DO YOU KNOW THE MORTGAGE LOAN CHANGES COMING JANUARY 2014?
by Gene Mock
Associate Broker, Premier Team, Keller Williams Realty 703-342-8100
ON JANUARY 1, 2014 - FHA & VA LOAN maximum amounts WILL BE REDUCED. The current high ceiling of FHA will decrease from it's current $729,750 to $625,500. VA loan amounts decrease from $843,750 to $692,500. 
A sweeping set of changes in lending rules will affect the way the U.S. mortgage industry functions goes into effect on January 1, 2014, called the Dodd-Frank Mortgage Reform Act of 2010. The Consumer Protection Act (Dodd-Frank) was passed by Congress following the onset of the Great Recession that devastated the housing and mortgage industry with worldwide repurcussions. These new regulations include Regulations Z, X and B, which respectively implement the Truth in Lending Act, Real Estate Settlement Procedures Act and the Equal Credit Opportunity Act.
The mortgage market represents about $10 Trillion, making it the largest consumer market in the world. Rules affecting mortgages are broad and complex. We are concentrating here on the effects consumers need to be aware of when thinking about purchasing a home.
The result of these changes for consumers is that it will be more difficult to qualify for a mortgage in January 2014. The Qualified Residential Mortgage" or QRM, will have far reaching consequences lessening the number of people who can obtain home loans. Starting in January 2014 there are eight factors that you, as the buying consumer, need to be aware of once the report goes into effect January 1, 2014.
WHAT YOU'LL NEED:
- Enough income or assets to cover mortgage payments
- Proof of employment or income from self-employment
- Prove you can afford property tax & homeowner's insurance
- Disclose amount you pay on any additional mortgages
- Provide full disclosure of any other properties that you own
- If applicable, must factor in child-support payments
- Need a debt-to-income ratio lower than 38%
- Need a clean credit history & good credit score
2014 MORTGAGE LENDING REGULATIONS - IMPLEMENTATION CONCERNS:
Pressures placed on the banking industry to be ready for compliance with these complex regulations is of real concern especially for smaller community banks and credit unions that lack the resources needed to meet new compliance requirements. Inconsistent or conflicting provisions and the continuing regulatory amendments issued by the CFPB (Consumer Financial Protection Board) since the beginning of the implementation periods is adding more confusion. Vendors providing software and programming updates to the banking industry have not been able to tell bank when they will be ready. Some lending institutions may be forced to stop offering mortgages altogether due to their lack of readiness.
CALL or TEXT Gene Mock today for information on real estate in the Northern Virginia Area
@ 703-342-8100
DO YOU KNOW THE MORTGAGE LOAN CHANGES COMING JANUARY 2014?
PREMIER TEAM ~ KELLER WILLIAMS REALTY ~ GOOGLE MAPS
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