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Banks are Starting to “Loosen Up” Mortgage Guidelines

February 3, 2012 By Arizona Home Group Leave a Comment

Banks are starting to “loosen up” after a half-decade of tightening mortgage guidelines. Looser mortgage lending standards should mean more home loan approvals for buyers, and fewer contract cancellations.

This can spur the housing market forward.

Not since before the recession have banks lowered mortgage approval standards like this and it bodes well for this year’s Phoenix housing market.

The Federal Reserve conducts a quarterly survey of its member banks and, last quarter, not a single responding bank reported having tightened its mortgage guidelines for prime borrowers.

A “prime borrower” is defined as one with a well-documented credit history, high credit scores, and a low debt-to-income ratio.

53 banks responded to the Fed’s survey and none said that mortgage guidelines “tightened considerably” or “tightened somewhat” between September and December 2011; 50 said that guidelines remained “basically unchanged”; 3 said that guidelines “eased somewhat”.

Mortgage applicants sometimes remark that the mortgage approval process can be challenging. Last quarter’s Fed survey hints that looser standards are coming.

Real estate agents report that 1 in 3 home sale contracts fail with “declined mortgage applications” as a leading cause.

Make note, though. “Looser standards” should not be confused with “irresponsible standards”. It remains more difficult to meet bank standards as compared to 5 years. Today’s underwriters are more conservative with respect to household income, overall assets and credit scores.

Even as compared to one year ago:

Minimum credit score requirements are higher
Down payment/equity requirements are larger
Maximum allowable debt-to-income ratios are lower

For buyers and refinancing households gaining approval, though, the reward is the lowest mortgage rates in a lifetime. Mortgage rates in Arizona continue to fall, helping home affordability reach new highs.

If you’re in the market to buy a new home or refinance one, your timing is could not be better. Check our list of affiliates for our recommendation for Mortgage Lenders.

Filed Under: Arizona Home Buyers, Canadian Buyers, Federal Reserve, Home Buyers, Housing Analysis, Mortgage Guidelines, New Homes, Phoenix Housing Market, Real Estate

Should You Worry About Termites in Arizona?

January 31, 2012 By admin Leave a Comment

Termites are just about everywhere in Arizona, and since they love wood, a home is a pretty good habitat. In order to gain access to wood sources above the ground, termites construct long tubes from the soil surface to the wood source. The termites can then move back and forth through these tubes.

If during the escrow period the termite inspection finds termites…don’t panic and cancel the purchase contract. Instead ask your Buyer Representative to make that a termite warranty is in place before you close on the home, which will limit any future costs to you.

Termite Prevention

There are different products on the market to prevent termites. Some inexpensive chemicals are repellants, and serve to keep termites away from the area where it is applied. They do not kill termites, but simply repel them from the area. A termiticide like Termidor or Premise is a non-repellant chemical. When the termite moves through the chemical, the chemical adheres to the termite, who then passes the chemical around to the queen and other members in the colony, effectively eradicates the whole colony.

Termite Protection in New Homes

The foundation of many new homes in the Phoenix area are treated before the home is built, and these homes will have a 5 year termite warranty. After your new home termite warranty expires, it is a good idea to get a new termite warranty. If a termite infestation is found, the warranty will cover any treatment, free of charge to the homeowner. If you find termites in your home without a warranty, treating the termites may cost you more than $700.

Check out our list of Affiliates for a recommendation for a Termite Inspector.

Filed Under: Arizona Home Buyers, Arizona Home Construction, Arizona Homes, Buying Homes in Arizona, Escrow Process, Home Buyers, New Homes, Real Estate

Mountain Bridge in East Mesa AZ – Newest Master Planned Community

January 30, 2012 By Arizona Home Group Leave a Comment

TOP 10 REASONS To Consider Mountain Bridge Master Planned Community

Open Space — Almost one half (42%) of Mountain Bridge consists of existing or revegetated desert or
parks, which help expand mountain and city light views throughout.
Private Home sites — No homes back to one another, allowing you privacy and openness.
Superb Location — within 1 mile of the 202 Freeway with easy access to the airport and
downtown Phoenix. Centered among top rated schools and mega-shopping.
Impressive Grand Arrival — The street scene is second to none with unique street lighting,
wide meandering sidewalks pulled away from the road, and dramatic over-sized landscaped medians.
Private Gated Communities — Each community in the master plan has been carefully planned to
create unique street scenes along with individual gated entries that have a high end resort-style arrival.
World Class Amenities — Mountain Bridge is a unique master planned community designed to meet
every lifestyle with parks throughout, hiking trails, a fitness facility, beach entry pool, private spa, a children’s
recreational center, playgrounds, intimate Ramadas and BBQ’s, basketball courts, a tennis center, and an
event lawn for special occasions.

Filed Under: Arizona Home Buyers, Arizona Homes, Gated communities, Home Buyers, Master Planned Communities, Real Estate

National Housing Market Appears to be Easing, Phoenix Market Strong

January 27, 2012 By Arizona Home Group Leave a Comment

Pending Home Sales 2011

The housing market appears to have eased a bit in December According to the National Association of REALTORS®. December’s Pending Home Sales Index slipped 4 percent from the month prior. The index measures the number of homes under contract to sell nationwide, but not yet sold.

Despite falling below its benchmark “100 value”, December’s Pending Home Sales Index is the reading’s second-highest value since April 2010 — the last month of last year’s home buyer tax credit program.

In other words, the housing market continues to show signs of improvement, propelled by low home prices and the cheapest mortgage rates of all-time. The Phoenix Housing Market’s activity reflects these conditions.

Freddie Mac’s mortgage rate survey put the 30-year fixed rate mortgage at an average of 3.96% in December — a 75-basis point improvement from December 2010. This helps to make homes more affordable nationwide.

On a regional basis, December’s Pending Home Sales Index varied:

Northeast Region: -3.1 percent from November 2011
Midwest Region : +4.0 percent from November 2011
South Region : -2.6 percent from November 2011
West Region : -11.0 percent from November 2011

But even regional data is only so helpful. Like everything in real estate, data must be local to be relevant.

Throughout the West Region, for example, the U.S. region in which pending home sales fell the most, several states must have performed better than the regional average. And, undoubtedly, within Phoenix Metro there were some cities that experienced marked market growth.

Unfortunately, the Pending Home Sales Index can’t capture that data. Nor can it identify the markets in which home sales suffered.

For today’s Arizona’s home buyers and sellers, therefore, it’s important to understand your local market and the drivers of local activity. Reports like the Pending Home Sales Index can paint a broad picture U.S. housing but for data that matters to you, you’ll want to look local.

Here’s a snapshot of the local Phoenix Housing Market.