Loan officers and mortgage consultants who made up a lender panel at a recent Silicon Valley Association of REALTORS® district tour meeting, said they are optimistic that the lending environment will get brighter for borrowers. In fact, members of the panel said these days they are already seeing some loosening in underwriting and easing of jumbo loans.
Connie Chronis, a mortgage consultant with Diversified Capital, said ARMs (adjustable-rate mortgages) are becoming more attractive these days as some buyers continue to look at them as a good strategy "to get in," save some money and refinance down the road. Asked about whether there is a preference between fixed loans and ARMs, Chronis said it depends on the individual's circumstances and whether the borrower is going to keep the property as a personal residence or a rental. She said move up buyers tend to lean more towards a 30-year fixed rate conforming loan.
Asked about appraisal management companies, Alan Russell, a residential mortgage lender with Princeton Capital, said more lenders are using their own appraisers these days and usually have a list of individuals on whom they rely. In the past, there had been numerous complaints of lenders using out of town appraisers who were unfamiliar with property values in the area. Russell said lenders are now more inclined to use appraisers who are experienced and are from within a 10- to 15-mile radius of the area.
John Woodfin, who is with MetLife, reminded REALTORS® that the high conforming loan limit, which was extended to $729,750 in most high-cost areas, will end on September 30. He said this information should be conveyed to buyers who are considering purchasing high-end homes.
"It will certainly impact the marketplace," remarked Woodfin.
The panelists indicated it is easier to get a loan today than it was 12 months ago, when lenders reverted to much tighter underwriting guidelines. It is still possible to obtain a conforming loan in one day or even a jumbo loan in two days with a good loan officer and if the loan fits all the guidelines.
Maria Anderson, a mortgage loan officer with Bank of America, said she has definitely seen loosening of underwriting in the past 12 months and she attributes this to more educated and knowledgeable loan officers. The key to a smooth loan process is working with a good loan officer, according to Anderson.
"The ultimate loan officer is detail-oriented and thinks like an underwriter," said Anderson.
The panelists also emphasized the need for all parties in a transaction to work together as a team. As more loans perform well, there will be a little more easing of underwriting standards, they told the REALTORS® .
REALTORS®
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The Silicon Valley Association of REALTORS® (SILVAR) is a professional trade organization representing over 4,000 REALTORS® and Affiliate members engaged in the real estate business on the Peninsula and in the South Bay. SILVAR promotes the highest ethical standards of real estate practice, serves as an advocate for homeownership and homeowners, and represents the interests of property owners in Silicon Valley.
The term "REALTOR®" is a registered collective membership mark which identifies a real estate professional who is a member of the National Association of REALTORS® and who subscribes to its strict Code of Ethics.
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