The fed funds were left unchanged today. On that news the mortgage bond have seen some pressure and are off aobut 19bp's. This should move rates up slightly in the afternoon and tomorrow morning. Applications rose in the last week by 8.2% though. The next big event will be the auctions on the 9th of $40B 3 yr bonds, $25B 10 yr bonds and $16B of 30 yr bonds.
Well the Senate has the bill now to vote to extend the tax credit. Lets all hope they do. If they fail to extend this I believe the housing market will come to a crawl. This would be for two reasons. First the consumer confidence would be shot. Consumers would see the government bailing out all the big banks and pulling back from the consumers who need most of the help. Secondly I think that the first time home buyers would stop buying anticipating a renewal of the bill early next year after the winter break. The best that could happen is to expand the tax credit to all home buyers and the least that should happen is to renew what is in place.
Now the government has implemented the Housing and Economic Recovery Act (HERA). Basically if the APR changes for the better or worse by .125% then new disclosures would need to be signed by the borrowers and the loan could not close for up to 6 days after signing it. I can see if the APR goes up then having them sign and wait the required days. But if the rates go down and I get my clients a better interest rate? The APR would go down and the borrowers would benefit from that. Why should the clients be punished and have to wait the additionals days?
This is just about as bad as the HVCC the act that makes it so that the lenders can't contact the appraisers. Just to get a re-inspection is now taking about a week. This over regulation is slowing down the closing times.
In these times there are going to be companies that will charge money to fix a persons credit. That is a waste of time and most people don't realize it. There are ways that a person can fix their own credit for free. It just takes time a effort. If a person takes the time and puts in the energy they can save money and make sure that the job is getting done properly.
With all of the changes in lending guidelines it is very important to have a decent credit score. There are websites out there where a person can get a free credit report to make sure that nothing is reporting incorrectly. If something is they just need to put forth the effort to make the calls and write the letters to get them removed. If there are collections or judgements then make the calls to set up terms for repayment and satisfy those trade lines.
I have a FREE Credit Aid packet that I can email to anyone looking to save themselves the money if they are willing to put forth the time and effort to fix it themselves. Interest rates are great if you have the score so if you need to get your score up then let me know and I will email you the packet.
Some of the program changes are not all bad for us. Back in about 2002 and before when you got a home loan you had to provide 2 years of w-2's, a month of pay stubs, bank statements, show job stability and have decent credit. Then you sat down with a mortgage person and decided how much you were going to put down and what type of program was best for you.
Then the change in the industry started to happen. The stated income/stated asset, no-doc and 0-down loans started to show up. Not long after that first time home buyers could by 0-down stated income and investment properties were close to follow. Obviously this was a drastic error for some. Around that time the running joke was "if you can fog a mirror you can get a loan". What was the industry thinking?
Now the guidelines have changed back and those who have started in the last few years are so shocked at how the banks are being "unrealistic" in there guidelines. A borrower must actually have a job, decent credit, prove the income and have a little down payment. How will we ever survive?
When I first started a co-worker of mine said "if you will not put your family or your best friend into a loan program, then don't do it to a client". How profound is that statement when we are building relationships for life with our clients.
Congress has this bill on the floor when they return from the Summer Break. We all need to voice our opinion to keep the Down Payment Assistance programs alive.
Congress introduced bipartisan legislation, H.R. 6694 that would reauthorize and reform charitable downpayment assistance. This bill would remedy a harmful provision in the new housing law which limits homeownership opportunities for low and middle-income Americans. The legislation, sponsored by U.S. Reps. Al Green (D-TX), Gary Miller (R-CA), Maxine Waters (D-CA), and Christopher Shays (R-CT) reauthorizes and reforms charitable downpayment assistance funded in part by sellers, which has helped over one million families and individuals become homeowners since 1999. The program was eliminated by legislation signed by President Bush on July 30, 2008.
The Green-Miller-Waters-Shays plan would re-authorize and reform non-profit downpayment assistance and secure it as an allowable source for FHA borrowers. The bill seeks to ensure that providers of the downpayment assistance operate in a transparent manner to guard against conflicts of interest. The bill also includes language to ensure that FHA maintains its financial stability by permanently authorizing the Secretary to assess higher premiums to higher risk borrowers.
It is important that you contact your elected officials in Congress and tell them that you support downpayment assistance and urge them to support H. R. 6694. To reach your elected officials, please call the US Capitol Switchboard at 202.224.3121.
With all the tightening in the lending industry lately. FHA and VA loans are definately on the upswing. Did you know that you can get the 3% down for FHA and the closing costs for both paid by the seller. If it is your seller than you should look into all the DPA programs. The Down Payment Assistance programs make the seller concessions tax deductible. Why would your seller just give the money to the borrower and not take advantage of the tax deduction? If you don't know about these programs then to be the best source of information to your sellers, you should learn about them. Ameridream is one of my personal favorites but there are a bunch of them out there. You can just search for Non-Profit Down Payment Assistance and they should appear. We need to be educated to help out all of the potential buyers out there.
FHA is still at 3% down payment. This program allows 6% to come from other parties. So the 3% down payment and the closing costs can be covered through seller concessions.
All other first time homebuyer programs will be with a 3% down payment. Most of these products have a maximum of 3% that can come from the seller to cover down payment and/or closing costs.
Product Updates:
· Effective 3/31/08 the Flex 100, My Community Mortgage 100%, and Home Possible 100% are being discontinued. The MI companies will no longer insure these products at 100% LTV.
· Due to MI restrictions maximum LPMI is limited to 97% LTV.
· The Stated Income/Stated Asset program is now limited to maximum 90% LTV.
With the state of our markets it suprises me that they left the loan limits alone. Here in Washington it is very easy to surpass the loan limits and the underwriting for Jumbos is more strict. Well atleast the rates are great right now with a 30 yr fixed just below 6% and 100% loan at 6.5%. Good Luck to all.
Freddie Mac conforming loan limits are unchanged for 2008
Today Freddie Mac is announcing that for 2008, our loan limits will remain unchanged from their 2007 levels. Through December 31, 2008, Freddie Mac will continue to purchase home mortgages up to the following loan amounts:
For properties in the United States (except Alaska, Hawaii, Guam & U.S. Virgin Islands)
It was a mystery that only the crack investigators at RSI - the REALTOR® Scene Investigation - could uncover.
Faced with the conundrum of consumers staying on the homebuying fence in the midst of solid U.S. economic performance, NAR President Pat V. Combs, in a spoof of the hit TV show "CSI: Crime Scene Investigation," dispatched her "trusted advisors" to gather the facts behind this inexplicable consumer behavior.
During a spirited presentation at the 2007 REALTORS® Conference & Expo in Las Vegas, she revealed the investigation's findings: The national media, seduced by a few vocal but misinformed analysts, have been painting the U.S. housing markets as one huge national market in the clutches of a meltdown, even though the facts paint a very different picture.
Solid Fundamentals Help, Subprime Problems Hurt
Using undercover investigative work that would make CSI's Dr. Albert Robbins proud, NAR Chief Economist Lawrence Yun reported that other national sales downturns in the last 30 years were spurred by broad economic problems. This year, by contrast, economic fundamentals remain solid, with the U.S. gross domestic product expected to grow by a respectable 2 percent, supported by 2 million job gains in the last two years and continuing low interest rates.
Yun said 2007 existing-home sales will exceed 5.5 million, close to the level in 2002, a record-setting year. At the same time, home prices remain near record highs despite drops in a few markets.
Yun told Combs' lead investigator (played by President-Elect Dick Gaylord) that much of the cooling in real estate markets over the last year is attributable to risky subprime loans. A tightening in credit standards, though much needed, has made it harder for some borrowers to close on their financing in a timely manner.
Help on the Way for Lending Troubles
Posing as undercover agents, NAR Chief Lobbyist Jerry Giovaniello and Vice President of Regulatory Affairs Joe Ventrone, told "investigator" Charles McMillan (2007 First Vice President) that these difficulties are having less of an impact than analysts thought they would. That's thanks in part to the increased attractiveness of federally backed FHA loans. More help is on the way, too.
NAR is keeping several initiatives on the front burner in Congress, including reforms that will make FHA more competitive in markets throughout the country and a tax law change that would make it easier for troubled borrowers to refinance into more appropriate financing. Congress is also looking at raising the Fannie Mae and Freddie Mac conforming loan limits, which have been too low to help buyers in high-cost markets like many in California.
"Reports of real estate's demise have been greatly exaggerated," said Combs at the spoof's denoument. The performance took place during "59-1/2 Minutes," the member forum that opened NAR's 2007 meeting, the association's 100th. "All of the evidence points to one conclusion: Real estate is alive and well and there are plenty of opportunities for consumers and our members."
REALTORS® in their local markets can help keep the media from perpetuating the bad-market myth by conducting their own investigations, Combs said. "Take time during the conference to consider the evidence and gather the information you need to help REALTORS® in your state refute inaccurate stories and build confidence in the market," Combs said.
NAR's Plan for Its Second Century
In addition to watching the sleuthing of RSI, REALTORS® learned of the association's plans for helping its members succeed into NAR's second century through a number of large-scale initiatives, including the launch of a federal credit union and efforts to reach out to home owners and educate them on the issues they share with REALTORS®.
The credit union, which has been more than a year in planning and will be presented at the Board of Directors meeting for approval, is intended to make member-friendly financing available to REALTORS®. Among other things, it would seek to offer financing options that aren't typically available from other lenders because of real estate professionals' irregular, commission-based income.
Some 30,000 members, guests, and vendors are in Las Vegas to attend governance meetings and educational sessions, and to learn about the latest products and services available to the industry from hundreds of vendors at the REALTORS® Expo.
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.
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