A new survey of bank risk professionals, when asked about Columbia SC housing, shows the originations space warming to the idea of expanding home lending.
Columbia SC Housing Prices Sustainable
Approximately 70% of the professionals surveyed feel home prices are rising at a sustainable pace, reaffirming that the Columbia SC housing recovery is real.
FICO and the Professional Risk Managers International Association surveyed bank risk professionals regarding their predictions for the next six months.
"The latest survey results, combined with data that indicates the real estate market is improving, not only in Columbia SC , but in many regions, paint a positive picture for a sector of the economy that has been slow to join the recovery," said Andrew Jennings, chief analytics officer at FICO and head of FICO Labs.
Meanwhile, 59% of bankers expect the supply of credit for residential mortgages to meet demand over the next six months, and 60% expect the supply of credit for mortgage refinancing to meet demand.
Jennings explained, "Mortgage lenders have been understandably guarded over the past five years. The improvement in their sentiment should be welcome news, and I wouldn't be surprised to see lenders cautiously expanding their mortgage and home equity lending businesses."
The survey found 84% of people believe that the level of mortgage delinquencies will decrease or stay the same, a significant improvement over last quarter.
Additionally, less than 20% believe the level of home equity line delinquencies will rise.
For more Columbia SC housing news, hop over to our Columbia SC Real Estate News under Columbia SC Real Estate Categories to your right.
Perhaps the greatest advantage of Columbia SC short sales to beleaguered homeowners facing default and foreclosure is the opportunity to move on with life and put the bad debt behind them as quickly as possible.
Typically, Columbia SC short sales take longer to sell than normal home sales or foreclosures because of the time required for the parties-lender, buyer, seller-to respond. In the past waiting 6-18 months was common, now we find the process taking about 3-4 months if you are aggressively on top of everything.
Improved Columbia SC short sales management systems and lenders more willing to settle for a short sale than foreclosure has helped the transition and sped up the process. By comparison, as processing times and backlogged inventories continued to plague foreclosure markets last year, 2012 was proclaimed the “year of the short sale” and short sale inventories skyrocketed.
Columbia SC Short Sales Selling Slower Than Some Foreclosures
Now there are so many Columbia SC short sales on the market they are selling slower than foreclosures that have made it through processing, as well as “normal” sales. Demand is considerably less for short sales among investors, especially the institutional investors who are having a major impact on some markets, and as a result they are selling at a discount about equal or even greater than foreclosures.
Last year, nationwide, short sales of homes that had never entered the foreclosure process accounted for 22 percent of all US homes sales, more than all REOs and sales of pre-foreclosure properties combined, according to RealtyTrac.
As volumes of Columbia SC short sales grew, so did their discounts from normal prices and their time on market. Last month, the median time on the market for single family homes was 74 days in February, up from 71 in January according to the National Association of Realtors. Short sales had a median of 101 days on market, up from 94 in January. Foreclosures (REOs) were on the market for a median of 52 days, up from 47 days in January.
In December, when demand was lower, the differences were even more pronounced. Columbia SC short sales had the longest days on market with a median of 117 days. Foreclosures were on the market for a median of 45 days (60 days last year), while the median days on the market for non-distressed properties was 74 days (106 days last year).
Perhaps an answer to the problem Columbia SC short sales are having lies with the changing nature of demand for distressed properties with the bulk purchases of foreclosures, especially pre-foreclosures, by some institutional investors. Reports of single sales of thousands of properties are not uncommon, especially in markets where hedge funds are most active.
Are Columbia SC short sales still the shortest solution? For starters, compare NAR’s 74 day median time on market for February with RealtyTrac’s national average of 414 days to process a foreclosure and NAR’s 52 days to sell them. So in most places, short sales are still the less painful option.
We have more information pertaining to Columbia SC short sales and foreclosures under our Columbia SC Mortgage Info section in the Columbia SC Real Estate Categories to your right.
Nearly half of all potential Columbia SC homebuyers can afford the median-priced home in the area, but that’s not much help if they can’t get a mortgage.
Six years after the subprime mortgage meltdown, banks remain tight-fisted, even with solid borrowers — a fact they attribute to shifts in government regulation and demands that they buy back bad loans. Mortgage credit has not eased much since 2007, according to Federal Reserve surveys of loan officers, even while low rates and the housing recovery have borrowers lined up looking for financing.
Which Columbia SC Homebuyers Are Having Problems With Lenders?
First time Columbia SC homebuyers and those who are self-employed find themselves jumping through especially complex hoops. Even would-be borrowers with crystal clear credit are having to justify even the smallest quirks in their finances, and the application process can take months.
This is all in sharp contrast to 2006 when just 12% of Columbia SC homebuyers could afford the median-priced home, but seemingly anyone could get a mortgage to buy one. The turnabout highlights a cruel fact of the housing crash: Many who were crushed by lost home values — or other economic pain related to the housing meltdown — may now miss out on record low prices and interest rates if they want to become Columbia SC homebuyers again.
Complaints about tight-fisted lenders have emanated not just from potential Columbia SC homebuyers and industry sources, but from Federal Reserve Chairman Ben S. Bernanke, who at least twice in the last year has remarked on how the pendulum has swung too far.
In November, Bernanke said, “Overly tight lending standards may now be preventing creditworthy borrowers from buying homes, thereby slowing the revival in housing and impeding the economic recovery.” There is no indication that things have improved since he made those comments.
Despite the problems, there have been some improvements since the mortgage market tightened up during the financial crisis. For instance, refinancing of certain underwater mortgages — those that borrowers owe more on than their homes are worth — has become more available for homeowners who have stayed current on payments under an Obama administration program that offers incentives to banks. And jumbo loans, those for more than $625,000, nearly disappeared after the crash, but now are widely available at rates less than a half a point higher than traditional loans.
The tighter mortgage market is all the more reason not to try to become a Columbia SC homebuyer alone. You need a professional to help you through the mortgage maze. Talk to us. We have a lot of experience dealing with lenders, and between our experience and the expertise of some of our preferred lenders that we work with on a regular basis, we can help you get through it all.
For more tips on getting through the mortgage maze, visit our Columbia SC Mortgage Info under our Columbia SC Real Estate Categories to your right.
Can’t wait to have your Columbia SC mortgage paid off so you can do other things with that money each month? There are some smart ways to reach your financial goal of paying off your Columbia SC mortgage faster, and wiser.
Refinance Your Columbia SC Mortgage to a 15-Year Term
Getting a 30-year mortgage is the common track most people follow when getting a Columbia SC mortgage, mainly to keep their payments as low as possible. If you can afford the higher monthly payments on a 15-Year term, consider refinancing to the shorter term loan. You’ll usually get a lower interest rate, and you’ll pay off your Columbia SC mortgage sooner, thereby reducing the amount of interest you pay over the life of the loan.
The trade off is, your monthly payments will be higher because you’re paying more of the principal each month. Here’s an example:
$250,000 30-Year Loan @ 5.0 percent, monthly payment is $1,342.05 $250,000 15-Year Loan @ 4.5 percent, monthly payment is $1,912.48
The total interest you’d pay on the 30-Year Loan would be $233,139.46
The total interest you’d pay on the 15-Year Loan would be $94,246.98
So as you can see, shortening your Columbia SC mortgage to 15 years saves you a ton of interest over the life of the loan.
Make Extra Payments When You Can
If refinancing to a shorter term is not possible for you, consider making extra principal payments each month. When you pay more than your loan requires, and when you designate the extra payments to be applied against the principal balance of your loan, you end up reducing that balance at an accelerated rate. Be sure your lender applies the extra payment towards principal and not towards future payments owed, or you’ll just be giving them the gift of interest they haven’t yet earned.
To achieve the greatest benefit, the increase should be at least 1/12th of a normal monthly principal and interest payment.
Check Your Property Taxes and Insurance
For most people, their Columbia SC mortgage payment includes four things: your principal, interest, property taxes, and insurance – which is collectively called your PITI.
Most people tend to focus on the principal and interest when they’re looking to pay down their mortgage faster. The amount you pay in property taxes and insurance, however, is often overlooked and this could be a big mistake.
If your property tax rate was set during the heady boom days of Columbia SC real estate, you might be paying taxes based on an assessment that’s no longer valid. It might be worth it to protest the assessment with your county to see if your rate should be re-adjusted to reflect today’s lower home values.
Re-investigate your insurance. If you opt for a higher deductible, you could get a lower premium, which will result in a lower monthly mortgage payment.
If your property taxes are lowered after the re-assessment, and/or your insurance premium is lowered, you can continue to make the same monthly payment and more of your money will be applied towards the principal and interest, which will help you pay down that loan much faster.
Hopefully these tips to pay down your Columbia SC mortgage faster and more wisely will help you become a better handler of your finances. For more mortgage tips, check out our Columbia SC Mortgage Info section under Columbia SC Real Estate Categories to your right.
The apparent end to the Columbia SC foreclosure crisis and the foreclosure crisis nationwide seems to be in sight. Today, less than half the number of homes are in or facing foreclosure as those facing the same fate in 2010 when the Columbia SC foreclosure crisis was at its peak.
While foreclosures are going down, Columbia SC housing prices are on the rise and slowly recovering. So what’s suddenly causing the drop in foreclosures? The secret… short sales. The video explains it all…
A good time to buy if everything is in place for you? Sound like sound advice?
Want more tips on mortgages and homebuying? Head over to our Columbia SC Mortgage Info Category under the Columbia SC Real Estate Categories to your right for more tips and advice.