. When you text, text (661-714-6258) or email me at Mike@AugustaFinancial.com.

But wait, there’s more!

Interest rates improved yesterday and then went up slightly today! It’s like weight loss: you lose a few pounds and then gain some! We will get there!

• 12-day escrows if your buyer is pre-approved  - Conventional / FHA / Jumbo / Bridge
• We do loans in all states, so call me with anything you need.  
• Government Loans (FHA / VA/ USDA) are in the high 5’s and low 6’s
• Conventional Loans up to $766,550.00 are in the high 6’s and low 7’s
• High Balance Loans $766,550.01 – $ 1,149,825.00 are in 7’s
• Jumbo loans above $1,149,625 are in 7’s
• Bank statement loans - They are available with 10% down again! 7’s to 9’s depending on down and credit score.
• Profit and Loss Statement loans- You don’t need bank statements, just a profit and loss statement!
• No income qualifier – 40% down with reserves! In the 8’s!
• 0 down loans are in the high 7’s – 660 credit score min right now, up to $793,000.00.
• Private Money lenders - Hard Money Loans – 35% down!
• No Ratio Loans 30% down
• DSCR – Debt Service Coverage loans with as little as 15% down
• Bridge Loans - typically 7.99% with limited fees – and they get you where you need to go!
• 0 down California Dream for all Equity Share – Registration April 3 to April 29, 2024
• 3/2/1 Buydowns 2/1 Buydowns and 1/0 Buydowns are available at great start rates!

Interest rates are subject to change without notice! The above are LA County Loan Limits.

Condo Update?  

I have seen a couple of condo policies with sufficient insurance, but they left out wildfire coverage, making them non-warrantable. I have seen that twice this week alone, and it looks like that is how some of the HOAs think they are getting around increasing premiums. They are getting away with lower premiums, but these condos are now non-warrantable!

Condo / Townhome – issues we know of now. Properties can be financed with 10% down and are considered NON-WARRANTABLE:

1. American Beauty Condos – The brown ones – Insurance – 50 Mil in coverage for 748 units is not nearly enough!
2. American Beauty Gardens: 19% delinquency on special assessments due. 19% are 60 days or more late! We can do with 5% down, but others can’t!
3. American Beauty Village: On Fannie’s List. Per Fannie, this project needs critical repairs and may have conditions such as material deficiencies and significant deferred maintenance. This project’s master insurance policy deductible exceeds the allowable limit
4. Bouquet Canyon Village is on Fannie’s list! Per Fannie – This project’s master insurance policy coverage does not meet the requirements
5. Bridgewater, Emeryville - On Fannie’s list!
6. Brookside Walk – Insurance –
7. Cabrini Villas, Burbank - On Fannie’s list!
8. Calla and Rowan  – 27513 Illumination – Fannie Mae Approval expired – New Construction.  See Blog on 5/7/2024
9. Canyon Village – Reserves and 10% of the dues not going to reserves!
10. Canyon Oaks – Insurance On Fannie’s list!
11. Casa Marabella – 13951 Sherman Way, Van Nuys -On Fannie’s list!  
12. Cassia and Jasmine  – 26949 Winding Trail Court  – Fannie Mae Approval Expired. See Blog on 5/7/2024
13. Cornerstone – Insurance -On Fannie’s list!
14. Creekside – ??? We don’t know
15. Encino Oaks – 5460 White Oak Ave – On Fannie’s list!
16. Lantana at Valencia – 27034 Hummingbird Lane – Fannie Mae Approval – expired. See Blog on 5/7/2024
17. Liberty Canyon HOA – 27409 Country Glen Road, Agoura Hills, CA- On Fannie’s list!
18. Madison at Towne Center  – Litigation – We can do with 5% down, but others can’t!
19. Mariposa: On Fannies List. Per Fannie Mae – This project’s master insurance policy coverage does not meet the requirements.
20. Orchid at Valencia  – 27033 Open Sky Place – Fannie Mae Approval Expired. See Blog on 5/7/2024
21. Penn Court HOA – 4201 Pennsylvania Ave La Crescenta On Fannie’s list!
22. Princessa Estates – has $8200 in Reserves, and they are voting on an assessment in May!
23. Rainbow Sierra Terrace – On Fannie’s Naughty List – This project’s master insurance policy is not written to Replacement Cost Value. See Selling Guide Sec. B7-3-03, Master Property Insurance Requirements for Project Developments.
24. Scenic Hills – Insurance – On Fannie’s list!  This project’s master insurance policy coverage does not meet the requirements in Selling Guide Sec. B7-3-03, Master Property Insurance Requirements for Project Developments.
25. Shadow Ridge – Oak Park – Insurance -On Fannie’s list!
26. Sherman Way Condos – 17900 Sherman Way Reseda – On Fannie’s list!
27. The District Community Association – 19533 Cardigan Dr, Northridge – On Fannie’s list!
28. Treana - Stevenson Ranch: On Fannie’s list! Per Fannie, this project needs critical repairs and may have conditions such as material deficiencies and significant deferred maintenance.
29. Valle Di Oro- On Fannie’s list! Per Fannie Mae, this project contains timeshare, fractional, segmented, or split ownership units or other arrangements (such as mandatory rental pooling, shared interest apartments, or community apartments) restricting the unit owner’s ability to occupy the unit.
30. Vista Del Canon – Insurance is too low, UGH!
31. Walnut Gardens II – 7320 Lennox Ave Van Nuys CA – On Fannie’s list!
32. Warner Center Condos – 5515 Canoga Ave, Woodland Hills, CA –  On Fannie’s list!
33. West Creek Condos and Townhomes: On Fannie’s List. Per Fannie, this project’s master insurance policy coverage does not meet the requirements in the Selling Guide!

Please let me know if you hear anything new on condos or townhouses.

I am still available all week if you need anything. Let me know if you have any questions or if someone is interested in buying a property! My cell is 661-714-6258, and my office line is 661-260-2970 ext. 2222. My direct line is 661-291-2222. When you text, text (661-714-6258) or email me at Mike@AugustaFinancial.com.

Have a great day and an even better tomorrow! Please call me when you have a client who needs to borrow!