Average Time to Close: 46 Days

The time to close on a mortgage loan is leveling off at about a month and a half. The time to close fluctuated in recent months following the implementation of the Consumer Financial Protection Bureau’s TILA-RESPA Integrated disclosure rules.

But the average time to close on a mortgage seems to be settling at about 46 days, according to Ellie Mae’s Origination Insight Report. The report shows that the time to close on a loan has remained at 46 days for the past three months. The average time to close a refinance also averaged 46 days.

Sixty-four percent of real estate professionals indicated their contracts were settled on time in August, while 30 percent said they faced delays to settlement, and 6 percent saw their contracts terminated, according to the latest REALTOR® Confidence Index, a survey sent to more than 50,000 real estate practitioners.


The biggest issues affecting a contract delay were issues related to obtaining financing, the appraisal, and a home inspection, according to the survey. “The fraction of delays due to appraisals has increased in recent months, in part due to a shortage of appraisers and other issues reported by REALTORS® (e.g. being asked to make ‘inspections’),” the report states.  

SOURCE: DAILY REAL ESTATE NEWS

Any questions or comments, feel free to contact James Y. Kuang at (626) 371-5662 or by email: james.kuang@coldwellbanker.com      

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Home Owners Using Airbnb Face Financing Snags

Homeowners who are renting out rooms using services like Airbnb are facing difficulties refinancing their mortgages, The Wall Street Journal reports.

Bank giants like Bank of America Corp. and Wells Fargo & Co. reportedly are subjecting borrowers who rent rooms to additional scrutiny when owners try to refinance. Some borrowers are finding they aren’t eligible for certain types of loans or they will have to pay higher interest rates, according to a WSJ article.

For some home owners, they may have assumed the extra income they’re generating from renting out rooms would help them when refinancing. After all, one owner in Seattle says he earned about $30,000 last year from renting out a cottage in his backyard. He thought that extra income would help him when he applied to refinance a home equity line of credit at Bank of America. Instead, he was denied by the bank because he was operating his home as a business. Bank of America says it does not offer home equity lines of credit on investment properties.

Lenders say such room-rental services are blurring the lines between residential and commercial properties and making it much more difficult to classify a home. Lenders typically maintain tighter underwriting standards, such as requiring larger down payments and higher rates, for investment or second home properties.


Online rental services have been seeing rapid growth over the past year. Airbnb’s website had 455,223 active listings as of July, an 80 percent increase from a year prior, according to YipitData research.


SOURCE: DAILY REAL ESTATE NEWS

Any questions or comments, feel free to contact James Y. Kuang at (626) 371-5662 or by email: james.kuang@coldwellbanker.com     

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Good Schools Give 77% Boost to Home Values

Home values can get a big increase from having a highly rated school nearby. According to the new ATTOM Data Solutions 2016 Schools and Housing Report, homes in ZIP codes with at least one good elementary school have values about 77 percent higher than in ZIP codes without highly ranked schools close by.

Researchers looked at home values and price appreciation against 2015 average test scores in nearly 19,000 elementary schools across 4,435 ZIP codes. They considered a “good school” to be one that had an overall test score that was at least one-third above the state average.

The research team found that out of 1,661 ZIP codes with at least one good school, the average estimated home value was $427,402 – 77 percent more than the home value of $241,096 in 2,774 ZIP codes without any “good schools.”

“While good schools are one of the top items on most homebuyer checklists because of the quality-of-life benefit they provide, this report shows that high-performing schools also come with a financial benefit for home owners in most markets – at least over the long term,” says Daren Blomquist, senior vice president at ATTOM Data Solutions. “Meanwhile, home prices in ZIP codes without any good schools tend to be more volatile, which might work to a home owner’s financial benefit in the short term but not over the long term of at least 10 years.”


Home owners living near at least one good school have gained, on average, $74,716 in value since purchase — an average return on investment of 32 percent, the study found. On the other hand, home owners in ZIP codes without any good schools have gained, on average, $23,311 in value since their purchase, an average return on investment of 27.5 percent.

SOURCE: DAILY REAL ESTATE NEWS

Any questions or comments, feel free to contact James Y. Kuang at (626) 371-5662 or by email: james.kuang@coldwellbanker.com      

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Limited Time VIP Buyer Bonuses:

BONUS#1: One year home warranty policy ($497 value)

BONUS#2: Lifetime notary service (in office)

BONUS#3: Financial Impact Analysis

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