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Home : New York : Nassau County : Massapequa : Nikitas Kouimanis

99,331 Points

Name: Nikitas Kouimanis, Nikitas Kouimanis 929 800 1888
Company: Equity Loans
E-mail: Contact Nikitas Kouimanis, Nikitas Kouimanis 929 800 1888 (Equity Loans )
Google Profile: Find me on Google+
Website: http://www.nikitas-kouimanis.com
Office Phone: (855) 342-3555
Cell Phone: (929) 800-1888
Alt. Phone: (800) 654-9342
Fax: (855) 544-4533
Description: Nikitas Kouimanis is New York's mortgage EXPERT! Apply or Call Now to get low mortgage rates and fees for all your purchase and refinance needs!

About Me

My name is Nikitas Kouimanis I am New York's Mortgage EXPERT. I am known to be a Nationally Ranked Loan Originator with 12 years of experience with great knowledge of all products in this industry. My goal has always been to make sure the loans I work on are the best fit for my clients. I have never and will never place a client in a program that doesn't fit their budget or lifestyle. I take great pride in my dedication to client satisfaction. I strive to develop a trusting, honest, long term relationship with my clients so much that, at the end, we are friends or even extended family.

I work throughout New York, New Jersey and Connecticut but most of my clients come from Manhattan, Brooklyn, Bronx, Queens and Long Island. Whether you are a first time home buyer or an experienced buyer, I know I can assist you. I have access to many different loan programs. Let me find the perfect program for your situation. Purchasing a home in Manhattan, Brooklyn, Queens, Long Island, or anywhere else in New York, New Jersey or Connecticut? I have home loan products that can make your home purchase dreams come true. Being that I am a nationally ranked FHA Loan Originator, I am very well rounded and specialize in government home loan programs. Government programs were created to make home ownership possible to more people.

FHA and VA loans are great examples. FHA programs have lower down payments and easier financial requirements which can be perfect for a First Time Home Buyer. VA Loans are for Veterans and their families to purchase a home with no money down. I even have access to Stated Income Mortgage Loans, a rare type of home loan that can help self-employed people among others purchase a home. I also offer Conforming Loansalso known as Conventional Loans with some of the most competitive rates you will find. I have access to conventional loan programs with both fix and adjustable rates. Purchasing a home that is over the conforming limits? No problem. I also have access to jumbo loan programs. Since Jumbo Loanscan have higher rates, it’s important to work with someone who has experience. I have access to the most competitive jumbo rates you’ll find. When it comes to home loans there is no one size fits all program, contact me and I will find a loan that works best for you and your situation. Are you already a home owner and want to take advantage of record low rates to save money on your mortgage payments or pull cash out of your home to pay for debts, a child’s education or just have some extra spending money? I can help you too. When you refinance, just like when you purchase a home, it’s important to know all your options. Little things can make a big difference in paying thousands of dollars for no reason. I have access to some of the most competitive refinance rates in New York. Let me run the numbers to see how much I could save you. If a refinance is not in your best interest I will be sure to tell you. I also offer the HARP2.0 The Making Home Affordable Refinance Program (HARP Phase II). This program is a government backed mortgage program that allows most borrowers with existing Fannie Mae and Freddie Mac loans to refinance their homes even if they owe more than their home is worth, have an adjustable rate mortgage, have been turned down for a refinance loan or loan modification in the past, or just can't afford their mortgage payment anymore.

My goal is to make you a client for life; I value my relationships with my clients. I look forward to speaking with you and gaining your trust and business. With so many places you can go, how can you be sure you are working with the best? Put me to the test and I’ll present all the options available to you, then you can compare my personal service and my loan terms. I’m confident that you’ll be pleased with what you see.

Loan Programs

Loans Products:

Home Purchase Mortgage
Home Refinance Mortgage
FHA Loans
VA Home Loans
Stated Income Mortgage Loans
30 Year Fixed Rate Mortgage
15 Year Fixed Rate Mortgage
Adjustable Rate Mortgage (or ARM)
Jumbo Mortgage
Interest-Only Mortgage
Cash Out Mortgage Loans
Fixed Rate Loans
Debt Consolidation
Harp Loans 2.0
Home Equity Loans
USDA Loans

Conforming Loans

A mortgage that is equal to or less than the dollar amount established by the conforming loan limit set by Fannie Mae and Freddie Mac's Federal regulator.

In the United States, a conforming loan is a mortgage loan that conforms to GSE guidelines.
In general, any loan which does not meet guidelines is a non-conforming loan. A loan which does not meet guidelines specifically because the loan amount exceeds the guideline limits is known as a jumbo loan.
Starting in 1970, Fannie Mae was authorized by the United States Government to purchase residential mortgage loans. Fannie Mae worked with Freddie Mac to develop uniform mortgage documents and national standards for what would come to be known as a conforming loan.
Fannie Mae and Freddie Mac are continuously in the market for conforming loans; because of this, conforming loans benefit from greater liquidity than non-conforming loans.
The Office of Federal Housing Enterprise Oversight (OFHEO) set the criteria on what constitutes a conforming loan limit that Fannie Mae and Freddie Mac can buy. Criteria include debt-to-income ratio limits and documentation requirements. The maximum loan amount is set based on the October-to-October changes in median home price, above which a mortgage is considered a jumbo loan, and typically has higher rates associated with it. This is because both Fannie Mae and Freddie Mac only buy loans that are conforming, to repackage into the secondary market, making the demand for a non-conforming loan much less. By virtue of the laws of supply and demand, then, it is harder for lenders to sell the loans, thus it would cost more to the consumers (typically 1/4 to 1/2 of a percent.)
A temporary increase in the Conforming Loan Limits for high-cost areas of living has been incorporated into the 2008 economic stimulus package. Congress has authorized an increase of the single family residences limits to the lesser of $729,750 or 125% of the median home value within the metropolitan statistical area (MSA). High-cost loans are only available through FHA loans.
The bill was signed into law by President Bush on February 13, 2008 but the new rates are still not being honored by any lenders (as of March 30, 2009).
The new jumbo-conforming program has been adopted by Fannie Mae and Freddie Mac effective April 1, 2008 until December 31, 2010.

I have your best interests in mind so please let me know a little bit about your situation by using my interactive Purchase Assistant tool orRefinance Advisor. From there I can contact you with a custom quote of your best options, or you can always call me direct at (212) 920 447. Please do not hesitate.

Debt Consolidation

Has mounting debt turned your life upside down? Are you having a hard time dealing with your debt burden? There is a way out. One of my specialties is helping people to get out of debt. An option you should look into if you are having trouble managing multiple bills, is to consolidate all your debts into a single loan payable at a low interest rate or a debt consolidation. I have helped many people living in Manhattan, Brooklyn and Long Island with their debt consolidation needs, let me help you see if this is a solution to your debt issues.

Whether you’ve built up debt through credit cards, car payments, student loans, or any other debt many of those sources have very high interests rates. These rates tend to be so high that many people ended up paying them off forever and paying the loan amount many times over. That is why debt consolidation is such a popular debt relief procedure because it takes your multiple debt burdens and replaces them with an affordable single monthly payment.

Once you qualify for a debt consolidation loan you will no longer have to deal with your creditors. The debt consolidation loan takes care of that. Your creditors are contacted and basically a deal is struck where they get payment on your debts. Most importantly you don’t have to worry about paying multiple creditors at high interest rates each month. All you need to do is just make one affordable monthly payment, and get out of debt much sooner and less money out of your pocket.

I can help get you back to a starter of living you want. End the annoying creditor phone calls and stop giving your hard earned money to high interest creditors. Please use my Debt Consolidationtool and tell me about your situation so you can see if this is a solution for you debt concerns. I’ll create you a custom debt consolidation solution for you.

FHA 203K Loan

A type of federally insured mortgage product for individuals who want to rehabilitate or repair a damaged home that will become their primary residence.

What Is An FHA 203k Loan?

Simple Answer - A great way to purchase and renovate a property in one simple process.

An FHA 203k Loan is a government insured mortgage program that allows borrowers to wrap the cost of property upgrades into a new home loan.

Since many homebuyers are finding that most of the foreclosures and short sale listings they are interested in purchasing require a minimal amount of repairs in order to bring them up to personal or bank standards, a 203k loan provides a perfect financing program for borrowers who have a limited budget for down payment + home improvement repairs.

According To HUD's Website:

When a homebuyer wants to purchase a house in need of repair or modernization, the homebuyer usually has to obtain financing first to purchase the dwelling; additional financing to do the rehabilitation construction; and a permanent mortgage when the work is completed to pay off the interim loans with a permanent mortgage.

Often the interim financing (the acquisition and construction loans) involves relatively high interest rates and short amortization periods.

The Section 203k program was designed to address this situation. The borrower can get just one mortgage loan, at a long-term fixed (or adjustable) rate, to finance both the acquisition and the rehabilitation of the property. To provide funds for the rehabilitation, the mortgage amount is based on the projected value of the property with the work completed, taking into account the cost of the work. To minimize the risk to the mortgage lender, the mortgage loan (the maximum allowable amount) is eligible for endorsement by HUD as soon as the mortgage proceeds are disbursed and a rehabilitation escrow account is established. At this point the lender has a fully-insured mortgage loan.

The main benefit of a 203k loan is that the FHA program was specifically created help borrowers repair, remodel or renovate homes without having to come out of pocket with a bunch of money.

HUD's primary goal is to help potential buyers purchase a home they may not otherwise be able to afford, by providing mortgages with favorable loan terms, higher loan limits, and flexible down payment options. The 203k program is unique, because it facilitates homeownership for borrowers and houses that may not be able to qualify for a conventional loan program. The popular 203k can be used to purchase a home or refinance an existing mortgage, and at the same time cover the cost of a remodel or necessary upgrades and repairs.

Basically, a 203k loan is a regular FHA loan with an added component that allows for repairs, remodels and renovation. All 203k programs allow borrowers to finance the purchase price of the home along with the extra funds needed for repairs and closing costs. Once the home purchase transaction is closed, renovation funds are held in escrow and released through a draw process to pay for pre-determined renovation work completed by approved contractors.

FHA's low down payment requirements help borrowers obtain an affordable loan that allows them to rehabilitate a neglected or distressed property. 203k loans are an important tool to increase home ownership, as well as a significant community resource for neighborhood revitalization.

Renovation Funds and Permanent Financing in A Single Loan

Most mortgage financing programs only provide permanent financing. That means lenders will not close a loan or release mortgage funds unless an appraisal demonstrates that the current condition and value of the home provides adequate security for the loan.

If a property requires repair or rehabilitation, the majority of lenders will stipulate that the improvements be completed before they will offer a long-term mortgage. This means banks are not able to fund a conventional home loan until repairs are complete, and repairs can't be made until the house has been purchased.

FHA's 203k renovation loan is distinctive in that it allows the borrower to purchase the home and provides additional funds to cover the costs of the proposed remodel or rehabilitation. Prior to the 203k inception, borrowers interested in a distressed property were forced to obtain separate loans to cover purchase, construction, and long-term financing.

The 203k loan programs have filled an important void by providing affordable financing for poorly-maintained properties such as short sales and foreclosures. Potential homeowners who may not have adequate funds for a conventional down payment plus the additional rehab costs this type of distressed property often requires will find a perfect fit with the 203k.

How Renovation Loans Work?

Before you worry about the details, remember that having an experienced 203k Loan Contractor and lender on your team is the key to a successful renovation project.

Most lenders and real estate agents shy away from renovation loans due to their lack of knowledge or understanding of the benefits to buyers, which is unfortunate.

However, a full-time renovation loan expert can lead you through the process and actually make the experience of buying and fixing up a property exciting.

Rehab Loan Purchase Process

Once the home is chosen, the following process illustrates the steps required to obtain an FHA 203k Home Renovation Loan. Included are the roles played by:

    HUD
    You’re Real Estate Agent
    You’re Mortgage Lender
    The 203K Consultant/Plan Reviewed
    The Contractor
    The Appraiser

Preliminary Market Analysis

To help determine the property's projected value, the real estate agent can help determine a projected value via a market analysis. This should be performed after a property has been identified prior to signing the sales contract and before you commit funds for an appraisal.

The market analysis should include:

    The extent of the rehabilitation work required (Contact a 203K Consultant)
    The rough cost estimate of the work (Contact a 203K Consultant or/and Contractor)
    The expected market value of the property after completion of the work (Contact a Real Estate Agent)

Writing The Sales Contract

A provision should be included in the sales contract that the buyer has applied for FHA 203k financing, and that the contract is contingent upon loan approval and the buyer's acceptance of additional required improvements as determined by HUD, the Appraiser or the Rehab Lender.
Work Write-up, Cost Estimate and HUD Case #

With the Consultant's help a feasibility study and preliminary cost estimate is used to produce the SOR - Specification of Repairs. After having refined and determined the specification of repairs the Contractor submits the bid for repairs or/and rehab. Next the lender will request the HUD Case number and the project will now move quickly to the appraisal stage.

Note: HUD does not require a Consultant on a Streamlined 203k loan (a rehab with minor a repair that total less than $35.000 and/or that does not include structural repairs). However, the experience and value of the consultant's advice can often save more than the fees charged for his/her service.
Lender Prepares/Issues Firm Commitment Application

After the appraisal and the contractor's bid have been accepted the lender will issue a Conditional Commitment and Statement of Appraised Value to establish the maximum insurable mortgage amount for the property.
Mortgage Loan Closing

The lender prepares the Rehab Loan Agreement and other pre-closing documents required for the mortgage closing. The Agreement is executed by both borrower and lender, and establishes conditions under which the lender will release funds from the Rehab Escrow Account.

A few of those conditions include the construction draw schedule, fees schedule, work item change orders and identity of interest statement.
Lender Obtains Mortgage Insurance Endorsement

After the closing, the lender submits copies of the mortgage documents to HUD for mortgage insurance endorsement. HUD reviews the submission and issues a Mortgage Insurance Certificate to the lender.
Construction Begins

At closing, mortgage proceeds are disbursed and the Rehab Escrow Account is established. Construction may begin immediately, and must begin with 30 days of closing.

During the rehab period, work is not allowed to cease at any time for more than 30 days. And depending on the extent of work to be completed and the type of 203k loan, the homeowner has up to six months to complete the repairs/rehab.

Note: Some lenders may require work to be completed in less than six months.
Funds Are Released from Rehab Escrow Account

Funds are disbursed to the various contractors according to the Rehab Lon Agreement. Changes to the work write-up are made through written change orders and are typically inspected by the Consultant or Lender's Fee Inspector. A final release of the funds confirms the substantial competition of the rehab.

Getting Approved For An FHA 203k Loan

If you are purchasing a home in with FHA 203k financing, there are a few steps and responsibilities you should be aware of to ensure your closing process goes as smooth as possible.

Obviously, you can trust that the experienced team at Rehab Loan Network will be paying attention to all of the details along the way.

FHA's primary goal is to help borrowers purchase a home they may not otherwise be able to finance based on the down payment requirements of most conventional loan programs. To further that goal, FHA offers favorable loan terms, higher loan limits, and flexible down payment options to qualified buyers.

While candidates are not required to have as large a down payment or the income amounts mandated by many conventional loan programs, they will need to show evidence of a steady, verifiable income and a good credit score.

Credit qualification, loan limits and other requirements for all FHA 203k loans are the same as regular FHA loans. Borrowers must demonstrate the willingness and ability to repay the loan. Like regular FHA loans, maximum loan amounts depend on the property's location.

The distinct difference between regular FHA loans and the 203k programs is that 203k rehabilitation loans are specifically designed to offer loans on distressed, outdated, uninhabitable or poorly maintained properties that may be unable to qualify for conventional loan programs.

In addition to the purchase price of the home, the FHA 203k loan allows the borrower to project costs and include the funds needed for the rehabilitation and related expenses, such as materials and labor.

You can also assure your real estate agent that our 203k Lending Team will keep them in the loop at every step, as well as notify them via phone, email or smoke signals when there are important documents or details that we need.

Most real estate agents and buyers are apprehensive about purchasing a home with an FHA 203k Loan due to their lack of experience with these great rehab loan programs, and the fear that they'll accidentally mess something up.

Don't worry though, most experienced 203k Lenders prefer to take control over the entire process to guarantee things get done right. Basically, as long as you're working with a Rehab Loan Expert, you're going to be just fine.

Either way, we have outlined below how the typical 203k loan advances, beginning with the location of a qualified property and ending with the last inspection and Final Release Notice.

Step 1: Buyer Locates the Property and Performs Preliminary Feasibility Analysis

Once a property is identified and before entering into a sales contract, the buyer and their real estate agent should perform an analysis to determine the extent and a rough cost estimate of repairs, and the market value of the property after completion.

Note: A good HUD Consultant can simplify this step for the borrower.

Step 2: Sales Contract is Written

The sales contract should include a provision that the buyer has applied for FHA 203(k) financing, and that the contract is contingent upon loan approval and buyer's acceptance of additional improvements that may be required by HUD or the lender.

Step 3: Buyer Selects Mortgage Lender

The borrower provides information for the lender to request a credit report, verifications of employment and deposits, and any other documentation needed to establish the ability of the borrower to repay the mortgage.

Step 4. Buyer Selects HUD Consultant

The HUD Consultant will inspect the property and prepare a Work Write-up and cost estimate.

Step 5: Lender Requests HUD Case Number and Appraisal

Once the lender accepts the Work Write-up and cost estimate, they will request a HUD case assignment number and an appraisal.

Nearly all lenders require that both the borrower and the property qualify for the mortgage, and a property's value is established through an appraisal.

The lender must be certain it can recover the investment if a borrower defaults on the loan. Lenders rely on a real estate appraisal to demonstrate a property's current, after-repair market value.

This value is used to support the purchase price or determine the equity held by a current homeowner. Final loan approval will depend in part on a satisfactory appraisal.

The critical difference between a traditional loan appraisal and an FHA 203k is that the 203k appraisal is based on the projected value of the home after repairs are complete. This means the 203k appraisal reflects an estimation of how much the property will be worth after the renovation.

A traditional appraisal is based on a property's current value in the real estate marketplace.

This is another important reason why the scope of work established by your HUD 203k Consultant and the contractor's subsequent bids are critical.

Detailed contractor bids are an essential element of the appraisal process for an FHA 203k loan. The 203k appraisal is based on the value of the property once the renovations are finished. The appraiser will consider the scope of the work and use it to determine an after-repair value, based on the sales price of comprables in the area that have similar upgrades.

Once the bids and a final, detailed list of proposed improvements are available, an experienced appraiser can evaluate the scope of work and compare the estimated value of the completed property to recently-sold comparable sales nearby.

Remember, the FHA 203k allows a potential homebuyer to borrow up to 110% of the after-repair value of the home.

As soon as the appraisal has been completed, the lender will review all documentation and the appraisal and determine the maximum mortgage amount.

Step 6: Lender Issues Firm Commitment

If all aspects of the borrower's application, the Work Write-Up and appraisal are acceptable, the lender will issue a firm commitment and prepare a Rehabilitation Loan Agreement, which establishes the conditions under which the lender will release funds from the Rehabilitation Escrow Account.

Step 7: Transaction is closed

At closing, the Agreement is executed by the borrower and the lender, mortgage proceeds are used to pay off the seller, and the Rehabilitation Escrow Account is established with the remainder of the funds.

Note: Once the transaction is closed, the borrower is required to make payments on the entire
mortgage amount, including the funds that have not yet been disbursed.

Step 8: Construction Begins

Depending on the extent of the project, the homeowner has up to six (6) months to complete the work, although the lender may require that repairs be completed sooner.

Step 9: Funds are Released from Rehabilitation Escrow Account

As construction progresses, the work is inspected and approved by a HUD-approved inspector and funds are released through draws to the contractor. A maximum of four draw inspections plus a final inspection are allowed.

Note: If repair costs exceed $10,000, additional draw inspections may be authorized provided the lender and borrower agree in writing.

Step 10: Completion of Work/Final Inspection/ Final Release Notice

When all work is complete, compliant and approved, the borrower provides a letter indicating they are ready for the final inspection. With sign-off from the HUD-approved inspector and the Final Release Notice, the last draw is paid out, less the required 10% holdback.

Unused contingency funds or mortgage payment reserves are applied to the mortgage principal or used to complete additional repairs as per the borrower and lender's agreement.

FHA 203k Eligible Properties

FHA's 203(k) loan program can be used to finance a single family home, as well as 1-4 unit properties.

While most people consider a 203k loan to fix up a foreclosure or distressed short sale that needs serious renovation work, FHA 203k loans can be applied to any property that meets loan limit guidelines.

Updating a kitchen, adding fresh carpet or making energy efficient upgrades are a few examples of how you can take advantage of a 203k loan.

Following specific guidelines, it can also be used to convert a building from a larger number of units down to 4 or less, as well as improvements (interior only) on an FHA-approved condominium unit.

Although FHA 203(k) loans are only offered for owner-occupied properties, provisions allow for the financing of mixed-use buildings, such as those with retail or commercial space combined with residential. In these cases, the 203k loan can only be used for the residential portion of the building.

Eligible Projects Include:

    1-4 Unit Properties Family Homes
    Conversion of a larger number of units down to 4 or less
    Interior renovations on an FHA-approved condo (subject to specific guidelines)
    Renovation of the residential portion of a mixed-use building, which combines retail or commercial space with residential
    Uninhabitable properties (a tear-down), as long as part of the existing foundation will remain
    Relocation of an existing house to a new foundation

*All properties are subject to specific guidelines.

Using FHA 203(k) To Purchase HUD Foreclosures:

FHA 203(k) loans can also be used to purchase HUD-owned foreclosures that have been designated by HUD as eligible for the 203(k).

If an eligible HUD foreclosure has been purchased through other means, a 203(k) loan can be made up to six months after the close, and repair funds made available to the owner.

FHA 203k Eligible Improvements

For all properties financed with a 203(k) loan, both the lender and FHA have repair requirements that must be addressed, in addition to the type and extent of work the borrower would like to complete.

FHA requires that properties financed under the 203(k) program meet certain basic energy efficiency and structural standards to comply with HUD's Minimum Property Standards and all local codes and ordinances.

FHA's energy efficiency standards include correctly-sized heating and air conditioning systems, as well as the type and extent of caulking, insulation and ventilation. The home is also required to have smoke detectors adjacent to each sleeping area.

Eligible Improvements Under The Streamlined 203(k)

    Repair or replacement of roofs, gutters and downspouts
    Repair, replacement or upgrade of existing HVAC systems
    Repair, replacement or upgrade of plumbing and electrical systems
    Repair or replacement of flooring
    Minor remodeling, such as kitchens, which does not involve structural repairs
    Painting, both exterior and interior
    Weatherization, including storm windows and doors, insulation, and weather stripping
    Purchase and installation of appliances (free-standing ranges, refrigerators, washer/dryer...)
    Accessibility improvements for persons with disabilities
    Lead-based paint stabilization or abatement of lead-based paint hazards
    Repair, replacement or addition of exterior decks, patios, porches
    Basement finishing and remodeling, which does not involve structural repairs
    Basement waterproofing
    Window and door replacements and exterior wall re-siding
    Repair or replacement of septic system and/or well

Eligible Improvements Under The FHA 203(K)

    Major rehabilitation or major remodeling, such as the relocation of a load-bearing wall
    New construction (including room additions)
    Repair of structural damage
    Repairs requiring detailed drawings or architectural exhibits
    Landscaping or similar site amenity improvements
    Any repair or improvement requiring a work schedule longer than six months
    Rehabilitation activities that require more than two (2) payments per specialized contractor

Streamlined 203k (k) Vs. Full 203k (K)

Properties that require these documents or services or that will take longer than six months to complete will also require the full, regular FHA 203(k) loan:

    A Consultant to develop a specification of Repairs/Work Write-Ups
    A plan reviewer, plans or architectural exhibits
    Any reason work might not begin within 30 days after loan closing
    The homeowner's displacement from the property for more than 30 days during the time the rehabilitation work is underway

FHA 203k Down Payment Requirements

The down payment requirements for an FHA 203k loan are the same as a standard FHA, 3.5% of the total loan amount.

The difference between the down payment on a regular FHA loan and a 203k is that the 203k loan requires a minimum 3.5% down payment based on the total amount of the home's purchase price plus the cost of repairs.
Obviously, figuring out the exact amounts for rehab costs and loan fees will be something that your 203k Lender and Rehab Consultant will need to be a part of, especially since there may be before and after repair values, mortgage insurance premiums and interest rate discounts to consider.

Bottom line, the main point to pay attention to when figuring your budget for a down payment on a purchase that is using an FHA 203k loan for home financing is that the total amount you will be responsible for is 3.5% of the total loan amount, which will be due at the time of closing.

Receiving Gift Funds For A 203k Rehab Loan

Will you have the opportunity to use gift funds as the down payment for your FHA 203k mortgage?

If so, FHA guidelines require that you provide transfer documentation for both the source and receipt of the gift. In addition, a borrower must provide the lender with a gift letter that includes the donor's name, address and telephone number, the dollar amount of the gift, the donor's relationship to the borrower, and a statement that no repayment of the gift funds is required.

The gift letter must be signed and dated by both borrower and donor.

Acceptable Sources Of Gift Funds For 203k Loans:

    A relative of the borrower
    A charitable organization
    The borrower's employer or labor union
    A close friend with a documentable relationship to the borrower
    A government agency or public entity that provides home ownership assistance

Unacceptable Sources Of Gift Funds For 203k Loans:

    Cash that is not documented
    Funds from the seller
    Donation from the real estate agent or mortgage officer
    Builder kick-backs
    Any party to the transaction

Questions About Documenting Gift Funds:

Are the gift funds already present in the borrower's bank account?

If so, a copy of the document showing the withdrawal from the donor's account is required, as well as the deposit slip and bank statement reflecting the deposit of said funds into the borrower's account.

Will the gift funds be provided at closing in the form of a check or money order?

If so, the donor must provide a document or canceled check showing the amount of the gift funds and their withdrawal from the donor account.

Will the funds be provided at closing as a wire transfer?

The donor must provide documented evidence of the transfer.

Will the funds be provided at closing via a loan to the donor?

The donor must provide written documentation that the funds were borrowed form an acceptable source and NOT from any party to the transaction, including the 203k lender.

FHA 203k Closing Costs

Many borrowers and real estate agents have a fear that the closing costs will be too high with a 203k loan.

While there may be extra attention and service work necessary, the fact is that a 203k loan is one of the least expensive ways to renovate a home.

An experienced Rehab Loan Officer will be able to provide a complete accounting of costs and fees, as well as the dollar amount you will need to close your FHA 203k transaction.

The services presented here may or may not be required for your mortgage, but the list will give you an overview of various costs involved in a typical 203k loan.

Origination Fee

According to the Federal Reserve Board's mortgage compensation rule, a loan originator may not receive compensation that is based on the interest rate or other loan terms. This will prevent loan originators from increasing their own compensation by raising the consumers' loan costs, such as by increasing the interest rate or points.

Depending on the mortgage company's government regulated compensation plan, a typical origination fee may range from 1-2% of the total loan amount.

A key point of this new FED rule is that the mortgage company has to charge every borrower the exact same lender related fees, for every transaction, regardless of the scenario, interest rate or "relationship" they have with their client.

One of the major consumer benefits of this mortgage compensation law is that it relieves any anxiety that a borrower may feel in thinking that they need to shop around or negotiate for a better deal.

Basically, now a borrower can spend their time pre-qualifying a mortgage company based on their experience and service vs. closing costs and rates.

HUD Consultant

If the borrower uses or is required to use a HUD Consultant, the borrower and the Consultant must enter into a written agreement that completely explains services the consultant will perform for the borrower and the fee charged.

Fee Consultant

Prior to the appraisal, a HUD-accepted fee consultant must visit the site to ensure compliance with program requirements.
Appraisal

The lender may charge a borrower no more than the actual amount the lender pays to have an appraisal done. Costs vary by area and property, and the fee may be either an upfront charge or included in the closing costs.
Inspection

Fees for a maximum of five draw inspections will be allowed.

Title Update Fee

To protect the mortgage from mechanic's liens filed by contractors working on the property, reasonable title company fees may be included as an allowable cost, not to exceed $50.00 per draw release.

To see if you qualify for a FHA 203K loan use my Purchase Assistant or my Refinance Advisor to tell me more about your situation so I can get back to you and see if it is the right loan program for your specific home loan needs.

FHA Loans

A mortgage issued by federally qualified lenders and insured by the Federal Housing Administration. FHA loans are designed for low to moderate income borrowers who are unable to make a large down payment.

FHA Loans

FHA Credit Scores & LTV Limits

Minimum Credit Score Limitations
Product	Standard Loan Limits	High Balance
Purchase Transactions	640	640
No Cash-Out Refi	640	640
Making Homes Affordable	640	640
Cash-Out Refinance	640	640
Maximum LTV / CLTV	Maximum LTV	Maximum CLTV
No Cash-Out Refi	97.75%	97.75%
Cash Out Refi	85%	85%
Streamline Refi	97.75%	125%
Refi with new 2nd mortgage	85%	85%
(MHA) Refi	97.75%	115%
Purchase	96.5%	96.5%
Identity of Interest	85%	85%
Unrelated Non-Occupying Co-Borrower	75%	75%
2nd Home (see guides)	85%	85%
Maximum CLTV on ALL loans are shown above and all mortgages are limited to the Geographical Maximum.

The Federal Housing Administration was begun as part of the New Deal in 1934. It guarantees private home mortgages (FHA loans) and provides funds to promote housing construction, especially for poorer people. It was authorized by the National Housing Act of 1934.

FHA loan is a mortgage loan in the United States insured by the Federal Housing Administration. The loan may be issued by federally-qualified lenders.

FHA loans have historically allowed lower income Americans to borrow money for the purchase of a home that they would not otherwise be able to afford. The program originated during the Great Depression of the 1930s, when the rates of foreclosures and defaults rose sharply, and the program was intended to provide lenders with sufficient insurance. Some FHA programs were subsidized by government, but the goal was to make it self-supporting, based on insurance premiums paid by borrowers.

Over time, private mortgage insurance (PMI) companies came into play, and now FHA primarily serves people who cannot afford a conventional down payment or otherwise do not qualify for PMI insurance.

Eligible Properties

1-4 unit primary residences, Planned Urban Developments (PUDs), Approved Condos. Special eligibility requirements for certain properties are listed below.

3-4 Unit Properties

The 3-4 Unit Property must be self-sufficient. The net rental income must be equal to or greater than the monthly mortgage payment. The net rental income is the appraiser's estimate for vacancies or the vacancy factor used by the jurisdictional HOC, whichever is greater.

Borrowers must still qualify for the mortgage based on income, credit, cash to close, and projected rents received from the remaining units.

Borrowers must have reserves equivalent to three months of PITI mortgage payments. These reserves cannot be gifted and must be the borrowers own funds.

Rural Properties

Rural properties are FHA eligible however no value can be assigned to any acres above 10. The sales price of the property must rely only on the first 10 acres including the house.

Ineligible Properties

If the re-sale date is 90 days or less following acquisition by the seller, the property is not eligible for an FHA mortgage.

Co-ops are ineligible

Commercial properties, boarding houses, hotels and motels, tourist homes, private clubs, sanitariums, and fraternity or sorority houses are also ineligible.

FHA Approved Condo and Townhouse Projects

Buying a condo or Townhouse provides a great opportunity for both first time homeowners and those downsizing their lifestyles. The FHA and HUD have approved FHA loans on condos and townhouses as long as the properties are on their pre-approved list.

The FHA loan process is fairly easy if you do your homework before getting started on the purchase.

Fortunately, you have arrived at the right place and we have made the process easier for you with this simple FHA condo purchasing checklist.

Following these simple steps will get you on your way to buying your condo or townhouse and getting a FHA home loan.

Having a high enough credit score. The FHA recently raised the credit requirement to a minimum score of 640. This is much lower than many banks but it still is a hard and fast rule.

The next step is to find HUD condos and townhouses on the approved list for FHA loans. If the condo community is not on the HUD approved list you can't get qualified. However, it will only take a few seconds to search what is available in your community and we have it right here for you.

To see if your condo is FHA approved go here.https://entp.hud.gov/idap /html/hicostlook.cfm

FHA Mortgage Limits

Knowing your local FHA lending limits is an essential step in the process when considering FHA financing. Clicking on the link below will open a separate browser window directly from HUD. Simply enter some basic information about your location and instantly know local lending limits.

A complete schedule of FHA mortgage limits for all areas are available at: https://entp.hud.gov/idapp/html/hicostlook.cfm

FHA Credit Guidelines

Right now, borrowers with lower than a 640 score are NOT eligible for FHA financing. Further, the FHA requires a minimum credit score of between 640 for borrowers to be eligible for a mortgage with a maximum of a 90% loan to value (LTV) for the property. Per FHA rules, borrowers are eligible for maximum FHA financing (96.5% LTV) with a 640 credit score and above. HOWEVER, lenders who offer FHA mortgages have recently been very reluctant to provide those mortgages to borrowers with lower than a 640 middle credit score.

Credit History

Non-Traditional Credit:

Non-Traditional Credit is acceptable if the borrower does not have any prior credit history or if that length of credit history is too short to qualify. We would need at least three letters from any repeated monthly obligation such as rent, utilities, store accounts, cell phone accounts, and/or any other acceptable sources. Make sure to let your FHA Loan Officer know about your current credit situation to avoid any mishaps in the processing of your mortgage.

Judgments:

Court ordered judgments must be paid completely, unless the borrower has been making regular and timely payments and the creditor is willing to subordinate that judgment to the new insured mortgage. The borrower must provide a satisfactory written explanation.

Collections:

Handled on a case by case basis.

Bankruptcy:

-Chapter 7 requires a minimum two-year lapse period since discharge date; minimum one-year lapse period may be acceptable if bankruptcy was caused by extenuating circumstances that are not likely to recur the reason cannot be debt caused by uneducated choices. Only extenuating circumstances will be considered and only after one year has passed. In all cases the borrower must have re-established credit and must demonstrate the ability to manage financial affairs.

-Chapter 13 is permitted if a one-year payout period has elapsed and performance has been satisfactory. The borrower must receive court approval to enter into the mortgage transaction.

Foreclosures:

Require a minimum of three years since the completion of the action and the borrower must have re-established good credit.

Delinquency or Default on Federal Debt:

If the borrower is presently delinquent on any federal debt or is obligated on any type of federal lien, he or she is not eligible for an FHA loan until the delinquent account is brought current, paid, or otherwise satisfied, or a satisfactory repayment plan is made between the borrower and the federal agency owed and is verified in writing.

FHA Closing Costs and Allowable Seller Paid

FHA closing costs are a significant reason for choosing an FHA home loan. Most traditional mortgages allow only a maximum of 3% seller contribution towards closings costs. With an FHA mortgage, the rules are that the seller is allowed to pay up to 6% of the sales price towards the buyer’s closings costs. This is usually more than enough to cover all of your FHA closing costs and even include discount points if you wish to buy down your mortgage interest rate. This, of course, means that you will have more money remaining after the close on your new home.

Having the seller pay for some or all of your FHA closing costs can be a part of your negotiation when buying a home. Make sure to bring this up with your real estate agent and attorney at the very beginning of the home buying process.

FHA Loan Checklist

When you're applying for an FHA loan the following list of documents will help expedite the process. We can help you understand any part of the FHA loan process so don't hesitate to contact us with any questions.

Employment Info

Past two years completed tax returns.
Past two years W-2's, 1099's and any other necessary tax forms.
One month worth of newest pay stubs.
Self-employed will need three years tax returns and YTD Profit & Loss Statement.

Savings Info

Past three months full bank statements for all accounts.
Any recent statements from investment accounts (retirement, 410k, mutual funds, etc.).

Personal Info

Driver's License or other official State identification.
Social Security Card.
Any Divorce, Palimony, Alimony Documents.
Green card or work-permit (if applicable).

FHA Loan Common Questions

Check out our list of common questions related to FHA mortgages. Check out our list of common questions related to FHA mortgages.

What is the FHA?

FHA stands for the Federal Housing Administration. It was created in 1934 to help Americans get into homes.

What makes a FHA insured mortgage beneficial?

A FHA insured mortgage is easy to qualify for, can be obtained with less than perfect credit, costs less and requires a smaller down-payment.

Where can I find FHA forms and other literature?

A great source for FHA forms and information is http://www.hud.gov/library/index.cfm.

What is the FHA loan limit in my area?

The loan limit across the country is different. Click here to see limits in your area.

Can I pay an FHA loan off early?

Yes, however be sure to check the pre-payment section of your contract before signing.

Can a FHA insured loan help me lower energy costs?

Yes, through the Energy Efficient Mortgages Program you can finance 100 percent of the cost of making your home more energy efficient. Contact us to see how.

Is there a FHA program to help me refinance my loan?

Yes, the recently create FHASecure is one of the ways that we can help you refinance your current home loan. Contact us now to see what we can do for you.

Can I refinance a fixed rate FHA loan?

Yes. Talk with one of our professionals today to see if refinancing makes sense for you.

What is the recommended debt-to-income ratio for FHA loans?

The recommended debt-to-income ratio for a FHA loan is 30%.

Are FHA loans assumable?

Absolutely, you can assume an existing FHA loan or allow a buyer to assume yours.

Will I have to pay mortgage insurance with an FHA loan?

Yes, in fact FHA mortgages often require you to carry mortgage insurance for longer than most conventional loans.

Can I get a "fixer-upper" of a home with a FHA mortgage?

Yes, however you might be required to fix certain problems in the home before you can get the full loan. Speak with us today for details on this.

Quick Links

Apply for a FHA Loan
FHA Loan Checklist
Common FHA Questions
FHA Qualifications
Benefits of FHA Loans

FHA Qualifications

Qualifying for a home mortgage loan can be difficult, near impossible without a sizable down payment and a moderate credit report. If this describes you and you financial position, an FHA loan may be for you! There are fewer restrictions for FHA loan qualification in comparison to a
standard mortgage loan. Qualifications for an FHA loan are:

Proven employment status of at least 2 years.
Steady or increasing income over a 2 year period.
History of on-time payment. No more than two missed payments on your credit.
If you've filed for bankruptcy you must wait at least 2 years and have good credit since you filed.
Those with foreclosures must wait at least 3 years since the most recent foreclosure.
Monthly mortgage payment should be roughly 30% of your gross income.
You must pay a minimum of a 3.5% down-payment.
Agree to 2.25% in closing costs
Only certain properties are eligible - single-family homes, condominiums and 2-4 unit properties.
The property must be your primary residence.

These are the basic qualifications for an FHA loan through us, as you can see FHA loans can be to qualify for. To learn more contact us or apply online to get the process started.

FHA Loan Benefits

FHA insured mortgages are some of the best kinds of mortgages available. This is because they can help more people into the home buying market. Check out the list below to understand some of the most basic benefits of an FHA mortgage.

Easier to Qualify for – because they’re backed by the federal government lenders are more likely to give you the kind of loan that you need.

Low Down Payment – FHA insured mortgages only require a 3.5% down-payment which makes it easier for people to own homes. Additionally the 3.5% can come in the form of gifts, unlike many other loan programs.

Lower Credit Borrowers Qualify – because FHA insured loans are backed by the government those with a poor credit history have an easier time getting this kind of loan.

Better Interest Rates – with the backing of the government these loans typically have a better interest rate than most traditional mortgage loans.

Better Home Stability – the FHA has programs designed to help homeowners keep their homes during hard times. The will work with you to help your home from falling into foreclosure. Always try to work out problems with your lender before the situation becomes dire.

How FHA Loans Work

We want to help you understand how a FHA mortgage loan works. In all actuality the Federal Housing Administration (FHA) doesn’t loan any money, they insure it. This means that you’re considered to be a less risky borrower than someone who might not have the backing of the federal government. Our role is to make sure that you qualify for an FHA mortgage and structure our loan to reflect it.

The other pages in the FHA loan center can help you understand more about this unique program. Whether you’re trying to determine if you qualify or if you’re interested in finding out what kind of documentation you’ll need to ultimately get your loan, our site can provide you the information you’re seeking. Additionally we’re more than happy to take your phone calls at 212-920-4471.

An important resource for considering a FHA loan is the official Housing and Urban Development website. There you can find even more answers to questions and learn more about insuring your loan through the Federal Housing Administration.

For More Information Refer To The Hud/FHA Website @ FHA Website

FHA Loan Limits

2012 FHA Mortgage Limits - see FHA High Balance Notes Below
Region	1 Unit	2 Units	3 Units	4 Units
Minimum Limit Caps	$271,050	$347,000	$419,400	$521,250
Standard Limit Caps	$417,000	$533,850	$645,300	$801,950
High Balance Caps	$729,750	$934,200	$1,129,250	$1,403,400
Search by zip code
A complete schedule of fha mortgage limits for all areas is available at: https://entp.hud.gov/idapp/html/hicostlook.cfm

To tell me more about your situation so I can get back to you and see if it is the right loan program for your specific home loan needs Apply here on my Purchase Assistant or my Refinance Advisor , or you can always call me direct at (212) 920 4471. Please do not hesitate.

HARP - Making Home Affordable Refinance Program

The Making Home Affordable Refinance Program (HARP Phase II) is a government backed mortgage program that allows most borrowers with existing Fannie Mae and Freddie Mac loans to refinance their homes even if they owe more than their home is worth.

Help for Homeowners - HARP - Making Home Affordable Refinance Program

Finally, there is help for homeowners that are underwater on their mortgages:
Do any of these sounds like you?

    The value of my property has fallen.
    I owe more than my home is worth.
    I have been turned down for a refinance loan in the past.
    I am having trouble making my house payments.
    I have an adjustable rate mortgage.
    I don't qualify for loan modification.
    I can't afford my mortgage payment.

If so, we might have the answer that you've been looking for.

The Making Home Affordable Refinance Program (HARP Phase II) is a government backed mortgage program that allows most borrowers with existing Fannie Mae and Freddie Mac loans to refinance their homes even if they owe more than their home is worth, have an adjustable rate mortgage, have been turned down for a refinance loan or loan modification in the past, or just can't afford their mortgage payment anymore.

HARP Phase II's goal is to help you stay in your home by making it more affordable for you to continue to make your monthly mortgage payments and keep your dreams of affordable home ownership alive. We can help you qualify for the HARP Phase II program if we can show that you are receiving one or more of the following benefits.
    A lower monthly mortgage principal and interest payment;
    A lower interest rate;
    A shorter amortization term (a loan for fewer years); or
    A more stable mortgage product; for example, movement from an ARM to a fixed-rate mortgage.

So if you're looking for a lower interest rate, a fixed mortgage, a lower payment, or a better mortgage then refinancing your home through the Making Home Affordable Program might be just the right answer for you.

How do I know if I'm eligible for HARP?
You may be eligible for HARP if you meet all of the following criteria:

    Your mortgage must be owned or guaranteed by Freddie Mac or Fannie Mae.
    Your mortgage must have been sold to Fannie Mae or Freddie Mac on or before May 31, 2009.
    Your mortgage cannot have been refinanced under HARP previously unless it is a Fannie Mae loan that was refinanced under HARP from March-May, 2009.
    The current loan-to-value (LTV) ratio must be greater than 80% (even if you owe more than twice what your home is worth you can still qualify).
    You must be current on the mortgage at the time of the refinance, with a good payment history in the past 12 months.
    We will then research your loan to make sure that it is eligible for the Harp Program.
    If it is we will then show you the savings that you can realize by refinancing your home through the    Harp Program.
    If your loan is not eligible, we'll let you know.

"Freddie Mac and Fannie Mae have adopted changes to the Home Affordable Refinance Program (HARP) and you may be eligible to take advantage of these changes. If your mortgage is owned or guaranteed by either Freddie Mac or Fannie Mae, you may be eligible to refinance your mortgage under the enhanced and expanded provisions of HARP. You can determine whether your mortgage is owned by either Freddie Mac or Fannie Mae by checking the following websites: www.freddiemac.com/mymortgage or http://www.fanniemae.com/loanlookup/."

Can I pay down the principal balance of my loan when I refinance my home through HARP?
Yes, you can pay down your principal balance when you refinance your home through HARP or any time after you. There are no pre-payment penalties.

Can I refinance my home through HARP if I have a low credit score?
Yes.

Can I refinance my home through HARP even if I don't live in the property anymore?
Yes.

Can I refinance my condo through HARP?
Yes.

HARP 2.0 and PMI

Many people who purchased their home with a down payment of less than 20% of the purchase price were required to have private mortgage insurance (PMI). This is common practice with Freddie Mac or Fannie Mae loans. Having PMI attached to a loan made that loan easier to sell on the Wall Street secondary market as a "whole loan". PMI hedged the risk brought by the high loan-to-value ratio by offering insurance against foreclosure for whoever owned the "whole loan".

Although HARP 2.0 allows homeowners with PMI to apply through the Making Home Affordable Refinance Program, many homeowners have faced difficulty refinancing with their original lender. HARP requires the new loan to provide the same level of mortgage insurance coverage as the original loan. This can be difficult and time-consuming, especially in the case of lender-paid private mortgage insurance (LPMI). As a result, many lenders are reluctant to refinance a PMI mortgage.

Fortunately, HARP 2.0 enables homeowners to go to any lender to refinance, so the mortgage holder is not stymied if the original bank is unwilling to pursue a HARP refinance.

Occupancy type

HARP 2.0 refinancing is allowed on all occupancy types: primary residence (owner-occupied), second home, or investment (rental) property. However, HARP 2.0 refinancing of investment properties by Fannie Mae and Freddie Mac has higher mortgage rates than for owner-occupied properties.

Appraisal waiver

Another feature of HARP is that applicants can forgo a home appraisal if a reliable automated valuation model is available in the area. This can save the borrower time and money, but is subject to the discretion of the mortgage servicer.

HARP 3.0

As part of the 2012 State of the Union Address, President Barack Obama referenced a plan to give "every responsible homeowner the chance to save about $3,000 a year on their mortgage". Within the mortgage industry, this plan is being referred to as HARP 3.0. The plan has not passed. HARP 3.0 is expected to expand HARP's eligibility requirements to homeowners with non-Fannie Mae and non-Freddie Mac mortgages, including homeowners with jumbo mortgages and Alt-A mortgages, those whose original mortgages were stated income, stated asset, or both.

To see if you qualify for HARP use my Refinance Advisor to tell me more about your situation so I can get back to you and see if it is the right loan program for your specific home loan needs, or you can always call me direct at (212) 920 447. Please do not hesitate

HARP is scheduled to end on December 31, 2013.

For More Information You Can Also Visit These Sites Directly.

External links:

Fannie Mae loan look-up tool, FANNIE MAE.
Freddie Mac loan look-up tool, FREDDIE MAC
Fannie Mae Guidelines, FANNIE MAE GUIDELINES

Jumbo Loans

A mortgage with a loan amount exceeding the conforming loan limits set by the Office of Federal Housing Enterprise Oversight (OFHEO), and therefore, not eligible to be purchased, guaranteed or securitized by Fannie Mae or Freddie Mac.

In the United States, a Jumbo Loan is a Mortgage Loan in an amount above conventional conforming loan limits. This standard is set by the two government sponsored enterprises Fannie Mae and Freddie Mac, and sets the limit on the maximum value of any individual mortgage they will purchase from a lender. Fannie Mae (FNMA) and Freddie Mac (FHLMC) are large agencies that purchase the bulk of U.S. residential mortgages from banks and other lenders, allowing them to free up liquidity to lend more mortgages. When FNMA and FHLMC limits don't cover the full loan amount, the loan is referred to as a "jumbo mortgage". The average interest rates on jumbo mortgages are typically higher than for conforming mortgages.
On February 13, 2008 President George W. Bush signed the Housing and Economic Recovery Act of 2008 which temporarily increased the jumbo conforming limit in the United States. The limit was raised to $729,750 or 125% of the median home value within the metropolitan statistical area, whichever is the lesser. Initially due to expire in December 2008, the new limits were extended through 2010. Mortgage lenders did not freely adopt these new limits, making them essentially "theoretical," as mortgages above the old conforming limit of $417,000 still attracted higher interest rates.
As of 2010, the limit on a conforming loan in "general" areas was $417,000 for most of the US, apart from Alaska, Hawaii, Guam, and the U.S. Virgin Islands, where the limit was $625,500. The limit in "high cost" areas was $729,750 and $938,250, respectively.
On October 1, 2011 the jumbo conforming limit of $729,750 in "high cost" areas was reduced to $625,500.
Jumbo mortgage loans are a higher risk for lenders. This is because if a jumbo mortgage loan defaults, it may be harder to sell a luxury residence quickly for full price. Luxury prices are more vulnerable to market highs and lows in some cases. That is one reason lenders prefer to have a higher down payment from jumbo loan seekers. Jumbo home prices can be more subjective and not as easily sold to a mainstream borrower, therefore many lenders may require two appraisals on a jumbo mortgage loan.
The interest rate charged on jumbo mortgage loans is generally higher than a loan that is conforming, due to the higher risk to the lender. The spread, or difference between the two rates, depends on the current market price of risk. While typically the spread fluctuates between 0.25 and 0.5%, at times of high investor anxiety, such as August 2007, it can exceed one and a half percentage points. It can be more expensive to refinance a jumbo loan due to the closing costs. Some lenders will offer the service of an extension and consolidation agreement, so that a jumbo refinance will not have to pay for mortgage tax again on the same principal balance. In other cases, title insurance companies will offer up to a 50% discount, often required by law for those refinancing within 1 year to 10 years. The largest discount is for refinancing within one year.
Some consumers seeking a jumbo mortgage choose to seek advice from a competent professional familiar with jumbo mortgage loans.
As house prices rose as part of the United States housing bubble, there was a large increase in the number of jumbo loan applicants. Due to rising prices, many consumers had to take out jumbo mortgages in order to buy modest homes in big-city areas; this option was no longer limited to high-end luxury residences.
Many of these new loans were 40- or 50-year amortization, or had an interest-only option, similar to subprime loans. That meant that the jumbo loan borrower would pay the loan back over a longer period of time, or could defer any repayment of principal for a few years (thereby also increasing the total amount to be paid back). However from 2007, as prices fell and the number of foreclosures rose, lenders turned away from providing jumbo mortgages. Lenders that did remain in the jumbo loan market increased rates sharply, with rates up to 1.5 percentage points higher than for conforming loans. This withdrawal from the market led to a lack of lending available to fund the purchases of expensive homes, thus putting further downward pressure on house prices and completing a vicious circle.
The delinquency rate on jumbo loans rose dramatically, tripling over the course of 2009, and by February 2010, almost one in ten jumbo mortgages were 'seriously delinquent' (i.e. in arrears by at least 60 days).

There a few key points you need to watch out for if you are looking into a jumbo loan. First because lenders don’t have the back up of Fannie Mae and Freddie Mac the mortgage rates tend to be higher than with conventional loans. Also since jumbo loans are riskier, fewer lenders are likely to do them which could delay the closing of the loan not to mention the potential of shopping around all over town to find the right lender.

This is where I come in, as Mortgage EXPERT I have the experience and knowledge to get you the most competitive jumbo loan rates with the best terms available for your situation. I have access to many different products which saves you the process of having to contact multiple lenders. I have your best interests in mind so please let me know a little bit about your situation by using my interactive Purchase Assistant tool or Refinance Advisor. From there I can contact you with a custom quote of your best options, or you can always call me direct at (212) 920 4471. Please do not hesitate.

Stated Income Mortgage Loans

Stated Income Mortgage Loans also known as a type of reduced-documentation- mortgage in which income is disclosed on the loan application and employment is verified however the income is typically stated. Where rates are typically higher.

A Stated Income Loan is a mortgage where the lender does not verify the borrower's income by looking at their pay stubs, W-2 (employee income) forms, income tax returns, or other records. Instead, borrowers are simply asked to state their income, and taken at their word.
Reasons For Stated Income Loans

These loans are nominally intended for self-employed borrowers, or other borrowers who might have difficulty documenting their income. Stated income loans have been extended to customers with a wide range of credit histories, including subprime borrowers. The lack of verification makes these loans particularly simple targets for fraud.

Stated income loans fill a gap of situations which normal loan standards would not approve. For example, a standard rule is that a customer's mortgage and other loan payments should take up no more than 45% of the person's income. This would seem prudent for a person just owning their main home. However, a real estate investor may have multiple properties and for each may receive only a small amount more than their loan payments on each house, but end up with $200,000 in disposable income. Nevertheless, a non-stated income loan would decline this person since their debt to income ratio would not be in line. The same issue can arise with self-employed borrowers, where the bank with a fully documented loan would include the borrower's business debt in their debt to income calculation. Stated income loans also help borrowers where fully documented loans normally would not consider the source of income as being reliable and stable, such as investors who consistently earn capital gains. Fully documented loans also do not consider potential future income increases. Another type of loan that uses the same principles is the no income disclosure loan.

In August 2006, Steven Krystofiak, president of the Mortgage Brokers Association for Responsible Lending, in a statement at a Federal Reserve hearing on mortgage regulation, reported that his organization had compared a sample of 100 stated income mortgage applications to IRS records, and found almost 60% of the sampled loans had overstated their income by more than 50 percent.

U.S... Senator Chuck Schumer is currently leading an effort to restrict stated income loan; his Borrowers Protection Act of 2007 would essentially forbid them. A few years later, Chuck Shumer's efforts came to fruition with the Dodd-Frank Financial Reform Bill HR4173. Within the Bill, Section 1411 has the following excerpt, "A creditor making a residential mortgage loan shall verify amounts of income or assets that such creditor relies on to determine repayment ability...” Currently, lenders are conducting their own version of income and asset verification.

Stated Income Loans are still offered typically by small local banks. Qualification requirements are based on stable employment, good reserves, good FICO and no less than 35% equity position in the property. Stated income loan availability changes state to state, county to county.

They are specifically for Self-employed borrowers only. We do have an investor that will lend to w2 employees but you need to have 50% equity in the home and the maximum loan amount is 1 million. Otherwise this type of loan is the loan of choice for self-employed people. If you are self-employed, it may be difficult to document a regular income. You might make a great deal of money one month only to follow it up with nothing the next. With a traditional lender, it is hard to convince them that you are a good risk. For self-employed people, it represents an opportunity to own a house without getting a regular job.

The pros of this loan are that you have a quicker application process - The process of getting your money is usually faster with a stated income loan. When you apply for a regular loan, they have to review the loan as well as verify everything about it with your employer and document it. With a stated income loan, they can skip this step and get on to lending you the money you need.

Make your own decisions - With a traditional loan banks try to make your financial decisions for you. They have many complicated ratios and formulas that they use to justify a loan amount for you. For example, if you are buying a duplex, they will only let you count a portion of the projected rental income in your income. However, with a stated income loan, you don't have to worry about whether or not the bank thinks you can afford it. You see the monthly payment and you decide whether or not you can afford it.

The cons of this loan are higher interest rates - As a result of the hassle-free level of faith in you, you will usually be charged a higher interest rate. They are taking a bigger risk by extending this type of loan to you. Therefore, they want to be well compensated for the risk that they are taking. This means more money coming out of your pocket each month and over the life of the loan.

Higher chance of default - While they do not like to admit it, sometimes the bank actually does know what they are doing in the approval process. They have many statistics to back up their decisions to lend or not. When you use a stated income loan, you are eliminating all of these built-in protection mechanisms. When you show them your income, debts, and credit score, they are basing their decision to lend on the history of others in your situation.

Out Line For The Reduced Doc Product Also Known As The Stated Income Mortgage Loan

The Reduced Doc Loan Program is for self-employed “business owners” only* buying or refinancing, including Cash-Out, their 1-4 family primary home or their one family or condo vacation home. Fixed, ARM or Interest only^^ products are available for this program. Debt to Income (DTI) should not exceed 38/44 with qualification based on using the fully amortized payment.
Maximum financing is:

All ARM Products
65LTV/CLTV up to $750,000 (1-4 Fam & Condo)
60LTV/CLTV from $750,100 to $1M (1-4 FAM & Condo)
50LTV/CLTV from $1,000,100 to $1.5MM (1-4 FAM & Condo)
50LTV/CLTV from $1,500,100 to $3M (1-2 FAM & Condo) All Fixed Rate Products 65LTV/CLTV up to $750,000 (1-4 FAM & Condo) 60LTV/CLTV from $750,100 to $1M (1-4 FAM & Condo) ^^2-4 family homes are excluded from the Interest Only products

INCOME
Borrower must provide proof (such as a CPA letter) that they are a self-employed owner in an established business for at least two full years and their credit will be a major factor in the approval process.** The DTI ratios should not exceed 36/44 on the RDLP program (on a fully amortized basis.) The borrower must be the owner of an established business entity that can be independently verified by a CPA or some other means. 1099 Independent Contractors do not qualify for this program and often work for one or more businesses but may not actually own the business. Landlords are usually not considered self-employed business owners for this program. All rental income must be verified by leases. The Reduced Doc Program may be combined with a borrower (including him/her) that has a salary or other verifiable form of income on the same application. The S/E borrower states their income confirms business ownership and verifies their liquid asset and reserves are commensurate with the income stated on the application. The salaried borrower lists and verifies their income by traditional means such as W-2's and pay stubs. The LTV and rates are based on the Reduced Doc Program.
Note: Qualify all Amortized and Interest Only ARM Products at the higher of the actual product rate or the start rate for the NJ 10/1 Amortized ARM

ASSETS
On all purchases the borrower must have the down payment, the closing costs and 12 months PITI reserves in seasoned personal, business or retirement accounts at time of application.
On all refinances the borrower must have the closing costs and 12 months PITI reserves in seasoned personal, business or retirement accounts at time of application.
For all purchases a minimum 35% down payment is required. Liquid and near liquid assets seasoned for two months including reserves must be commensurate with the type of business the borrower owns and the income stated on the application. Assets must be in the applicant’s personal accounts or jointly with any co-borrower to be considered. Assets shared with other family members may not be considered.
Any liquid or near liquid assets used for the transaction should be seasoned and verified with the last two months statements in domestic accounts. Foreign asset accounts are not acceptable.
Proceeds from the sale of a departing residence or other real estate are acceptable for the down payment. However, the reserves requirements should be in personal seasoned liquid accounts.
The minimum reserves for all Reduced Doc owner-occupied purchase and refinance transactions must be at least 12 months PITI. A second home requires an additional three months for a total of 15 months PITI. A non-traditional second
home requires an additional 6 months PITI for a total of 18 Months PITI.
Business assets for the transaction and reserves are acceptable if the borrower is 100% owner of the business and their company’s accountant confirms that personal use of the business funds will not adversely affect the business operations. In addition if business liquid assets are used they should be seasoned the same as personal assets and close attention will still be on the borrower’s personal liquid asset positions.
Gifts, including gifts of equity and a refinance of recently inherited property are acceptable if the borrower has at least 35% of the purchase price or the value of the inherited property plus closing costs and the necessary reserves in personal seasoned liquid funds.

CREDIT
Personal credit use and history are very important. Over extended use of credit will be a concern.
Although FICO scores are not used to evaluate any loan applications, a very strong credit profile including a satisfactory
rental reference or mortgage payment history is required and will be an important factor in the analysis of the loan request.
A strong mortgage payment history means no late payments past the grace period, usually the 15th of the month. This is important. Copies of canceled mortgage payment checks or a detailed mortgage payment history from the lender showing no payments were made past the grace period or late fees paid may be required as documented proof.

A Stated Income Loan is a loan program that isn’t for everyone, but it does have its advantages for specific situations. Use my Purchase Assistant or my Refinance Advisor to tell me more about your situation so I can get back to you and see if it is the right loan program for your specific home loan needs, from there I can contact you with a custom quote of your best options, or you can always call me direct at (212) 920 447. Please do not hesitate.

VA Loans

A mortgage loan program established by the United States Department of Veterans Affairs to help veterans and their families obtain home financing. The Department of Veterans Affairs does not directly originate VA loans.

VA Mortgage Loans

A VA (Veterans Administration) guaranteed home loan is the preferred loan program for active, non-active, Reserve, National Guard, and retired military of the armed forces because there is no down payment needed and no private monthly mortgage insurance required.

Benefits of Getting A VA Loan

100% financing + seller’s concession of 6%.
No private mortgage insurance is required.
There is a limitation on buyer closing cost.
The loan is assumable subject to the assumer’s credit approval.
Seller can pay 4% of your closing cost and even help you pay down your debt in order to lower your debt to income ratio.
Interest rate are better than conforming loans and similar to FHA loans but without the PMI.

2012 VA Loan Eligibility Questions
2012 Underwriting Guidelines
2012 VA Loan Funding Fee’s Exemptions
2012 VA Loan Funding Fee Exemptions
2012 VA Loan Closing Costs Exemptions
2012 VA Loan Compliance Inspections
2012 VA Loan Sellers Concessions

Military Service Requirements for VA Loan Eligibility

Note: Applications involving other than honorable discharges will usually require further development by VA. This is necessary to determine if the service was under other than dishonorable conditions.

Wartime - Service During:

WWII: 9/16/1940 to 7/25/1947
Korean: 6/27/1950 to 1/31/1955
Vietnam: 8/5/1964 to 5/7/1975

You must have at least 90 days on active duty and been discharged under other than dishonorable conditions. If you served less than 90 days, you may be eligible if discharged for a service connected disability.

Peacetime - Service during periods:

7/26/1947 to 6/26/1950
2/1/1955 to 8/4/1964
5/8/1975 to 9/7/1980 (Enlisted)
5/8/1975 to 10/16/1981 (Officer)

You must have served at least 181 days of continuous active duty and been discharged under other than dishonorable conditions. If you served less than 181 days, you may be eligible if discharged for a service connected disability.

Service after 9/7/1980 (enlisted) or 10/16/1981 (officer)

If you were separated from service which began after these dates, you must have:

Completed 24 months of continuous active duty or the full period (at least 181 days) for which you were ordered or called to active duty and been discharged under conditions other than dishonorable, or

Completed at least 181 days of active duty and been discharged under the specific authority of 10 USC 1173 (Hardship), or 10 USC 1171 (Early Out), or have been determined to have a compensable service-connected disability;

Been discharged with less than 181 days of service for a service-connected disability. Individuals may also be eligible if they were released from active duty due to an involuntary reduction in force, certain medical conditions, or, in some instances for the convenience of the Government.

Gulf War - Service during period 8/2/1990 to date yet to be determined

If you served on active duty during the Gulf War, you must have:

Completed 24 months of continuous active duty or the full period (at least 90 days) for which you were called or ordered to active duty, and been discharged under conditions other than dishonorable, or

Completed at least 90 days of active duty and been discharged under the specific authority of 10 USC 1173 (Hardship), or 10 USC 1173 (Early Out), or have been determined to have a compensable service-connected disability, or

Been discharged with less than 90 days of service for a service-connected disability. Individuals may also be eligible if they were released from active duty due to an involuntary reduction in force, certain medical conditions, or, in some instances, for the convenience of the Government.

VA Loan Fees A Borrower Might Pay

When buying a home with a VA mortgage, there are a range of fees and expenses a borrower should expect to pay, and then there are fees that could be paid depending on the type of home loan, the state or housing market that loan is issued in, etc.
The VA has some requirements that govern these types of expenses; one good example of that is when a third party renders a service as part of the VA loan. The only amount the borrower may...

Is Now The Time To Apply For A VA Home Loan?

Ever since 2008 and the housing market crisis that started that year, some veterans and currently serving military members have felt leery of applying for a home loan. While it’s true that some choose to buy in spite of housing market woes, those who held back may well be considering 2012 or early 2013 as the time to commit.

Part of that motivation is due to recent headlines like the one published on October 3, 2012 at Money.CNN.com; “Economists: Housing recovery finally here”.

That’s a fairly...
VA Loan Fees and The Appraisal Process

The appraisal process for VA home loans seems to be a mystery to many borrowers; there are many frequently asked questions about this critical stage of buying a home using VA loan benefits.

VA appraisals are required by federal regulations; the home you want to buy with a VA loan must meet VA minimum property requirements for safety, structural integrity, and other issues.

Some assume these rules are to protect the borrower from buying a home with shoddy workmanship or one that is located in an area...

Questions about who is eligible for a VA loan and reuse of eligibility for another VA loan

Q: How do I apply for a VA guaranteed loan?

A: You can apply for a VA loan right here by using either my Purchase Assistant or myRefinance Advisor. Just by doing so you will be telling me more about your situation so I can get back to you and see if it is the right loan program for your specific home loan needs , or you can always call me direct at (212) 920 447. Please do not hesitate

Q: How do I get a Certificate of Eligibility?

A: You can obtain information on how to get a Certificate of Eligibility by going on to this site here. http://www.benefits.va.gov/homeloans/docs/Veteran_registration_coe.pdf). A Certificate of Eligibility for Home Loan Benefits, to the Veteran Loan Administration Eligibility Center, along with proof of military service. In some cases it may be possible for VA to establish eligibility without your proof of service. However, to avoid any possible delays, it's best to provide such evidence.

Q: Can my lender get my Certificate of Eligibility for me?

A: Yes, it's called Web LGY. Only VA Approved lenders have access to the Web LGY system. This Internet based application can establish eligibility and issue an online Certificate of Eligibility in a matter of seconds. Not all cases can be processed through Web LGY - only those for which VA has sufficient data in our records. However, veterans are encouraged to ask their lenders about this method of obtaining a certificate.

Q: What is acceptable proof of military service?

A: If you are still serving on regular active duty, you must include an original statement of service signed by, or by direction of, the adjutant, personnel officer, or commander of your unit or higher headquarters which identifies you and your social security number, and provides your date of entry on your current active duty period and the duration of any time lost.

If you were discharged from regular active duty after January 1, 1950, a copy of DD Form 214, Certificate of Release or Discharge From Active Duty should be included with your VA Form 26-1880. If you were discharged after October 1, 1979, DD Form 214 copy 4 should be included. A PHOTOCOPY OF DD214 WILL SUFFICE.....DO NOT SUBMIT AN ORIGINAL DOCUMENT.

If you are still serving on regular active duty, you must include an original statement of service signed by, or by direction of, the adjutant, personnel officer, or commander of your unit or higher headquarters which shows your date of entry on your current active duty period and the duration of any time lost.

If you were discharged from the Selected Reserves or the National Guard, you must include copies of adequate documentation of at least 6 years of honorable service. If you were discharged from the Army or Air Force National Guard, you may submit NGB Form 22, Report of Separation and Record of Service, or NGB Form 23, Retirement Points Accounting, or its equivalent. If you were discharged from the Selected Reserve, you may submit a copy of your latest annual point’s statement and evidence of honorable service. Unfortunately, there is no single form used by the Reserves or National Guard similar to the DD Form 214. It is your responsibility to furnish adequate documentation of at least 6 years of honorable service.

If you are still serving in the Selected Reserves or the National Guard, you must include an original statement of service signed by, or by the direction of, the adjutant, personnel officer, or commander of your unit or higher headquarters showing the length of time that you have been a member of the Selected Reserves. Again, at least 6 years of honorable service must be documented.

Q: How can I obtain proof of military service?

A: Standard Form 180, Request Pertaining to Military Records, is used to apply for proof of military service regardless of whether you served on regular active duty or in the selected reserves. This request form is NOT processed by VA. Rather, Standard Form 180 is completed and mailed to the appropriate custodian of military service records. Instructions are provided on the reverse of the form to assist in determining the correct forwarding address.

Q: I have already obtained one VA loan. Can I get another one?

A: Yes, your eligibility is reusable depending on the circumstances. Normally, if you have paid off your prior VA loan and disposed of the property, you can have your used eligibility restored for additional use. Also, on a one-time only basis, you may have your eligibility restored if your prior VA loan has been paid in full but you still own the property. In either case, to obtain restoration of eligibility, the veteran must send a completed VA Form 26-1880 to our Eligibility Center. To prevent delays in processing, it is also advisable to include evidence that the prior loan has been paid in full and, if applicable, the property disposed of. This evidence can be in the form of a paid-in-full statement from the former lender, or a copy of the HUD-1 settlement statement completed in connection with a sale of the property or refinance of the prior loan.

Q: I sold the property I obtained with my prior VA loan on an assumption. Can I get my eligibility restored to use for a new loan?

A: In this case the veteran’s eligibility can be restored only if the qualified assumer is also an eligible veteran who is willing to substitute his or her available eligibility for that of the original veteran. Otherwise, the original veteran cannot have eligibility restored until the assumer has paid off the VA loan.

Q: My prior VA loan was assumed, the assumer defaulted on the loan, and VA paid a claim to the lender. VA said it wasn’t my fault and waived the debt. Now I need a new VA loan but I am told that my used eligibility cannot be restored. Why?

Or,

Q: My prior loan was foreclosed on, or I gave a deed in lieu of foreclosure, or the VA paid a compromise (partial) claim. Although I was released from liability on the loan and/or the debt was waived, I am told that I cannot have my used eligibility restored. Why?

A: In either case, although the veteran’s debt was waived by VA, the Government still suffered a loss on the loan. The law does not permit the used portion of the veteran’s eligibility to be restored until the loss has been repaid in full.

Q: Only a portion of my eligibility is available at this time because my prior loan has not been paid in full even though I don’t own the property anymore. Can I still obtain a VA guaranteed home loan?

A: Yes, depending on the circumstances. If a veteran has already used a portion of his or her eligibility and the used portion cannot yet be restored, any partial remaining eligibility would be available for use. The veteran would have to discuss with a lender whether the remaining balance would be sufficient for the loan amount sought and whether any down payment would be required.

Q: Is the surviving spouse of a deceased veteran eligible for the home loan benefit?

A: The unmarried surviving spouse of a veteran who died on active duty or as the result of a service-connected disability is eligible for the home loan benefit. If you wish to make application for the home loan benefit as a surviving spouse, contact our Eligibility Center. In addition, a surviving spouse who obtained a VA home loan with the veteran prior to his or her death (regardless of the cause of death), may obtain a VA guaranteed interest rate reduction refinance loan. For more information, contact our Eligibility Center.

[NOTE: Also, a surviving spouse who remarries on or after attaining age 57, and on or after December 16, 2003, may be eligible for the home loan benefit. However, a surviving spouse who remarried before December 16, 2003, and on or after attaining age 57, must apply no later than December 15, 2004, to establish home loan eligibility. VA must deny applications from surviving spouses who remarried before December 16, 2003 that are received after December 15, 2004.]

Q: Are the children of a living or deceased veteran eligible for the home loan benefit?

A: No, the children of an eligible veteran are not eligible for the home loan benefit.

VA Loan Fees A Borrower Might Pay

When buying a home with a VA mortgage, there are a range of fees and expenses a borrower should expect to pay, and then there are fees that could be paid depending on the type of home loan, the state or housing market that loan is issued in, etc.
The VA has some requirements that govern these types of expenses; one good example of that is when a third party renders a service as part of the VA loan. The only amount the borrower may be charged for such services is the actual cost of those services--no surcharges or extra fees can be tacked on by the lender.

Some other types of expenses a borrower should anticipate “just in case” include the following:

Title Examination and Title Insurance

The borrower may be required to pay a fee for title examination and title insurance, if warranted. VA loan rules explain this in VA Pamphlet 26-7, Chapter Eight.

Mortgage Electronic Registration System (MERS) Fee

VA loan rules state, “The veteran may pay a fee for MERS. MERS is a one-time fee for the purpose of electronically tracking the ownership of the beneficial interest in a loan and its servicing rights.”

Special Mailing Fees for Refinancing Loans

For refinancing loans only, VA loan rules permit the borrower to be charged for costs associated with using Federal Express, Express Mail, or a similar service, “when the saved per diem interest cost to the veteran will exceed the cost of the special handling.”

“Other” Fees Authorized By The Department of Veterans Affairs

VA loan rules for “other” or “additional” fees are addressed in Chapter Eight of VA Pamphlet 26-7, which states clearly, “Additional fees attributable to local variances may be charged to the veteran only if specifically authorized by VA. The lender may submit a written request to the Regional Loan Center for approval if the fee is normally paid by the borrower in a particular jurisdiction and considered reasonable and customary in the jurisdiction.”

The phrase “reasonable and customary” is key in that paragraph. While that may be open to interpretation, the VA has the final say when it comes to that interpretation as it applies to the rules in Chapter eight.

Is Now The Time To Apply For A VA Home Loan?

Ever since 2008 and the housing market crisis that started that year, some veterans and currently serving military members have felt leery of applying for a home loan. While it’s true that some choose to buy in spite of housing market woes, those who held back may well be considering 2012 or early 2013 as the time to commit.

Part of that motivation is due to recent headlines like the one published on October 3, 2012 at Money.CNN.com; “Economists: Housing recovery finally here”.

That’s a fairly bold headline--and one that might push some doubters into giving the market another chance. Consider the article’s opening line. “It's been a long time coming, but economists surveyed by CNNMoney believe the nation's housing market has finally turned the corner.”

That article goes on to say that fourteen economists were surveyed about home prices, with nine respondents indicating they feel home prices have either started trending upwards or will do so in 2013. Three months prior to that survey, fifty percent of the economists polled by CNN Money stated a turnaround in home prices was likely in 2013.

There are other indicators that the time to consider a VA home loan is now--there have been three months of improvements in the numbers on the S&P/Case-Shiller home price index, plus, as CNN Money reports, "a pick-up in sales of existing homes and home construction and a big jump in the price of new home sales.”

Qualified VA borrowers currently have very low interest rate options open to them, and with house prices beginning to rise once more, there is a good opportunity for borrowers--depending on the housing market--to find competitive prices on new purchase homes, short sales, and even VA loan assumptions.

If you’re considering a VA loan for the end of 2012 or early 2013, it’s a very good idea to pre-qualify for a VA loan amount, discuss your options with a loan officer, and start planning for a look at your favorite neighborhoods for a new home.

VA Loan Fees and The Appraisal Process

The appraisal process for VA home loans seems to be a mystery to many borrowers; there are many frequently asked questions about this critical stage of buying a home using VA loan benefits.

VA appraisals are required by federal regulations; the home you want to buy with a VA loan must meet VA minimum property requirements for safety, structural integrity, and other issues.

Some assume these rules are to protect the borrower from buying a home with shoddy workmanship or one that is located in an area unsuitable due to high risk of natural disasters or other problems. But there is another reason for the detailed rules that govern VA appraisals; when it comes time for the VA borrower to sell the home later down the line (assuming he or she chooses to do so); the sale of that home is not tarnished by such conditions as pointed out in the VA rulebook as being unacceptable.

In other words, the VA appraisal protects the buyer at purchase time, but also when it’s time to put the home up for sale.

The VA appraisal costs money--the borrower is responsible for paying the VA appraiser’s fee, which varies depending on the housing market and state. There is no one set fee for VA appraisal work; only what is considered “reasonable and customary” in that housing market.

Another area that confuses some borrowers--the need to pay for any required compliance inspection. When a VA fee appraiser does the job at a specific home and finds things which require correction, repair, or other attention in order for the VA loan to be approved, there may be a compliance inspection required in order to make sure those repairs actually get done, and to the satisfaction of the VA.

Compliance inspections must also be paid for by the borrower--it’s an expense that should be considered a typical part of buying a home. Sometimes they are needed, sometimes they are not. But a VA loan applicant should always budget for such things just in case--don’t be caught unprepared for the expense should it be required.

Finally, it should be noted that appraisal fees and compliance inspection fees are issued for services rendered--NOT for the results of those services. The borrower does not pay for a positive outcome in either case--just that the work gets done and a determination is made. It’s the service, not the outcome that is being paid for.

VA Loan 2012 Underwriting Guidelines for New VA Loan Home Purchase

No down payment is required by VA unless the purchase price exceeds the reasonable value of the property. The VA Loan lender may require a down payment if necessary to meet secondary market requirements if the home is being purchased above the value given by the VA Loan Appraiser.

The veteran must certify that he or she intends to personally occupy the property as his or her home.

Interest rate and points are negotiated between the VA approved VA Loan Lender and veteran.

The veteran and seller may negotiate for the seller to pay all or some of the points.
Points must be reasonable and must be approved by the Veterans Administration.

Points may not be financed in the loan except with Interest Rate Reduction Refinancing Loans (IRRRLs).
Flexible VA Loan standards. The veteran must have:

Satisfactory credit, and
Satisfactory repayment ability
Stable income
Residual income (net effective income minus monthly shelter expense) in accordance with regional tables, and

Acceptable ratio of total monthly debt payments to gross monthly income (A ratio in excess of 41% requires closer scrutiny and compensating factors.).

2012 VA Loan Funding Fee’s

The veteran must pay a funding fee to help defray costs of the VA home loan program.
The VA home loan program involves a veteran’s benefit.VA policy has evolved around the objective of helping the veteran to use his or her home loan benefit. Therefore, VA regulations limit the fees that the veteran can pay to obtain a loan.
Lenders must strictly adhere to the limitations on borrower-paid fees and charges when making VA loans.
In order to defray the cost of administering the VA home loan program, each veteran must pay a funding fee to VA at loan closing.
Congress may periodically change the funding fee rates to reflect changes in the cost of administering the program, or to assist a certain class of veterans

Purchase and Construction Loans

Note: The funding fee for ALL subsequent use loans closed on or after October 1, 2006, and before October 1, 2007, is 3.35 percent. This applies to all purchase loans where no down payment of 5 percent or more is made as well as cash-out refinances where the fee would have been 3.3 percent. Effective October 1, 2007, the subsequent use fee reverts back to 3.3 percent.

Type of Veteran	Down payment	Percentage for First time Use	Percentage for Subsequent Use
Regular Military	None 5% or more (up to 10%) 10% or more	2.15% 1.50% 1.25%	3.3% * 1.50% 1.25%
Reserves/ National Guard	None 5% or more (up to 10%) 10% or more	2.4% 1.75% 1.5%	3.3% * 1.75% 1.5%

Cash-Out Refinancing Loans

Type of Veteran	Percentage for First Time Use	Percentage for Subsequent Use
Regular Military	2.15%	3.3%*
Reserves/National Guard	2.4%	3.3%*

*The higher subsequent use fee does not apply to these types of loans if the veteran’s only prior use of entitlement was for a manufactured home loan.

Type of Loan	Percentage for Either Type of Veteran Whether First Time or Subsequent Use
IRRRLs	.50%
Manufactured Home Loans (NOT permanently affixed)	1.00%
Loan Assumptions	.50%

Lenders must remit the VA funding fee via the VA Funding Fee Payment System (FFPS); within
15 calendar days of loan closing.

Lenders paying the fee more than 15 days after loan closing will automatically be assessed a four percent late fee. Fees paid more than 30 days late will automatically be assessed an interest charge in addition to the late fee.

2012 VA Loan Funding Fee Exemptions

The following persons are exempt from paying the VA Loan funding fee:

Veterans receiving VA compensation for service connected disabilities.
Veterans who would be entitled to receive compensation for service connected disabilities if they did not receive retirement pay.
Veterans who are rated by VA as eligible to receive compensation as a result of pre-discharge disability examination and rating.
Veterans entitled to receive compensation, but who are not presently in receipt because they are on active duty.

Surviving spouses of veterans who died in service or from service-connected disabilities (whether or not such surviving spouses are veterans with their own entitlement and whether or not they are using their own entitlement on the loan).

A VA Loan lender must:

Verify the status of any veteran who may be exempt from paying the funding fee;
Determine the amount of funding fee owed by any non-exempt borrower;
Collect the appropriate fee from all non-exempt borrowers at loan closing;
Electronically remit the funds to VA in a timely manner through the VA Funding Fee Payment System (FFPS);
Print proof of payment of the funding fee; and
Submit proof that the funding fee has been paid or that the veteran is exempt from paying the funding fee to VA with the closed loan package.

Note: The funding fee may be paid from loan proceeds or cash from borrower.

The lender must verify exempt status by obtaining one of the following:

A properly completed and signed VA Form 26-8937, Verification of VA Benefits, indicating the borrower’s exempt status,
For a veteran who elected service retirement pay instead of VA compensation, a copy of the original VA notification of disability rating and documentation of the veteran’s service retirement income, or
Indications on the Certificate of Eligibility (COE) that the borrower is entitled as an unmarried surviving spouse.

If the veteran’s exempt status cannot be verified prior to loan closing, the funding fee must be remitted as if the borrower was not exempt.

Indicate in the closing package that the veteran claims exempt status. VA will determine the borrower’s status and refund the funding fee if appropriate. If the veteran has a pending disability compensation claim at the time of loan closing, the funding fee must be remitted as if the borrower was not exempt.

Advise the veteran to contact the VA RLC to request a refund if it is later determined that the veteran is entitled to compensation retroactively to a date prior to loan closing.

2012 VA Loan Closing Costs Exemptions (Closing Costs a VA Loan Can NOT Be Charged)

The VA home loan program involves a veteran’s benefit. VA policy has evolved around the objective of helping the veteran to use his or her home loan benefit. Therefore, VA regulations limit the fees that the veteran can pay to obtain a loan.

VA Loan Lenders must strictly adhere to the limitations on borrower-paid fees and charges when making VA loans which are why so many Veterans and Active Duty Service Members are “steered” away from a VA Loan and told that any “Civilian loan” is better.

The approved VA Loan lender’s maximum allowable flat charge of one percent of the loan amount (or greater percentage in the case of construction loans) is intended to cover all of the lender’s costs and services which are not reimbursable as “itemized fees and charges.” The lender may pay third parties for services or do as it wishes with the funds from the flat charge, as long as the lender complies with the Real Estate Settlement Procedures Act (RESPA).

The lender may not charge the borrower for attorney’s fees. However, reasonable fees for title examination work and title insurance can be paid by the borrower. They are allowable itemized fees and charges.

VA does not intend to prevent the veteran from seeking independent legal representation. Therefore, the veteran can independently retain an attorney and pay a fee for legal services in connection with the purchase of a home. Closing documents should clearly indicate that the attorney’s fee is not being charged by the lender, but is being paid by the veteran as part of an independent arrangement with an attorney.

Fees or commissions charged by a real estate agent or broker in connection with a VA loan may not be charged to or paid by the veteran-purchaser.

While use of “buyer” brokers is not precluded, veteran-purchasers may not, under any circumstances, be charged a brokerage fee or commission in connection with the services of such individuals. Since information on property available for purchase and financing options is widely available to the public from a variety of sources, VA does not believe that preventing the veteran from paying buyer-broker fees will harm the veteran.

A veteran obtaining a VA refinancing loan cannot use loan proceeds to pay penalty costs for prepayment of an existing lien.

A veteran purchasing a property with a VA loan cannot pay penalty costs required to discharge any existing liens on the seller’s property.

In proposed construction cases in which the dwelling was constructed under the Department of Housing and Urban Development (HUD) supervision, the cost of any inspections or re-inspections must be borne by the builder or sponsor and are not chargeable to the veteran-purchaser. This includes:

Re-inspections by VA or HUD of onsite or offsite work for which an escrow agreement was established, and any additional re-inspections deemed necessary by VA to assure conformity with VA regulations.

The following list provides examples of items that cannot be charged to the veteran as “itemized fees and charges.” If it IS a VA Loan, “Civilian” Loans like Conventional and FHA Loans you WILL be charged. Instead, the lender must cover any cost of these items out of its flat fee:

Loan Closing Lender Fees

Lender Document Preparation Fees

Conveyance fees

Attorney’s services other than for title work

Photographs

Interest Rate Lock In Fees

Postage and other mailing charges, stationery, telephone calls, and other overhead

Amortization schedules pass books, and membership or entrance fees

Commitment fees or marketing fees of any secondary purchaser of the mortgage and preparation and recording of assignment of mortgage to such purchaser

Trustee’s fees or charges

Loan application or processing fees

Fees for preparation of truth in lending disclosure statement

Fees charged by loan brokers, finders or other third parties whether affiliated with the lender or not, and tax service fees.

Appraisals and Veterans Administrations Compliance Inspections

The veteran MUST pay the fee of a VA appraiser and VA compliance inspectors.
The veteran can also may have to pay for a second appraisal if he or she is requesting reconsideration of value.

The veteran cannot pay for appraisals requested by parties other than the veteran or an approved VA Loan Lender

2012 VA Loan Sellers Concessions

For the purposes of this topic, a seller concession is anything of value added to the transaction by the builder or seller for which the buyer pays nothing additional and which the seller is not customarily expected or required to pay or provide.

Seller concessions include, but are not limited to, the following:

Payment of the buyer’s VA funding fee
Prepayment of the buyer’s property taxes and insurance
Gifts such as a television set or microwave oven
Payments of extra points to provide permanent interest rate buy downs
Provision of escrowed funds to provide temporary interest rate buy downs, and
Payoff of credit balances or judgments on behalf of the buyer.

Seller concessions do not include payment of the buyer’s closing costs or payment of points as appropriate to the market.

Example: If the market dictates an interest rate of 7½ percent with two discount points, the seller’s payment of the two points would not be a seller concession. If the seller paid five points, three of these points would be considered a seller concession.

In some localities, builders or sellers offer concessions as a competitive tool. In extreme cases, the concessions may entice unwary and unqualified veterans into home mortgages they cannot afford. The concessions may disguise the veteran’s inability to qualify for the loan.

Any seller concession or combination of concessions which exceeds four percent of the established reasonable value of the property is considered excessive, and unacceptable for VA-guaranteed loans.

Do not include normal discount points and payment of the buyer’s closing costs in total concessions for determining whether concessions exceed the four percent limit.

Testimonials

I am very satisfied and have already recommended his services to my friends that are looking to refinance.

May 23, 2012
To Whom It May Concern:

This Christmas I received a great gift, a refinanced home. A couple of years ago I received a similar gift when my brother helped me to remove my ex-husband’s name from my home loan with a refinanced loan, but this year he was unable to help me so he recommended Nikitas Kouimanis. Nikitas has been nothing but professional and very helpful from the first moment with the filling out of the initial paperwork until the final refund of my escrow account with my former lender. Nikitas kept me updated with all the ins and outs of my loan and was even available for me at odd hours due to my crazy work and training schedule.
Though we have never formally met in person (I am in Missouri and he is in New York), I feel like he took the time necessary to work with me and with my previous lender to square away the best deal for me. I am very satisfied and have already recommended his services to my friends that are looking to refinance.

Sincerely,
Rachel Graczak

We are extremely happy with the service we have received and with the loan terms .

4 June 2012

To whom it may concern,

Nikitas Kouimanis was instrumental in securing our first mortgage a year age and in securing a refinance loan on the same house on June 1^st, 2012. Nikitas on both occasions worked tirelessly with the difficult intricacies of the loans. He was available at all hours for consultation and I don’t believe the loans would have been done without his expertise and hard work. Nikitas is an excellent communicator whose knowledge of the process enabled the loans to fund even after I and my wife were ready to give up due to the difficult circumstances associated with the loan. Before we started to build our new house in order to get the construction loan we got pre-approved through Wells Fargo Mortgage for the Long term loan after the construction loan expires. After we finished building the home and we were ready for long term financing we went back to the same loan officer at Wells Fargo that pre-approved the loan a while back. However some two months later the loan officer quit Wells Fargo and went to another company partly due to the difficulties he was having getting Wells Fargo to close our loan. He took the loan package with him to his new company but two months later there was still no movement so we went on line to Lending Tree to find a lender. Sterling National bank and Nikitas were referred by Lending Tree. We did eventually get frustrated with SNB as well and we tried another mortgage company but after a few weeks they gave up and we went back to Sterling NB. I am very glad we did as Nikitas would not let this loan drop and eventually got it through.
I would recommend Nikitas Kouimanis and Sterling National Bank to anyone interested in obtaining a mortgage, in fact we have told our son and niece to work with him when they are ready to get a loan. We are extremely happy with the service we have received and with the loan terms .

Christopher Lee Navoda
Orasa Rice-Ray

They are indeed very fortunate to have him on their staff.

Nikitas Kouimanis is by far and away, the best loan officer with whom I’ve ever worked. His extensive knowledge and expertise, coupled with his consummate professionalism and unflagging “can do” attitude make him an outstanding member in his field, and a true jewel in Sterling National Bank’s crown. They are indeed very fortunate to have him on their staff.

Vicki LaBarre

Words cannot express how grateful Iam to you for all your help in refinancing my mortgage.

July 17, 2012

Dear Mr. Kouimanis,

Words cannot express how grateful Iam to you for all your help in refinancing my mortgage. As you know, it was a year long process for me, trying to find a bank or mortgage company who would be willing to help me refinance. I was given false hope over and over again from many companies whose employees simply wanted “the sale” and once they realized it would take some leg work to help me maneuver through the process after I filled out their applications, I would not be called back or simply turned down and dismissed as it being too difficult a process since my debt to income ratio was higher than necessary for a quick and simple refinance.
At the lowest point of my despair thinking I would never be able to quality or find someone who would help me, I called the servicing company who held my mortgage and they referred me to Sterling Bank. The universe must have been perfectly aligned for me that day as when I called the number given me I was fortunate to find myself talking to you. Everything changed from that moment on. Your knowledge, willingness to be patient and take the time to speak to me, ask me questions, make suggestions and most importantly not lie or give me false hope made my refinancing not only possible but it was a greater savings than I imagined.
Your professionalism, sincere kindness and honesty made the entire process flawless and fast.

Thank you so much for everything,
Paula Lewis

“It’s rare to find a person that truly cares about their clients these days.

Tom Thompson

January 23, 2013

“It’s rare to find a person that truly cares about their clients these days. Niki does exactly this and provides such a high customer service unmatched in his field. I encourage anyone to do business with or refer him! I certainly keep Niki in the highest regards!

“Nikitas, is a well rounded mortgage professional.

Jeff Williams

February 4, 2013

“Nikitas, is a well rounded mortgage professional. I have found him to be direct, honest, and extremely driven. His knowledge of industry products ands guidelines are extensive. Nikitas is great as an overall mortgage lending resource.

Nikitas is detail-oriented and has a way of making every loan a personal goal of his to get closed.

Michael A.
, Zikos Realty

“I’ve had the pleasure of working with Nikitas for two years. Nikitas has always represented himself to be a professional loan officer who goes the extra mile to help his borrower(s). Nikitas is detail-oriented and has a way of making every loan a personal goal of his to get closed. He is always striving to make his borrower(s) loan process a smooth and easy transaction. I would recommend Nikitas to anyone who is looking to buy a home or to simply refinance an existing mortgage.” November 23, 2010

I strongly believe he will make a great success soon.

Jonathan Zhang

“Nikitas is a very active and capable guy, whom I have known for a while. I strongly believe he will make a great success soon.” August 25, 2009

Howard Sloane

“I have been doing business with Nikitas for the past few years & have always been a hard worker. He has always managed his team in a way that was both professional & strategic. He is a great asset to the company he works for now & any company he worked for in the past.

Carl White

Top qualities: Personable, High Integrity, Creative
“Nikitas comes with my highest recommendations. He is always looking for new ideas to assist his clients. I admire him for his creative work and his willingness to “give first”. You would be doing yourself a favor to align yourself with Nikitas as I have. Respectfully Submitted, Carl White” August 9, 2011

Owen Geronimo

, Real Estate Sales, World Properties For Sale

“Nik is an industrious professional that know his clients’ need. Prompt in closing transactions and knowledgeable about his products. Call Nik if you need financial advice, he won’t disappoint you.” May 20, 2009

Joel Copeland

“Nikitas is a great person to talk with, learning from him and being his friend is a great honor for me. Just give him a call and things will start changing ” July 11, 2009

Michael A. Mills

“Working with Nikitas has garnered him my highest recommendation. Nikitas is constantly scouring the marketplace and industry publications, looking for new ideas to assist his clients. I admire him for his creative work and his willingness to “give first”. His nearly encyclopedic knowledge of residential lending guidelines, mortgage product structures, and underwriting standards makes him an asset to his clients. His application of this know-how gives him an edge over typical loan officers. He can find beneficial and ethical ways to help his clients in almost any situation. His frank manner of speaking and perennial honesty is heralded as a boon by his clients, who often come into the relationship with negative expectations guided by stereotypes of slick bombastic sales people. In an industry where a good reputation is as hard to come by as it is to obtain, you would be doing yourself a favor to align with Nikitas, as a client, referral partner, or a collateral business partner, as I have. Respectfully Submitted, Michael A. Mills” February 22, 2012

Brian Bates

“Since I have worked with Nikitas as a mortgage professional, he has demonstrated all the ideal skills that are necessary to excel within our career. He is experienced, knowledgeable, and motivated in this career, which allows him to provide customers with all the right tools to accomplish their goals.” February 22, 2012

Bart Kaplan

Top qualities: Great Results, Personable, High Integrity
“Nick is a self-starter with a great work ethic and is a person of high moral values and is up to any task.” February 20, 2012

Nikitas, I wanted to take a quick minute to extend my thanks for your efforts in managing our mortgage refinance. It had been several years since I had been through the mortgage loan process, and I very much appreciated your willingness to “hand hold” me through the entirety. Your prompt and thorough response helped me to remain at ease through the process.

Linda Casbeer

Disclaimer: ActiveRain Corp. does not necessarily endorse the real estate agents, loan officers and brokers listed on this site. These real estate profiles, blogs and blog entries are provided here as a courtesy to our visitors to help them make an informed decision when buying or selling a house. ActiveRain Corp. takes no responsibility for the content in these profiles, that are written by the members of this community.

Featured Learning Tracks on ActiveRain University

About Me

Loan Programs

Testimonials

Tom Thompson

January 23, 2013

Jeff Williams

February 4, 2013