It is more important now than ever, as a result of increasing regulation and scrutiny of the mortgage industry, to plan ahead when you are planning on obtaining a mortgage loan to buy a house or refinance an existing loan to ensure that the process will go smoothly and as expected. Your loan approval is subject to the financial information you provide at the time of your loan approval. Any subsequent changes in your financial situation before the actual date of closing could jeopardize your loan approval and delay your closing. Continue Reading →
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“Nobody ‘wants’ to pay PMI, it’s just that we have no choice, especially if you want to buy a house and don’t have say an extra $50k to $80k lying around for a down payment, which most first-time buyers don’t.” Chris Durst, a first-time homebuyer and commenter on Investopedia.com. Continue Reading → FHA Interest Rate Change: MHDC’s Cash Assistance Loan (CAL) is now 4%! (APR 4.93) MHDC is raising mortgage interest rates offered to first-time homebuyers. First-time home buyers receive a forgivable 3% cash assistance loan for down payment and closing costs. Continue Reading → Federal Housing Administration Commissioner Carol Galante recently announced a series of changes to be issued that will allow the agency to better manage risk and further strengthen the health of the Mutual Mortgage Insurance Fund (MMI). FHA will increase its annual mortgage insurance premium for most new mortgages by 10 basis points, or 0.10%. The FHA will also require most borrowers to continue paying annual premiums for the life of their mortgage loan. As part of the fiscal cliff deal, Congress extended the cancellation of mortgage debt relief provision for 1 year, through the end of 2013. It seems there is little focus on the importance of this law, it is crucial to foreclosure mitigation efforts such as principal forgiveness and short sales. Continue Reading → Mortgage Interest Tax Deductibility passed as part of the American Taxpayer Relief Act of 2012. This allows MI to be tax deductible for 2012 and 2013. The provision extends the ability to deduct the cost of mortgage insurance on a qualified personal residence. The deduction is phased-out by 10% for each $1,000 by which the taxpayer’s AGI exceeds $100,000. Thus, the deduction is unavailable for a taxpayer with an AGI in excess of $110,000. The bill extends this provision for two additional years, through 2013. Continue Reading → Fannie Mae has declared that housing is finally providing a tailwind to economic growth. The company’s December Economic and Strategic Report says that the market “has turned the corner and a sustained recovery is under way.” Looking into 2013, economists predict mortgage originations will increase by 15% while refinance volume is expected to fall 26%. Continue Reading → “Every single thing about housing is flashing green,” stated James Dimon, chief executive of J.P. Morgan Chase, in an interview with CNBC last month. “Household formation is rising, inventory is falling, and affordability is near a record high.” This should mean many potential homebuyers will be assessing their finances in 2013 to get ready to buy a home. Checking your credit score is at the top of the list, and in turn credit myths and credit misconceptions are plentiful. Continue Reading → Freddie Mac says about 30% of borrowers this year have opted for shorter-term home loans when they refinance, with most picking a 15-year mortgage. Shorter-term loans are particularly attractive to people “who have been homeowners for a number of years…or who want the security of knowing they will own their home free and clear when they retire,” Continue Reading → After the problems we have seen over the past few years in the real estate, mortgage and banking industries, it is not surprising we have seen significant changes in the loan process making it more challenging for a home-buyer to obtain a mortgage. Some of the changes borrowers see when they attempt to obtain a mortgage to buy or refinance a home include: Continue Reading → According to Lawrence Yun, Chief Economist for the National Association of Realtors, home prices nationally are up 11.1% in October compared to this point last year. The number of homes available for sale nationally fell reducing the available supply to a level below that of one year ago. The result is tighter supply of homes helping boost the national median existing-home price level to $178,600 in October; price increases have helped home owners regain equity lost during the housing crisis.
The Federal Housing Administration (FHA) has lowered mortgage insurance premiums on Streamline Refinance transactions. It will now be it easier for borrowers to take advantage of record low interest rates and save money each month. Under this program, up-front mortgage insurance premiums will be reduced to 0.01 percent of the total loan amount for borrowers with FHA loans made before June 1, 2009. Continue Reading → Determine your “mortgage goals.” What are your expectations? If everything falls into place, what mortgage payment “range” you would be comfortable with? Review your credit history and sources of income. How much money are you willing to commit to buying a home; do you have money set aside for a down payment? Will you get a gift from a family member? Continue Reading → Qualified first-time home buyers can receive a forgivable 3% cash assistance loan for down payment and closing costs on a home. The Missouri Housing Development Commission (MHDC) provides a competitive interest rate on a safe 30-year fixed rate 1st mortgage. Your 3% advance loan is treated as a 2nd mortgage completely forgivable after five years of continuous occupancy. New, Constant Funding means MHDC will have the monies available for the borrowers regardless of bond issuance. Continue Reading → Over the past few years, ARM’s (adjustable rate mortgages) have received somewhat of a “bad name” however, there are truly benefits to utilizing an ARM, which include: Continue Reading → If the last time you looked at your mortgage was when you closed on your loan, it’s time to take it out for an annual once over. New loan programs and opportunities to leverage your home equity can bring you lower mortgage payments and new investment opportunities. Continue Reading → “The time needed to close a mortgage loan has increased by almost 25 percent over the last year, from an average of 40 days to 49,” reports Mortgage News Daily, “and it was refinances that drove the change.” Continue Reading → The new legislation is titled: Honoring America’s Veterans and Caring for Camp Lejeune Families Act (H.R. 1627) and has been signed into law on August 6, 2012. Congress expanded the scope of the legislation and specifically mandated improvements in VA home loan benefits through the VA Home Loan Guaranty Program. Realtors and lenders will now be able to help more veterans and their families become homeowners. A portion of the new law makes VA loans available to more surviving spouses, provides easier funding fee waivers for disabled vets and helps single and dual-duty parents with occupancy hurdles. Continue Reading → I continue to hear in the news about incredible low interest rates, but the catch is getting approved for a mortgage loan, either for a purchase or refinance. The process is getting harder and harder. In this tighter credit environment, FHA remains to be a great alternative for buyers with limited resources for a down payment and closing costs or past credit problems. Underwriting guidelines are more lenient than conventional guidelines. Continue Reading → Most banks and lenders use scores calculated by FICO (also known as Fair Isaac) and derived from your reports with the major national credit bureaus Equifax, Experian, and TransUnion. Be careful, the credit scores sold at popular credit report monitoring websites are NOT the same scores that lenders use! Continue Reading → It is important to understand the difference between a Mortgage Banker and a Mortgage Broker. The mortgage company I am with a mortgage banker with over 41 years of serving our community. What does that mean? Picture your community bank and take away everything but the mortgage department. We use our own money to close the loan and select a servicer to handle your monthly mortgage payments. In essence, a mortgage banker controls the loan process from application to closing. Continue Reading → Since the appraised value of home is a key element when considering a purchase or refinance, the following are the top four most common questions about appraisals asked by sellers: Continue Reading → What are sellers’ concessions? A seller concession can be any negotiation where the seller, builder, developer, salesperson or any interested party gives a credit to the borrower at closing. The seller concession can help lower or eliminate the amount of money a borrower is required to bring to the closing table. Continue Reading → FHA remains to be a great alternative for buyers with limited resources for a down payment and closing costs or past credit problems. Underwriting guidelines are more lenient than conventional guidelines. Continue Reading → ARE YOU PRE-QUALIFIED? Have you given much thought to how much of a mortgage payment would be for your dream home? Should you talk to you mortgage professional before house hunting? Absolutely! Even if you haven’t so much as selected a Realtor®, it’s important to talk with your mortgage professional first. Why? Continue Reading → Recently I was contacted by a prospect that was referred to me from a past client. This prospect was interested in a VA loan and had some general questions about the loan process and VA loans. He had mentioned he was currently working with the VA on some credit issues, but the process was taking a long time. It turned out, the prospect was “working” with a mortgage company that had “VA” in their name and there was no affiliation with the VA. I’ve seen this happen numerous times with both VA and FHA where a prospective homebuyer contacts or is contacted by a lender that implies they are who they are not. Know who you are dealing with. Continue Reading → Every borrower’s situation is different. My goal is to provide various options/loan programs that are available to meet the borrower’s needs. When considering a refinance, the following are typical situations borrowers face: Continue Reading → Recently, I heard a radio commercial about “special” financing for certain veterans implying this “special” loan is available for a “limited time only.” The good news is that the Veterans Administration (VA) offers an ongoing mortgage loan program to benefit members of the armed forces who have generally served for two years in peace time, or 90 days during conflict. Members of the National Guard or Reserves who have served for six years are eligible along with widows of veterans if the veteran died in a service-related incident. The VA offers loans to: Purchase a New or Existing Home, Rate Reduction Refinance, and Cash-Out Refinance. Borrowers are evaluated by their credit worthiness and their ability to show stable and sufficient income to cover the costs of owning a home, cover other obligations and expenses and have enough left for family support. Traditional credit scoring is not used by the VA in underwriting. Non-married co-borrowers are not permitted. VA loans must be the borrowers’ primary residence. Continue Reading → The sale price for a house is $200,000, but the appraisal comes back at $190,000. Should the borrower still try to purchase this property or just leave it be? This is not unusual circumstance common in today’s real estate market; appraisals are coming in conservatively. What action should the borrower take when there is a mismatch between the seller’s asking price and the home’s appraised value? Remember, the maximum loan amount is based upon the lower of the sale price or the appraised value, whichever is less. Continue Reading → When applying for a mortgage, a borrower’s “Occupancy Type” is a major factor in determining maximum loan-to-value (equity), loan program available and mortgage interest rate. An Owner Occupied property will have better terms (less down payment, better rates) than a Non-Owner Occupied property. Three Types of Occupancy: Owner Occupied / Primary Residence -According to HUD, a principal residence is a property that will be occupied by the borrower for the majority of the calendar year. At least one borrower must occupy the property and sign the security instrument and the mortgage note for the property to be considered owner-occupied. |
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