When the demand for homes grows faster than the number of homes for sale, prices increase.
As recent home sales data confirms, buyers currently outpace sellers and one consequence of this is an increase in multiple-offer situations this year.
It's no wonder home prices are up across so many neighborhoods.
A conforming mortgage is one that, quite literally, conforms to the mortgage guidelines set forth by Fannie Mae or Freddie Mac.
Each year, the government sets the maximum allowable loan size for a conforming mortgage, based on "typical" housing costs nationwide.
Loans in excess of this amount are typically called "jumbo".
While home prices increased from 1980 to 2006, so did conforming loan limits. Since then, however, as home prices have dipped, the conforming loan limit has held.
Now, in 2010, for the 5th consecutive year, the government set $417,000 as the nation's conforming mortgage loan limit.
The 2010 conforming loan limits, as released by the government, are:.....
APR is an acronym for Annual Percentage Rate. It's a government-mandated calculation meant to simplify the comparison of mortgage options.
A loan's APR can always be found in the top-left corner of the Federal Truth-In-Lending Disclosure.
Because APR is expressed as a percentage, many people confuse it for the loan's interest rate. It's not. APR represents the total cost of borrowing over the life of a loan. "Interest rate" is the basis for monthly mortgage repayments.
Mortgage markets improved last week as foreign buyers of mortgage debt helped to push mortgage rates to a 4-week low.
It marked the 3rd consecutive week that rates improved, breathing extra life into this year's ongoing Refi Boom.
Fixed-rate, conforming mortgage rates fell about 0.125 percent on the week. ARMs did about the same.
There wasn't much data to move mortgage rates last week; investors worked mostly on momentum and trends. However, the Friday University of Michigan Consumer Sentiment survey release garnered some attention.
After worsening in August and September, consumer sentiment fell for the third straight month in October. Analysts worry about what it could mean to the economy. Holiday Shopping season is here and consumer spending fuels the economy. If households hold the purse strings tight, our nation's budding economic recovery may stall.
In a scenario like that, employment rates won't rebound so fast, but rate shoppers might not mind. Slower-than-expected economic growth tends to suppress mortgage rates, helping to improve home affordability overall.
The data comes from a quarterly survey the Federal Reserve sends to its member banks. The Fed asks senior bank loan officers around the country whether "prime" residential mortgage guidelines had tightened in the last 3 months.
For the period July-September 2009:
Roughly 1 in 4 banks said guidelines tightened
Roughly 3 in 4 banks said guidelines were "basically unchanged"
Just one bank said its guidelines had loosened.
Combine the Fed's survey with recent underwriting updates from the FHA and from Fannie Mae and it becomes clear that mortgage lenders are much more cautious about their loans than they were, say, 2 years ago.
Today's borrowers face a host of hurdles including:........
Consider this a last call for FHA Streamline Refinances. Starting next Tuesday, the popular rate-lowering program gets strict on borrowers.
There's 5 days left.
Under the current streamline refi guidelines, FHA homeowners have minimal program eligibility requirements.
FICO scores must be 620 or higher
The refinance must provide a "tangible benefit"
No mortgage lates allowed in the last 12 months
Beyond that, everything else goes, practically. There's no income, asset, or job verification with the current FHA Streamline program. Neither is there an appraisal requirement. It doesn't matter if you're 50% underwater.
Until next week, that is.
Beginning November 17, FHA Streamline Refinance applicants must show evidence of income and.......
General Rules for Orlando Home Buyer Tax Credit Seekers:
A "first time home buyer" is defined as someone who has not owned a home in the last three years. If you are a "first-time home buyer", your tax credit will amount to 10% of the purchase price of your new home not to exceed $8,000.
A "long-time resident" is defined as someone who has lived in the same primary home for 5 out of the past 8 years. If you are a "long-time resident", your tax credit will amount to 10% of the purchase price of your new home not to exceed $6,500.
The tax credit does not need to be paid back if you continue living in the home as your primary residence for three years without selling it
The home must be purchased for less than $800,000 before May 1, 2010. If you sign a binding contract to purchase a home before May 1st, you would need to close on the transaction before July 1, 2010.
Single taxpayers with incomes up to $125,000 and married couples with incomes up to $225,000 qualify for the full tax credit
You cannot purchase the home from a related party like a spouse, direct ancestor, or direct lineal descendent (child or grandchild); however, you can still qualify for the credit if you purchase a property from siblings, nephews, nieces, and others
If you are married, both spouses must qualify for the credit
If more than one unmarried individual is buying the property, the credit can be split up among all the individuals who qualify. However, the total credit taken cannot exceed $8,000 (or $6,500 for "long-time residents"). Alternatively, if only one of the unmarried buyers qualifies for the credit based on their income or past home ownership status, the individual who qualifies for the credit can claim the full credit.
The credit applies even if you have co-signers on your mortgage loan
The credit applies to 1-4 unit homes as long as you live in one of the units as your primary residence - you could live in one unit and rent out the others
How does the tax credit work? A tax credit is kind of like a gift certificate that you can use to pay your taxes - it reduces your income tax bill on a dollar for dollar basis. Imagine paying your bill at IRS Restaurant, and then later getting an IRS Restaurant gift certificate. Normally, you would need to go back to IRS Restaurant and buy more food in order to use your new gift certificate. But what if IRS Restaurant allowed you to just turn in your gift certificate for cash? That's how the home buyer tax credit works! All you need to do is file a form with the IRS after you buy your new home and they will send you a refund check for $8,000 (or $6,500) - just like the example of IRS Restaurant that allows you to exchange your gift certificate for cash! Remember though, you'll receive the $8,000 (or $6,500) from the IRS AFTER you purchase your new home, so you cannot use the funds to help with your down payment.
Chris is Florida's #1 FHA Mortgage Broker and a syndicated mortgage blogger. He is regular contributor to the many leading industry blog-fronts including The Mortgage Chili Blog, My FHA Mortgage Blog, Top of Mind Networks, the newest contributor to Lenderama and has been recently featured on Fox35 News.
Combined, the 3 events reinforced the growing belief on Wall Street that the U.S. economy is in recovery, but not yet out of the woods. This particular philosophy has been excellent for mortgage rates, helping to hold conforming 30-year fixed mortgage rates near 5.250 percent since the start of the year.
It helped rates last week, too. But low rates......
Congress both extended and expanded the First-Time Home Buyer Tax Credit program Thursday.
The White House says the President will sign it into law today.
The up-to-$8000 tax credit's expiration date has been pushed forward to spring, requiring homebuyers to be under contract by April 30, 2010, and to be closed by June 30, 2010.
The program's basic eligibility requirements remain the same:
Buyers can't purchase the home from a parent, spouse, or child
Buyers can't purchase the home from an entity in which they're a majority owner
Buyers can't acquire the home by gift or inheritance
All parties to the purchase must meet eligibility requirements
The new law includes some notable updates, however.
For one, the definition of "first-time home buyer" has been expanded to include most homeowners with at least 5 years in their current home. "Move-up" buyers like these are now eligible for IRS tax credits, but with a cap at $6,500.
This means that you don't have to be a true first-time home buyer to claim the "first-time home buyer tax credit".
Disclaimer: ActiveRain Corp. does not necessarily endorse the real estate agents, loan officers and brokers listed on this site. These real estate profiles, blogs and blog entries are provided here as a courtesy to our visitors to help them make an informed decision when buying or selling a house. ActiveRain Corp. takes no responsibility for the content in these profiles, that are written by the members of this community.
;)
;)
