Nathan Goodman's Blog

Help you clients save money and get a tax credit...

Nathan Goodman (Guild Mortgage Company) — Tue, 05 May 2009 16:32:35 -0700

Here you will find the information pertaining the First Time Home Buys Savings Account.

This link will take you to the actual form.

http://mt.gov/revenue/formsandresources/93-99forms/99-FTB.pdf

I have include theactualdocument in case you have questions which can be answer at the bottum paragragh. In these hard times now is the time to take advantageofmoney saving opertunities for your clients.

FIRST-TIME HOME BUYER SAVINGS ACCOUNT

Annual Reporting Information

For Self-Administered Individual Accounts

Instructions on Back

Taxpayer Information

Name______________________________Social Security Number___________________

Account Information

Account Number
_____________________

Financial Institution where account is located_____________________________________

Address of Financial Institution________________________________________________

Complete the table below for the current year. Additional information regarding first-time

home buyer savings account is provided on the back of this form. If you made withdrawals

from your first-time home buyer savings account that were not used to pay qualifying expenses,

you must complete Form FTB-P. To order this form call 1-406-444-6900.

A B C D

Date Deposits Interest Withdrawals Withdrawals Balance

Earned Used for Used for Columns A+B

Eligible Noneligible Less Columns

Expenses Expenses C+D

Enter balance of accounts as 12-31-98

Your allowable reduction is the total of column A or $3,000 whichever is less, plus the total of column B.

Attach this form to your Montana income tax return.

For more information regarding first time

homebuyers, please access our website at http://www.montana.edu/wwwpb/pubs/mt9918.html

Form FTB

Rev. 8/99

MONTANA

158

MONTANA FIRST-TIME HOME BUYER SAVINGS ACCOUNT

Beginning with tax year 1998, qualifying taxpayers may exclude contributions made to accounts established

specifically to pay eligible costs associated with the purchase of a taxpayer's first home. A

qualifying taxpayer (first-time home buyer) is "an individual who has never owned or purchased under

contract for deed, either individually or jointly, a single-family residence in Montana or out-of-state".

Eligible costs include "the down payment and allowable closing costs for the purchase of a single-family

residence in Montana by a first-time home buyer".

The maximum exclusion per year per individual is $3,000. Contributions in excess of $3,000 may be

claimed as a reduction from Montana adjusted gross income in subsequent tax years, however, the

maximum contribution deduction allowed in any one tax year is $3,000.

Married couples may each claim a first-time home buyer savings account reduction of up to $3,000 if they

maintain separate accounts. Jointly held accounts do not qualify as first-time home buyer accounts

unless husband and wife file jointly (both using the same column of the tax return) for Montana tax

purposes.

In addition to deducting up to $3,000 in contributions to a first-time home buyer savings account, interest

earned on an account is excludable from Montana adjusted gross income.

No first-time home buyer reductions are allowed after a home is purchased. Any funds remaining in an

account after home is purchased must be included in Montana adjusted gross income in the year the home

is purchased. Funds remaining in an account after the purchase of a home are not includable in Montana

adjusted gross income if the funds were not claimed as a first-time home buyer reduction.

First-time home buyer savings accounts are self-administered and can be established with any financial

or investment institution. The account must be a new account established in the first year the reduction

is claimed. The account cannot be used for any purpose other than for paying qualifying expenses related

to the purchase of a first home do qualify for the first-time home buyer provision.

If, after 10 years of making contributions to an account, a taxpayer has not purchased a home, funds in

a first-time home buyer savings account will become subject to Montana income tax as ordinary income.

Withdrawals from first-time home buyer savings accounts used for purposes other than qualifying firsttime

home purchase expenses are subject to state taxation as ordinary income and are also subject to a

10% withdrawal penalty. Money withdrawn from an account on the last business day of the tax year is

not subject to the 10% penalty, however it is subject to state taxation.

Taxpayers claiming this exclusion must attach to their return each year:

n Copies of all account statements (monthly, quarterly, annual) from the financial or investment

institution where the account is maintained.

n A completed Form FTB.

For the year in which a home is purchased, taxpayers claiming the first-time home buyer savings account

reductions must also attach to their tax return copies of the buy/sell agreement and the closing statement

for the home purchased.

Additionally, upon the Department of Revenue's request, account holders must be able to provide verification

that all withdrawals from an account were used to pay qualifying expenses associated with the

purchase of a first home.

HVCC know what it isa before may 1st...

Nathan Goodman (Guild Mortgage Company) — Fri, 24 Apr 2009 12:25:26 -0700

Home Valuation Code of Conduct

A uniform code for appraiser that requires them to go through a clearinghouse orders and to get paid. The code would require an independent appraiser to go and join an AMC to get orders and work. This will eliminate independent appraisers overnight.

I am interested in any ones thoughts on this topic and how they think it will effect there business.

Rate future...scary!

Nathan Goodman (Guild Mortgage Company) — Tue, 13 Jan 2009 16:55:11 -0800

Rates are great but not much purchase action mostly refi's. After the refi boom is done what is next...

Just my thoughts here...

The gov't can't keep buying bonds and paper, they run FNMA and FMAC so not only are they buying the paper but they are guaranteeing it.

It seems like they are burning the candle at both ends and the one who will get burnt is you and I.

At some point they will have to turn over control back to the private market and when they do this do you really think the investors will be ok making 4.5%...?

Answer: No!

At that point the market will start risk based pricing and the risk is huge so at this point rates will go up when the Treasury runs out of money...

Anyone feel free to comment or correct.

Bail out issue...

Nathan Goodman (Guild Mortgage Company) — Wed, 03 Dec 2008 13:27:30 -0800

I was watching a special on WW1last night and it kind of triggered me to think about this whole financial mess were in...I am not an economist but I have definitely been paying attention. What caught my eye specifically in the special about WW1was the type of economy Germany had after the first war when they were forced to pay6 back reparations to the Allied powers for the cost of the war. Well the result was Germany did not have the funds so in order to comply they just printed money for the reparations and handed it over the the Allied powers...While the result was catastrophic the economy tanked and the famous pictures we all saw after the Soviet Union was dismantled were actually preceded by the German ones although no one was paying much attention because WW2 was right around the corner. The picture I speak of in both cases is the one where citizens have to cart a whole wheel barrel of cash just to buy a loaf of bread. You may ask by now what is my point? The point is that all this bailout money were are injecting into the economy has no backing just like Germanies' currency after WW1...So will our fate be the same, will the dollar plummet and loss value? I hope not but given what is going on in Washington how can it not... The deflation and liquidity crisis is mostly looked at as a bad problem. But a simple illistration points out that if you can survive the crisis your money will be worth more. For a simplified example consider this; the US economy runs on $10 of cash, the crisis hits and now we only have 5$ in the system. The people with the remaining 5$ of money now will have less but it will be worth more. $5 of cash in the system is gone so the remaining is still servicing the same people but with only less cash thus making the remaining $5 in the long and short worth more. Less money in the system equals more value for the money still in the system. So after all the deflation and liquidity issues the money you can hang on to will ultimately be worth more...

It may not be scientific but it seemed to make sense to me...

As usual I welcome all comments and criticism...

This has been a deep thought by:

Mack Handy

Historical Chart of 30 yr fixed and Prime Rate going back to 1963 - For all those who think rates are not going up, think again...

Nathan Goodman (Guild Mortgage Company) — Wed, 29 Oct 2008 10:16:19 -0700

This chart shows why rates are going to go up and possible where they are headed. If rates are cyclical then this chart should provide some clarity as to where rates are head in the short term. The one thing this chart doesn't reflect is that I believe that 30yr rates will start to act on there own away from the prime rate. In the future the 30 yr rate will not pair itself with the prime rate. This is due to factors effecting 30 yr rates that do not have a sever and direct effect on the prime rate. There will still be some correlation but the exact movement of both will not follow such a definite path. I put this blog out not to doom and gloom but to educate people to not be surprised by higher rates in the short term future of the housing market. I know as much as anybody that the effect of rising rates will be a detriment to our industry but once the public is used to the idea of higher rates it will be business as usual. A silver lining may just be that the higher rates will kick some of these people on the fence in to gear to purchase a home before the rate goes to high...

Rates are going up...

Nathan Goodman (Guild Mortgage Company) — Mon, 27 Oct 2008 16:32:08 -0700

FHA @ 7% today

30 YR Fixed just priced one out @ 6.75 and the credit was excellent

A little forwarning trying and warm your clients up to the idea that rates are going to get worse and will continue to for some unkown amount of time. This idea of low rates spurring growth is way to late in the game to make a difference so the long postiton on rates is that once we realize growth will no longer be fueled by low rates, they will begin to rise as the market starts to stabilize the right way...Rewarding risk with return on investment is the only model for mortgages that will be left after the collapse of the 2ndary market. I just want people to warm up to the idea of higher rates now so it is not a shock later. For anyone who thinks that rates will not go up to 14% read some history. After a crisis half as bad as this one in the late seventies 30 years mortgage rates shot up in two years 5%, this will not likely happen in todays market; it will definatly happen. Just remeber this: You heard is here first...

America stay strong there are rough waters ahead...

From the report on the fianncial condition of the US Governemnt

Nathan Goodman (Guild Mortgage Company) — Thu, 23 Oct 2008 15:56:38 -0700

Unsustainable Debt

As noted earlier, the Government must borrow from the public to finance any gaps between expenditures and

revenues. Increased borrowing leads to higher debt service (net interest) which in turn can make it more difficult to

balance expenditures and revenues in the future. Chart J shows that by 2030, public debt is projected to rise to 68

percent of GDP, surpassing the non-wartime peak of 49 percent in 1993. By 2040, public debt is projected to be 128

percent of GDP, well above the

World War II peak of 109 percent,

and by 2080, debt is projected to

approach 600 percent of GDP.

At some point before the debt

reaches such unprecedented levels,

the world's financial markets

would likely cease lending to the

United States. Although the

precise point at which this would

occur is unknown, these projected

debt levels cannot be sustained

indefinitely. Many economists

believe that persistent debt / GDP

levels over 100% are unhealthy.

The U.S. is projected to surpass

that mark within the next 30 years,

with the debt/GDP ratio at that

point on a continually and dramatically rising trajectory (more than 10 percentage points per decade through 2080).

Avoiding the catastrophic consequences of this fiscal path will require action to bring program expenditures in line

with available resources. How soon those actions are taken will greatly influence their ultimate impact on the

Nation.

I wish the chart showed up but pretty sovering facts here...hope we as a country are listen to what they are saying...

FHA loan limit is going to be raised to 417k...

Nathan Goodman (Guild Mortgage Company) — Thu, 09 Oct 2008 10:14:25 -0700

10/02/2008 - "This morning, FHA Commissioner Brian Montgomery announced that the new HECM nationwide loan limit (maximum claim amount) will be $417,000. The target effective date is November 1"
This is a target date right now, not a set deadline. We still expect FHA to increase the "floor" on the origination fee from $2,000 to $2,500. A mortgagee letter will be published shortly that provides additional details.

There was some debate within HUD to consider area limits at 115% of area median home value, with a floor of $417,000 and a cap of $625,500. Ultimately, the interpretation was determined that the new legislation will be a $417,000 loan limit. As many of you recall, this was the original limit embraced by the industry.
As NRMLA requested a more liberal interpretation to $625,500 in high cost areas, the complexity of the bill's language created much debate and ultimately this final decision. Nonetheless, we are pleased with this major milestone for the industry.

A majority of U.S. counties have lending limits at the existing floor (currently $200,162), which has drastically reduced the amount of equity that seniors living in higher-valued homes could access. We believe these new limits will have a significant impact on the quality of life and provide more relief to those seniors who need the help especially in today's turbulent economic environment.
These are all positive developments for the reverse mortgage industry and the clients we serve. And as HUD moves toward the implementation of many other important aspects of the housing bill including the new purchase product and co-op lending, we look forward to continuing to report on additional developments in these areas in the near future."
Announcement comes from NRMLA (National reverse Mortgage Lenders Association) 10/02/2008
Press Release from NRMLA

Some humor on a day when it may be hard to find some...

Nathan Goodman (Guild Mortgage Company) — Tue, 07 Oct 2008 16:04:27 -0700

Look for these mergers/consolidations to occur soon...
1. Hale Business Systems, Mary Kay Cosmetics, Fuller Brush, and W. R. Grace Co. will merge and become: Hale, Mary, Fuller, Grace.
2. PolyGram Records, Warner Bros., and Zesta Crackers join forces and become: Poly, Warner Cracker.
3. 3M will merge with Goodyear and become: MMMGood
4. Zippo Manufacturing, Audi Motors, Dofasco, and Dakota Mining will merge and become: ZipAudiDoDa .
5. FedEx is expected to join its competitor, UPS, and become: FedUP.
6. Fairchild Electronics and Honeywell Computers will become: Fairwell Honeychild.
7. Grey Poupon and Docker Pants are expected to become: PouponPants.
8. Knotts Berry Farm and the National Organization of Women will become: Knott NOW!
And finally...
9. Victoria 's Secret and Smith & Wesson will merge under the new name: Titty Titty Bang Bang

I couldn't resist...

Citi...Letter received from rep

Nathan Goodman (Guild Mortgage Company) — Tue, 07 Oct 2008 13:30:15 -0700

Good morning.

I have some rather sad news to share today. There is no more accurate was to say it.

Later this afternoon you should be receiving some formal communication from CitiMortgage of their intent to dramatically change their way of doing business. This change will eliminate my position and all of the other account executive for the CitiMortgage Wholesale (broker) channel. Citi will be taking the 9,500 brokers it does business with today and reducing that number to the neighborhood of 1,000. They will then support those customers with an inside sales team going forward. I received this news minutes ago and I feel it my duty and privilege to relay it to you as I have managed our relationship.

It is not my intent as to explain why Citi is making this change. More so what I would like to cover is what will happen next so you can prepare for loans that are already in the pipeline and any deadlines that have been determined on submitting/locking and funding. I will do everything in my power to make this period as painless and seamless as possible. Expect complete details later this afternoon and in the days to come.

Here is what I know. The last day to lock and submit any loans to Citi Wholesale will be Friday. There has been no communication of any sort as to when loans would need to be funded by OR as to which customers will be retained going forward. I know that they are looking at the top customers, but outside of that...I know nothing more.

My final day of employment at Citi Mortgage will be this Friday. Over the last few weeks I have been evaluating my options and am just about certain (as certain as one can be in this situation) of my intent to stay in this industry as a wholesale account executive.

-from my CITI rep...minutes ago!

THis is forshadowing the inevitable, the credit market has shrunk and is only getting worse...Governemnt will be the only one buying mortgages for a long while...

FHA the real story...

Nathan Goodman (Guild Mortgage Company) — Thu, 02 Oct 2008 16:01:47 -0700

I have received from the HUD office all the item pertaining to condo developments and the guidelines at every possible stage. Whether it is new, existing, annexation, or additional phases different rules apply to the different types. I believe on common misconception realtors have is that once your project is FHA approved that that also means that your Borrower is FHA approved for financing. Which is not the case. The FHA condo approval has two parts. First the Condo development itself must be approved and then each individual borrower must meet the FHA condo requirements. This is a separate set of rules for the borrower not the development. This is where the 51% o/o comes into play as well as the questionnaire. We have been seeing realtors advertise units as FHA approved when in fact all the have is the development approval but are still unable to get financing for the first 51% of the units because of the 51% requirement for o/o. I know a little confusing I almost messed it up just typing it...lol

OT - some politics

Nathan Goodman (Guild Mortgage Company) — Thu, 02 Oct 2008 13:32:43 -0700

Here's an interesting fact:

Do you Remember 1987?

Thought you might be interested in this forgotten bit of information........

It was 1987! At a lecture the other day they were playing an old news video of Lt.Col. Oliver North testifying at the Iran-Contra hearings during the Reagan Administration.

There was Ollie in front of God and country getting the third degree, but what he said was stunning! He was being drilled by a senator; 'Did you not recently spend close to $60,000 for a home security system?'

Ollie replied, 'Yes, I did,Sir.'

The senator continued, trying to get a laugh out of the audience, 'Isn't that just a little excessive?' 'No,sir,'continued Ollie. 'No? And why not?' the senator asked. 'Because the lives of my family and I were threatened, sir.' 'Threatened? By whom?' the senator questioned. 'By a terrorist, sir' Ollie answered. 'Terrorist? What terrorist could possibly scare you that much?' 'His name is Osama bin Laden, sir' Ollie replied.

At this point the senator tried to repeat the name, but couldn't pronounce it, which most people back then probably couldn't. A couple of people laughed at the attempt. Then the senator continued. Why are you so afraid of this man?' the senator asked.

'Because, sir, he is the most evil person alive that I know of',Ollie answered. 'And what do you recommend we do about him?'asked the senator. 'Well, sir, if it was up to me, I would recommend that an assassin team be formed to eliminate him and his men from the face of the earth.'

The senator disagreed with this approach,and that was all that was shown of the clip.

By the way, that senator was Al Gore!

Also: Terrorist pilot Mohammad Atta blew up a bus in Israel in 1986. The Israelis captured, tried and imprisoned him. As part of the Oslo agreement with the Palestinians in 1993, Israel had to agree to release so-called 'political prisoners.'However, the Israelis would not release any with blood on their hands, The American President at the time, Bill Clinton,and his Secretary of State, Warren Christopher, 'insisted' that all prisoners be released. Thus Mohammad Atta was freed and eventually thanked us by flying an airplane into Tower One of the World Trade Center .. This was reported by many of the American TV networks at the time that the terrorists were first identified. It was censored in the US from all later reports.

DPA - alive again...?

Nathan Goodman (Guild Mortgage Company) — Wed, 01 Oct 2008 14:52:13 -0700

For Immediate Release: October 1, 2008
CONTACT: Henry Fawell (410) 545-5830

CBO report: downpayment assistance could generate
new revenue for U.S. Treasury
AmeriDream urges Congress to preserve DPA to stabilize housing market

GAITHERSBURG, MD - Downpayment assistance programs that expire today could generate sorely-needed revenues for the federal government if Congress preserves them by passing H.R. 6694, according to a new report from the Congressional Budget Office (CBO). Downpayment assistance programs funded in part by sellers (DPA) were eliminated, effective today, as part of the housing stimulus package signed into law in July.

"At a time when Congress considers saving Wall Street, we must not lose sight of the homeowner on Main Street," said Ann Ashburn, President of AmeriDream. "Unlike the $700 billion rescue package under consideration in Congress, DPA programs do not cost the American taxpayer a dime. In fact, they could generate $13 million in revenues for the federal government if they are reauthorized by Congress, according to the CBO.

"The choice before Congress is simple: deny 25,000 qualified first-time homebuyers the FHA's homeownership opportunities every month, or preserve a program that can help stabilize the housing market, generate dollars for the government, and give homeowners on Main Street the same consideration being given to Wall Street. We urge Congress to pass H.R. 6694."

The CBO Report can be found online here: http://www.cbo.gov/ftpdocs/98xx/doc9844/hr6694.pdf

H.R. 6694, sponsored by Congressman Al Green (TX-9), would reinstate FHA seller downpayment assistance for persons with certain credit scores. H.R. 6694 is co-sponsored by 25 members of Congress from both sides of the aisle and was passed by voice vote in September by the House Committee on Financial Services. The legislation is also supported by the National Association of Realtors, the National Association of Home Builders, the National Association of Mortgage Brokers, the Christian Community Development Association, the National Organization of African Americans in Housing (NOAAH), U.S. Hispanic Chamber of Commerce, National Caucus of Hispanic State Legislators, U.S. Conference of Mayors, U.S. Conference of Black Mayors, National Association of Black Mortgage Brokers, the National Council of State Finance Agencies, the Council of Large Public Housing Authorities, the Congressional Black Caucus, the Congressional Hispanic Caucus and the Congressional Asian Pacific American Caucus.

BACKGROUND: AmeriDream, a 501(c)(3) charity, was established in 1999 to provide housing-related programs throughout the United States. AmeriDream helps low and moderate income individuals and families, a disproportionate number of whom are first-time homebuyers, minorities, legal immigrants, women headed households, and single-parents, achieve homeownership. AmeriDream provides a wide range of programs, including homebuyer education, loss mitigation counseling, community development, and privately-funded down payment gift assistance. These programs are provided at no cost to the taxpayer. AmeriDream not only seeks to help families purchase homes, but also provide them with the education and other resources needed to be responsible homeowners. In turn, those responsible, committed homeowners help build safe, thriving communities. More than 250,000 families and individuals have utilized AmeriDream's DPA program to become homeowners.

Hope for Home Owners...New way to bail out poeple who should not be bailed out!

Nathan Goodman (Guild Mortgage Company) — Tue, 30 Sep 2008 15:36:39 -0700

HOPE FOR HOMEOWNERS
1) Purpose- The purpose of the HOPE for Homeowners Program is--
a) to create an FHA program, participation in which is voluntary on the part of homeowners and existing loan holders to insure refinanced loans for distressed borrowers to support long-term, sustainable homeownership;
b) to allow homeowners to avoid foreclosure by reducing the principle balance outstanding, and interest rate charged, on their mortgages;
c) to help stabilize and provide confidence in mortgage markets by bringing
transparency to the value of assets based on mortgage assets;
d) to target mortgage assistance under this section to homeowners for their principal
residence;
` 2) Requirements of Insured Mortgages- To be eligible for insurance under this section, a
refinanced eligible mortgage shall comply with all of the following requirements:
` a) LACK OF CAPACITY TO PAY EXISTING MORTGAGE-
1) IN GENERAL- The mortgagor shall provide certification to the Secretary that the mortgagor has not intentionally defaulted on the mortgage or any other debt, and has not knowingly, or willfully and with actual knowledge, furnished material information known to be false for the purpose of obtaining any eligible mortgage.
2) PENALTIES-
(i) FALSE STATEMENT- Any certification filed pursuant to clause (i) shall contain an acknowledgment that any willful false statement made in such certification is punishable under section 1001, of title 18, United States Code, by fine or imprisonment of not more than 5 years, or both.
(ii) LIABILITY FOR REPAYMENT- The mortgagor shall agree in writing that the mortgagor shall be liable to repay to the Federal Housing Administration any direct financial benefit achieved from the reduction of indebtedness on the existing mortgage or mortgages on the residence refinanced under this section derived from misrepresentations made in the certifications and documentation required under this subparagraph, subject to the discretion of the Secretary.
b) CURRENT BORROWER DEBT-TO-INCOME RATIO- As of March 1, 2008, the mortgagor shall have had a ratio of mortgage debt to income, taking into consideration all existing mortgages of that mortgagor at such time, greater than 31 percent (or such higher amount as the Board determines appropriate).
C) DETERMINATION OF PRINCIPAL OBLIGATION AMOUNT- The principal obligation amount of the refinanced eligible mortgage to be insured shall--
1) be determined by the reasonable ability of the mortgagor to make his or her mortgage payments, as such ability is determined by the Secretary pursuant to section 203(b)(4) or by any other underwriting standards established by the Board; and
2) not exceed 90 percent of the appraised value of the property to which such mortgage relates.
d) REQUIRED WAIVER OF PREPAYMENT PENALTIES AND FEES- All penalties for
prepayment or refinancing of the eligible mortgage, and all fees and penalties related to default or delinquency on the eligible mortgage, shall be waived or forgiven.
e) EXTINGUISHMENT OF SUBORDINATE LIENS-
1) REQUIRED AGREEMENT- All holders of outstanding mortgage liens on the
property to which the eligible mortgage relates shall agree to accept the proceeds of the insured loan as payment in full of all indebtedness under the eligible mortgage, and all encumbrances related to such eligible mortgage shall be removed.
2) SHARED APPRECIATION - The Board shall establish standards and policies
that will allow for the payment to the holder of any existing subordinate mortgage of a portion of any future appreciation in the property secured by such eligible mortgage that is owed to the Secretary pursuant to subsection (k).
(i) In establishing the standards and policies required under clause (i), the Board shall take into consideration--
(I) the status of any subordinate mortgage;
`(II) the outstanding principal balance of and accrued interest on the existing senior mortgage and any outstanding subordinate mortgages;
`(III) the extent to which the current appraised value of the property securing a subordinate mortgage is less than the outstanding principal balance and accrued interest on any other liens that are senior to such subordinate mortgage; and
`(IV) such other factors as the Board determines to be appropriate.
3) VOLUNTARY PROGRAM- This paragraph may not be construed to require any holder of any existing mortgage to participate in the program under this section generally, or with respect to any particular loan.
4) TERM OF MORTGAGE- The refinanced eligible mortgage to be insured shall--
(i) bear interest at a single rate that is fixed for the entire term of the mortgage; and
(ii)have a maturity of not less than 30 years from the date of the beginning of amortization of such refinanced eligible mortgage.
5) MAXIMUM LOAN AMOUNT- The principal obligation amount of the eligible mortgage to be insured shall not exceed 132 percent of the dollar amount limitation in effect for 2007 under section 305(a)(2) of the Federal Home Loan Mortgage Corporation Act (12 U.S.C. 1454(a)(2)) for a property of the applicable size.
6) PROHIBITION ON SECOND LIENS- A mortgagor may not grant a new second lien on the mortgaged property during the first 5 years of the term of the mortgage insured under this section, except as the Board determines to be necessary to ensure the maintenance of property standards; and provided that such new outstanding liens (A) do not reduce the value of the Government's equity in the borrower's home; and (B) when combined with the mortgagor's existing mortgage indebtedness, do not exceed 95 percent of the home's appraised value at the time of the new second lien.
7) APPRAISALS- Any appraisal conducted in connection with a mortgage insured under this section shall--
(i) be based on the current value of the property;
(ii) be conducted in accordance with title XI of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 3331 et seq.);
(iii) be completed by an appraiser who meets the competency requirements of the Uniform Standards of Professional Appraisal Practice;
(iv) be wholly consistent with the appraisal standards, practices, and procedures under section 202(e) of this Act that apply to all loans insured under this Act; and
(v) comply with the requirements of subsection (g) of this section (relating to appraisal independence).
8) DOCUMENTATION AND VERIFICATION OF INCOME- In complying with the FHA underwriting requirements under the HOPE for Homeowners Program under this section, the mortgagee shall document and verify the income of the mortgagor or non-filing status by procuring (A) an income tax return transcript of the income tax returns of the mortgagor, or(B) a copy of the income tax returns from the Internal Revenue Service, for the two most recent years for which the filing deadline for such years has passed and by any other method, in accordance with procedures and standards that the Board shall establish.
9) MORTGAGE FRAUD- The mortgagor shall not have been convicted under Federal or State law for fraud during the 10-year period ending upon the insurance of the mortgage under this section.
10) PRIMARY RESIDENCE- The mortgagor shall provide documentation satisfactory in the determination of the Secretary to prove that the residence covered by the mortgage to be insured under this section is occupied by the mortgagor as the primary residence of the mortgagor, and that such residence is the only residence in which the mortgagor has any present ownership interest.
11) Appraisal Independence- PROHIBITIONS ON INTERESTED PARTIES IN A REAL ESTATE TRANSACTION- No mortgage lender, mortgage broker, mortgage banker, real estate broker, appraisal management company, employee of an appraisal management company, nor any other person with an interest in a real estate transaction involving an appraisal in connection with a mortgage insured under this section shall improperly influence, or attempt to improperly influence, through coercion, extortion, collusion, compensation, instruction, inducement, intimidation, nonpayment for services rendered, or bribery, the development, reporting, result, or review of a real estate appraisal sought in connection with the mortgage.
(i) CIVIL MONETARY PENALTIES- The Secretary may impose a civil money penalty for any knowing and material violation of paragraph (1) under the same terms and conditions as are authorized in section 536(a) of this Act.
12) Premiums- For each refinanced eligible mortgage insured under this section, the Secretary shall establish and collect--
(i) at the time of insurance, a single premium payment in an amount equal to 3 percent of the amount of the original insured principal obligation of the refinanced eligible mortgage, which shall be paid from the proceeds of the mortgage being insured under this section, through the reduction of the amount of indebtedness that existed on the eligible mortgage prior to refinancing; and
(ii) in addition to the premium required under paragraph (1), an annual premium in an amount equal to 1.5 percent of the amount of the remaining insured principal balance of the mortgage.
13) Origination Fees and Interest Rate- The Board shall establish--
(i) a reasonable limitation on origination fees for refinanced eligible mortgages insured under this section; and
(ii) procedures to ensure that interest rates on such mortgages shall be commensurate with market rate interest rates on such types of loans.
14) Equity and Appreciation- FIVE-YEAR PHASE-IN FOR EQUITY AS A RESULT OF SALE OR REFINANCING- For each eligible mortgage insured under this section, the Secretary and the mortgagor of such mortgage shall, upon any sale or disposition of the property to which such mortgage relates, or upon the subsequent refinancing of such mortgage, be entitled to the following with respect to any equity created as a direct result of such sale or refinancing:
(i) If such sale or refinancing occurs during the period that begins on the date that such mortgage is insured and ends 1 year after such date of insurance, the Secretary shall be entitled to 100 percent of such equity.
(ii) If such sale or refinancing occurs during the period that begins 1 year after such date of insurance and ends 2 years after such date of insurance, the Secretary shall be entitled to 90 percent of such equity and the mortgagor shall be entitled to 10 percent of such equity.
(iii) If such sale or refinancing occurs during the period that begins 2 years after such date of insurance and ends 3 years after such date of insurance, the Secretary shall be entitled to 80 percent of such equity and the mortgagor shall be entitled to 20 percent of such equity.
(iv) If such sale or refinancing occurs during the period that begins 3 years after such date of insurance and ends 4 years after such date of insurance, the Secretary shall be entitled to 70 percent of such equity and the mortgagor shall be entitled to 30 percent of such equity.
(v) If such sale or refinancing occurs during the period that begins 4 years after such date of insurance and ends 5 years after such date of insurance, the Secretary shall be entitled to 60 percent of such equity and the mortgagor shall be entitled to 40 percent of such equity.
(vi) If such sale or refinancing occurs during any period that begins 5 years after such date of insurance, the Secretary shall be entitled to 50 percent of such equity and the mortgagor shall be entitled to 50 percent of such equity.

A better solution than the bailout...

Nathan Goodman (Guild Mortgage Company) — Tue, 30 Sep 2008 15:23:54 -0700

Hi Folks,

I'm against the $85,000,000,000.00 bailout of AIG.
Instead, I'm in favor of giving $85,000,000,000 to America in a We
Deserve It Dividend.

To make the math simple, let's assume there are 200,000,000
bonafide U.S. Citizens 18+.
Our population is about 301,000,000 +/- counting every man,
woman and child. So 200,000,000 might be a fair stab at adults 18 and
up.. So divide 200 million adults 18+ into $85 billion that equals
$425,000.00.

My plan is to give $425,000 to every person 18+ as a We
Deserve It Dividend.

Of course, it would NOT be tax free. So let's assume a tax
rate of 30%.
Every individual 18+ has to pay $127,500.00 in taxes.
That sends $25,500,000,000 right back to Uncle Sam.
But it means that every adult 18+ has $297,500.00 in their
pocket.
A husband and wife has $595,000.00.

What would you do with $297,500.00 to $595,000.00 in your
family?

Pay off your mortgage - housing crisis solved.
Repay college loans - what a great boost to new grads
Put away money for college - it'll be there
Save in a bank - create money to loan to entrepreneurs.
Buy a new car - create jobs
Invest in the market - capital drives growth
Pay for your parent's medical insurance - health care improves
Enable Deadbeat Dads to come clean - or else

Remember this is for every adult U S Citizen 18+ including
the folks who lost their jobs at Lehman Brothers and every other
company that is cutting back. And of course, for those serving in our
Armed Forces.

If we're going to re-distribute wealth let's really do
it...instead of trickling out a puny $1000.00 ( "vote buy" ) economic
incentive that is being proposed by one of our candidates for
President.

If we're going to do an $85 billion bailout, let's bail out
every adult U S Citizen 18+!

As for AIG - liquidate it. Sell off its parts.
Let American General go back to being American General.
Sell off the real estate.
Let the private sector bargain hunters cut it up and clean it
up.

Here's my rationale. We deserve it and AIG doesn't. Sure
it's a crazy idea that can "never work."
But can you imagine the Coast-To-Coast Block Party!

How do you spell Economic Boom?

I trust my fellow adult Americans to know how to use the $85
Billion We Deserve It Dividend more than I do the geniuses at AIG
or in Washington DC .

And remember, The Birk plan only really costs $59.5 Billion
because $25.5 Billion is returned instantly in taxes to Uncle Sam.

Ahhh...I feel so much better getting that off my chest.

Kindest personal regards,

Birk

T. J. Birkenmeier, A Creative Guy & Citizen of the Republic

PS: Feel free to pass this along to your pals as it's either
good for a laugh or a tear or a very sobering thought on how to best
use $85 Billion!!

--
When told the reason for Daylight Saving time the old Indian
said...
"Only a white man would believe that you could cut a foot off
the top of a blanket
and sew it to the bottom of a blanket and have a longer
blanket."

The future of lending...

Nathan Goodman (Guild Mortgage Company) — Tue, 30 Sep 2008 15:20:35 -0700

Many wholesale lenders as well as brokers are likely to
be closing down before the end of the year and into 2009
as the Great Credit Crunch continues and the recession deepens.
Futher than that, the falling home prices and furthur decling
values in California in particular will leave very little room
for undercapitalized wholesale lenders and high fixed costs brokers.

Only the largest national lenders like Wells, Countrywide Bank,
HSBC, Citi, Flagstar, B of A, etc. will survive as they do have
their own in-house portfolio products that give them a better
profit margin than selling Agency products. As you can see,
most brokers prefer to work with these tier-one lenders due to
better rates and pricing for rebates. There isn't enough business
for wholesale lenders to survive. For example, Shearson Wholesale
which used to be an active and vibrant wholesale lender is no
longer around -- any many more with the same business model will
have to shrink or close down in coming months and into 2009.

That's my 2 cents.

Copied from the Broker Outpost

MBOH

Nathan Goodman (Guild Mortgage Company) — Tue, 30 Sep 2008 15:11:01 -0700

Montana Board of Housing - A great product to get low income and rural properties sold. I am taking the training and the program looks to be a great resource for the Montana real estate market. FNMA is the only GOE that is going to take a MBOH loan. The rates are historically a bit lower than conventional loans. I look forward to learning more and if any one else is interested be sure to let me know and I will answer any questions about the program.

Bridger Bowl

Nathan Goodman (Guild Mortgage Company) — Tue, 30 Sep 2008 12:50:44 -0700

Bridger Bowl received a new ski lift over the summer and it looks to be awesome. The lift will provide access to the Slushmans area, which can be dangerous but also a lot of fun. Hopefully no ones dies over there because the avalanche danger is extremely high in that region. The mountain should see the lift lines go down but I am sure we will see a run over o the new lift every powder day because that lift access snow is the farthest out so people will undoubtedly ski it first...

hello

Nathan Goodman (Guild Mortgage Company) — Tue, 30 Sep 2008 12:45:21 -0700

test

...

Nathan Goodman (Guild Mortgage Company) — Tue, 30 Sep 2008 12:44:47 -0700

...

Moon Light Basin

Nathan Goodman (Guild Mortgage Company) — Tue, 30 Sep 2008 12:31:26 -0700

I was informed by a source close to moon light that they will not be doing any further mountain development until further notice. They had a loan with Lehman Brothers that was due and payment was missed so the Mountain expansion has been suspended no new lifts or bathrooms, and the real estate side of things has also been put on hold...More as story develops...

Spell Checked Version - Sorry forgot to do it...

Nathan Goodman (Guild Mortgage Company) — Tue, 30 Sep 2008 12:24:36 -0700

I believe that getting front of the financial crisis will only drag the Federal Government further into the red. Historically the government is a reactive measure to combat private sector issues when the free market was unable to solve the problem. I fear that this time we are only stepping out in front of a speeding train that is eventually going to wreck. Accept this time the Federal Government is a passenger instead of a on looker of the financial tragedy. The plan can stop the inevitable so just let it happen rather than delay it until the winter or early spring. The constant propping up of the markets is only making the Governments credibility more deeply entrenched in the bad faith of this financial crisis. If the federal government goes down due to bad Private market choice who will bail them out? The answer is simple no one, you will then see a rapid disconnection of other foreign governments from our assets, bonds, and currency and in the end the US will be life a person with a plague; quarantined from the rest of the world for the mistakes of a few on Wall Street. So once again I say let the free market fail and then step in rather than taking us all along on a speeding train to a terrible end...

Bailout why act now?

Nathan Goodman (Guild Mortgage Company) — Tue, 30 Sep 2008 12:11:27 -0700

I believe that getting front of the financial crisis will only drag the Federal Government further into the red. Historically the givernemnt is a reactive measure to combat private sector issues when the free market was unable to solve the problem. I fear that this time we are only stepping out in front of a speeding train that is eventually going to wreck. Accept this time the Federal Governemnt is a passanger instead of a on looker of the finacial tradgy. The plan can stop the enevatible so just let it happen rather than dely it until the winter or early spring. The constant proping up of the markets is only making the Governemnts credibility more deeply entrenched in the bad faith of this fiancial crisis. If the federal goverement goes down due to bad priviate market choice who will bail them out? The answer is simple no one, you will then see a rapid disconnection of other foriegn governemnts from our assets, bonds, and currency and in the end the US will be life a person with a plague; quarintineed from the rest of the world for the mistakes of a few on Wall Street. So once again I say let the free market fail and then step in rather than taking us all along on a speeding train to a terrible end...

Just so everybody knows no longer GSE's...

Nathan Goodman (Guild Mortgage Company) — Tue, 09 Sep 2008 13:09:32 -0700

The proper name is GOE...This will be the new acronym for the two with them now being Governemnt Owned Entities...

Covered Bond market continuation...

Nathan Goodman (Guild Mortgage Company) — Thu, 31 Jul 2008 15:28:04 -0700

Well if you haven't already noticed Sec. Paulson has been all over touting his covered bond program, too bad he ripped it off from our over seas friends, not to worry no of us pay much attention to anyone else globally anyways...lol. His program is being back (no surprise) by the four biggest financial companies in AAmerica...They all are about to unveil plans to follow the European suit and begin to sell covered bonds that are tied to mortgage related securities... The new system would offer control over the underwriting process and would standardize the mortgage industry. The bonds would be first backed up by the lenders themselves. The bonds would then have another back up via the Federal Government. The bonds would then be as we say double backed. This would eliminate much of the concern over default. The only main problem I see is that the risk now falls on underwriting. That basically means that underwriters of the loans will be the last line of defense to keep bad loan from poisoning the rest of the portfolio... Once the loan are all ready passed underwriting the backers would then be responsible for the loss and we both know banks will look to the Government to bail out bad loans first before they will even know the system is set up so you can't. Companies in my opinion will continue to sell bad loans tied to these bonds because default will not be there concern because they know they have the deep pockets of the Government to bail them out of a bad situation. The one thing the lenders do not count on is the Government never gives without first figuring out how they can take from you... They will be taking the liberty of regulating mortgage underwriting standards and how rates are set for loans to consumers. It is a back end socialist program in the mind of this blogger... Wow that is the first time I have ever referred to myself as a blogger... The story on this is of course still unfolding and I will up date with info as I learn it, and please keep in mind that I am not perfect... It is always important to do your own research as well as using mine... One other foot note. Can anyone imagine what our economy would look like if just for one month our media portrayed nothing but positive information...Case in point look what hte Greenspan interview CNBC did is going to do to the markets friday...