Strategic Mortgage - Bill Kamboukos

FHA Down Payment Potential Increase: Bill Introduced In Congress

Strategic Mortgage — Tue, 10 Nov 2009 11:05:18 -0600

FHA Down Payment Potential Increase:

Bill Introduced In Congress

The minimum down payment for borrowers looking to obtain an FHA loan for the purchase of a home currently sits at 3.5%. However, a bill introduced to congress last month by Representative Scott Garrett, a New Jersey Republican, aims to increase the down payment to a minimum of 5%.

In addition, the new bill would also prohibit the FHA from letting borrowers roll their closing costs into the outstanding balance of the loan. Thus, further increasing the minimum out of pocket contributions by home buyers.

This comes at a time where FHA financing continues to play a larger and larger role in insuring new home mortgages. However, with an increased percentage of the current marketplace also comes increased risk. As a result, the FHA said in a Sept. 18 statement that it's tightening credit and appraisal standards and appointing a chief risk officer.

However, there has been no indication from the FHA that an increase in down payment is yet necessary to manage their increasing role in the housing market. And in a time when more and more first time home buyers are purchasing homes in the current marketplace, the potential passage of such a proposal could certainly put the process out of reach for certain buyers.

At this point this bill has yet to move forward and would need approval from the House of Representatives before moving forward. As always as additional information unfolds, we will present the facts and analysis.

For more information on home purchase loan or refinance programs for existing and potential home owners, please contact Bill Kamboukos and Carlos Felix of Strategic Mortgage at (480) 219-3682 or by emailing: info@strategicmtgaz.com or online at www.strategicmtgaz.com

Home Buying Tax Credit Extension: Officially Announced

Strategic Mortgage — Fri, 06 Nov 2009 15:15:30 -0600

Home Buying Tax Credit Extension:

Officially Announced

It is now official; the current home buyer tax credit has been extended. In addition, the new plan is an expanded version of the original plan that allows some existing homeowners to take advantage of the credit as well.

The latest version of the credit still provides up to an $8,000 tax credit for first-time homebuyers. However, it also provides up to $6,500 for existing homeowners looking to trade up to a bigger primary residence and who have already lived in their current home for five years. This expands on the amount of home buyers who can now take advantage of the tax credit.

In addition, to qualify for the full credit, homebuyers must have adjusted gross income of less than $125,000 or $225,000 for married couples filing jointly. Furthemore, the credit will only apply to homes sold for $800,000 or less.

Under the new plan purchase contracts must be signed by April 30, 2010 (extended from November 30, 2009). However, the purchases have until June 30, 2010 to close in order for a buyer to qualify for the credit.

The expansion of the home buyer tax credit means that a potential new wave of additional first time home buyers can now still take advantage of this special tax credit. While also now allowing existing homeowners to take advantage of the credit as well. How this will affect the home buying market over the next year is to be seen. However, for now we know that home buyer tax credit will be available until mid 2010. As additional information is available we will present it on this important housing issue.

FHA Home Loan Changes- Pushed Back, But Loom Large

Strategic Mortgage — Mon, 26 Oct 2009 10:01:20 -0500

FHA Home Loan Changes-

Pushed Back, But Loom Large

This next week was supposed to mark additional changes to lending standards by the Federal Housing Administration to their home loan standards. However, for the second time, the FHA has pushed back the date of these changes, originally set to go into effect on October 1^st, to December 7^th, 2009.

The major changes that we are supposed to see with these new revised rules most affect condominium financing through the FHA. The proposed changed would include the following:

The elimination of "Spot approvals" , as the entire condominium project has to meet FHA approval before a borrower can get an FHA-insured mortgage.

30 percent of the units maximum will be allowed to have FHA-insured mortgages.

50% of the units in a new complex will need to be sold before the FHA will insure a mortgage on a condo sold.

50% of the units in a project must be owner occupied.

However, the new rules do allow for some flexibility as well in the approval process of condo complexes and that is where the delay in releasing these new rules may stem from. The indication in the initial update is that Direct Endorsement Lenders can approve an entire project (not an individual spot approval ) and therefore allow a buyer to purchase a condo unit in that project using an FHA loan. However, it has been argued that this puts too much responsibility on Direct Endorsement Lenders and Underwriters and thus may be revised for the final rules being released December 7^th.

As always we will provide additional information and analysis as it becomes available on these latest proposed regulation changes.

Weekly Roundup - The Housing Price Bottom & Tax Credit Extension

Strategic Mortgage — Wed, 21 Oct 2009 12:26:15 -0500

Weekly Roundup -

The Housing Price Bottom & Tax Credit Extension

As we near the final two months of the year, two major issues in housing seem to have remained constant from the beginning of the year, housing prices and the first time home buyer tax credit.

In regard to falling housing prices, Rochdale Securities banking analyst Richard Bove this past week stated on CNBC that, "I really believe that the industry has bottomed, that we're not going to see further crashes in home prices or in home sales."

He followed that up by stating that analysts are no longer happy with banks breaking earnings and revenue forecasts and are now looking at early stage delinquencies, which appear to be declining.

If that is the case then perhaps the worse portion of foreclosures has already started. We will monitor to see how much this rings true going forward.

Home Buyer Tax Credit

On other fronts, HUD Secretary Shaun Donovan spoke in front of the Senate Banking Committee with one of the key issues being discussed being a possible extension of the first-time home buyer tax credit, set to expire November 30^th. Mr. Donovan said the government is weighing the costs and benefits very closely and will have an answer in the coming weeks, before the deadline, on an extension or not. Although this did not provide us an answer for now, it at least sets a time table for getting one. As always we will provide information as available.

Interest Only Loans For Homeowners? - Lenders Push To Include In Modifications

Strategic Mortgage — Tue, 13 Oct 2009 15:22:04 -0500

Interest Only Loans For Homeowners? -

Lenders Push To Include In Modifications

The news this week is that banks will begin to push the Obama administration to expand its mortgage-modification program to allow interest-only periods on reworked loans, seeking to bring more homeowners into the initiative while recognizing concern that it may only postpone defaults.

This plan is part of a new round of ideas and plans to refine the $75 billion "Home Affordable" program, announced in February as a bid to rework as many as 4 million loans. The program's latest phase also is marked by a need to permanently convert more than 500,000 trial modifications by collecting paperwork so consumers' mortgage payments don't revert within months. See last week's article for information about efforts that even include going door to door to reach borrowers.

In addition, the Treasury will soon announce details of a program to encourage short sales of properties by homeowners who don't qualify for modifications. It will include "capped" payments to retire second mortgages that may form an "industry standard" and help curb the "back and forth" with owners of that debt which creates one of the biggest hurdles.

Furthermore, under the current federal program, taxpayer subsidies to lenders, servicers and homeowners are used to encourage the reworking of borrowers' mortgages to cut their monthly payments to 31 percent of their incomes. Servicers are first directed to lower interest rates to as low 2 percent, then extend terms to as long as 40 years and then suspend payments on a portion of the debt until maturity.

Therefore, banks have intimated that the benefit of allowing interest-only periods as well would be a significant pickup in terms of modifications being done, because the current methods often fail to allow loans to pass required tests on whether modifications serve lenders better than foreclosures.

However, there has also been concern that Interest-only periods of five or 10 years would mean a risk of defaults only being delayed, as payments would need to eventually include principal as well.

As always as additional plans and details are released we will provide both information and analysis on the latest changes to home loan and home retention programs.

Freddie Mac Coming Door To Door: New Program To Help Homeowners

Strategic Mortgage — Mon, 05 Oct 2009 08:24:19 -0500

Freddie Mac Coming Door To Door:

New Program To Help Homeowners

This past week, Freddie Mac, the very larger and now government controlled mortgage entity announced a plan to come door to door to get in touch with delinquent borrowers. The plan will be to touch base with borrowers that are behind on mortgage payments in an effort to help them complete the process of qualifying for programs such as the Making Homes Affordable Plan. Below is the information on this new effort as described by Freddie Mac themselves.

"Freddie Mac today announced it has hired Titanium Solutions, Inc. to meet with delinquent borrowers at their homes and help them supply missing information, documents and complete other actions needed to begin their three month trial payment periods for Home Affordable Modifications under President Obama's Making Home Affordable program.

Titanium Solutions will target late-paying borrowers with Freddie Mac-owned mortgages who have not returned letters or phone calls sent by their servicers, or who need to provide additional information or documents to launch their three-month Home Affordable Modification trial periods. Titanium will also help those borrowers who have started their Trial periods complete the documentation process to enable them to be converted into final modifications.

"By meeting with our borrowers, one on one, in their homes Titanium Solutions can help them overcome the roadblocks keeping them from starting their Home Affordable Modification trial periods, "said Ingrid Beckles, Senior Vice President Of Default Asset Management at Freddie Mac. "We believe this can give borrowers seeking Home Affordable Modifications the same type of personalized guidance they may have had when they were buying their home or applying for their mortgage."

"Through this initiative, Freddie Mac again demonstrates their commitment to helping homeowners in need. We are pleased to work with them to improve contact with at risk homeowners who are in jeopardy of losing their homes to foreclosure, as well as increasing the number of homeowners who receive and are approved for a modification," said Patrick Carey, Chief Executive Officer at Titanium Solutions, Inc.

Reaching Delinquent Borrowers in their Homes

Titanium Solutions representatives will provide borrowers seeking Home Affordable Modifications with a wide range of support and expertise from reviewing program requirements, to explaining which documents are needed, to securing signatures and walking them through unfamiliar processes.

To minimize potential fraud by imposters, Titanium Solutions representatives will not accept mortgage payments or any other money from borrowers. Representatives will also carry a copy of their servicers' solicitation letter the borrower initially received. These letters are specially formatted and include unique information about the mortgage loan.

For more information about Freddie Mac efforts to help borrowers and support Making Home Affordable, visit freddiemac.com/avoidforeclosure."

As more information on this program and others to help current and potential home owners develops we will of course provide information.

August Home Sales Report: Numbers Paint Picture of Market

Strategic Mortgage — Tue, 29 Sep 2009 12:05:46 -0500

August Home Sales Report:

Numbers Paint Picture of Market

In just recently released numbers, sales of existing homes rose in August for the fifth consecutive month, adding support as the real estate market continues to try and rebound.

The report indicated a rise in home sale of 0.7% from August 2008 to August 2009 and while this number was less than gains in recent months, it was still an encouraging sign as we transition from the summer into the fall and head near the end of the current version of the home buyer tax credit.

However, the more interesting information in the latest report is the geographic split in the numbers. With the West providing much of the positive in the report and far outpacing other parts of the country in sales. As home sales rose 12% in the West in August.

In addition, the report shows that new and existing home inventories continue to drop, which is a good sign for the market. And that 93.3% of all sales were existing homes, which should continue to help inventories.

Also, in looking at the numbers, the report shows us that currently there is only a 3 month supply of housing on homes between $100,000 and $250,000 in the West. That is perhaps the most encouraging sign that lower end home prices are moving and should provide support in the market from the bottom up and perhaps eventually lead to a recovery.

As always we will provide updates and additional analysis as it comes. However, the latest home sales report definitely provides information that provides positive information on a national basis and even more so for housing in the West.

$8,000 Home Buyer Tax Credit – Extension Coming?

Strategic Mortgage — Mon, 21 Sep 2009 16:47:52 -0500

$8,000 Home Buyer Tax Credit -

Extension Coming?

As we head into October the $8,000 first time home buyer tax credit nears its deadline of November30th. Meaning that buyers have very little time to left to purchase a home and close on the home to take advantage of the credit. However, multiple campaigns have begun from lawmakers to introduce a six month to one year extension of the $8,000 first-time homebuyer's tax credit.

In addition to lawmakers, we have see realtors, bankers and homebuilders joining in the push, starting a campaign that encourages Congress to extend the program for one year with the tag line: "Don't Let America's Real Estate Recovery Expire."

Specifically from the White House, spokesman Robert Gibbs told reporters that President Barack Obama's economic team is looking at the tax credit and "evaluating the impact" on new home sales.

"Through that evaluation we'll come to something to give the president a recommendation," Gibbs said.

One more popular version of the legislation would extend the program through the end of 2010, almost double the credit to $15,000 and remove restrictions that prohibit individuals who already own homes or earn $75,000 -- $150,000 for couples -- from getting the tax break. The bill, first introduced in June, failed in a 47-50 Senate vote in August. And it seems that with the current budget deficit that this specific version of the legislation may not pass. However, additional is mounting to extend the tax form in its current state for a longer period.

That is because the home buyer tax credit has received much praise for increased home sales and even some increased average housing prices seen over the summer season, as indicated by Realtors and Commerce Department data and the S&P/Case-Shiller index respectively.

Whether or not the tax credit will be extended is obviously still very much so up in the air. As additional information develops we will pass along the information. In the mean time, with many new home buyers trying to take advantage before the credit goes away, October could be a very busy month for new homes sales.

For more information on home purchase loan or refinance programs for existing and potential home owners, please contact Bill Kamboukos and Carlos Felix of Strategic Mortgage at (480) 219-3682 or by emailing: info@strategicmtgaz.com or online at www.strategicmtgaz.com

THE FHA 203K LOAN: Facts On The FHA Streamline Repair Loan

Strategic Mortgage — Tue, 08 Sep 2009 19:38:49 -0500

THE FHA 203K LOAN:

Facts On The FHA Streamline Repair Loan

Purchase or Refinance

The FHA 203K loan is available for the purchase or refinance of a property and takes into account the purchase price or payoff (in the case of a refinance) and then adds in the cost of repairs to create your new loan balance. The repairs are then completed after the loan closing.

Property Value

The property must be appraised based on what the property will be worth after repairs. This value will then be used for a property value and the loan to value will be based off of the new loan value.

Streamlined

The maximum repair amount allowable is $35,000 with no minimum amount that can be taken for repairs. The funds will be escrowed at closing and released as the work is completed. A general contractor is not needed, but the work must be completed by a licensed professional.

Eligible Improvements

Eligible improvements include: repair/replacements of roofs/gutters, hvac, plumbing, electrical, flooring, painting, appliances, patios, porches, driveways, windows, doors, septic systems and other common repairs.

Ineligible Improvements

Ineligible improvements include: complete remodeling, new construction, structural issues, landscaping. As well any repairs taking longer than three months or not starting within 30 days of closing are ineligible.

These are just some of the basics of the FHA 203K Loan. In today's market this can be a very important loan program for both new buyers and existing home owners. If you have a property that needs minor repairs, this may be the loan for you.

For more information on the FHA 203K loan as well as additional loan programs and current rates, please contact Bill Kamboukos and Carlos Felix of Strategic Mortgage at (480) 219-3682 or by emailing: info@strategicmtgaz.com or online at www.strategicmtgaz.com

$8,000 Home Buyer Tax Credit - Ending Soon

Strategic Mortgage — Thu, 03 Sep 2009 13:49:02 -0500

$8,000 Home Buyer Tax Credit -

Ending Soon

As we head into the fall, recent housing numbers and anecdotal evidence, suggests that home buying has certainly picked up. One of the reasons for the increase in home sales, outside of lower prices and interest rates, is the $8,000 first time home buyer tax credit. This credit applies to new home buyers (or those who have not owned a home in the past three years) and it comes to an end on Monday November 30, 2009.

What that means, is that in order to take advantage of this credit, your home purchase must close by that date. With most home closings taking between 30 and 45 days in the current market, that means we are getting closer and closer to the deadline to where new home buyers will be certain they will be able to take advantage of this credit.

For those that have interest in purchasing and obtaining the tax credit, now would be the time to act. Especially if you have concerns which may lengthen the process, such as credit or down payment issues that may affect the loan process.

In addition, there is also a negative in the positive that is increased buyers; that is a more difficult time in getting your purchase offer accepted. Home buyers and real estate agents in the current market have reported that multiple offers are common place on almost all bank owned homes in the current market. Meaning that it could take longer until you have your offer accepted, as you may end up having to bid on more than one property.

In addition, other transactions such as short sales, will typically take longer to close as well, as a third party bank must approve the sale.

What this all means is that this is certainly an opportune time to purchase, with the combination of affordability and tax credits in the current market for buyers. However, with the time length from start to finish of purchasing a home in the current market, November 30^th is a lot closer then it may seem. If you are looking to purchase, now may be the time to contact a mortgage broker to begin the prequalification process and real estate agent to begin searching for homes.

For more information on home purchase loan or refinance programs for existing and potential home owners, please contact Bill Kamboukos and Carlos Felix of Strategic Mortgage at (480) 219-3682 or by emailing: info@strategicmtgaz.com or online at www.strategicmtgaz.com

Credit Scores and Down Payments for Mortgage Loans

Strategic Mortgage — Tue, 18 Aug 2009 19:41:10 -0500

Credit Scores and Down Payments for Mortgage Loans

In today's mortgage and real estate market, two of the most common questions we receive are, what type of credit score do I need to purchase or refinance a home. And what type of down payment do I need to purchase a home. The answer is, it depends on the type of loan you can obtain, what type of property it is and whether you plan on living in the home or renting it, among other things. As always, this information is subject to change, but here is a brief synopsis of where we sit in the current market.

Credit Scores: First, one of the most important issues to consider is your credit score. We have written articles in the past which can be read on our blog about keeping good credit and improving your credit score and will provide more information in the near future as the scoring models change. But, the credit score you need will depend upon the type of loan you obtain.

The minimum score you will realistically be able to obtain financing with in this market will be a 620 fico score. With a 620 credit score you will be able to obtain an FHA loan, a Veterans Administration (if you are active or retired military) or even a conventional loan. However, if you score is in this range, it will probably make sense to not obtain a conventional loan as it will be pricier for a fico in that range.

Instead if you are looking to obtain a conventional loan, to obtain the most ideal rates you will now need a 740 fico, with good rates still available, but not the lowest available at 740, 720, 700, 680, and 660 and down to a 620 fico.

Down Payments: Next you must consider down payments for the type of loan you are looking for. The lowest down payment available is currently, nothing, as Veterans Administration loans do not require any down payment. These loans are of course for current or retired military with proper qualification however and only can be used for the home you will live in, no investment or second homes.

Then there is FHA mortgages which now have a minimum down payment of 3.5%. There are no restrictions on who can obtain an FHA loan and these types of loan even allow for someone not living in the home to help the buyer qualify, such as a parent co-signing for a child. However, these loans are again only for primary residences and no investment or second homes.

Finally, there are conventional loans. The minimum down payment for conventional loans will be 5% for a primary residence and even that is getting more and more difficult with 10% now becoming the norm. However, you can also finance second homes and investment properties as well through conventional loans, with a minimum of a 20% down payment required.

These are just some of the many factors to consider when purchasing or refinancing a home, but this should provide answers to two of the most common questions in today's market.

New Mortgage Regulations - Add Protections But Could Delay Closings

Strategic Mortgage — Tue, 11 Aug 2009 11:54:55 -0500

New Mortgage Regulations -

Add Protections But Could Delay Closings

These new rules came into place at the end of July and may lead to longer closing times in the coming months. Specifically they require lenders to:

Provide a good faith estimate (GFE) of a mortgage's full cost within three business days of receiving an application.
Not charge any fees until consumers receive the GFE. The only fee lenders can ask for upfront is a "reasonable fee" for obtaining the consumer's credit history.
Wait seven business days after providing the initial loan costs before closing the loan.
Offer a new estimate of the loan costs three business days before the closing date if the original annual percentage rate (APR) increases by more than one-eighth of a percentage point.

These new regulations are in effect now and as mentioned you may begin to see these lengthening the time frame to complete purchase and refinance transactions in the coming months. How much impact they have on increased transparency is yet to be seen, but we will provide updates on the effectiveness of these new regulations in the coming month. What we do know for now, is that one additional piece of regulation has been added to the mortgage lending process with the goal of protecting consumers, but the only guarantee at the moment is a lengthier loan process.

For more information on mortgage programs, rates and information for potential and current homeowners, please contact Bill Kamboukos and Carlos Felix of Strategic Mortgage at (480) 219-3682 or by emailing: info@strategicmtgaz.com or online at www.strategicmtgaz.com

Home Prices Finally Stabilizing? - Case-Shiller Index Thinks So

Strategic Mortgage — Mon, 03 Aug 2009 13:57:24 -0500

Home Prices Finally Stabilizing? -
Case-Shiller Index Thinks So

After nearly three years of declining home prices, the value of U.S. homes finally grew on a monthly basis in May for the first time in nearly three years, according to a 20-city index released this past week.

The index showed a month-over-month increase of 0.5%, according to the report from financial data company Standard & Poor's and economists Case-Shiller. This was the first increase in the monthly index since July 2006.

Annually, home prices in the 20 cities have fallen 17.1%, but it was the second straight month that the year-over-year decline lessened.

According, to David Blitzer, chairman of the index committee S&P, "This could be an indication that home price declines are finally stabilizing."

However, Robert Shiller, the Yale economist who co-founded the index, says that there has been a decrease in foreclosure sales and that this shows up in the index statistics as a plus for home prices. But added that foreclosures could increase again in the near furture, but the future does look encouraging. In fact, with recent efforts of the government, confidence is moving higher and we are beginning to see signs of recovery in other areas as well.

On the other hand, Paul Bishop, the managing director of research for the National Association of Realtors, was glad to see the upturn but did not want to overemphasize the results of a single month, saying the economy is not out of the woods yet.

"Job losses could continue after the recession ends," he said. "That's where the economy intersects with consumers in the most tangible way. Until consumers have some level of confidence that the economy is improving, many will be reluctant to buy."

Where prices are heading from here is yet to be seen. However, with the price of homes in the current market, coupled with government intervention for modification for existing homeowners, tax credits for new homeowners and historically low interest rates, buyer activity has increased. More homeowners are now attempting to remain in their homes and new home buyers are trying to purchase homes. It will of course be very interesting to see where June and July's numbers come out when released. As always as more information becomes available we will pass along the information and analysis.

For more information on mortgage programs, rates and information for potential and current homeowners, please contact Bill Kamboukos and Carlos Felix of Strategic Mortgage at (480) 219-3682 or by emailing: info@strategicmtgaz.com or online at www.strategicmtgaz.com

Where are mortgage rates going? - Interest Rates One Percent Less Than Last Year

Strategic Mortgage — Mon, 27 Jul 2009 12:25:01 -0500

Where are mortgage rates going? -

Interest Rates One Percent Less Than Last Year

This past year has seen interest rates, on a national average, fall a full one percent from their levels last year, on 30 year fixed mortgages. It was not too long ago that any interest rate below 6% was seen as a good long term option. But as we saw the government step in and move interest rates below 6% and then below 5% and now as we sit in the low 5's on a national average, sentiment toward what a good interest rate is has changed.

Since the government stepped in to help aid mortgage rates move down at the beginning of the year many current and potential homeowners have had their minds set on obtaining elusive interest rates such as 4.5% or 4%. Now, that is not to say that it is not a good thing to try and obtain a great interest rate, but as we sit now already half way through the year and half way through the Federal Reserve's purchase program, we sit at a crossroads for long term interest rates.

We do not if we will ever get back to interest rate levels below 5% that we touched for a short time or even more so 4.5% or 4%. However, with the government intervention on a large scale set to end at the end of the calendar year, we may 6% rates before we get anywhere near 4% again.

What that means is that perhaps it is time to evaluate locking into a long term fixed rate before the end of the year if you already have not. If you plan on spending any considerable amount of time in your home, now may be the time to lock into what is still a historically low interest rate and stop chasing a rate that may never come to pass. At the end of the day, it may be your best option for at least one certainty going forward, in an uncertain market. As always, we will provide updates as we head into the latter part of the year and interest rates may see some added pressure.

For more information on mortgage programs, rates and information for potential and current homeowners, please contact Bill Kamboukos and Carlos Felix of Strategic Mortgage at (480) 219-3682 or by emailing: info@strategicmtgaz.com or online at www.strategicmtgaz.com

FHA To Introduce Green Loans: Additional Incentives For Energy Efficient Homes Coming

Strategic Mortgage — Thu, 23 Jul 2009 13:46:54 -0500

FHA To Introduce Green Loans:

Additional Incentives For Energy Efficient Homes Coming

This past year the federal government has increased incentives for home energy-efficiency through increases in tax credits for solar panels, solar water heaters, geothermal heat pumps, heavy-duty insulation, windows, air conditioning and other similar home enhancements.

This appears to be the beginning of a much larger push by the government towards green housing. At the Department of Housing and Urban Development, a new generation of energy-efficient mortgages will soon be rolled out, starting with FHA loans that offer 5 percent larger mortgage amounts to people who plan to undertake energy-efficiency improvements.

Under these new loans, for example if you qualify for a $200,000 FHA mortgage to purchase a standard house, FHA lenders might now might be able to offer you $10,000 more upfront -- a $210,000 loan amount -- if the extra money is used to substantially lower the property's annual energy consumption.

Additional incentives are also being considered, including giving applicants credit on their qualifying incomes for a home loan in exchange for documentable savings in annual energy expenditures.

In addition, the House of Representatives has also passed a massive energy-conservation and emissions-control bill. Among other items, this bill contains a subsection devoted to creating incentives for consumers and federal agencies to build and finance more energy-efficient dwellings. This plan will include initiatives for:

- The FHA is directed to insure a minimum of 50,000 new energy-efficient mortgages during the coming three years. An energy-efficient house is defined as one in which energy consumption is reduced by 20 percent after renovations.

- Fannie Mae and Freddie Mac are directed to develop new mortgage products and more flexible underwriting guidelines to reward energy-conscious borrowers and builders.

Plans to also help establish a secondary market for energy-efficient and location-efficient mortgages for moderate- and lower-income homebuyers for conventional and FHA loans are currently being pushed. This new generation of loans would increase the qualifying incomes of applicants by at least one dollar for every dollar of projected energy savings from renovations, green construction or efficient design.

There are also many more complex elements to the proposed changes including initiatives to have these properties properly valued by appraisers, state government intervention and moving homes to a more energy efficient grid altogether and away from traditional energy sources that will be part of the future of "green" loans.

Some of these plans may take effect soon, while others may take much longer to roll out. However, it appears that the future will put an emphasis or at least some incentive on a "greener" home. As programs begin to roll out we will provide additional information and details.

For more information on mortgage programs, rates and information for potential and current homeowners, please contact Bill Kamboukos and Carlos Felix of Strategic Mortgage at (480) 219-3682 or by emailing: info@strategicmtgaz.com or online at www.strategicmtgaz.com

Government Considering Mortgage Aid For Unemployed

Strategic Mortgage — Tue, 14 Jul 2009 20:32:00 -0500

Government Considering Mortgage Aid For Unemployed

This past week, the Government has begun to consider new options to expand its mortgage help initiatives. The new plan being considered will be used to delay foreclosure for jobless homeowners who are unable to keep up with monthly payments.

Policymakers are contemplating options for loan forbearance for unemployed homeowners. Thus, allowing borrowers to delay, defer or skip payments, an upgrade from current plans that are somewhat currently available in the private sector.

With rising foreclosures still an issue, lawmakers did say such a plan will come with additional hazards. It could help more people struggling with the current economic difficulties, but it also could create perverse incentives that distort the housing market.

However, officials said such a program would be in keeping with other measures to help workers who have lost jobs in the current recession.

This plan is seen as a response to increasing loan modifications, but also an increase in mortgage delinquencies as well. As recent numbers suggest that loan servicers implemented 185,156 loan modifications during the first quarter of the year, up 55 percent from the prior quarter.

However, seriously delinquent mortgages, defined as loans that are 60 or more days past due, increased by nearly 9 percent from the prior quarter to 5 percent of all mortgages. Showing that there are still many homeowners in need of assitance.

Whether or not a plan like this will be added to the ever growing mortgage relief plans the government is currently backing is to be seen. As always we will provide information and analysis when further developments arise.

For more information on home purchase loan or refinance programs for existing and potential home owners, please contact Bill Kamboukos and Carlos Felix of Strategic Mortgage at (480) 219-3682 or by emailing: info@strategicmtgaz.com or online at www.strategicmtgaz.com

Fannie & Freddie - Easing Condo Requirements?

Strategic Mortgage — Thu, 09 Jul 2009 16:05:54 -0500

Fannie & Freddie - Easing Condo Requirements?

As we have previously addressed, this past year has seen increased changes to Fannie Mae and Freddie Mac's condo requirements policy. With the main issue being new increased standards in their new definition of warrantable and non-warrantable condos (in other words, loan that they will or will not guarantee).

As a result, recently lawmakers have come out and said that they want Fannie Mae and Freddie Mac to relax recently tightened standards for mortgages on new condominiums, saying they could threaten the viability of some developments and slow the housing-market recovery.

In March, Fannie Mae said it would no longer guarantee mortgages on condos in buildings where fewer than 70 percent of the units have been sold, up from the previous 51 percent threshold. With Freddie Mac following suit recently as well.

In a letter to the CEO's of both companies, Representatives Barney Frank, the chairman of the House Financial Services Committee, and Anthony Weiner warned that a 70 percent sales threshold "may be too onerous" and could lead condo buyers to shun new developments, according to the paper.

The legislators asked the companies to "make appropriate adjustments" to their underwriting standards for condos.

In addition, Weiner said the rules have "had a real chill on the ability to get these condos sold," at a time when prices of condos have fallen enough to attract potential buyers.

In addition to the 70 percent sales threshold, Fannie Mae will also not purchase mortgages in buildings where 15 percent of owners are delinquent on condo association dues or where one owner has more than 10 percent of units, as the firm sees these as signals that a building could run into financial trouble.

Now, the ball is in the court of Fannie and Freddie who are said to be preparing a response to the lawmakers. Whether this will actually lead to any changes is yet to be seen, but we will certainly pass on any developments as they occur.

90 Day Flip Rule – FHA & Conventional Loans

Strategic Mortgage — Mon, 29 Jun 2009 16:55:47 -0500

90 Day Flip Rule - FHA & Conventional Loans

In today's real estate market we see many purchases that are properties which were recently foreclosed on and now being sold by the bank. This has been a reality of a market that has at times and in certain areas seen more bank owned properties as conventional home sales. As a result of the decline in prices we have also seen an increase in properties being bought by investors, often on a cash basis, cleaned up and then put back on the market for resale, very quickly. For these particular cases, what you may have heard as, as the 90 day flip rule, comes into play.

The Federal Housing Administration has for many years had a 90 day flip rule in place, to prevent the buy and quick resale of a home within 90 days. This past year, this rule was lifted and allowed for ownership change and immediate resale of a property in the case of a property being foreclosed on and resold by a bank. So although you may have heard that the 90 day flip rule had been lifted on FHA loans, it really does not affect any homes, except for those being foreclosed and resold by the bank.

On the other hand, you have conventional Fannie Mae and Freddie Mac backed loans. And although no 90 day rule exists for conventional loans, most, if not all lenders will have restrictions on properties that have been bought and sold within 90 days. In general, lenders will allow for the immediate purchase and resale of all foreclosure homes being resold by banks, just as in FHA. However, in the case of an investor acquiring a property and then trying to resale the property within 90 days for a price higher then it was purchased for (which is often the case in a "flip" transaction), this will not be allowed, as it will be considered a flip transaction.

What this basically means for purchasers of new homes at the end of the day, is that if the home has recently changed ownership, it is important to know why and how. If the property was foreclosed on and being sold by the bank you are fine. However, if the property was bought by a third party investor and resold right away, for a higher price, then you may not be able to obtain conventional or FHA financing on the home.

Government’s Refinancing Program May Expand

Strategic Mortgage — Mon, 22 Jun 2009 13:40:59 -0500

Government's Refinancing Program May Expand

This past week, there was news that perhaps the government's Fannie Mae and Freddie Mac refinancing program may begin refinancing mortgages with loan-to-value ratios above 105 percent as the Obama administration seeks to boost participation in its anti-foreclosure programs.

"We're actively considering how to structure a program that makes sense over 105 percent," Federal Housing Finance Agency Director James Lockhart said. He said a ratio of 125 percent "is a number" that's on the table, though "not necessarily the number we're going to end up with."

This would be an expansion of President Barack Obama's Home Affordable program announced Feb. 18, sought to help homeowners who may owe more on their mortgages than their homes are worth. No word was given at to when the loan-to-value ratio could be raised.

Home Affordable has been "seeing a slowdown" as mortgage rates increase, Lockhart said. The average rate on a typical 30- year fixed loan was 5.38 percent last week, according to Freddie Mac. The rate is up from a record low of 4.78 percent at the end of April.

The program applies to mortgages that meet Fannie Mae and McLean and Freddie Mac's conforming loan limits. That cap is $417,000 for some areas and as high as $729,750 for the 250 most expensive real estate markets.

Under the program, borrowers with loans owned or guaranteed by Fannie Mae or Freddie Mac who have loan-to-value ratios of 80 percent to 105 percent and aren't delinquent can refinance without buying mortgage insurance, or paying for more insurance than they already have.

Expanding the program to a 125 percent loan-to-value level may benefit additional borrowers that have loans backed by Fannie Mae or Freddie Mac. Fannie Mae and Freddie Mac own or guarantee more than half of the single-family mortgages in the U.S.

Lockhart also said yesterday that his agency, the companies' regulator, is looking at ways for Fannie Mae and Freddie Mac to help the so-called warehouse lending market, which provides financing to smaller, independent mortgage companies, amid a credit crunch.

While Fannie Mae and Freddie Mac are prohibited by law from lending directly to other firms, Lockhart said they may be able to provide the market some liquidity by committing to purchase multifamily and other loans.

As more information is released on this initiative and others we will continue to provide updated information as always.

For more information on consumer initiatives, home purchase loan or refinance programs for existing and potential home owners, please contact Bill Kamboukos and Carlos Felix of Strategic Mortgage at (480) 219-3682 or by emailing: info@strategicmtgaz.com or online at www.strategicmtgaz.com

Obama's Plan for a Consumer Financial Protection Agency

Strategic Mortgage — Tue, 16 Jun 2009 20:06:50 -0500

Obama's Plan for a Consumer Financial Protection Agency

This past week saw the release of information for a potential Consumer Financial Protection Agency proposed by President Obama. Nothing is set in stone yet and it is uncertain if this agency will come to pass. However, it cold lead to additional oversight and changes aimed at protecting consumers with financial instruments including mortgages. However, as with many government proposals and initiatives that we have seen with the end claimed results being helping consumers, we will reserve judgment until we see results. The plan perhaps looks good on paper in Washington, but what effect will this have on Main Street if it comes to pass? Here is what we know so far.

The agency would:

* be accountable as primary federal financial consumer protection supervisor.

* have broad authority to protect consumers of credit, savings, payment, and other financial services and regulate such products and services.

* have "full authority" to enforce protections through orders, fines and penalties.

* define standards for plain products and subject alternative products to greater scrutiny.

* ban unfair terms and practices or restrict terms and practices for products that may have benefits.

* help ensure executive pay does not create conflicts of interest between consumers and financial firms.

* enforce fair lending laws and the Community Reinvestment Act, which requires financial institutions to serve sparsely populated or low-income areas.

* overhaul mortgage laws to make them clearer and fairer to consumers.

* require firms to offer a simple mortgage with straightforward terms and uniform disclosure. Consumers could opt for alternative loans but these would be subject to restrictions.

* ban unfair practices such as "yield spread premiums," which entitle mortgage brokers to higher fees if they steer consumers to mortgages with higher costs.

* require mortgage brokers to be paid over time based on loan performance rather than in a lump sum at closing.

* restrict or ban prepayment penalties.

* require loan originators or loan bundlers to retain 5 percent of credit risk.

When we receive additional information and details on the new proposed agency, we will as always pass them along.

The Basics On Condo Financing: FHA Approval & Warrantable Condos

Strategic Mortgage — Wed, 10 Jun 2009 19:43:49 -0500

The Basics On Condo Financing:

FHA Approval & Warrantable Condos

Recently we have seen an increased demand for clients looking to purchase condos. The important thing to remember however that financing for condos is different than that of single family residence homes. In today's market, in order to finance or refinance a condo, the property needs to fall into one of two categories: it either needs to be FHA approved or a warrantable condo. We will go over basics of these two types of financing options for condos and how to determine if the condo you are looking at falls into either of the two categories.

FHA Approved Condos

Federal Housing Administration financing is available with no restrictions different then loans for single family residences, except that the property must be inside a condo complex that is FHA approved. Well how do you know if a condo is FHA approved? It is quite simply actually, as the FHA provides a link to check this directly at: https://entp.hud.gov/idapp/html/condlook.cfm. Simply put in the condo project name or other details and you will be able to determine if the condo is approved or not.

Warrantable Condos

On the other hand if you are looking to obtain a conventional loan that is backed by Fannie Mae or Freddie Mac, you must determine if a condo is considered warrantable. Unfortunately, there is not a handy tool like the FHA provides to look up individual complexes. Instead, you must determine if the condo project fits into one of three classes that follow. If it does then it warrantable, if not then you cannot obtain a conventional loan on the condo.

CLASS I

1. Developer's control of the homeowners association has been turned over to the condo owners
2. Project is not subject to additional phasing or add-ons which have not yet been completed
3. All common elements and amenities must be fully installed, completed and in operation
4. 70% of all units in the entire development must have been sold and or legally obligated to close
5. 70% of all units in the entire development must have been sold to owner occupants

CLASS II

1. Recent or current condominium conversions (from apartments)
2. Homeowners association has been controlled by the unit owners (other than the developer) for less than two years
3. Project is not subject to phasing or add-ons which have not yet been completed
4. All common elements and amenities are fully installed, completed and in operation
5. 70% of the units in the entire development must have been sold and/or legally obligated to close
6. 70% of the units in the entire development must have been sold to owner occupants
7. No more than 15% of the current unit owners are more than one month delinquent in payment of homeowner's dues or assessments

CLASS III

1. Homeowners Association has been controlled by unit owners (other than developer) for at least one year
2. Project is not subject to phasing or add-ons
3. All common amenities are fully installed, completed, and in operation
4. 90% of the units have been sold (owner-occupancy of at least 60%)

In order to determine if a condo falls into one of these classes a condo questionnaire must be completed to determine eligibility. In addition, depending on the type of down payment, loan purpose, etc, there may be additional restrictions for conventional mortgages for condos.

Always consult a lender for final determination on any type of financing, but now you have a guide to begin to determine what type of financing is available if you are looking at financing or refinancing a condo.

For more information on home purchase loan or refinance programs for existing and potential home owners, please contact Bill Kamboukos and Carlos Felix of Strategic Mortgage at (480) 219-3682 or by emailing: info@strategicmtgaz.com or online at www.strategicmtgaz.com

FHA Approves $8,000 Tax Credit at Closing – With a Caveat

Strategic Mortgage — Mon, 01 Jun 2009 18:51:29 -0500

FHA Approves $8,000 Tax Credit at Closing - With a Caveat

Following up on the initial announcement that we presented a few weeks ago, HUD has now finalized a plan to allow home buyers to use the $8,000 tax credit for first time buyers, at the closing of their home purchase.

This new plan will allow buyers who qualify for the current first time home buyer tax credit to utilize these funds at closing, as opposed to waiting for the refund, until after closing. Previously buyers had to close on their home and then file an amendment to their 2008 taxes or wait to file their 2009 taxes next year, to take advantage of the credit.

However, there is one caveat that is included in this new final plan, and that is that the $8,000 can be used for closing costs or down payments, but can not be used for the 3.5% minimum down payment currently required on all FHA loans.

What that means is that this new plan will do nothing to help those buyers who lack the 3.5% down payment required for the purchase of a new home, using FHA financing. Instead, this plan will be aimed at allowing buyers to borrow the tax credit, at closing, for additional down payment above and beyond 3.5%. As well, as allowing home buyers to use the tax credit funds to be used to pay for closing costs.

Borrowers can still receive the required 3.5% down payment in the form of a gift from family members, as has always been the case with FHA financing.

In addition, this new initiative to receive the tax credit at closing will be more of a short term bridge loan for the borrowers to receive the $8,000 tax credit, as a silent second mortgage from an FHA mortgagee lender or a government agency and then having the funds repaid when the actual tax credit from the government is processed.

This new plan will certainly provide an incentive for some borrowers who are already looking to purchase a home, but will it create an initiative or opportunity for more buyers to purchase? We will have to wait and see.

For more information on home purchase loan or refinance programs for existing and potential home owners, please contact Bill Kamboukos and Carlos Felix of Strategic Mortgage at (480) 219-3682 or by emailing: info@strategicmtgaz.com or online at www.strategicmtgaz.com

Mortgage Rates Rise: Will The Fed Revise Their Plan?

Strategic Mortgage — Thu, 28 May 2009 12:38:21 -0500

Mortgage Rates Rise:

Will The Fed Revise Their Plan?

This past week has seen a rapid spike in interest rates moving the average 30 year fixed rate from a national average of near 4.8% to now significantly above 5% with rates still on the move. When and if rates will move back down below 5% is now the question many consumers have on their mind. However, like many other issues surrounding the mortgage market, the answer may just be an issue of waiting and seeing what happens.

Both treasury yields and mortgage rates rose last Wednesday to their highest levels since November, in turn dealing a blow to the Federal Reserve's efforts to stimulate the economy by keeping borrowing costs low.

The Fed has made low mortgage rates a priority in its strategy to help the U.S. recession. In order to achieve that, the central bank has been buying mortgage backed securities and Treasurys. Since this past fall, it has bought more than $460 billion of mortgage-backed securities and more than $125 billion of Treasury bonds.

However, in recent days the tables have been turned against the Fed, as investors worry the government's approach could lead to inflation. The government will sell nearly $2 trillion in U.S. Treasury bonds this year to fund its stimulus programs, and investors worry there won't be enough demand for it. Therefore, excess demand would send bond prices down and push up the government's cost of raising money.

In addition, recent signs of a recovery in the U.S. and across the globe have attracted investors to move out of the relative safety of the Treasury market and into securities that may yield more, such as corporate bonds, stocks and other debt. While that's generally good news for the U.S., it also makes it harder for the Fed to help reinvigorate the battered housing market and keep mortgage rates low.

As such, with higher interest rates on the horizon, investors have been moving out of longer-term Treasury bonds and into shorter-term debt to avoid the risk of rising rates. Treasury traders have expected the U.S. central bank to step in to keep the 10 year Treasury bond yield at 3.5%. However, the Fed has not been so exact in its purchases.

Higher interest rates, in turn, make existing mortgage-backed securities less attractive, because newer securities would be filled with loans that pay more interest. Once Treasury yields solidly surpassed 3.5%, investors sold nearly $10 billion worth of bonds backed by mortgage loans, analysts estimate.

With Wednesday's rise in rates, additional pressure may now be put on the Fed to increase its planned purchases of Treasurys beyond the $300 billion already earmarked. This is after the late April meeting in which the Fed considered raising the amount but held off. Now the speculation is that the Fed may need to address the market's reactions before its next June 24 FOMC meeting.

When and if the Fed steps in again with a new or revised plan to help keep mortgage rates low is still to be seen. In the mean time we will have to play a waiting game as we see where mortgage rates head next.

Government Adds Cash Incentive To Home Owners Who Can’t Save Homes

Strategic Mortgage — Mon, 18 May 2009 13:52:43 -0500

Government Adds Cash Incentive To Home Owners Who Can't Save Homes

The Treasury Department recently announced a new plan that includes a cash incentive to assist homeowners to move on and to get loan servicers to forgive mortgage debt for mortgages that can not be modified, for which foreclosure will be the best option.

This newest initiative is the latest portion of the government's Making Home Affordable program to be announced. (See: http://www.treasury.gov/press/releases/tg131.htm).

As mentioned in previous articles, the original program was designed to help, homeowners to be eligible for loan adjustments or refinancing if they meet a slew of criteria including being a loan owned by Fannie Mae or Freddie Mac, being a conforming loan limit and being a primary residence, among other things.

However, even if you meet all those qualifications, mortgage help is not assured. The homeowners may still not be able to afford reduced monthly mortgage payments of 31% of income. And to protect the investors who own the mortgage, the value of a modified loan still has to be greater than the value of what would be recovered in foreclosure.

In these cases, lenders first consider a short sale, a deal in which the home is sold for less than the mortgage balance, and loan servicers may forgive the difference.

If that is unsuccessful, the final step is a "deed in lieu of foreclosure," when borrowers voluntarily forfeit the deed and the debt may be erased.

Under the new initiatives, for short sales and deeds in lieu, borrowers will get up to $1,500 to assist with relocation expenses. Treasury will also pay the servicers $1,000 to complete a short sale or deed in lieu.

A deed in lieu might also be better for the banks. Banks acquire the properties back from delinquent borrowers faster and more easily, saving them legal, financial and other costs associated with going through the entire foreclosure process.

Not every deed in lieu involves "cash for keys," but motivated lenders will often pay borrowers something, typically about $1,000, to vacate by a fixed date and to not vandalize the homes or strip it of fixtures.

The borrowers who may benefit most from this program are the ones who would still not be able to repay their mortgages under any reasonable workouts.

These would include delinquent borrowers who are way underwater, owing much more on their mortgages than their homes are worth, people who have lost their jobs with little hope of finding another and ones who have gone through a divorce or another life-changing event.

In those cases, they may be better off cutting their housing expenses by switching to a rental and the cash-for-keys is one more good reason to do so.

However, the deed in lieu may not be simple. If there's a second mortgage, the lender will not allow a deed in lieu unless they get the full cooperation of the holder of the second mortgage.

To help solve that issue, Treasury will also make incentive payments to second mortgage holders, up to $1,000, if they give up all claims.

We will continue to monitor and provide updates on the making homes affordable program as they become available. However, the introduction of this new program perhaps signals that the government is now seeing that not as many borrowers as they once thought will be helped by the making homes affordable program. Or perhaps this is just another initiative to help clarify and enhance the original program.

FHA Borrowers May Soon Be Able To Use $8,000 Tax Credit at Closing

Strategic Mortgage — Thu, 14 May 2009 17:16:10 -0500

FHA Borrowers May Soon Be Able To Use $8,000 Tax Credit at Closing

The details are still a bit unclear as to how the program will be implemented. However, HUD Secretary Shaun Donovan announced this past week that first-time buyers using FHA loans would soon be allowed to "monetize" the $8,000 federal first-time buyer tax credit and use the funds for their down payment.

"We, like you, believe that this new tax credit is not only a tremendous opportunity for first-time home buyers, but also an enormous benefit for communities struggling to deal with an oversupply of housing. ... We all want to enable FHA consumers to access the tax credit funds when they close on their home loans so that the cash can be used as a down payment. 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 the numerous organizations that are already part of the FHA network to receive this additional benefit," Donovan told attendees at the National Association of Realtors, Real Estate Summit in Washington.

As mentioned, the details of the program still haven't been announced, but the revised policy seems to offer a benefit to potential first time home buyers without the full down payment for the purchase of a home.

The policy should help boost the housing market by allowing first-time buyers using FHA loans to stretch their dollar by using the federal credit at settlement as part of their closing funds, rather than waiting months for a refund on a tax return. "This allows them to solve the ‘chicken or the egg' question: the promised tax credit or the closing" that allows them to get the money, said Rob Dietz, director of tax issues of the National Association of Home Builders, adding: "They have a right to this credit amount as a first-time buyer. It makes sense to turn this credit into their home equity."

Still two questions remain unanswered: Will first-time home buyers be able to monetize the tax credit using any FHA-approved lender? Or will they need to be working with a state housing finance agency, which usually requires additional documentation and provides financial and homeownership counseling to those who qualify for their help?

"We will attempt to answer those questions once we've published our mortagee letter," HUD spokesman Brian E. Sullivan said.

If buyers could monetize the tax credit, they would essentially receive a short-term bridge loan for the amount of the credit (which could vary based on their income and the home's sales price). They could apply that money to their down payment or as additional equity in their home. For buyers working with a state housing finance agency, the monetized tax credit often becomes a "soft" second mortgage, which they must pay back once they receive their tax refund.

Dietz added that," There's no doubt that the purpose of the tax credit is to stimulate housing demand. We estimate new and existing home sales will increase by 160,000. But it's not a tax credit that is in anyway large enough to reinflate the market-it's just a useful and limited tool to smooth out the market," he said. "As for causing sales to return to 2005 levels or push prices up, this tax credit is not capable of doing that."

As the details of the new program and the mortgage letter from FHA are published we will provide additional information and details. The final version of this program will tell the story of whether or not this will be a program that enables first time buyers an option to purchase a home and truly take advantage of the $8,000 home buyer tax credit at closing.

For more information on home purchase loan or refinace programs for existing and potential home owners, please contact Bill Kamboukos and Carlos Felix of Strategic Mortgage at (480) 219-3682 or by emailing: info@strategicmtgaz.com or online at www.strategicmtgaz.com

Strategic Mortgage - Bill Kamboukos

FHA Down Payment Potential Increase: Bill Introduced In Congress

Home Buying Tax Credit Extension: Officially Announced

FHA Home Loan Changes- Pushed Back, But Loom Large

Weekly Roundup - The Housing Price Bottom & Tax Credit Extension

Interest Only Loans For Homeowners? - Lenders Push To Include In Modifications

Freddie Mac Coming Door To Door: New Program To Help Homeowners

August Home Sales Report: Numbers Paint Picture of Market

$8,000 Home Buyer Tax Credit – Extension Coming?

THE FHA 203K LOAN: Facts On The FHA Streamline Repair Loan

THE FHA 203K LOAN:

Facts On The FHA Streamline Repair Loan

Purchase or Refinance

The FHA 203K loan is available for the purchase or refinance of a property and takes into account the purchase price or payoff (in the case of a refinance) and then adds in the cost of repairs to create your new loan balance. The repairs are then completed after the loan closing.

Property Value

The property must be appraised based on what the property will be worth after repairs. This value will then be used for a property value and the loan to value will be based off of the new loan value.

Streamlined

The maximum repair amount allowable is $35,000 with no minimum amount that can be taken for repairs. The funds will be escrowed at closing and released as the work is completed. A general contractor is not needed, but the work must be completed by a licensed professional.

Eligible Improvements

Eligible improvements include: repair/replacements of roofs/gutters, hvac, plumbing, electrical, flooring, painting, appliances, patios, porches, driveways, windows, doors, septic systems and other common repairs.

Ineligible Improvements

Ineligible improvements include: complete remodeling, new construction, structural issues, landscaping. As well any repairs taking longer than three months or not starting within 30 days of closing are ineligible.

These are just some of the basics of the FHA 203K Loan. In today's market this can be a very important loan program for both new buyers and existing home owners. If you have a property that needs minor repairs, this may be the loan for you.

For more information on the FHA 203K loan as well as additional loan programs and current rates, please contact Bill Kamboukos and Carlos Felix of Strategic Mortgage at (480) 219-3682 or by emailing: info@strategicmtgaz.com or online at www.strategicmtgaz.com

$8,000 Home Buyer Tax Credit - Ending Soon

Credit Scores and Down Payments for Mortgage Loans

New Mortgage Regulations - Add Protections But Could Delay Closings

New Mortgage Regulations -

Add Protections But Could Delay Closings

These new rules came into place at the end of July and may lead to longer closing times in the coming months. Specifically they require lenders to:

Provide a good faith estimate (GFE) of a mortgage's full cost within three business days of receiving an application.

Not charge any fees until consumers receive the GFE. The only fee lenders can ask for upfront is a "reasonable fee" for obtaining the consumer's credit history.

Wait seven business days after providing the initial loan costs before closing the loan.

Offer a new estimate of the loan costs three business days before the closing date if the original annual percentage rate (APR) increases by more than one-eighth of a percentage point.

For more information on mortgage programs, rates and information for potential and current homeowners, please contact Bill Kamboukos and Carlos Felix of Strategic Mortgage at (480) 219-3682 or by emailing: info@strategicmtgaz.com or online at www.strategicmtgaz.com

Home Prices Finally Stabilizing? - Case-Shiller Index Thinks So

Where are mortgage rates going? - Interest Rates One Percent Less Than Last Year

Where are mortgage rates going? -

Interest Rates One Percent Less Than Last Year

FHA To Introduce Green Loans: Additional Incentives For Energy Efficient Homes Coming

FHA To Introduce Green Loans:

Additional Incentives For Energy Efficient Homes Coming

This past year the federal government has increased incentives for home energy-efficiency through increases in tax credits for solar panels, solar water heaters, geothermal heat pumps, heavy-duty insulation, windows, air conditioning and other similar home enhancements.

Under these new loans, for example if you qualify for a $200,000 FHA mortgage to purchase a standard house, FHA lenders might now might be able to offer you $10,000 more upfront -- a $210,000 loan amount -- if the extra money is used to substantially lower the property's annual energy consumption.

Additional incentives are also being considered, including giving applicants credit on their qualifying incomes for a home loan in exchange for documentable savings in annual energy expenditures.

- The FHA is directed to insure a minimum of 50,000 new energy-efficient mortgages during the coming three years. An energy-efficient house is defined as one in which energy consumption is reduced by 20 percent after renovations.

- Fannie Mae and Freddie Mac are directed to develop new mortgage products and more flexible underwriting guidelines to reward energy-conscious borrowers and builders.

Some of these plans may take effect soon, while others may take much longer to roll out. However, it appears that the future will put an emphasis or at least some incentive on a "greener" home. As programs begin to roll out we will provide additional information and details.

For more information on mortgage programs, rates and information for potential and current homeowners, please contact Bill Kamboukos and Carlos Felix of Strategic Mortgage at (480) 219-3682 or by emailing: info@strategicmtgaz.com or online at www.strategicmtgaz.com

Government Considering Mortgage Aid For Unemployed

Fannie & Freddie - Easing Condo Requirements?

90 Day Flip Rule – FHA & Conventional Loans

Government’s Refinancing Program May Expand

Obama's Plan for a Consumer Financial Protection Agency

The Basics On Condo Financing: FHA Approval & Warrantable Condos

FHA Approves $8,000 Tax Credit at Closing – With a Caveat

Mortgage Rates Rise: Will The Fed Revise Their Plan?

Government Adds Cash Incentive To Home Owners Who Can’t Save Homes

FHA Borrowers May Soon Be Able To Use $8,000 Tax Credit at Closing