Ready Bell Home Loans @ Mason McDuffie Mortgage » Loan Programs

FHA News: Mortgage Insurance to increase

readybell — Sun, 20 Feb 2011 19:25:05 +0000

FHA NEWS

As of April 18^th, 2011 FHA will once again be INCREASING their monthly mortgage insurance premiums. What this will look like in $

Example: $400,000 loan, less than 5% down, 30 year loan

Current monthly Mortgage Insurance: $300

New April 18^th monthly Mortgage Insurance : $366.67

That is over a 20% increase!

That is an additional $800 per year in this scenario.

I would strongly suggest you

1) Have your borrowers qualified under upcoming changes and explore other loan programs

2) Encourage your FHA buyers to get serious now. They will need to be in contract prior to April 18^th to avoid these changes.

The deal with 2nd approvals

readybell — Tue, 01 Feb 2011 17:13:46 +0000

Why certain properties require a 2nd approval by the sellers preferred lender:

1) If it is a bank foreclosure asking you to qualify through their bank, They are requiring this because:

A) They want one of their people to check you out to make sure you are really qualified. Sadly, a large percentage of pre qualification or pre approval letters are not worth the paper they are typed on. Some lenders do not even run credit before they say you are pre approved!

B) They want an opportunity to get your loan business. Banks make money off of each loan they close.

C) If the bank approves you and you go with another lender and the loan “blows up” you can go back to the bank and they can close the loan for you. Remember they already approved you.

2) It it is a foreclosure asking you to get a 2nd approval through their preferred lender. This means that the foreclosing entity and lender are not in the same company.

A) They want a lender they trust to go through your file to make sure you have the ability to close the purchase because of reasons mentioned in 1A

B) They make absolutely no additional money if you use their preferred lender. They do get peace of mind which can be priceless.

C) They know if their preferred lender does the loan it will close. If you use another lender and it “blows up.” you can go back to the preferred lender to close the deal and rescue the deal.

D) Certain financing is available on certain types of foreclosures. Very few lenders take the time to learn “niche” loans which is another reason you will see a preferred lender. The preferred lender knows how to do the unique financing.

Note:Due to the complicated nature of financing these days we are seeing preferred lenders on both short sales and regular sales now too.

Lenders’ perspective: I am fine with the 2nd approval process. I am happy to call the other loan agent and see what they need and get it over to them as quickly as possible. It is the nature of our business right now. Also, they are providing a complimentary service for my client. They are providing options. I am always suspect of lenders that dislike this process. It is really not that much extra work. It makes me wonder why they do not want their clients to have additional options.

Struggling with your mortgage? Start here

readybell — Sat, 15 Jan 2011 16:57:59 +0000

Remember those interactive stories where your answers alter the story and affect the ending? Well, apparently marketing at Fannie Mae is really into them.

Fannie Mae has created a new interactive video where you control the outcome of the story based on your answers. It basically lets you role play through your financial situation. I played with it for awhile and it does actually have some solid points. It is at least a different way to look at your financial situation and thankfully they are honest. Check it out
http://www.knowyouroptions.com/ways-home

I would recommend this for Realtors to send past clients to if that client is now in trouble. It answers the questions in a safe, non threatening way and the entire website is a resource that will help your clients.

A Home should not be a burden; The “Conservative” view

readybell — Sat, 20 Nov 2010 13:31:18 +0000

It was recently brought to my attention that I was “conservative.” I have been conservative for the better part of my life. I am proud to be conservative. I am intrigued by those who are free spirited and do not worry about the future but I have always been a gal with a plan. I know that one day I will want to retire. I know that one day my son will go to college which will be costly and I know that money does not fall from trees.

In this case however where it was brought up it was not a compliment. I got the “well Jenn, you are conservative..” This comment was made in regards to how I qualify my clients and conduct my business. Keep in mind this was after I had warned a Realtor that they were shopping $100,000 out of the clients price and comfort range.

Let me be blunt. I feel that a person should be able to afford the house they would like to buy. Apparently, the notion that people should be able to afford where they live is a “conservative” view point. I pride myself knowing that Julie and I do everything possible to make sure our clients are in a comfortable financial position so that they do not have to decide between feeding their family and paying their mortgage. Even in our restricted marketplace there is still the ability to get people into trouble by maxing the guidelines and stretching the truth. We do neither and never will.

Having a home should be a benefit not a burden. By actually being able to afford the home you live in it can benefit and enrich your life. We have all seen what a home burden can be as evidenced by the millions losing their homes every day.

If you are comfortable paying $5000 a month for housing, stay at that even if your mortgage person says you can afford $8000. Remeber you are the one who will write the check every month, not the mortgage person.

PART TWO: How to take advantage of Todays great rates when you have less than 20% equity in your home without paying mortgage insurance

readybell — Sun, 14 Nov 2010 15:53:14 +0000

If your home loan is owned by Fannie Mae or Freddie Mac there are special refinances available. Commonly know as HARP, these loans can be 100% of what you owe and you can get a great rate with nomortgage insurance. Many people assme that since they get a bill from say Bank of America or Chase that Fannie or Freddie do not own their loan. This is not true. The company that sends you your bill rarely owns the actual loan. They own what is called the servicing rights, which in a nutshell means they get paid by the person who does own your loan to send your bill and collect your money every month.To see if Fannie Mae oR Freddie Mac owns your loan give us a call. We are happy to look it up for you.

How to take advantage of Todays great rates when you have less than 20% equity in your home without paying mortgage insurance

readybell — Sat, 13 Nov 2010 15:50:13 +0000

How to take advantage of Toady’s great rates when you have less than 20% equity in your home without paying mortgage insurance. Part One

Many people feel that if they have less then 20% equity in their home they cannot refinance without paying mortgage insurance thus defeating any savings from refinancing. They are often told this by loan consultants or brokers. This is not always true. Let me demonstrate

FHA 15 year fixed:
If you owe $90,000 on a $100,000 home and you only have one loan, your loan to value is 90%. Under FHA guidelines if you are refinancing or purchasing a home and you do a 15year fixed as long as your loan to value is below 90% you DO NOT PAY MONTHLY MORTGAGE INSURANCE. You would pay the 1 percent upfront fee for FHA that is financed into the loan but no mortgage insurance. With rates as low as 3.875% with no points this can be a life saver for borrowers who want to get a low rate and pay their loan down quicker but lack sufficient equity to go conventional without mortgage insurance. This is also great for borrowers with lackluster credit. FHA does not penalize you with a higher rate is your credit is less than perfect.

New Loan Program. Only 1/2% down on FHA.

readybell — Fri, 12 Nov 2010 15:44:53 +0000

.5% down on FHA loan. Yes, that is right only .5% down

We have a new loan we are very excited about. Everything great except you are a little short on the downpayment or closing costs? Check this out

This is a great program for borrowers who need help with the down payment or closing costs.

Brief overview: This loan is sponsored by the CRHMFA Homebuyers Fund and administered by the National Homebuyers fund to assist low to moderate California residents to purchase homes. Low to moderate income in Sonoma and Marin is over 100,000 per year!
The program offers a 3% grant towards down payment or closing costs.

Rules about Grant Funds:

· May not exceed 3% of the first mortgage loan amount

· Proceeds may be used only for down payment or closing costs

· No cash back to borrower

· This is a grant. There is no recapture and no second lien attached to the property. The grant is easy to get. We basically reserve the funds not like some grants that are daunting and time consuming

Borrower Eligibility: Basic FHA+

· Owner occupied only. No non occupant co borrowers

· Income limits. Income cannot exceed CHF income limits for the county property is located in.

Check limits at http://www.nhfloan.org/programs/CHF_Platinum/Platinum_IncomeLimits.pdf

Other Notes:

· Single Family only

· 30 year fixed only

· Loan cannot exceed $417,000

· Rates are higher then normal FHA.

We are happy to see if your clients qualify for this program or to answer any questions you may have.

Let us know how we can help

Jennifer Ready 707-478-0637

3 Reasons this is the ultimate buyers market

readybell — Thu, 11 Nov 2010 15:44:44 +0000

1) Rates are at historic lows. Borrowers with as little as 3.5% down are getting rates in the very low 4′s on 30 year fixed loans!

2) Foreclosure land. For those of us who already own homes the heap of foreclosures is a real drag but for buyers this is the ultimate market. Prices are LOW. House that were $700,000 a few years ago are now $400,000.

3) Many sellers are paying closing costs. Fannie Mae is offering a 3.5% credit towards closing costs for any home purchased owner occupied through December. That is a pretty sweet deal. www.homepath.com

FHA VS Homepath

readybell — Wed, 22 Sep 2010 18:35:05 +0000

FHA (with new rules) VS Homepath

In a prior blog I discussed how FHA was changing October 4th and how this would affect monthly payments. For reference check out FHA Oct4th. These changes will make Homepath more competitive with FHA. Prior to October 4th FHA beat Homepath in monthly payment due to Homepath’s higher rates. As of October 4th Homepath is competitive.

NEW AS OF OCTOBER 4TH FHA Cost:
Purchase Price: $400,000
3.5% down: $14,000
1% upfront MI fee: $4000 Total Loan amount: $389,860
Principal and interest: $1997.14 (rate est 4.375% no points)
Taxes (estimated): $322
Insurance (estimated): $80
Mortgage Insurance: $287.52
Total Monthly payment: $2686.66

HOMEPATH has no mortgage insurance
Purchase Price: $400,000
3% down: $12,000 down
Total Loan amount: $388,000
est interest 5.125% with one point
Principal and interest: $ 2112.61
Taxes (estimated): $322
Insurance (estimated): $80
Total Monthly payment: $2514.61

FHA new COSTS. What this means

readybell — Wed, 11 Aug 2010 22:47:52 +0000

FHA is the single hottest loan in Northern California. With a limited amount required down (3.5%) and more relaxed income and asset requirements FHA is the way most new Homebuyers are going. As of October 4th the cost of having an FHA loan will INCREASE MONTHLY for the first 5 years.

Let’s look at the math for a 30 year fixed FHA loan at 4.875%

Current rules FHA Cost:

Purchase Price: $400,000

3.5% down: $14,000

2.25% upfront fee: $9000

Total Loan Amount: $394,685

Principal and interest: $2088.71

Taxes (estimated): $322

Insurance (estimated): $80

Mortgage Insurance: $175.70

Total Monthly payment: $2667.33

NEW AS OF OCTOBER 4TH FHA Cost:

Purchase Price: $400,000

3.5% down: $14,000

1% upfront fee: $4000

Total Loan amount: $389,860

Principal and interest: $2063.17

Taxes (estimated): $322

Insurance (estimated): $80

Mortgage Insurance: $287.52

Total Monthly payment: $2753.61

Although the monthly payment is higher for the first 5 years (You have to pay mortgage insurance for 5 years) with the new rules if you keep the loan for the full 30 years you will actually save about $2485. Where this will become an issue is with “cusp” borrowers. Borrowers who were max qualified at a certain amount will now qualify for less.

Written by Jennifer Ready www.Readybell.com