Posts Tagged ‘mortgage’
Can You Refinance If You Are “Upside Down”?
July 23rd, 2011
Many people think that if their mortgage balance equals or exceeds the market value of their home, they cannot get new financing. Actually, they may be wrong. If your loan is owned by one of the three big government entities – FHA, Fannie Mae or Freddie Mac – you might be eligible for a “streamline refi.” (Remember: these programs do not hold loans that are higher than $417,000 or $729,750, depending on when you got your loan.)
Questions to ask yourself: First of all, are you a mortgage holder in good standing? If you have never missed a payment, have excellent credit and the underlying owner of your loan is one of these government programs, you may be in good shape. If you have one of these loans plus a second trust deed, the task may be tougher or impossible.
What to do: Call your loan servicer – the company you make your payments to – and ask if Fannie, Freddie or FHA holds your loan. If so, ask to speak with the department that could discuss refinancing.
Next, ask if FHA, Fannie or Freddie is the underlying owner of your loan. You have a legal right to know this. If the answer is yes, discuss refinancing the loan. You cannot “shop’ the loan between servicers (again, the name of the company on the mortgage statement) but you may be able to do a streamline refinance without an appraisal.
What NOT to do: Do NOT ask for a loan modification if you want to find out about refinancing. These two departments don’t know what the other is doing, and the “loan mod” folks have no incentive to forward your inquiry. (In fact, they have very little incentive to process your loan modification, which explains why only some 1,350,000 loan modifications had been approved by March of last year.)
Botton line: A streamline refi is worth a try if you meet the basic criteria.
So Is It Better to Rent or Buy?
March 1st, 2011
When it comes to deciding weather to buy vs. rent, most people make this decision by comparing monthly payments. If the rent payment would be cheaper than the payment on a home, many decide it would be cheaper to rent. This approach, however, fails to take into account a number of other factors:
• In purchasing a home with today’s low 30-yr fixed rate, you are locking in a permanent monthly payment for 30 years. In contrast, rent payments will increase with inflation. A rent payment of $1,000 today could be $1,125 in 5 years (using annual increases of 3%).
• After consulting their tax advisor, most home buyers can reduce their withholding taxes – based upon the deductibility of mortgage interest, property taxes and PMI. Renters have no such deductions.
• For each $100,000 in loan amount a home owner’s principal balance will have decreased $8,171 over 5 years (for example, a $300,000 loan will have decreased to $275,487 in 5 years). Couple that with property appreciation of 2% per year and you have increased your equity to $49,243 (and that is not even counting your down payment).
• Add to this the fact that the current hosuing market has caused purchase prices to decrease, and many homeowners have had to sell in dsitress and then find a rental home. This has created higher demand for rentals coupled with a higher rate of home affordability.
While renting has traditionally been more affordable than buying, when you look at the supply and demand factors above and add the missed opportunity for appreciation and higher quality of life that homeownership brings, homeownership makes more and more sense.
Sources: Bronwyn Stanisch, Prospect Mortgage, and Economic Focus, 2/28/11.
Changes to FHA that Could Cost You Money
February 21st, 2011
The Obama administration unveiled its long-awaited white paper titled “Reforming America’s Housing Finance Market,” which proposes solutions to revamping the nation’s mortgage system. The Administration’s intent is to wind down the federal mortgage giants Fannie Mae and Freddie Mac and to curtail the Federal Housing Administration (FHA). To help reduce the government’s role in mortgage funding, the white paper focuses on a series of short steps to increase fees and down-payment requirements which will make government loans less attractive and allow banks to compete in offering loans without government guarantees.
To get that ball rolling HUD has already announced an increase in the FHA annual mortgage insurance premium of 0.25% effective April 18, 2011That increase would take the annual premium from 0.90% to 1.15% and increase a borrower’s monthly payment by $60 on a $300,000 purchase.
The second step would take effect Oct 1, 2011 with the plan to lower the ceiling on jumbo conforming loan limits in high-cost markets from $729,750 to $625,500.
Whether you are buying or selling a home within the FHA price range, take note. These changes will reduce the number of buyers who can qualify.
I’d like to thank Brownie Stanisch, at Prospect Mortgage, once again for this information.
Posted in Market Update, Mortgage Info | 
Tags: Conejo Valley real estate, FHA, FHA financing, mortgage, Sher Hann | 
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Home Buyer Tips to Keep Your Mortgage Loan on Track
September 22nd, 2010
You and your devoted real estate agent have been shopping for a home for what seems like an eternity. You have finally gotten an offer accepted on your dream home and are in escrow. This is not the time to relax – stay focused and make sure that your mortgage loan does not derail at the last minute. Lenders are now initiating fraud-detection systems that will alert them if loan applicants make any changes to their credit profile that could impact their ability to make monthly mortgage payments. Follow these simple rules:
• Do not shop for, purchase, or lease a car
• Do not apply for or increase home equity or personal lines of credit
• Do not apply for, accept, or obtain any new credit cards
• Do not accept offers to increase revolving credit limits
• Do not transfer balances between credit cards
• Do not make any large purchases on existing cards
• Do not accept any deferred payment offers
• Do not cancel credit cards or initiate credit disputes
These words of wisdom come from my trusted mortgage advisor, Brownie Stanisch, at Prospect Mortgage.
By Debbie Gleason, Manstreet Mortgage
Mortgage interest rates are the lowest we’ve seen in our lifetime! Combined with the lowest home prices in years, ownership is more affordable than ever. This is great news for both homebuyers and homowners who are in a postiion to refinance.
There are several great loan products available, and while qualifying is definitely requiring a lot of time and paperwork, for most people it is definitely worth it. I am locking 30 year fixed conforming loans (max $417,000) at 4.5-4.75% [apr 4.5-4.75%] with NO CLOSING COSTS………NONE; conforming jumbo loans (max $729,750) at 4.75-5% [apr 4.75-5%].
AND a few lenders are offering piggyback equity lines and fixed rate seconds again.
Many who think they cannot qualify, or do not have equity, are eligible for Fannie Mae and Freddie Mac refinance programs that allow as high as 125% loan to value. Those with FHA loans can get a streamline refinance which, in most cases, requires NO appraisal, income documentation, or asset documentation.
This is truly a great opportunity for homebuyers and home owners.
For more information, contact Debbie Gleason, DebbieG@MainstreetLoans.com (818.874.9900).
Mortgage Update
May 25th, 2010
The 2010 California tax credit for first-time homebuyers (FTHB) that began with escrows closing on or after May 1, 2010, has already allocated $25,473,000 of the $100 million allotment. The FTHB tax credit is equal to the lesser of 5% of the purchase price or $10,000 and must be applied in equal amounts over 3 tax years (max $3,333 per year).
To qualify, (1) buyers cannot have owned a principal residence in the last 3 years; a married couple is disqualified if either has owned a principal residence within the 3-year period, (2) buyers must be over 18 and not related to the seller, (3) buyers must reside in the property for at least 2 years following the purchase. There are no income limits or purchase price limits. To apply for the tax credit a 2010 Application form 3549-A (see attachment to this email) must be completed by seller (or escrow) and buyer. Signed application, along with a copy of the final settlement statement (buyer’s HUD1), must be faxed to FTB within 14 days of closing (one minute late and you are disqualified).
For more info visit CA FTB website 2010 CA Tax Credit for New Home / First-Time Buyer. My thanks once again to Brownie Stanisch, of Prospect Mortgage, for providing this information.
The Clock Is Ticking…
April 27th, 2010
The Homebuyers Tax Credit expires this week! Thousands of dollars could slip through your Ffngers!
The heat is on for those who are out shopping for homes right now – as the Homebuyers Tax Credit is about to come to an end.
Last November, the government expanded and extended the new Homebuyers Tax Credit. According to the program, first-time homebuyers are eligible for a tax credit of up to 10% of the purchase price of the home, with a maximum credit of $8,000. And current homeowners are eligible for up to $6,500.
Although military personnel may qualify for a special extension, the vast majority of homeowners must have contracts in effect no later than April 30, 2010 and must close no later than June 30, 2010 to qualify for the credit.
This means that homebuyers now have less than one week to get their paperwork going to qualify for this credit, before it goes away!
Here are some important details about this tax credit.
Dollar-for-Dollar Benefit
The benefit of a tax credit is that it’s a dollar-for-dollar benefit, rather than a “tax deduction” or reduction in tax liability that would only reduce $1,000 to $1,500 when all was said and done.
So, if a first-time homebuyer who qualified for the entire benefit were to owe $8,000 in income taxes and would qualify for a tax credit of $8,000, she would owe nothing.
Even Better… It’s Refundable!
Remember, because it’s a tax credit, it’s refundable! That means a homebuyer can receive a check for the credit if he or she has little or no income tax liability.
For example, if a first-time homebuyer is eligible for a tax credit of $8,000 but is liable for $4,000 in income tax, she can still receive a check for the remaining $4,000!
What are the Income Caps?
Single tax filers with incomes up to $125,000 are eligible for the total credit amount. Those who earn more than this cap can receive a partial credit. However, single filers with incomes of $145,000 and above are ineligible.
Joint filers with incomes up to $225,000 are eligible for the total credit amount. Those who earn more than this cap can receive a partial credit. However, joint filers with incomes of $245,000 and above are ineligible.
What’s the Maximum Purchase Price?
Qualifying buyers may purchase a property with a maximum sales price of $800,000.
If you or someone you know is in the process of purchasing a home, this is an important week to take action – feel free to forward this article to anyone who it might benefit. The clock is ticking and the deadline is Friday!!
For this article I thank John Mallett, Mainstreet Mortgage.
Federal Help for Distressed Homeowners
April 16th, 2010
On April 5th the federal government launched revisions to the Home Affordable Foreclosure Alternative (HAFA) program.
HAFA gives new guidance to mortgage loan servicers currently participating in the Home Affordable Modification Program (HAMP).
HAFA is designed to streamline the short-sale process by incorporating the following unique features. If your lender has agreed to participate in HAFA, here’s the deal:
• Borrower may receive preapproved short-sale terms prior to listing the property
• HAFA prohibits loan servicers from reducing real estate commissions
• HAFA requires borrowers to be fully released from future liability for the debt
• HAFA participants must use standardized processes, documents and time frames
• HAFA offers financial incentives to loan servicers, investors and borrowers
– $1,500 to servicers for handling a short-sale
– $2,000 to investors who share proceeds with second-lien holders
– $6,000 to second lien holders for releasing their claims
– $3,000 to borrowers (distressed sellers) for relocation assistance.
Coupled with the fact that forgiven mortgage debt may now not be taxable at the California or the federal level), this can only be good news for distressed sellers.
My thanks to Browyn Stanisch, of Fieldstone Financial for this information.
Posted in Market Update, Uncategorized |
Tags: imi Valley real estate, mortgage, short-pay, short-sale, Simi Valley real estate |
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Mortgage Update: A Gift from the Governor
March 29th, 2010
The state of California has re-established and expanded the $10,000 homebuyer tax credit. This program was so successful in 2009 that it ran out of funds after just four months, with 10,659 home buyers claiming the credit.
The new law, AB183, just signed by Gov. Schwarzenegger, doubles the allocation to $200 million in tax credits for homes purchased between May 1, 2010 and Dec 31, 2010. The state also extended the new credit to first-time homebuyers of existing homes, as well as buyers of newly constructed homes. The funds will be split evenly between the two groups and will be available on a first-come, first-served basis.
As before, the tax credit is equal to the lesser of 5% of the purchase price or $10,000 and will be applied in equal amounts over a period of three taxable years. The buyers will have to occupy the home as their primary residence for at least two years.
Buyers have no income limits or purchase price limits. The only requirements are that the buyer must not be a dependant and must not purchase a home belonging to a relative. Remember – the program ends when funding allocations have been met.
Many thanks to Brownie Stanisch, of Prospect Mortgage, for this information.
Posted in Market Update |
Tags: California tax credit, mortgage, new homes first-time buyers |
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