greg zaccagni: FHA modifies 90 day wait period designed to avoid inflated values by flipping homes. - 06/25/08 09:12 AM
The rule as originally stated:
To be eligible for a mortgage insured by FHA, the property must be purchased from the owner of record and the transaction may not involve any sale or assignment of the sales contract. This requirement applies to all FHA purchase money mortgages regardless of the time between resales.
If the owner sells a property within 90 days after the date of acquisition, that property is not eligible security for a mortgage insured by FHA unless it falls within one of the exceptions to the time restrictions on resales set forth in §203.37a(c) of the regulations. FHA … (3 comments)
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greg zaccagni: Great Expectations or Mortgage Pre-approval? - 06/21/08 07:40 PM
Great Expectations or Mortgage Pre-approval?
Could the dynamics between real estate agents & mortgage lenders change to match conditions in the current mortgage lending market?
Real estate agents are generally not paid till a purchase transaction closes. With gas prices now exceeding $4.00 per gallon, buyer's agents have even stronger motivation to ensure their prospects can qualify for the properties they show on their dime & time.
With days on market high in almost every price category the question I wonder is whether the traditional business model favoring listing agents now favors buyer's agents that have sources of qualified buyers.
Perhaps … (2 comments)
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greg zaccagni: What is a Non Warrantable Condo? - 06/21/08 09:48 AM
Non Warrantable Condos are not eligible to be sold to Fannie Mae or Freddie Mac because they DO NOT fit into one of the following three classes:CLASS I1. Developers control of the homeowners association has been turned over to the condo owners2. Project is not subject to additional phasing or add-ons which have not yet been completed3. All common elements and amenities must be fully installed, completed and in operation4. 70% of all units in the entire development must have been sold and or legally obligated to close5. 70% of all units in the entire development must have been sold to … (9 comments)
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greg zaccagni: What caused the subprime meltdown? - 10/20/07 03:00 PM
After creating a market that allowed almost anyone to qualify for a loan the secondary market (mortgage investors) suddenly stopped buying loan types that didn't perform as predicted.
Investors also exercised their contractual right to force originators to buy back defaulting loans resulting in many loan originators going out of business.
Investors also stopped buying mortgage bonds with any marginal loans and raised the guidelines for almost every mortgage backed securities they buy.
Unable to sell the loans they originate many lenders were trapped with no buyers for their "product" - subprime loans.
While your originator may retain servicing as a separate profit center, … (0 comments)
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greg zaccagni: Government approves Bail out for Subprime ARM morgage holders with FHA Secure - 09/21/07 09:57 PM
Looks like relief has arrived for many subprime ARM mortgage holders! Here are some details and remember FHA remains a full doc loan program. See my seperate blog on FHA lending guidelines.
Greg Zaccagni @ http://www.mortgageadvisor.info
September 5, 2007
SUBJECT: The FHASecure Initiative and Guidance on Appraisal Practices in Declining Markets
The Federal Housing Administration is pleased to announce an initiative that will enable homeowners to refinance various types of adjustable rate mortgages (ARMs) that have recently "reset." This mortgagee letter describes how lenders and homeowners may refinance mortgages that, due to the increased mortgage payment following the reset, … (3 comments)
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greg zaccagni: Subprime Mortgages Defined - 09/16/07 08:58 AM
We hear the term nearly every day. What does "subprime" really mean? Greg Z @ http://www.mortgageadvisor.info/
Subprime mortgages
As with subprime lending in general, subprime mortgages are usually defined by the type of consumer to which they are made available. According to the U.S. Department of Treasury guidelines issued in 2001, "Subprime borrowers typically have weakened credit histories that include payment delinquencies, and possibly more severe problems such as charge-offs, judgments, and bankruptcies. They may also display reduced repayment capacity as measured by credit scores, debt-to-income ratios, or other criteria that may encompass borrowers with incomplete credit histories."
Subprime mortgage loans … (0 comments)
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greg zaccagni: What's Your Rate? - 09/13/07 07:26 AM
With all mortgage ads it's easy to see why some think mortgage rates are an off the shelf item. Truth is they are more like life & health insurance quotes - subject to your personal situation.
Just as an insurance agents ask height, weight, family health history etc... a meaningful mortgage rate requires its own line of questioning. The probability of receiving the published rate is directly proportionate to your ability to document favorable replies.
Questions generally fall into these categories:
The type & condition of the property you seek to finance. Lenders want habitable "move in ready" properties that are likely to sell … (5 comments)
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greg zaccagni: Financing home repairs & improvements - 09/08/07 10:18 PM
financing unexpected & planned home improvements
Bad News:
Unsecured lines of credit are really glorified credit cards without tax deductible interest. Non-deductible interest for homeowners is like throwing money away unless you're able to pay it off in short order or plan to default on the loans.
Liquidating interest bearing accounts like savings, CD's, IRA's & 401k's may have prepayment or tax penalties in addition to killing the appreciation that motivated you to invest in the 1st place.
Home equity lines are no longer easy qualifying & interest rates have increased considerably. Most are tied to the prime rate - currently 8.25%. Some offer below … (2 comments)
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greg zaccagni: Do credit pulls affect my FICO score? - 09/03/07 07:37 AM
Mortgage lenders are asked this question all the time. I send inquiries directly to the source for an unbiased answer. According to the Fair Isaac Corporation (FICO) same "type" inquiries will be treated as a single credit pull as it is apparent you are shopping for one loan. Here is what they say:
"Looking for a mortgage ... loan may cause multiple lenders to request your credit report, even though youre only looking for one loan. To compensate for this, the score ignores all mortgage ... inquiries made in the 30 days prior to scoring... In addition, the score looks on your credit … (3 comments)
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greg zaccagni: Avoiding Foreclosure - 08/31/07 11:27 PM
This is the legal means a mortgage company may use to repossess their collateral, your home should you default on making timely payments. If the property is sold for less than the total amount owed on the mortgage loan, the mortgage company or HUD could seek a deficiency judgment against you. A deficiency judgment could seriously affect your ability to qualify for credit in the future. Even worse, it's a one way street. Surplus funds are not returned to former homeowners. With much to loose & nothing to gain, foreclosure should be avoided at all costs.Do Not Ignore a Breach / … (1 comments)
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greg zaccagni: What are Reserve Requirements? - 08/31/07 03:48 AM
To qualify for some mortgage loans you will be asked to meet their reserve requirements. Lenders want to know that in the event your current source of income is interrupted you have sufficient cash "reserves" to meet your mortgage payment obligation for a specified period of time. Reserves are required on many prime loan programs which generally have lower mortgage rates so providing this information is in your best interest.
Lenders want to see that the money has been in your account for several months before they'll accept those assets. It's called being seasoned and it's done to show you haven't just … (1 comments)
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greg zaccagni: I pay cash for everything & now I want a mortgage - 08/28/07 08:00 AM
Like oil & water, cash payment histories & mortgage approval don't mix. Mortgage lenders use your demonstrated use of credit to predict the likelihood to make timely mortgage payments in the future. Vendors don't report your cash payments to credit reporting agencies. Only your debts (what you owe) get reported.
It's a good idea to establish a credit history several years before you intend to buy your 1st home. Start with a savings/checking account. Consider applying for a major credit card with that same institution as they have your savings in reserve. Apply for a gas card or perhaps a department store card … (4 comments)
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