10/05/10: CPK Market Update

By cpk • October 5th, 2010

MARKET UPDATE for October 5 2010

The topic for this month’s newsletter is “Change.” It seems appropriate given that we’re nearing early November, which means that the political landscape could be experiencing some significant change. Of course, over the last 3 years, we’ve seen drastic change in the banking and finance industries. Many of my friends and clients have experienced and continue to undergo change in their employment situations as well.

This month, I would particularly like to focus on change going on with the Federal Housing Administration, and specifically, with FHA loans. We have some exciting changes coming in the next few months, as FHA is evolving its lending programs to meet with current finance needs and standards. FHA used to charge a 2.25% “Up-Front Mortgage Insurance Premium” on its loans. This amount could be quite costly: for borrowers used to paying “1 point” on a loan, this was over 100% more than the industry-standard charge.

As of mid-October, FHA will be lowering the Up-Front Mortgage Insurance amount to 1%. While they will be increasing the monthly mortgage insurance charge, the drastic drop in the Up-Front Mortgage Insurance takes away one of the major barriers and disincentives to doing an FHA loan. Further, FHA has rolled out a new loan program called the “Short Refinance” program. For clients who owe more on their mortgages than their homes are worth and who do not qualify for other special programs, the FHA Short Refinance program will enable borrowers to refinance with FHA if their current mortgage lender agrees to write-off part of their principal balance.

The net effect: lower payments and more affordability for client struggling with loan payments.

It’s exciting that in a troubled market, there are entities that are “changing with the times.” As always, we at CPK Mortgage are on the front-lines for our clients: gathering information and enabling their success and best interests. Contact us today for more information on these and other programs. We’re constantly evolving to remain leaders in the industry.


According to the California Association of Realtors, 154 of 206 Metropolitan areas with 200,000 or more people experienced “year over year increases in foreclosure activity.” The time to be pre-approved for these tremendous deals is now. Call today!


According to a Kathleen Pender article on August 3, 2010 in The Chronicle with Bloomberg, the California “Franchise Tax Board is continuing to take applications for [the] first-time home buyer tax credits.” While many thought the credit ran out, there may still be opportunities. Contact us for more information.


It’s time to begin gearing-up for the Los Angeles Marathon! Again, I’ll be training runners at Beit T’Shuvah. Never run a marathon? Come and train with us. We are an official charity of the Los Angeles Marathon for the second consecutive year.


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