Gene Perez Your Real Estate Consultant, Santa Maria Homes: August 2009

Fannie Mae just tightened up their lending rules regarding condos. This is going to have a large effect on the price of condos here in Santa Maria. Fannie Mae's business consists of buying and pooling conforming loans. Conforming loans must meet criteria established by Fannie Mae, including restrictions on the size of the loan and qualifications of the borrower. When buying these loans, Fannie Mae assumes the risk of defaulting borrowers and changing interest rates. This decision by Fannie Mae will more than likely cause another decline in condo prices and an increase in association fees (HOA's).

The new rule says that if more than 15% of an association's units are delinquent or late in their payments over one month, Fannie Mae is not guaranteeing the loan. This means that the banks cannot provide the loans, unless they intend to hold on to it. Banks do not typically hold on to loans. Therefore, if they are not going to give loans to people who are interested in buying a condo, then the only people who will be able to acquire these condos are "Cash Buyers" because no one else can get a loan. Even if they qualify for a loan, the interest rate will be much higher. So even if the prices of condos come down, they will essentially be paying much more. This means that more investors will be looking to buy condos in Santa Maria.

This is going to have a dramatic effect in the real estate industry in the Santa Maria area. It is a reality that there already exist condo communities that have more than 15% of the units that are currently delinquent in their mortgage. They are not going to meet the Fannie Mae requirements. It will be too difficult. This is going to have a continuing negative effect on the Santa Maria housing market.

So, "have we hit rock bottom yet"? This is a certain indicator that we have not. Prices are going to continue to drop. There are people wanting to buy, but they do not qualify for a loan. This is great for cash buyers who are interested in an investment. It's just another hurdle for the average person trying to realize their dream.

I hope that this informatio was helpful if you have any questions please let me know so that way I can provide useful and helpful information.

Buying or selling a home or property in Santa Maria CA, or a Santa Maria foreclosure, or a property on the Central Coast, my goal is to provide you with resources you need.  DRE 0131588

You can feel confident that he will treat you with respect and dignity and that he is only down the street, a local phone call away not an "800" number if you need help, and have any questions.  His office is located in the OSH shopping center on 1954 S. Broadway, ste. L, Santa Maria, Ca. or you can call him at  805-352-1100  or email him at GenePerez@GMSLoans.net

Buying a condo in Santa Maria, Ca. can be tricky. Now something that people are starting to look at are condos since they are usually a lot cheaper than a home.  Just don’t forget that condos you have an Association fee that can be as little as $100.00 to as much $300.00 that is on top of your mortgage payment.

But the big thing is whether that condo will qualify for an FHA loan because if it does not that means you may have to put down more money.  Usually at least 10% vs. 3.5 % down.  So rather than waste your time since you may not have that kind of money to put down just go to this website and find out if that condo complex is on the FHA website.   So main thing for example on a 100k condo its a lot easier to put down $3,500.00 than it is $10k.

Go to:  https://entp.hud.gov/idapp/html/condlook.cfm

Once you are at the website - The Condominiums page allows users to search for FHA-approved condominium projects by location, name, or status.  The search can be configured to find specific types of projects through the use of the pull-down menus and entry fields.  I would suggest in the STATUS menu (last one) that you click on the pull-down menu and choose ALL.  Projects can have their FHA approval withdrawn for various reasons and you will need to know that information.

if you want to search for any homes or condos that you might want to buy just go to www.GenePerez.net.