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 →
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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 → In spite of warning from the Mortgage Bankers Association (MBA), the St. Louis Association of REALTORS (SLAR) and other housing-related groups of the damage the “Mortgage Foreclosure Intervention Code” (Bill #174 introduced by Hazel Erby, District 1) could do to the already struggling St Louis housing market, including increasing the cost of home mortgages, last month the St. Louis County Council passed the bill, it was signed into law by County Executive Charlie Dooley and will go into effect on September 28, 2012. Then, just last week, Lewis Reed, President of the St. Louis Board of Alderman, introduced what is a basically the same bill in an attempt to get the same law enacted by the City of St. Louis. Continue Reading → Maybe you’re a seller that has found yourself faced with the reality that you can’t sell your house or condo for a price today that will yield enough to pay off your loan, and you are not a candidate for, or don’t want to do, a short-sale? Or, maybe you are a seller with a house or condo that, for one reason or another, there is very limited demand for and, in fact, it seems that perhaps no one wants to buy what you have to sell? If so, maybe someone suggested, or you have considered, using a lease/option or a lease purchase to sell your home? After-all, there is a large demand for lease-options and lease-purchases by buyers but, you are just not sure if it is right for you? Continue Reading → Should I rent or buy a home in St Louis? This is a question that I’ve been asked dozens of times over the past couple of years and one that given the fact that home affordability is at an all time high and mortgage interest rates at an all time low, is generally easy to answer with “buy if you can”. I guess I many not have realized just HOW much sense that made financially, until a report came out a few days ago that looked to answer this very question and found that home ownership was 45 percent cheaper 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 → As of the end of the second quarter of this year, there are 90,937 underwater St Louis homeowners, a slight increase from the prior quarter when there were 90,196 underwater St Louis homeowners and a decrease of almost 9 percent (8.8 percent) from the 2nd quarter of 2011 when St Louis underwater homeowners numbered almost 100,000 (99,792). One is said to be “underwater” on their mortgage when they owe more on their mortgage than their home is currently worth, which is also referred to as having “negative equity”. 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 → I have good news for homeowners that are underwater on the mortgage and need to do a short sale, or for buyers looking to buy a short sale. The Federal Housing Financing Agency just issued new guidelines to lenders that service Fannie Mae and Freddie Mac loans that are intended to “offer a streamlined short sale approach” which will be music to the ears of anyone that has been through the process. I don’t always agree with the actions of the FHFA but I think this is a good move and will help the market. The new guidelines, which go into effect November 1, 2012, include: 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 → Assuming you plan to stay put for 3 years or more, buying a home is a better financial decision than renting a home, according to a new report by Zillow. To arrive at this conclusion, Zillow analyzed the “breakeven horizon” in more than 200 metropolitan areas and 7,500 U.S. cities to determine how many years it would take owning a home before it becomes more advantageous than renting the same home from a financial perspective. In more than 75 percent of those metros analyzed, within about 3 years a homeowner would break-even on owning a home versus renting a home. 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 → Over one in four homeowners in the U.S. with a mortgage are “underwater” meaning they owe more on their homes than they are currently worth and, according to data just released from a survey by Zillow, 75 percent of them are underwater by 40 percent or more meaning it will most likely be many years until they even have the hope of seeing equity in their home again. Nonetheless, this has not deterred the majority of these underwater homeowners from “staying the course” as 59 percent said would not consider a strategic default in order to get out from under their home. 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 → Yesterday’s existing home sales report from the National Association of REALTORS® shows existing home sales in June were at at a seasonally adjusted-annual rate of 4.37 million units which is a decrease of 5.4 percent from the month before, and a 4.5 percent increase from the year before and is at the lowest level since October 2011. 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 → Fannie Mae has launched a new foreclosure prevention program called “Know your Options” that has been in development for about a year and has, as it’s top priority, “helping homeowners avoid foreclosure”. The program includes working with and training 18 of it’s largest loan servicers as well as launching a website for consumers, KnowYourOptions.com, which contains educational tools and resources for homeowners that may be facing foreclosure and opening 12 “Mortgage Help Centers” in the areas hardest hit by the housing crisis. Continue Reading → More good news on the real estate market arrived this morning in the S&P/Experian report on credit defaults which revealed that mortgage default rates on first mortgages fell to 1.41 percent in June bringing it to it’s lowest level since May 2007. This is significant as this is the “leading indicator” for foreclosures which have hammered home prices for the past 5 years plus this represents a significant decline from when the mortgage default rate peaked at 5.67 percent in May 2009. Continue Reading → Here’s some good news to end our week with: In St. Louis the number of homeowners that are underwater on their mortgage (owe more than their home is worth), otherwise known as being in a “negative equity” position, dropped to 90,196 homeowners, or 16.1 percent of all St. Louis homeowners with a mortgage, in the first quarter of this year, down from 101,829 St Louis homeowners, or 18.1 percent during the prior quarter, according to a report just released by Corelogic. Continue Reading → According to a report just released by Lender Processing Services, the foreclosure inventory in the U.S. remains near all-time highs, with 4.12 percent of all active mortgages in the foreclosure pipeline in addition to the 3.2 percent that are 90 days or more delinquent but have not yet begun the foreclosure process. Continue Reading → Interest rates have been strong all year, last week however, we saw mortgage backed securities rally each day and with the release of unemployment figures on Friday we are now officially sitting at historic lows! If you have not taken advantage of these rates…what are you waiting for? Maybe you have been told that you don’t have enough equity in your home due to the housing market trending down over the past few years? Continue Reading → According to a report released today by CoreLogic, there were 63,000 completed foreclosures in the U.S. in May 2012, down from 62,000 the month before and down almost 20 percent (18.18) from May 2011. Since the real estate market meltdown began in September 2008 there have been about 3.6 million homes that had forecloses completed upon. 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 → The percentage of first-lien mortgages that were current and performing at the end of the first quarter of 2012 increased to the highest levels in three years, according to a report published today by the Office of the Comptroller of the Currency. Continue Reading → Today, the U.S. Department of Housing and Urban Development and U.S. Census Bureau released new home sales data for May 2012 showing an increase of 7.6 percent from the month before, and an increase of 19.8 percent from a year ago. The seasonally-adjusted new home sales rate for May was 369,000 homes, up from a revised rate of 343,000 homes the month before. The supply of new homes on the market decreased to a 4.7 month supply from a revised 5.0 months the month before. The median new home price decreased slightly to $234,500 from a revised median price of $236,000 the month before and increased 5.6 percent from a year ago when the median new home price was $222,000. Continue Reading → Lately the $64 question for many people is whether to rent or buy a home. I think by now everyone knows that, as a result of the collapse in home prices and dirt-cheap interest rates, buying a home is now more affordable than ever, but for a lot of people there are still doubts or concerns that need to be addressed before making the decision whether or not to buy. Many of these issues stem around financing including; how much down payment will be necessary, what can I afford, etc. The American’s Banker Association (ABA)came out with five questions every potential buyer should ask when deciding to buy or rent a home that, along with the helpful online calculators they offer, I think may be very helpful: Continue Reading → The mortgage delinquency rate (the percentage of home loans 30 or more days past due) increased in May 1.1 percent from the month before according to the latest “First Watch Report” from Lenders Processing Services (LPS). While it’s a modest increase, this marks the second consecutive month we’ve seen an increase in mortgage delinquency rates reversing the downward trend for the 9 months prior which is not good. Since delinquent mortgages are the precursor to forelcosures and foreclosures have wreaked havoc on home prices, this is something we definitely want to keep an eye on. 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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