Alan's Mortgage Information

Update - I've Moved to PrimeLending - Alan Gross

Alan Gross (PrimeLending) — Wed, 04 Nov 2009 09:20:59 -0600

I Have Moved to PrimeLending

It's been no secret that the last couple of years have been very volatile in both the Real Estate and Mortgage Banking industries... with home prices dropping, loan programs becoming more restrictive and companies closing.

As you know, my success has been driven by you and others like you, who have referred your friends, co-workers, relatives and clients to me when they were considering home financing. My primary goal has always been to offer my clients an unmatched level of service... to make the mortgage loan process absolutely painless and to provide real world, make sense financing options... allowing my clients to cut a straighter path to their financial goals.

As I looked at the changes taking place, I began evaluating the direction of the mortgage banking industry, and began forecasting the tools necessary to again raise the bar for my standard or customer service... to provide more value for you and your referrals!

After looking at many options available in today's market, I am pleased to announce that I have aligned with PrimeLending... a bank owned mortgage provider that is not new to the concept of customer service as a primary business directive. Using the latest technological systems we can offer a level of service that is unparalleled in the mortgage industry! (Not to mention PrimeLending's unmatched mortgage programs.)

Why did I start looking at other options? As many of you are aware, National City Mortgage was purchased by PNC bank at the end of 2008. I became concerned about their commitment to the mortgage operation when I read in the corporate history. "In 1993, PNC acquired Sears Mortgage operation to create one of the nation's largest mortgage originators and service providers at the time. Due to the heavy consolidation in the industry, PNC made a strategic decision to exit the consumer mortgage business in 2000, selling PNC Mortgage to Washington Mutual Home Loans, Inc." As we moved through 2009 it became clear to me that PNC didn't want to make the kind of commitment to the consumer mortgage business I felt was necessary to meet my service level goals.

With my move to PrimeLending, I am happy to be able to tell you that you will continue to receive the same high level of help and service you have received in the past. I will continue to work with the same people I have worked with for the past 12 years including the regional management, processing and underwriting staffs. The only thing that is changing is my office location.

As I transition I will be using a new home office phone number, (240.813.0614) and a new email address(HomeMortgageAdvisor@gmail.com) I am doing this to take advantage of new technologies. You will still be able to reach me at my current phone number and email address. The new office phone number is 301.208.0055. As in the past the best place to reach me will be at the home office.

With your permission, I will continue to keep you advised of items of interest and impact to you and your home... I am confident you will share my excitement... I look forward to speaking with you soon.

Have a great upcoming holiday season!

Call me with any questions you have concerning the current mortgage market.

To keep up with the trends in interest rates you can visit my Daily Market Report at www.mtg-info.net/DailyMarketReport.

I am always available to answer any questions you have concerning interest rates or mortgage loans.

Whether your looking to buy or refinance, call me today. I'm here to help. The best place to reach me is at my home office 240.813.0614. You can also email me at HomeMortgageAdvisor@gmail.com

Alan Gross
Home Office: 240.813.0614
Email: HomeMortgageAdvisor@gmail.com
Web: www.mtg-info.net

Good News For Mortgage Loans

Alan Gross (PrimeLending) — Fri, 30 Oct 2009 09:20:44 -0500

Congress Passes Legislation Extending Loan Limits Scheduled to Expire on 12/31/09.

On October 29, 2009 Congress passed legislation to keep the U. S. government running through December 18th. Included in this legislation is a provision that will extend the temporary loan limits for Fannie Mae, Freddie Mac and FHA. The higher loan limit ceilings were first authorized as part of a 2008 stimulus package and were extended through 12/31/2009 earlier this year.

The loan limits will remain at $729,750 through 12/31/2010. "While those loan limits aren't scheduled to go down to $625,500 until Jan. 1, if not maintained at the higher level now, the mortgage industry will begin to plan for loans at the lower amount," said appropriators said in a statement. "This could result in major disruptions in the mortgage origination market for large loan sizes as early as November.

This legislation is particularly important in high housing cost areas because the secondary market for "Jumbo" loans has not recovered since it's collapse at the the beginning of the housing crisis.

In related news, the U. S. Senate won't vote until next week at the earliest on proposals to extend the $8,000 tax credit for first-time homebuyers. The Obama administration is officially asking Congress to extend the tax credit for first-time homebuyers. "I think the first-time home-buyer credit is a great example of funding that's helped to stabilize the housing market and should be extended." Jared Bernstein, chief economist to Vice President Joe Biden, said on Bloomberg television. Treasury Secretary Timothy Geigher gave his support earlier.

Lawmakers announced earlier this week a plan to attach the tax-credit proposal to a pending bill on unemployment benefits. The lawmakers want to extend the credit until April 30, 2010. The proposal would expand the tax credit to allow higher-income Americans and some that already own homes to quality for the break.

Homebuyers who have lived in their prior residences for at least five years may receive a credit of $6,500 under the plan, said Senate Finance Committee Chairman Max Baucus. Also, couples earning as much as $225,000 and individuals as much as $125,000 would quality for the extended break, Baucus said. That's an increase in the limit of $75,000 for individuals and $150,000 for couples.

"The success of the American economy is closely tied to the success of the housing market; by helping to stabilize the housing market, the homebuyer tax credit has help shore up the economy as it begins to recover," said Baucus, a Montana Democrat. "This plan would enable an even greater number of potential homebuyers to take the credit."

Call me with any questions you have concerning the current mortgage market.

To keep up with the trends in interest rates you can visit my Daily Market Report at www.mtg-info.net/DailyMarketReport.

I am always available to answer any questions you have concerning interest rates or mortgage loans.

Whether your looking to buy or refinance, call me today. I'm here to help. The best place to reach me is at my home office 301.353.9360. You can also email me at mtginfo@aol.com

Alan Gross
Home Office: 301.353.9360
Email: mtginfo@aol.com
Web: www.mtg-info.net

Facebook - How To Change The "News Feed" Settings

Alan Gross (PrimeLending) — Mon, 26 Oct 2009 16:18:04 -0500

How To Change the New Facebook "News Feed" Settings:

Recently Facebook has made some changes in what can appear on Facebook pages. These changes have caused confusion for a lot of people.

Facebook's changes include a restriction on the number of updates. The preset limit is set at 250 individuals with Facebook determining what content is displayed.

The video below shows how to make adjustments to the new settings and gives you control of what you want to see.

To keep up with the trends in interest rates you can visit my Daily Market Report at www.mtg-info.net/DailyMarketReport.

I am always available to answer any questions you have concerning interest rates or mortgage loans.

Whether your looking to buy or refinance, call me today. I'm here to help. The best place to reach me is at my home office 301.353.9360. You can also email me at mtginfo@aol.com

Alan Gross
Home Office: 301.353.9360
Email: mtginfo@aol.com
Web: www.mtg-info.net
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What Consumers Want From A Real Estate Agent

Alan Gross (PrimeLending) — Thu, 22 Oct 2009 13:49:35 -0500

Anne Ruldolph On What Consumers Want From A Real Estate Agent

Anne Randolph is the publisher of Lore Magazine and has a consulting company, Lore Consulting. Lore Magazine (www.Loremagazine.com) focuses on the personal stories of the top producers and brokers in the real estate industry.

For the last 8 years Anne has focused on bringing a strong consumer and analytic perspective to the real estate industry through research, consulting and speaking.

The video below is a discussion about what consumers want from their real estate agents.

Anne Randolph On What Consumers Want From Real Estate Agent - Click here for the most popular videos

Another Great Google Feature

Alan Gross (PrimeLending) — Wed, 21 Oct 2009 10:49:27 -0500
The more I work with Google products the more I become a Google Fan. A few months ago I opened a new email address HomeMortgageAdvisor@gmail.com. Then I added an igoogle account which lets me check my email, Google Voice (another free service I added recently - 240.813.0614) and store all my favorite sites online so I have access to them from any computer. I recently came across Google Reader In Plain English. It lets you get content from your favorite sites without having to visit all of them. Here's a short video on Google Reader In Plain English:

Twitter Tips?

Alan Gross (PrimeLending) — Fri, 16 Oct 2009 09:41:58 -0500
For all you Twitter fans it's important to know the limitations of writing twits. The video below offers some guidelines. Enjoy!

Googles New Service!

Alan Gross (PrimeLending) — Fri, 09 Oct 2009 10:51:46 -0500
Need to get away? Want to lose touch with the world? Google now has the answer - Go to Google Village!
Google Opt Out Feature Lets Users Protect Privacy By Moving To Remote Village

Grout Medic - They Help Sell Homes Faster

Alan Gross (PrimeLending) — Wed, 19 Aug 2009 15:19:13 -0500

Grout Medic - Bring Grout & Tile Back To Life

We all know that a homes appearance, particularly in the kitchen and bathroom, can help or hinder in the sale of a home.

A good friend of mine, Dennis Cyr, specializes in bringing grout and tile back to life. Grout Medic will remove and replace grout and caulk, as well as clean and seal grout, and stain grout (change color) without removing it. He will also remove and replace broken tiles, repair hollow/loose tiles, provide slip resistent tub treatments and much more. The "new look" of tile replacement can be achieved at a fraction of the cost and reduce the time needed from 7 -10 days to less than a day!

Grout Medic uses state-of-the-art environmentally safe products and machines. Ask Dennis about fixing mildew problems.

Dennis can be reached at 301.285.0600 or via email at dkcyr@verizon.net.

If you mention to Dennis that you found out about his services from me he will give a $50.00 discount on any job over $300.00.

Dennis is based in Beltville, Maryland.

You can find a link on my website at: http://www.mtg-info.net/GroutMedic.

Call me with any questions you have concerning the current market.

To keep up with the trends in interest rates you can visit my Daily Market Report at www.mtg-info.net/DailyMarketReport.

I am always available to answer any questions you have concerning interest rates or mortgage loans.

Whether your looking to buy or refinance, call me today. I'm here to help. The best place to reach me is at my home office 301.353.9360. You can also email me at mtginfo@aol.com

Alan Gross
Home Office: 301.353.9360
Email: mtginfo@aol.com
Web: www.mtg-info.net

Taylor Bean Mortgage Closes - How Could It Effect You?

Alan Gross (PrimeLending) — Fri, 07 Aug 2009 09:48:02 -0500

Taylor, Bean & Whitaker Mortgage Corp. Shuts Down. Why Could This Effect You?

Taylor, Bean & Whitaker Mortgage Corp. (Taylor Bean), a privately held mortgage company, was one of the largest independent home-loan providers in the United States. It's primary customers were mortgage brokers and smaller banks. Taylor Bean closed suddenly Wednesday when the Federal Housing Administration (FHA) barred it from making loans insured by the government agency.

According to industry newsletter Inside Mortgage Finance Taylor Bean ranked 12th among U.S. mortgage originators in the first half of 2009 funding $17 billion of loans or 1.7% of the total loans originated. It was the third-largest originator of FHA loans in June (source - Inside Mortgage Finance, a trade publication.)

Some of the effects of the closing of Taylor Bean are being felt immediately. Loans that had closed but not yet been funded cannot be completed. Borrowers who had loans currently in process through the company will need complete new applications with another company. Some buyers will see their settlements delayed while they wait for approvals from a different lender.

The long term effects are not quite as clear. The number of wholesale lenders has been shrinking the past few years as some have gone out of business and others have withdrawn from the business. This has made it more difficult for mortgage brokers to place loans for their clients. There has also been some speculation that the closure of Taylor Bean will allow interest rates to rise because the remaining lenders will have less competition.

On a different note, remember that the First Time Homebuyers Tax Credit of up to $8,000 currently expires on December 1, 2009. Waiting to long to buy a home could result in being unable to take advantage of the credit. Remember, the new Truth in Lending Act (TILA) that took effect July 30, 2009 has the potential to slow down or delay settlements.

Call me with any questions you have concerning the current market.

To keep up with the trends in interest rates you can visit my Daily Market Report at www.mtg-info.net/DailyMarketReport.

I am always available to answer any questions you have concerning interest rates or mortgage loans.

Whether your looking to buy or refinance, call me today. I'm here to help. The best place to reach me is at my home office 301.353.9360. You can also email me at mtginfo@aol.com

Alan Gross
Home Office: 301.353.9360
Email: mtginfo@aol.com
Web: www.mtg-info.net

New Truth in Lending Rules Act Could Affect Settlements

Alan Gross (PrimeLending) — Mon, 27 Jul 2009 08:50:26 -0500

Important News - New Truth-In-Lending Act Changes Could Effect Real Estate Settlements

The Housing and Economic Recovery Act of 2008 included several revisions to the Truth in Lending Act (TILA.) These important revisions go into effect on July 30, 2009.

While most changes will not be noticeable to you, there are new requirements that will impact processes and possibly closing dates. However, I hope with continued communication and awareness of these changes, we will avoid any problems.

The key changes effective with all applications on or after July 30, 2009 are:

Collection of fees: Lenders cannot collect a fee from the consumer, other than a reasonable fee for obtaining the consumer's credit history, until the consumer is in receipt of the initial Truth-in-Lending (TIL.)

TIL disclosure applicability: Lenders must now provide a TIL on refinance transactions.

New statements added to all TIL disclosures: "You are not required to complete this agreement merely because you have received these disclosures or signed a loan application."

Initial TIL waiting period: A loan cannot close until seven business days from the delivery of the initial TIL. For example: Lender places loan disclosures in the mail on Monday, August 3rd, the loan cannot close until on or after Tuesday, August 11th. Business days are the same for as used for recission periods on refinanced loans - Monday through Saturday excluding public holidays.

Annual Percentage Rate (APR) re-disclosure tolerance: After the initial TIL is given if there are any changes that effect the APR and cause the APR to go up by 0.125% for fixed rate products (or 0.250% for ARM products) a new TIL must be given to the borrower. The new waiting period is three business days after the borrower receives the revised disclosures. A borrower is presumed to have received the new disclosures within three business days if placed in the mail. This creates a six day waiting period, three days to receive the disclosures and a three day waiting period. If a new / revised TIL is required and it is hand delivered or provided in another manner more prompt that regular mail to the borrower, the TILA mandates that the closing not occur for 3 business days from the date the borrower receives the revised disclosure. The delivery will need to be documented by receiving a signed and dated revised TIL.

It should be noted that the fees used to calculate the APR are not just the fees charged or controlled by the lender. It is also affected by the fees and costs charged by the settlement agent. A lender must estimate the closing costs of the settlement agents. If these costs are higher than the original estimate it could trigger the need for re-disclosure.

In order to insure that I continue to meet your expectations loans will have to be locked earlier in order to assure the settlement is not delayed by the new required waiting periods. It's also important to get closing costs from the settlement company as quickly as possible so any adjustments can be made quickly and not cause a delay in the settlement.

As you mortgage consultant, I want you to be aware of these important changes, particularly the initial TIL waiting period and APR re-disclosure tolerances. As always, I will keep you posted on any other important changes.

Call me with any questions you have concerning the current market.

To keep up with the trends in interest rates you can visit my Daily Market Report at www.mtg-info.net/DailyMarketReport.

I am always available to answer any questions you have concerning interest rates or mortgage loans.

Whether your looking to buy or refinance, call me today. I'm here to help. The best place to reach me is at my home office 301.353.9360. You can also email me at mtginfo@aol.com

Alan Gross
Home Office: 301.353.9360
Email: mtginfo@aol.com
Web: www.mtg-info.net

Higher Mortgage Loan Limits To Be Extended?

Alan Gross (PrimeLending) — Thu, 23 Jul 2009 11:26:08 -0500

House Appropriations Committee Approves Bill That Would Extend Increased Mortgage Loan Limits

On Friday July 17, 2009 The House Appropriations Committee approved the Housing and Urban development budget for 2010. (Making appropriations for the Departments of Transportation, and Housing and Urban Development - see pages 143-146 - You can read the entire 162 pages if you need a sleeping pill) The bill, if approved, would extend the temporary $729,750 loans limits for Fannia Mae, Fred Mc and the Federal Housing Administration (FHA) available in high cost housing markets though September 2010. The maximum loan amount varies from state to state and county to county. To determine the maximum loan available in your area view this link. Area Maximum Loan Amounts.

The bill also increases the lending and guarantee authority of FHA from $315 billion to $400 billion in single family loans during fiscal year 2010. This is important because FHA loans have risen in the past few years from less than 10% of mortgage loans to almost 40% of mortgage loans and if higher limits were not enacted this important source of mortgage financing could dry up.

I wrote last month about legislation proposed by Johnny Isakson, R-Ga that would expand the current $8,000 tax credit for first time homebuyers. The legislation would also extend the tax credit which currently expires on December 1, 2009 to one year from the date of enactment and would allow homebuyers to claim the credit on their 2009 tax return for purchases made in 2010. I haven't seen anything in the news or on Sen. Issacon's web site showing any progress has been made in getting the proposal passed. I'll let you know if I hear anything new.

First-time homebuyers are running out of time to take advantage of the current $8,000 tax credit. The current credit expires on November 30, 2009. Because of the time it takes to find a home, arrange for financing and go to settlement people wanting to take advantage of the credit need to be looking for homes now.

Call me with any questions you have concerning the current market.

To keep up with the trends in interest rates you can visit my Daily Market Report at www.mtg-info.net/DailyMarketReport.

I am always available to answer any questions you have concerning interest rates or mortgage loans.

Whether your looking to buy or refinance, call me today. I'm here to help. The best place to reach me is at my home office 301.353.9360. You can also email me at mtginfo@aol.com

Alan Gross
Home Office: 301.353.9360
Email: mtginfo@aol.com
Web: www.mtg-info.net

How Low Will Mortgage Interest Rate Go?

Alan Gross (PrimeLending) — Thu, 09 Jul 2009 11:19:49 -0500

How Low Will Mortgage Interest Rates Go?

In early December 2008 the Treasury Department "leaked" a plan that it was considering to lower mortgage interest rates. On December 16th the Federal Reserve (FED) dropped its target for the Federal Funds Rate from 1% to between 0 and 0.25%. In addition the FED pledged to use "all available tools" to fight the current downturn in the economy. Based in it's statements the FED plans to keep interest rates at "exceptionally low levels: for some time to come.

The effect of these actions was to move mortgage interest rates lower. They bottomed in mid January before rising a little bit through the end of February. Interest rates then started moving down again and by mid March they reached a low point which held relatively stable through May 27th. Despite predictions that interest rates would move lower, on May 27th the market panicked and rates shot up peaking on June 10th. Since that time the trend in interest rates has been moving down.

So where are we headed? The other day Mark Zandi, chief economist with Moody's Economy.com, changed his forecast slightly. He had been leaning towards an interest rate of 4.5 percent by the end of the summer. Now, "4.5% seems increasingly less likely," Zandi acknowledged. "I'm hoping rates move back to below 5 percent in the next few weeks."

As we have seen in the past predicting the movement in mortgage interest rates can be a tricky business. For those who are considering buying a new home or refinancing their current mortgage it appears this summer will a good time to accomplish either.

Call me with any questions you have concerning the current market.

To keep up with the trends in interest rates you can visit my Daily Market Report at www.mtg-info.net/DailyMarketReport.

I am always available to answer any questions you have concerning interest rates or mortgage loans.

Whether your looking to buy or refinance, call me today. I'm here to help. The best place to reach me is at my home office 301.353.9360. You can also email me at mtginfo@aol.com

Alan Gross
Home Office: 301.353.9360
Email: mtginfo@aol.com
Web: www.mtg-info.net

Is The $15,000 Tax Credit For Homebuyers Alive Again?

Alan Gross (PrimeLending) — Thu, 11 Jun 2009 15:01:18 -0500

Is The $15,000 Tax Credit For Homebuyers Alive Again?

On June 10, 2009 Johnny Isakson, R-Ga, introduced legislation that would expand the current $8,000 tax credit for first time homebuyers. The new legislation would increase the maximum amount of the tax credit from $8,000 to $15,000. Unlike the current tax credit, it would not be limited to first-time homebuyers. The proposed legislation would also eliminate the current income caps of $75,000 for an individual and $150,000 for married couples. The legislation would also extend the tax credit which currently expires on December 1, 2009 to one year from the date of enactment and would allow homebuyers to claim the credit on their 2009 tax return for purchases made in 2010.

"The first-time homebuyer tax credit has made a difference. First-time home buyers used it and the market stabilized, but we don't have a recession in first-time home buyers. We have a recession in the move-up market," Isakson said. "One of the biggest problems facing the American people today is an illiquid housing market, a decline in their equity, a decline in their net worth and a depression in the housing market that we are obligated to correct if we possibly can."

"The man who is transferred from Missouri to Georgia can't sell his house in Missouri, can't come to Georgia and can't take the transfer. His employer can't afford to buy the house and hold it for him because of the proliferation of inventory that is owned," Isakson said. "Today, in the United States, one in two sales made every day is a short sale or a foreclosure. That is an unhealthy market, and it is continuing to precipitate a downward spiral in values, loss of equity by the American people and a protracted, difficult economic time for our country."

The proposed legislation immediately picked up a bipartisan group of co-sponsors for his legislation, including Senators Lamar Alexander, R-Tenn., Jim Bunning, R-Ky., Saxby Chambliss, R-Ga., Chris Dodd, D-Conn., John Ensign, R-Nev., Joe Lieberman, ID-Conn., Lisa Murkowski, R-Alaska, James Risch, R-Idaho, and David Vitter, R-La.

To view the press release: Isakson Continues Push to Stimulate Housing Market

This legislation could have positive effect on real estate sales in 2009 and 2010. I will continue to monitor the progress of the legislation and keep you posted on it's progress.

Call me with any questions you have concerning the current market.

Alan Gross
Home Office 301.353.9360
www.mtg-info.net
mtginfo@aol.com

$8,000 Tax Credit As A Down Payment Rules Issued - They Are Not What We Hoped For!

Alan Gross (PrimeLending) — Fri, 29 May 2009 13:18:01 -0500

$8,000 Tax Credit As A Down Payment Rules Issued By HUD. They Are Not What Was Hoped For!

At the National Association of Home Builders Spring Board of Directors meeting on May 29, 2009 HUD Secretary Shaun Donovan announced the rules for using the $8,000 tax credit. They are not what was hoped for. The tax credit cannot be used for the initial 3.5 percent downpayment required for FHA loans. The tax credit can be applied to a downpayment in excess of the required 3.5 percent, points to buy down the interest rate and/or closing costs.

"We believe this is a real win for everyone," said Donovan. "Today, the Obama Administration is taking another important step toward accelerating the recovery of the nation's housing market. Families will now be able to apply their anticipated tax credit toward their home purchase right away. At the same time we are putting safeguards in place to ensure that consumers will be protected from unscrupulous lenders. What we're doing today will not only help these families to purchase their first home but will present an enormous benefit for communities struggling to deal with an oversupply of housing."

Per HUD News Release No. 09-072:
Currently, borrowers applying for an FHA-insured mortgage are required to make a minimum 3.5 percent downpayment on the purchase of their home. Current law does not permit approved lenders to monetize the tax credit to meet the required 3.5 percent minimum down payment, but, under the terms of today's announcement, lenders can now monetize the tax credit for use as additional down payment, or for other closing costs, which can help achieve a lower interest rate. Buyers financing through state Housing Finance Agencies and certain non-profits will be able to use the tax credit for their downpayments via secondary financing provided by the HFA or non-profit. In addition to the borrower's own cash investment, FHA allows parents, employers and other governmental entities to contribute towards the downpayment. Today's action permits the first-time homebuyer's anticipated tax credit under the Recovery Act to be applied toward the family's home purchase right away. Unlike seller-funded down-payment assistance, which was a vehicle for abuse, this program will allow homebuyers to shop for the best home price and services using their anticipated tax credit.

Click to view a full the complete HUD News Release No 09-072

Click to view HUD Mortgagee Letter 2009-15 "Using First-Time Homebuyer Tax Credits"

The $8,000 tax credit is available to first-time homebuyers who purchase and settle on a home prior to December 1, 2009.

With home prices down and interest rates hovering at near record lows, 2009 will go down in history as one of the best home buying opportunities for both first-time and move-up homebuyers.

Call me with any questions you have concerning the current market.

How will the new appraisal rules effect you?

Alan Gross (PrimeLending) — Mon, 18 May 2009 15:31:21 -0500

How Will The New Appraisal Rules Effect You?

Effective May 1, 2009 all home mortgages being sold to Fannie Mae and Freddie Mac must follow the new Home Valuation Code of Conduct (HVCC). HVCC sets new guidelines on how appraisals must be ordered and who can have contact with the appraisers. This regulation does not apply to FHA or VA loans. Even though it only applies to loans sold to Fannie Mae and Freddie Mac it will affect all conventional home loans.

Why were the HVCC regulations written? The HVCC regulations were written to deal with some felt were shady and unethical practices of pressuring appraisers to "come in at the value needed." They evolved from a potential lawsuit by the Attorney General of New York (Andrew Coumo) against Fannie Mae and Freddie Mac. On March 3, 2009 the Attorney General, Fannie Mae, Freddie Mac and the OFHEO reached a settlement agreement regarding the issues of appraisal coercion and independence in exchange for the Attorney General dropping the investigation.

HVCC forbids parties involved in the origination of mortgage loans including loan originators from communicating directly with home appraisers on loans to be sold to Fannie Mae and Freddie Mac. Instead of selecting the appraiser and contacting them as was done in the past, lenders must now go through an appraisal management company (AMC) to order the appraisal. This means that the lender has no input in selecting the appraiser. One can now only hope that a competent appraiser is selected to complete the appraisal. It's been reported that some AMC's have been choosing appraisers based on the fee they will accept over the quality of the service provided. If the loan is being "brokered" to another lender the appraisal is ordered not by your broker but by the lender approving and funding the loan. This means that you may need to pay for multiple appraisals if the loan is moved from one lender to another.

With another party involved in the transaction expect the cost of an appraisal to rise slightly. The HVCC regulations can also cause some delays in getting appraisals completed. Recently I had a borrower buying a second home in Wintergreen, VA. The appraiser needed a copy of the contract. The appraiser couldn't call me directly. He had to make the request through the AMC.

It will take time to determine if the new regulation will benefit or hurt the consumers it was designed to protect.

Call me with any questions you have concerning the current market.

Use the $8,000 Tax Credit As A Down Payment?

Alan Gross (PrimeLending) — Wed, 13 May 2009 11:17:49 -0500

Use The $8,000 Tax Credit As A Down Payment?

At the National Association of Realtors legislative summit's meeting on May 12, 2009 HUD Secretary Shaun Donovan announced a plan that would allow first time homebuyers to use the $8,000 tax credit as a downpayment.

"We all want to enable FHA consumers to access the tax credit funds when they close on their home loans so that cash can be used as a donwpayment. So FHA will permit trusted FHA-approved lenders and HUD-approved nonprofits, as well as state and local governmental entities to "monetize" the tax credit through short-term bridge loans. We think the policy is a real win for everyone, ensuring that borrowers can tap into numerous organizations that are already part of the FHA network to receive this additional benefit. FHA will be publishing details shortly."

The $8,000 tax credit is available to first-time homebuyers who purchase and settle on a home prior to December 1, 2009.

Allowing first-time homebuyers to use the tax credit as a downpayment will help stimulate the housing market. A major obstacle holding many buyers back is the lack of the up front cash needed to complete the purchase.

With home prices down and interest rates hovering at near record lows, 2009 will go down in history as one of the best home buying opportunities for both first-time and move-up homebuyers.

Look for further details on this new programs as they become available.

Call me with any questions you have concerning the current market.

How To Recognize and Deal With The Swine Flu

Alan Gross (PrimeLending) — Thu, 30 Apr 2009 09:05:18 -0500

There's been a lot in the news recently regarding the swine flu. Johns Hopkins recently release a patient information sheet dealing with how to recognize swine flu and what steps to take if you suspect you or a family member has the flu. To get their recommendations click the link below.

Swine Flu Information Sheet

Have a happy and healthy spring!

Will The New Stimulus Package Help The Housing Market?

Alan Gross (PrimeLending) — Wed, 18 Feb 2009 12:51:30 -0600

Will The New Stimulus Package Help The Housing Market?

Yesterday President Obama signed the 2009 stimulus package into law. There are a number of provisions that will effect the housing industry. Will this legislation put a floor on real estate values and start moving the industry towards recovery? Let's look at the portions of the plan that will effect the real estate market.

$8,000 Tax Credit for First-Time Homebuyers:

The original proposal was for a $15,000 tax credit for all purchases of homes. The new package contains an $8,000 tax credit restricted to first-time homebuyers. There is talk of reintroducing separate legislation to modify the tax credit. Here's a breakdown of the legislation signed yesterday:

* The tax credit is for first-time homebuyers only. (Cannot have owned a principal residence over the three years prior to purchase.)
* The tax credit does not have to be repaid. (There is a recapture clause. If the home is sold within three years of purchase the entire amount of the credit is recaptured on the sale. This applies only to homes purchased in 2009.)
* The tax credit is equal to 10 percent of the home's purchase price up to a maximum of $8,000.
* The credit is available for homes purchased on or after January 1, 2009 and before December 1, 2009.
* Single taxpayers with incomes up to $75,000 and married couples with incomes up to $150,000 qualify for the full tax credit. The credit phases out for incomes above these levels.
* The tax credit does not need to be paid back to the government unless the property is sold within three years, at which point the entire amount of the credit will be recaptured.

Higher Loan Limits:

The ceiling for Fannie Mae, Freddie Mac and FHA loans was increase to $729,750 in high cost areas through December 31, 2009. The factor for high cost areas is increased back to 125% of the 2008 median home price for markets between the floor and ceiling limits. The limits will maintain the current floor limit of $271,050 for FHA loans and $417,00 for conventional loans. For the few markets where the 2009 limits were higher than 2008, those markets will maintain the higher limit. As I write this the web sites for Fannie Mae, Freddie Mac and FHA (HUD) have not been updated to reflect the new limits.

Reverse Mortgages (HECM)

Reverse mortgage allow qualified borrowers to refinance or purchase homes without having to make any payments while living in the home. The new legislation raises the maximum loan amount to $625,000. While FHA loan maximums are set depending on the properties location, the HECM maximum loan amount is the same throughout the country. It's been tough to find information about the new HECM rules but I believe the new loan limit will expire on December 31, 2009 and will then return to the current limit of $417,000.

Call me with any questions you have concerning the current market.

PMI Mortgage Insurance Company Eliminates Loans Originated By Third Parties

Alan Gross (PrimeLending) — Fri, 13 Feb 2009 12:15:56 -0600

PMI Mortgage Insurance Company Eliminates Loans Originated By Third Parties

Remember Private Mortgage Insurance (PMI)? It was insurance required by mortgage lenders on conventional loans when the borrower had a loan-to-value (LTV) greater than 80%. PMI was established to help borrowers with little cash buy or refinance houses. Then along came 2nd mortgages and home equity lines of credit. With these loans borrowers could borrow up to a combined loan-to-value (CLTV) of 100%. Terms such as 80/10/10, 80/15/5 and 80/20 became common. PMI became an afterthought.

It was thought during the boom years of secondary financing that PMI cost to much and the companies that issued PMI were making to much money for to little risk. Well, as the saying goes, "the worm turns." Now PMI companies are losing $Billions and 2nd mortgages and home equity lines are a thing of the past because of the perceived risk of the investors that used to buy these loans.

Recently one private mortgage insurance company aptly named PMI announced that it would not longer insure loans originated by third parties (brokers.) If one mortgage insurance company has done it, expect the rest to follow. According to the announcement these changes become effective February 20, 2009. PMI, the company, also announced other changes effective February 20, 2009. See PMI Eligibility and Guideline Changes.

What does this mean for homebuyers and homeowners wanting to get a loan with less than 20% equity in the property? Be sure you are working with a lender that is not brokering your loan.

Call me with any questions you have concerning the current market.

Where Are Mortgage Interest Rates Headed?

Alan Gross (PrimeLending) — Mon, 09 Feb 2009 18:07:23 -0600

Where Are Mortgage Interest Rates Headed?

The questions I get asked the most concerns where interest rates are today and what direction are they headed. It been a tough couple of months to provide answers to these questions. Back in November the Federal Reserve (FED) announced that it would be buying Mortgage-Backed Securities (MBS). The effect was to move mortgage interest rates down. Rates moved on a downward path through early January, when despite the efforts of the FED they began to move up again. Despite predictions of lower rates this trend has continued into February. As of today the FED has purchased about $91 billion of the $500 billion allocated to buy MBS's.

So where are we headed? Some experts expect interest rates to move back down. William (Bill) Gross is a co-founder of The Pacific Investment Management Company, LLC (PIMCO), one of the worlds largest bond funds. PIMCO is one of the companies contracted to assist the FED's purchase of MBS's.

Bill Gross appeared today Monday February 9th on CNBC's Squawk Box. When asked about mortgage interest rates he said he felt they were going to head down again. To see a the full interview go to Bill Gross on Squawk Box 2.9.09.

Let's all hope Bill is right. Getting the housing industry moving in a positive direction is one of the first steps needed in turning the economy around. It's going to be a very interesting couple of weeks. As the old saying goes "Hold on to your hats."

Call me with any questions you have concerning the current market.

Fannie Mae Revises Investment Propery Guidelines

Alan Gross (PrimeLending) — Mon, 09 Feb 2009 10:02:59 -0600

Fannie Mae Revises Investment Property Guidelines

Last year Fannie Mae reduced the allowance for the number of properties financed from 10 properties to 4 properties. On February 6th they released Announcement 09-02 revising the allowance for the number of properties financed back to 10 properties. To see the full amendment to the Fannie Mae Selling Guide go to Announcement 09-02.

In Fannie Mae's words "Fannie Mae is committed to providing financing opportunities for high-credit quality, bona fide investors. Experienced investors play a key role in the housing recovery and Fannie Mae's continued support for investor borrowers is consistent with its mission to provide stability, liquidity, and affordability to the nation's housing system."

When more than 4 properties are financed the borrower must have a minimum credit score of 720. For 1 Unit Second Home or Investment Properties the maximum Loan-to-Value (LTV) will be 75%. For 2-4 Unit Investment Properties the maximum LTV will be 70%.

Announcement 09-02 also includes new reserve requirements for second homes, investment properties and multiple financed properties.

When the borrower will own one to four financed properties (including the subject property) the reserve requirements are:
- two months reserves on the subject property if it is a second home,
- six months s reserves on the subject property if it is an investment property, and
- two months reserves on each other financed second home or investment property.

When the borrower will own five to ten financed properties (including the subject property) the reserve requirements are:
- two months reserves on the subject property if it is a second home,
- six months reserves on the subject property if it is an investment property, and
- six months reserves on each other financed second home or investment property.

This change in the Fannie Mae Guidelines should have a positive effect on real estate sales. Although the restrictions on LTV and cash reserves are tighter than in the past, it allows investors to finance a larger number of properties. I look for Freddie Mac to make similar revisions to their guidelines.

Call me with any questions you have concerning the current market.

A $15,000 Tax Credit For Homebuyers?

Alan Gross (PrimeLending) — Thu, 05 Feb 2009 11:33:41 -0600

Will There Be a $15,000 Tax Credit For Homebuyers?

A new amendment to the economic stimulus package working it's way through congress was unanimously approved on February 4th. The amendment proposed by U.S. Senator Johnny Isakson, R-Ga. would increase the current "tax credit" of $7,500 to $15,000.

The amendment would provide a direct tax credit of 10% of the purchase price up to a maximum of $15,000 for the purchase of a home. The property purchased must be used as a primary residence. The credit would allow taxpayers to claim the credit on their 2008 tax return. Under the amendment the tax credit would have to be repaid if the home is sold within two years of the purchase. Purchases would have to be made within one year of the legislations enactment. The tax credit will not be limited just to first time homebuyers.

The legislation would sunset the current $7,500 housing tax credit.

"It is time to fix America's problem, not throw money at the symptoms. It is time to fix housing first. It is rare that we have a road map to success in times of difficulty, but this country has once before realized a housing crisis every bit as bad as the one we have today and economic troubles every bit as dangerous," Isakson said. "We have a pervasive housing problem, and we have a historical precedent that works. I am proud this Senate has joined together, learned from history and repeated a method that worked by adopting this amendment."

To view the press release: Senate Unanimously Approved Isakson Amendment to Stimulate Housing Market.

This amendment could have positive effect on real estate sales in 2009. I will continue to monitor the progress of the legislation and keep you posted on it's progress.

Call me with any questions you have concerning the current market.

Will The $7,500 Tax Credit For First Time Homebuyers Get New Teeth?

Alan Gross (PrimeLending) — Mon, 26 Jan 2009 10:03:14 -0600

Will The $7,500 Tax Credit For First Time Homebuyers Get New Teeth?

On January 15th the House Democratic Leadership released information concerning the proposed $825 billion economic stimulus package. Part of the package includes a proposed improvement in the Tax Credit of $7,500 for first time homebuyers that was part if last years Housing and Economic Recovery Act (ACT) enacted in July 2008.

Under the ACT a first-time homebuyer buying a principal residence is able to claim a tax credit of 10% of the purchase price up to a maximum of $7,500. The definition of a first-time homebuyer is an individual or married couple that has not owned a principal residence in the previous three years. The ACT set the time period for this credit from April 9, 2008 through July 1, 2009.

A part of the ACT that has been less publicized is the income limits. The credit begins to phase out for taxpayers whose modified adjusted gross income is more than $75,000 ($150,000 for married filing jointly.) For taxpayers not filing a married joint return the tax credit is completely phased out when the modified adjusted gross income exceeds $95,000 ($170,000 for married filing jointly.)

Under the current ACT the credit is repayable over a period of 15 years. In essence, it is an interest free loan. There are some instances where the entire credit would not have to be repaid. Because of this repayment requirement it is believed that a relatively few consumers have been attracted to the plan.

The new proposal would change eliminate the repayment requirement and make this a true tax credit. By some industry estimates eliminating the repayment requirement could lead to an additional 202,000 home purchases this year. The National Association of Realtors is working to get the deadline extended from July 1st to December 31st. This would increase the number households able to tax advantage of the credit and would lead to an even larger increase in home purchases.

There is also a proposal to increase the maximum loan in "high cost" areas from $625,500 back to the $729,750 that was part of last years economic stimulus package.

Both these proposals could have positive effect on real estate sales in 2009. I will continue to monitor the progress of the legislation and keep you posted on it's progress.

Call me with any questions you have concerning the current market.

New higher loan limits again? Will new TARP legislation help the real estate market?

Alan Gross (PrimeLending) — Fri, 09 Jan 2009 13:19:36 -0600

New Higher Loan Limits - Are the loan limits that were lowered at the end of 2008 going to be raised again?

In a news conference today, January 9th, Barney Frank announced that house democrats have agreed with President-elect Barack Obama that the loan limits for loans purchased by Fannie Mae and Freddie Mac need to be raised back to the $729,750 in high cost areas. The proposal would also increase the loan limits on Federal Housing Administration insured loans. "Keeping the loan limits at last year's levels this year so we can then think about what we do going forward will be in the economic recovery program for FHA, Fannie Mae and Freddie Mac," Frank said.

Barney Frank also released proposals to amend the Troubled Assets Relief Program (TARP) legislation passed last year. Proposals in this legislation which is expect to be introduced next week include:

FORECLOSURE RELIEF

TARP Foreclosure Mitigation Plan - Use of the second $350 billion is conditioned on the use of a minimum of $[50] billion for foreclosure mitigation, with plan required by March 15, 2009. By that date, the Secretary shall develop (subject to TARP Board approval) a comprehensive plan to prevent and mitigate foreclosures on residential mortgages. The Secretary shall begin committing TARP funds to implement the plan no later than April 1, 2009.

Required Elements of Plan - The foreclosure mitigation plans must apply only to owner-occupied residences and shall leverage private capital to the maximum extent possible consistent with maximizing prevention of foreclosures. Treasury must use some combination of the following program alternatives:

1) guarantee program for qualifying loan modifications under a systematic plan, which may be delegated to the FDIC or other contractor

2) bringing costs of Hope for Homeowner loans down (beyond mandatory changes in Title V below), either through coverage of fees, purchasing H4H mortgages to ensure affordable rates, or both

3) program for loans to pay down second lien mortgages that are impeding a loan modification subject to any write-down by existing lender Treasury may require

4) Servicer incentives/assistance - payments to servicers in connection with implementation of qualifying loan modifications

5) Purchase of whole loans for the purpose of modifying or refinancing the loans (with authorization to delegate to FDIC)

HOPE FOR HOMEOWNERS IMPROVEMENTS

Eliminates 3% upfront premium

Reduces 1.5% annual premium to a range between .55% and .75%, based on risk-based pricing (also makes technical fix to permit discontinuation of fees when loan balance drops below certain levels, consistent with normal FHA policy)

Raises maximum loan to value (LTV) from 90% to 93% for borrowers above a 31% mortgage debt to income (DTI) ratio or above a 43% ratio

Eliminates government profit sharing of appreciation over market value of home at time of refi. Retains government declining share (from 100% to 50% after five years) of equity created by the refi, to be paid at time of sale or refi as an exit fee

Authorizes payments to servicers participating in successful refis

Administrative simplification: (a) eliminates borrower certifications regarding not intentionally defaulting on any debt, (b) eliminates special requirement to collect 2 years of tax returns, (c) eliminates originator liability for first payment default, (d) eliminates March 1, 2008 31% DTI test, (e) eliminates prohibition against taking out future second loans, (f) requires Board to make documents, forms, and procedures conform to those under normal FHA loans to the maximum extent possible consistent with statutory requirements.

HOME BUYER STIMULUS

Requires Treasury to develop a program, outside of the TARP, to stimulate demand for home purchases and clear inventory of properties, including through ensuring the availability of affordable mortgages rates for qualified home buyers. In developing such program, Treasury may take into consideration impact on areas with highest inventories of foreclosed properties. The program will be executed through the purchase of mortgages and MBS using funding under HERA.

In developing such program, Treasury shall provide mechanisms to ensure availability of such reduced rate loans through financial institutions that act as either originators or as portfolio lenders.

Treasury shall make the affordable rates available under this program available in connection with Hope for Homeowner refinancing program.

It is clear we have not seen the last piece of legislation that will effect mortgage loans and the real estate market. There have been more major changes in mortgage financing rules in the past 12 months than were made over the past 10 years. Hold on to your hats because the ride is just beginning.

To keep up with the trends in interest rates you can visit my Daily Market Report at www.mtg-info.net/DailyMarketReport.

I am always available to answer any questions you have concerning interest rates or mortgage loans.

FED Move Causes Mortgage Interest Rates To Drop!

Alan Gross (PrimeLending) — Wed, 17 Dec 2008 12:16:11 -0600

Mortgage Interest Rates Drop!

On December 16th the Federal Reserve (FED) dropped its target for the Federal Funds Rate from 1% to between 0 and 0.25%. In addition the FED pledged to use "all available tools" to fight the current downturn in the economy. Based in it's statements the FED plans to keep interest rates at "exceptionally low levels: for some time to come.

In the past the FEDs cut in the Federal Funds Rate has not always translated into lower mortgage interest rates. In this case the announcement had an immediate effect and mortgage interest rates showed an immediate decline.

Mortgage interest rates are now at all time lows. Unlike the past when mortgage rates were the same for everybody, mortgage interest rates are now priced based on factors such as loan amount, credit score, loan purpose and loan to value. Call me so we can determine the interest rate for your particular situation.

As has happened in the past, these low interest rates will cause a flood of new mortgage applications. The crisis in the mortgage market over the past few years has caused many mortgage companies to close or cut back on staff levels. Don't wait until you feel interest rates are at the bottom to get your application started.

Whether your looking to buy or refinance, call me today. I'm here to help. The best place to reach me is at my home office 301.353.9360. You can also email me at mtginfo@aol.com

Have a safe and happy holiday season!