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HUD is looking to increase down payment requirements, mortgage insurance premiums, reduce the allowable seller concession from 6% to 3%, among other things. Read more. /// The good thing about risk-based pricing is that much lower rates can be obtained with high credit scores. Better yet, we can often make good scores even better to secure that better rate. Mortgage Ready Credit Score /// The most common misconception about the homebuyer tax credits is that the close must occur by April 30th. The date is actually June 30th. Details. Make it a good week folks! - Paul :))
Hint: Flips
When a home is resold after improvements have been made, 91 days have to lapse from the day of recording and the day the mortgage application is submitted. Less than 91 days is viewed as a flip and loan will be declined until seasoning requirement is met. Even if the 91 day has been met, the underwriter may view the increase of the new sales price as excessive, and may request a second appraisal and invoice receipts validating the increased sales price.
S&P Case-Shiller: Home prices lose momentum in November
On a month over month basis, home prices in 20 US cities fell 0.2% in November. The 10 city index also fell by 0.2%. Read more.
HAMP guidelines updated to improve loan modification conversion rate
The program has enrolled over 850,000 homeowners who are seriously delinquent in their mortgage payments in a trial modification period but has encountered significant problems in converting those trials into permanent loan modifications. Today the two departments released updated guidance for the mortgage servicers who initiate the modifications and monitor the trial periods. Read more
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"Sometimes our enthusiasm for change depends on our willingness to take chance on tomorrow by risking what we have today".
Market assessment
The 30yr fixed is expected to go up to around 6% as the Fed stops buying mortgage backed securities in March, the home buyer tax credit program will expire the following month, and foreclosures are expected to flood the market. Prices are expected to drop. Prices may come down, BUT the cost of borrowing (30yr fixed) will likely go up about 20% (from 5% to 6% is a 20% increase cost of borrowing), compensating for possible lower prices. Low prices may be obtained by purchasing foreclosures. FHA and Fannie are trying harder to sell REOs. Lastly, the trend in mortgage lending is still towards more restrictive criterica, adding to processing time: Full prequals and credit score planning important! - I wish all of us a succesful 2010! - Paul
Tax credit deals
If a purchase needs to be eligible for a home buyer tax credit, get fully pre-approved, buy asap, and get a rate lock with a floatdown right away. Don't wait! The gridlock for the Nov 30 tax credit dependent sales (mortgages) was horrific and the extension of the program avoided last moment buyers losing out on their tax credit.
Foreclosures
Fannie Mae is offfering REO properties through Homepath.com. For HUD (FHA) REOs go here. Note that Prospect Mortgage is one of the few approved Homepath lenders, and we also offer the $100 down mortgages for the HUD foreclosures. Both HUD and Fannie are keen to sell.
Credit scores
Loan requirements and pricing are becoming even more dynamic. The minimium Fico is formally 620 (for now). With compensating factors a 560 score still offers possibilities. To get best rates, plan for a 720 score, which will give you a 0.375%-0.50% better rate then with a 620 score, depending.... Contact me for assistance.
Mortgage modification are still a disaster
The Obama administration's mortgage modification program was originally projected to keep 3-4 million people in their homes. Promised help is sorely lacking. To date, almost a year after launch, it has permanently changed the mortgage terms of only 31,000 homeowners. Opportunistic loan defaults have not helped either. It was easier to get a loan modification in mid 2008 then it is today!
Available
- Direct lender for FHA, Fannie, Freddy, VA, USDA, Jumbo, other loans
- Same day loan decision
- 30-day closes (45-days for FHA)
- FHA loans down to 560 Fico
- 50-70% LTV stated income loans (600-700 Fico needed)
- Loans for non-residents
- Rehab and construction loans
- Non-warrantable property loans
- Reverse mortgages
- Commercial loans
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"If you only do what you know you can do - you never do very much."
Tom Krause
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I want to thank you for the privilege of working with you this year, and I look forward to more of the same in 2010. I hope you'll enjoy the festivities, family time, and all the trimmings ;) I also hope you think about, and reach out, those less fortunate than us (including the financially challenged homeowners who don't seem to be able to get the loan modification they are entitled to). Happy Holidays to you and your loved ones - and best wishes for 2010! - Paul :))
Homeowners rush to refinance as rates jump
Mortgage rates rose this week, and homeowners rushed to refinance. The pattern is familiar: People wait on the sidelines while mortgage rates are falling. Then, when rates finally hit bottom and bounce back up, homeowners apply. Read more. (I will be available throughout the holiday season for new business and immediate rate locks. Call 917-209-1111, or email for callback - P)
ARMs now 0.375%-0.75% lower than 30-yr fixed
The good news about the housing market and the economy has caused a spike in longer-term Treasury and mortgage yields. At the same time, short term Treasury yields have remained low as market participants believe the Fed will keep short term borrowing rates between 0%-0.25% for the first half of 2010. These two factors have created the steepest yield curve (difference between 2 and 10 year Treasury yields) on record. What does this mean? The 30-year fixed is now higher than 5%. However, 5 and 7 year ARMs have never been more attractive: 0.375% - 0.75% better rate than the 30-year fixed. - P
Housing prices end 2-year skid, says IHS Global Insight
The 2-year slide in US housing prices ended in Q3, 2009 and increased 0.2% over the previous quarter, according to a quarterly report form IHS Global Insight, a provider of economic and financial analysis. Although prices increased on a national average, 161 of the top 330 metropolitan areas had declines in prices. Read more. The Federal Housing Finance Agency’s (FHFA) monthly Home Price Index also showed improvement as prices increased 0.6% on a seasonally adjusted basis from September to October.
Real estate's 50 most influential online: 2009
The growing body and use of online communications tools has produced rich channels for real estate industry participants and observers to exert their influence. Read more.
Why the Fed will be sidelined in 2010
As most of us already know, the Fed will conclude its planned purchases of $1.25 trillion in Mortgage Backed Securities (MBS) in March... Read more
The 15 shadiest mortgage lenders backed by the government (You!)
I rresponsible mortgage lending brought down the U.S. economy. So you'd think that the lesson has been learned. But it hasn't. Read more
Available
- Direct lender for FHA, Fannie, Freddy, VA, USDA, Jumbo, other loans
- Same day loan decision
- 30-day closes (45-days for FHA)
- FHA loans down to 560 Fico
- 50-70% LTV stated income loans (600-700 Fico needed)
- 90% LTV Fannie Mae condo loans
- Loans for non-residents
- Rehab and construction loans
- Non-warrantable property loans
- Reverse mortgages
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"Christmas is a time when you get homesick – even when you’re home"
Lenders are subject to extreme scrunity at the moment. Above average defaults can have drastic consequences - and no lender is immune. This has led to over the top caution and excessive documentation and underwriting requirements. Well, it is what it is, so to deal with it I have improved my service by appointing a dedicated processor to provide personal client support to so that all conditions can be met quickly and smoothly! /// Rates continue to be at or near historic lows. Given the eternal optimism that is inside all of us we believe they are here to stay (or go lower yet). Again, the writing is on the wall for higher rates next year! The Fed buys approx 80% of all mortgage loans now, will stop doing this by March, and there are few other buyers at current price (interest rate) levels! (Re-)finance now! Read more. /// Make it a good week folks! - Paul :))
620 is now the standard
New Fannie requirements are now in effect. The Fico standard for FHA and conventional loans is now 620. Note that I still have sub-620 solutions (500-619), even at market rates!
Forbes: Commercial real estate will collapse
The commercial real estate market is on its last legs and unless drastic actions are taken, the effects on the broader economy will be catastrophic. The obvious problem is the excessive amount of debt placed on the properties and the amount of debt that has to be refinanced during a short period of time. Read more.
AVAIL - Self managed credit repair and improvement
Credit repair, rescore, and credit coaching - the 3 pillars for improving and maintaining credit scores - all in one! Check out AVAIL. It helps you understand your credit profile, and puts you in charge of your own improvement plan. Video. Contact me for assistance.
New York City's smallest apartment
Purchased for $150,000 three months ago, the co-op is 14.9 feet long and 10 feet wide and is on the 16th floor of a building on 110th Street, but, get this — it’s only accessible by a staircase from the 15th floor. Read more.
IRS to outline changes to the home buyer tax credit program
Revisions include expanded income limits, a cap on home prices, additional documentation requirements and prohibitions against claims by dependents. Read more.
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"Failure is success if we learn from it"
Rates reach record lows, then spike!
On Friday the 30-year fixed jumped to 5.5% then eased somewhat. Are we seeing the end of record low rates? Read more. /// Saturday Dec 13 Fannie Mae will implement significant underwriting changes. (See below). /// Loan modifications are in the news a lot. It's still a mess. /// Make it a great week folks! - Paul :))
Mortgage bond yields jump to highest in month after jobs data!
Yields on Fannie Mae and Freddie Mac mortgage securities climbed to the highest in a month amid signs the employment market is improving. Read more.
New Fannie Mae guidelines will have signficant impact!
On Saturday Dec 13 Fannie Mae will implement significant underwriting changes. These include higher credit score and reserve requirements, lower debt to income allowances, post bankruptcy/foreclosure restrictions, lower loan to values for 2-unit properties. All pre-Dec 13 (pre-)approvals will be grandfathered up to January 31, 2010. Play it safe: Apply this week!
FHA mortgages to cost more
Home buyers, and millions nationwide, will have to come up with more cash and reach higher minimum credit scores to get a government-backed mortgage under changes unveiled by the Federal Housing Administration. Read more.
Obama administration cracks down on mortgage companies
The Obama Administration today tried to kick up a notch the campaign to help home borrowers struggling under their mortgages. Read more, and more.
Modifications are not likely to halt foreclosures
Opinion: The somber truth is that most people who can no longer afford to make their mortgage payments will lose their homes. And no amount of programs out of Washington will change that. Read more.
Prof backs mortgage walkaways
Opinion: Go ahead - break the chains. Stop paying on your mortgage if you owe more than the house is worth. And most important: Don’t feel guilty about it and don’t think you’re doing something morally wrong. Read more.
New York judge nullifies mortgage
A New York judge is sending a strong message to mortgage companies: Help struggling homebuyers avoid losing their homes. Read more.
AVAIL - Self managed credit repair and improvement
Credit repair, rescore, and credit coaching - the 3 pillars for improving and maintaining credit scores - all in one! Check out AVAIL. It helps you understand your credit profile, and puts you in charge of your own improvement plan. Video. Contact me for assistance.
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"Whoever is happy will make others happy too".
Mortgage applications for home purchases have fallen to the lowest level in 12 years. The Nov 30 deadline for tax credit deals caused an increase in applications through mid-October, followed by a remarkable decrease since of course, but the housing market is still facing major hurdles. /// Both Fannie and FHA have now delegated condo approvals to lenders. I believe this will be a huge improvement. /// Have a wonderful Thanksgiving! - Paul :))
Reaching out to condo buyers
Industry executives say the FHA.’s new rules will open an important lending option to condo buyers, especially those with weak credit. Read more.
The struggles continue for Fannie Mae and Freddie Mac
It appears, our government thinks the Fannie/Freddie experiment is working well despite evidence to the contrary. Read more
AVAIL - Self managed credit repair and improvement
Credit repair, rescore, and credit coaching - the 3 pillars for improving and maintaining credit scores - all in one! Check out AVAIL. It helps you understand your credit profile, and puts you in charge of your own improvement plan. Video. Contact me for assistance.
15-year fixed drops to lowest ever recorded by Freddie Mac
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"Life is a long lesson in humility".
Fannie Mae is again raising lending criteria: DTI to 45%, Fixo to 620, financing 5 years following foreclosure with 680 Fico, higher PMI requirements, 75% ltv max for 2-unit+ investment property, higher reserves, the official retirement of construction-to-permanent financing!, and more. /// Fannie changes take effect Dec 12. I think it is more than likely that FHA will also up the standards again. Elimination of seller concessions and raising the minimum down to 5% are possible. Read more. /// Make it a good week folks :) - Paul
Do you qualify for a jumbo mortgage?
Plenty of lenders offer jumbo mortgages now, although the requirements are stricter than they used to be. Read more. (Prospect Mortgage has the most liberal lending criteria in the industry! - P).
BigFunnels.com
Interested in working with me, build a huge funnel, and do many sales? Check the ultimate funnel building, and contact conversion solution. BigFunnels.com.
Temporary jumbo loan limits extended through 2010
The temporary increased maximum loan limits originally set to expire at the end of the year will remain in place through 2010, according to the Federal Housing Finance Agency (FHFA). The limits for conforming jumbo loans eligible for purchase by the government-sponsored enterprises (GSEs) was set at $417,000 for single-family homes by the Economic Stimulus Act of 2008 (ESA) and the Housing and Economic Recovery Act of 2008 (HERA), but were set to expire at the end of 2009. more
Rates down a bit
Available
- Direct lender for FHA, Fannie, Freddy, VA, USDA, Jumbo, other loans
- Same day loan decision
- 30-day closes (45-days for FHA)
- FHA loans down to 560 Fico
- 50-70% LTV stated income loans (600-700 Fico needed)
- 90% LTV Fannie Mae condo loans
- Loans for non-residents
- Rehab and construction loans
- Non-warrantable property loans
- Reverse mortgages
- Commercial loans
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"The road to success is always under construction" -
Lily Tomlin
Home buyer tax credits have been extended and improved! Up to $8,000 for qualified first-time home buyers purchasing a principal residence is available. And up to $6,500 for qualified repeat home buyers. Details. Make it a good week folks! - Paul
What will your business look like in 12 months from now?
The Home Buyers Scouting Report, the ultimate funnel building, and contact conversion solution - is off to a flying start. If you missed it last week, go to my blog to read up and go for a test drive! Note that it is also my program to refer clients to you!
Minimum Fannie Fico to 620
The minimum Fico for Fannie Mae loans is going up to 620 effective December 12th. Read more. Note that as of today my minimum FHA Fico's for a purchase still start at 560!
What the Fed's latest move means for mortgages
The Federal Reserve may be keeping interest rates intact at near 0%, but consumers planning to buy a home or refinance one in the following months may want to take note: The end of record-low mortgage rates appears to be a step closer. Read more. Freddie Mac rate surveys.
Available
- Direct lender for FHA, Fannie, Freddy, VA, USDA, Jumbo, other loans
- Same day loan decision
- 30-day closes (45-days for FHA)
- FHA loans down to 560 Fico
- 50-70% LTV stated income loans (600-700 Fico needed)
- 90% LTV Fannie Mae condo loans
- Loans for non-residents
- Rehab and construction loans
- Non-warrantable property loans
- Reverse mortgages
- Commercial loans
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"Ignorance is a voluntary misfortune" -
T.L. Haynes, The Royal Path of Life, 1886
I am pleased introduce the The Homebuyers Scouting Report. The Home Buyers Scouting Report is the "MLS for buyers" - a contact capture and conversion system. It is a revolutionary new system that can drastically improve your sales volume. (See below). /// It looks like the home buyer tax credit will be extended and expanded. /// Mortgage applications are down due no more tax credit driven purchases. /// Make it a good week folks! - Paul
Problem: You are losing most of your contacts!
How often do you connect with prospective clients (open house, ad call, personal sphere, cold calls, etc.), hand them your business card, follow up with them, and never have them convert to a sale? 80%, 90%, 95% of the time? Do you have to have to maintain a HUGE funnel of clients in order to actually get a few sales? You also know that buyers want all the available information, but they want to be able search for what they want when they want it - without having to wait for you to send them listings. If you're not around, they may go to someone else. NAR reports that buyers will on average visit 7 websites, connect with 17 realtors, and spend 6-9 months in their education phase. So how can you beat the odds and increase your conversion rate?
Solution: The Home Buyers Scouting Report!
The Home Buyers Scouting Report can help you beat the odds an increase your conversion rate in a big way! You use the MLS to list your sellers. And you use the HBSR to show the listings to your buyers. What if you could also use it to allow your buyers to peruse real time listings at their leisure with only YOUR contact info associated with all listings? The Home Buyers Scouting Report is a contact capture and conversion system which allows you to "own" and support literally hundreds of home shoppers, respond to their inquiries on a daily basis, and zero in on who is ready to buy/sell. Read more.
Rates flat
"Economic data releases this week offered mixed signals as to the state of the housing market. Total existing home sales jumped 9.4% to an annualized rate of 5.57 million homes in September, the strongest pace since July 2007, according to the NAR. However, new home sales unexpectedly fell 3.6% to 402,000 houses, the weakest since June of this year, based on figures from the Department of Commerce. Nonetheless, stronger housing demand has lowered the inventory of unsold existing homes in September to the lowest since January of this year and for new homes the lowest since November 1982, which should help stabilize falling house prices." said Frank Nothaft, Freddie Mac vice president and chief economist. Freddie Mac rate surveys.
Available
- Direct lender for FHA, Fannie, Freddy, VA, USDA, Jumbo, other loans
- Same day loan decision
- 30-day closes (45-days for FHA)
- - FHA loans down to 560 Fico
- 50-70% LTV stated income loans (600-700 Fico needed)
- 90% LTV Fannie Mae condo loans
- Loans for non-residents
- Rehab and construction loans
- Non-warrantable property loans
- Reverse mortgages
- Commercial loans
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"Chaos is the score upon which reality is written" - Henry Miller
Fannie Mae is raising the minimum Fico to 620 from 580. Fannie pricing is also more dynamic (higher score, lower rate), has more restrictive program criteria: 680 needed for PMI, more reserves needed, and more. Count on FHA tightening up as well. Read more. /// Make it good week folks! - Paul
"I'll improve my Fico by paying off my collections"
Not necessarily. Your score can actually go down! "A recent paid collection is often worse than a distant unpaid collection". Credit score and repair info.
New FHA condo rules delayed to Dec 7th
Implementation of FHA’s new policy for condominium project approval and condo unit financing will be delayed until Dec 7th. Also note that the minimum down payment may go to 5%, and seller concessions eliminated next year.
Rates up a bit
"Following bond yields, long-term mortgages rates edged up slightly this week," said Frank Nothaft, Freddie Mac vice president and chief economist.
"Although rates for 5/1 ARMs and traditional 1-year ARMs are around half a percentage point below 30-year fixed mortgages, consumers appear to be seeking the stability of fixed-rate mortgages. Freddie Mac rate surveys
Big rebound in existing home sales
Existing-home sales bounced back strongly in September with first-time buyers driving much of the activity, marking five gains in the past 6 months, according to the NAR. Read more.
Available
- Direct lender for FHA, Fannie, Freddy, VA, USDA, Jumbo, and other loans
- Same day loan decision
- 30-day closes (45-days for FHA)
- Condo (conversion) financing services. Information
- FHA loans down to 560 Fico
- 50-70% LTV stated income loans (600-700 Fico needed)
- 90% LTV Fannie Mae condo loans
- Loans for non-residents
- Rehab and construction loans
- Non-warrantable property loans
- Reverse mortgages
- Commercial loans
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"Only as high as I reach can I grow, only as far as I seek can I go, only as deep as I look can I see, only as much as I dream can I be." - Karen Ravn
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Mortgage financing news and topics, and meaningful advice for real estate pro's and consumers.
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