Aaron Wheeler

Rates will always be higher for TIC properties because they are perceived as a higher risk. It is really a "fractional" loan in most cases, and the major banks will not handle them. It is not uncommon to have a rate that high.

To answer your questions:

1. Rates are directly tied to mortgage-backed securities (MBS). Rates on these have been coming down in response to the current financial crisis, so mortgage rates will drop to a certain extent.

2. There is nothing to prevent you from refinancing in the future as long as you do not have a prepayment penalty. Unless someone is will to absorb the closing costs as a part of the refinance, you really have to do the math and see if there is a tangible benefit to you to refinance given the monthly payment savings. If the payback period is over 24 months, it is probably not worth it.

3. The caps are listed as three numbers. The first number, 5, means the maximum increase at the time of the first adjustment. The second number, 2, means the maximum yearly increase up/down after the first adjustment. The third number, 5, means that maximum the rate can go up/down over the life of the loan. There is typically a "floor" rate that the rate cannot go under.

4. The current conforming loan limit is $417,000. The limit for "conforming jumbo" loans, created by the Economic Stimulus Act this year, is currently $729,750. Most banks will not be funding these loans after 12/1 as the law expires at the end of the year. For 2009, the conforming loan limit will either be $417,000 or 115% of the median housing price in an area, but not greater than $625k. So, for the San Francisco Bay Area, this number should be $625k.

You may want to consider traditional condos as well, as they can be easily financed through the major banks.

Please let me know how I can be of assistance.

Best regards,

Aaron Wheeler
President
Oakville Properties
http://www.oakvilleproperties.net - Tue Oct 7 2008, 09:56

There is plenty of new construction available as well in communities such as The Hayes, Symphony Towers, and others.

Please let me know how I can be of assistance.

Best regards,

Aaron Wheeler
President
Oakville Properties
+1 (877) 765-2347 http://www.oakvilleproperties.net - Fri Oct 3 2008, 10:58

You may want to consider a condotel project where your unit can be rented to hotel guests while you are not using it. These units are fully furnished. Please keep in mind that you will be making contributions towards FF&E (furniture, fixtures, and equipment) replacement as there is wear & tear over time.

There are many to choose from, including but not limited to CityCenter, Signature at MGM Grand, Trump, Palms, etc.

It is generally more difficult to obtain financing for a condotel project.

Please contact me for more information.

Aaron Wheeler
President
Oakville Properties
+1 (877) 765-2347 - Wed Oct 1 2008, 11:33

I assume that you need this for court or estate tax reasons. You really need to retain a licensed appraiser to prepare this for you.

-Aaron Wheeler, President, Oakville Properties & Oakville Capital - Fri Aug 24 2007, 15:37

That would be extremely restrictive and you may turn away legitimate buyers. In order for it to work, your listing agent would not be able to use a lockbox - they would have to list the property in the MLS as "appointment only". My experience is that "appointment only" homes tend to sit on the market for an extended period of time.

The alternative to that, which I rarely see, is to use CBS (Call Before Showing) codes on the lockbox, if your system permits that. This allows the agent to access the lockbox, but they must enter an additional code which they can only obtain from the listing agent. Again, this tends to slow the process now and increases days on market.

In the high-end luxury market, I have seen some listing agents conduct a little more "due diligence" before allowing a prospect to see the home.

-Aaron Wheeler, President, Oakville Properties & Oakville Capital - Wed Aug 22 2007, 10:01