I hate that credit is increasing.
Equifax Sees ‘Turning Point’ in Home Equity Credit Improvements
By: Carrie Bay 10/08/2012
Home equity installment balances rose 0.3 percent in August–-the first monthly increase since November 2007, according to Equifax. The company says its findings signal “a possible turning point in mortgage demand.”
This newly developed trend in home equity credit is highlighted in Equifax’s newest National Consumer Credit Trends Report and bears noting after the home equity credit market plummeted along with property values during the housing downturn.
The total number of home equity installment loans fell 43 percent in a span of four years—from 7.7 million in August 2007 to 4.4 million in August 2012, Equifax reports.
Home equity installment balances contracted even further, declining 49 percent from their $278 billion peak in September 2007 to just $143 billion in August 2012.
But according to Amy Crews Cutts, Equifax’s chief economist, recent trends seem to indicate the residential real estate market has finally found solid ground.
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Proprietary OC Housing News home purchase analysis
7725 East VIEWRIM Dr Anaheim Hills, CA 92808
$359,000 …….. Asking Price
$143,000 ………. Purchase Price
9/27/1996 ………. Purchase Date
$216,000 ………. Gross Gain (Loss)
($11,440) ………… Commissions and Costs at 8%
============================================
$204,560 ………. Net Gain (Loss)
============================================
151.0% ………. Gross Percent Change
143.0% ………. Net Percent Change
5.6% ………… Annual Appreciation
Cost of Home Ownership
——————————————————————————
$359,000 …….. Asking Price
$12,565 ………… 3.5% Down FHA Financing
3.40% …………. Mortgage Interest Rate
30 ……………… Number of Years
$346,435 …….. Mortgage
$100,273 ………. Income Requirement
$1,536 ………… Monthly Mortgage Payment
$311 ………… Property Tax at 1.04%
$55 ………… Mello Roos & Special Taxes
$90 ………… Homeowners Insurance at 0.3%
$361 ………… Private Mortgage Insurance
$237 ………… Homeowners Association Fees
============================================
$2,590 ………. Monthly Cash Outlays
($226) ………. Tax Savings
($555) ………. Equity Hidden in Payment
$13 ………….. Lost Income to Down Payment
$65 ………….. Maintenance and Replacement Reserves
============================================
$1,887 ………. Monthly Cost of Ownership
Cash Acquisition Demands
——————————————————————————
$5,090 ………… Furnishing and Move In at 1% + $1,500
$5,090 ………… Closing Costs at 1% + $1,500
$3,464 ………… Interest Points
$12,565 ………… Down Payment
============================================
$26,209 ………. Total Cash Costs
$28,900 ………. Emergency Cash Reserves
============================================
$55,109 ………. Total Savings Needed
The property above is available for sale on the MLS.
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Cost of Ownership Analysis
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Nearby Foreclosures
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Lenders are content to wait and see if prices are going any higher before pushing out the squatters. MLS inventory will remain tight, and there will be no flood of REO. In fact, the shortage will continue.
West Coast Foreclosure Starts Plunge in September: ForeclosureRadar
Foreclosure starts fell dramatically in all five West Coast states tracked by Foreclosure Radar, confirming suspicions that a foreclosure wave may not arrive.
“It was recently reported that the nation’s five largest mortgage servicers have implemented all of the 320 servicing standards required under the national mortgage settlement,” stated Sean O’Toole, founder and CEO of ForeclosureRadar. “The continued decline in Foreclosure Starts clearly shows that even though servicers are now apparently in compliance and clear to move forward with foreclosures, they are still in no rush to foreclose on the majority of delinquent borrowers.”
In September, foreclosure starts in Nevada fell 40.1 percent from the prior month and in Oregon, foreclosure starts fell 40 percent during the same period, according to a ForeclosureRadar report released Wednesday.
Arizona (-37.1 percent), Washington (-31.2 percent), and California (-20.7 percent) also saw dramatic declines over a one-month period.
While California saw the smallest decrease, the state had the highest number of foreclosure starts, which totaled 14,090 in September compared to 1,450 in Nevada and only 51 in Oregon.
Year-over-year, the decline in foreclosure starts was even greater. Oregon led with a 96 percent drop, followed by Nevada (-73.8 percent), and Washington (-70.8 percent), Arizona (-50.8 percent), and California (-48.1 percent).
“There has been speculation that the banks would rush to clear inventory before the CA Homeowner Bill of Rights takes affect in January 2013, causing an increase in the number of foreclosures. Clearly this is not the case as we continue to see the number of Foreclosure Starts decline,” the foreclosure data provider noted in its report.
Month-over-month, September foreclosure sales were also down across all five states: Arizona (-24.3 percent), California (-17.9 percent), Nevada (-19.5 percent), Oregon (-0.3 percent), and Washington (-33.5 percent).