Monday, March 8, 2010
Monday, January 25, 2010
Dates to Remember
Dates to Remember:
February 1. 2010
HUD TAKES ACTION TO SPEED RESALE OF FORECLOSURES
With certain exceptions, FHA currently prohibits insuring a mortgage on a
home owned by the seller for less than 90 days. This temporary waiver will give FHA
borrowers access to a broader array of recently foreclosed properties.
April 5, 2010
INCREASE IN UPFRONT PREMIUMS FOR FHA MORTGAGE INSURANCE
FHA loans with a case number assigned on or after April 5, 2010, will have a
2.25% upfront mortgage insurance premium. This is a .5% increase. Case numbers are
generally assigned when there is a contract with a property address, and a closing date
AND the borrower has committed to go forward with the loan.
Annual premiums (remitted on a monthly basis) will not change at this time.
Please go to http://www.hud.gov/offices/adm/hudclips/letters/mortgagee/files/10-02ml.pdf. for more information.
Other changes include:
New borrowers will now be required to have a minimum FICO score of 580 to qualify
for FHA’s 3.5% down payment program. Borrowers with less than a 580 FICO score
will be required to put at least 10% down.
Seller concessions will be reduced from 6% to 3%. HUD has not yet released an effective
date for this change. (This will be a big one)
April 5, 2010
SHORT SELL PROCESS BECOMES EASIER
As of now, these seem to be the key points:
• Mortgage servicers have 10 days to accept or deny a short sale request. After a sale
is completed, the borrower could be completely released from debt.
• Borrowers are eligible to receive a $1,500 moving allowance, if they sell their home
through a short sale.
• Mortgage servicers will receive $1,000 for each completed short sale.
• Investors who hold first mortgages can get as much as $1,000 for allowing second
lienholders to release their liens.
• Second lienholders can get only as much as $3,000 in proceeds from short sale to
release their liens.
• The property must be the homeowner’s principal residence.
• The homeowner is delinquent on the mortgage or default looks likely.
• The loan was made before Jan. 1 this year and is less than $729,750
The borrowers’ total monthly mortgage payment exceeds 31 percent of their before-
tax income.
Mark P. Moyes
Associate Lending Manager
“Mark of Excellence”
February 1. 2010
HUD TAKES ACTION TO SPEED RESALE OF FORECLOSURES
With certain exceptions, FHA currently prohibits insuring a mortgage on a
home owned by the seller for less than 90 days. This temporary waiver will give FHA
borrowers access to a broader array of recently foreclosed properties.
April 5, 2010
INCREASE IN UPFRONT PREMIUMS FOR FHA MORTGAGE INSURANCE
FHA loans with a case number assigned on or after April 5, 2010, will have a
2.25% upfront mortgage insurance premium. This is a .5% increase. Case numbers are
generally assigned when there is a contract with a property address, and a closing date
AND the borrower has committed to go forward with the loan.
Annual premiums (remitted on a monthly basis) will not change at this time.
Please go to http://www.hud.gov/offices/adm/hudclips/letters/mortgagee/files/10-02ml.pdf. for more information.
Other changes include:
New borrowers will now be required to have a minimum FICO score of 580 to qualify
for FHA’s 3.5% down payment program. Borrowers with less than a 580 FICO score
will be required to put at least 10% down.
Seller concessions will be reduced from 6% to 3%. HUD has not yet released an effective
date for this change. (This will be a big one)
April 5, 2010
SHORT SELL PROCESS BECOMES EASIER
As of now, these seem to be the key points:
• Mortgage servicers have 10 days to accept or deny a short sale request. After a sale
is completed, the borrower could be completely released from debt.
• Borrowers are eligible to receive a $1,500 moving allowance, if they sell their home
through a short sale.
• Mortgage servicers will receive $1,000 for each completed short sale.
• Investors who hold first mortgages can get as much as $1,000 for allowing second
lienholders to release their liens.
• Second lienholders can get only as much as $3,000 in proceeds from short sale to
release their liens.
• The property must be the homeowner’s principal residence.
• The homeowner is delinquent on the mortgage or default looks likely.
• The loan was made before Jan. 1 this year and is less than $729,750
The borrowers’ total monthly mortgage payment exceeds 31 percent of their before-
tax income.
Mark P. Moyes
Associate Lending Manager
“Mark of Excellence”
Monday, January 4, 2010
Interest Rates Go UP, UP, and Away
Interest Rates UP, UP and Away!!
Reference from Steve Harney Blog
NEWS UPDATE: In 4 weeks rates have increased from 4.71 to 5.14
The government has been keeping interest rates down for over a year. The programs that they used to accomplish this will be coming to an end on March 30, 2010. Rates are expected to rise quickly and dramatically after that.
Here is what the experts are predicting:
Broadly, we expect interest rates to be lowest in the early part of the year, as support programs remain fully in force, with 30-year fixed-rate mortgages hanging around the 5% mark during the first quarter. After that we’ll start a transitional period, and for planning purposes, borrowers should expect figures one-half to even a full percentage point higher than this. ..With continued economic healing expected, pressure will build for the Fed to list rates and/or begin to remove supports, and, absent any resumption of these programs, rates will nudge closer to 6% than 5% for the final two quarters of 2010.
“If you told me by the end of 2010 a 30-year rate was at 6 percent that sounds about right” says Mark Zandi, chief economist at Moody’s. “I don’t think there’s any question rates are headed up.”
“The ending of the Fed program will definitely affect rates,” says Mark Goldman, professor of real estate at San Diego State University. “So far, the Fed has not expressed interest in keeping the program going. That could raise rates by some 150-200 basis points.” (which equates to 6 ½ to 7% rates).
Washington Post article 12/26/09 (http://www.washingtonpost.com/wp-dyn/content/article/2009/12/25/AR2009122501652.html)
After hitting an all-time low in early December, the average rate on a 30-year, fixed-rate mortgage rose to 5.05 percent this week and could climb to 6 percent by the end of 2010, if not sooner, according to giant mortgage financier Freddie Mac.
The experts are saying rates will be somewhere between 6-8% by the end of 2010. This is why, even though prices are still receding, a person should consider buying now instead of waiting and trying to time the bottom of the housing market.
Thursday, December 10, 2009
Monday, November 30, 2009
Friday, November 6, 2009
The New and improved Tax Credit
It's finally here:
Congress just passed an expanded version of the $8,000 first time home buyer tax credit that was set to expire on November 30.
Although the tax credit remains at $8,000 for home buyers that have not owned a primary residence in the last three years, it has been expanded to include a $6,500 tax credit for home buyers that have lived in their current primary residence for at least five consecutive years out of the past eight years. Under the old rules, move-up home buyers did not qualify. Consider these three examples:
Example 1:
Jane purchased a home in 2002, lived there for 5 years as her primary home, moved out in 2007, and turned that home into a rental property. If Jane decides to buy a new primary residence today, she would qualify for the $6,500 tax credit based on the fact that she lived in the same residence as her primary home for at least five consecutive years out of the past eight.
Example 2:
Harry purchased a home in 2004, and lived there for the past 5 years as his primary home. If Harry decides to buy a new primary residence today, he would qualify for the $6,500 tax credit based on the fact that he lived in the same residence as his primary home for at least five consecutive years out of the past eight.
Example 3:
Nicole purchased a home in 2006, and lived there for the past 3 years as her primary home. If Nicole decides to buy a new primary residence today, she would not qualify for the $6,500 tax credit based on the fact that she did not live in the same residence as her primary home for at least five consecutive years out of the past eight.
The tax credit applies to homes purchased for less than $800,000 before May 1, 2010. In other words If you sign a binding contract to purchase a home before May 1st, you would need to close on the transaction before July 1, 2010. It works kind of like a gift certificate that can be redeemed for cash. You simply file a form with the IRS right after you buy your home, and the IRS will send you a check for the full amount of your credit.
The income limitation for single tax payers went up from $75,000 under the old rules to $125,000 under the new rules. For married tax payers, the income limitation went up from $150,000 to $225,000. This means that more people will qualify for the credit – especially in parts of the country with higher costs of living. This should help stimulate parts of the housing market that may not have been impacted by the old version of the credit.
There are many creative ways of structuring your home purchase transaction in ways that maximize the benefits of the credit. Here are a few examples:
• The credit applies to 1-4 unit homes as long as you live in one of the units as your primary residence – you could live in one unit and rent out the others
• If two unmarried individuals buy a home, and only one of the individuals qualifies for the credit based on their income or past home ownership status, the individual who qualifies for the credit can claim the full credit. (Note: In the case of married couples, both spouses must qualify for the credit.)
• The credit applies even if you have co-signers on your mortgage loan
For more details contact me directly or visit my website at:
www.markmoyes.com/taxcredit.html
Congress just passed an expanded version of the $8,000 first time home buyer tax credit that was set to expire on November 30.
Although the tax credit remains at $8,000 for home buyers that have not owned a primary residence in the last three years, it has been expanded to include a $6,500 tax credit for home buyers that have lived in their current primary residence for at least five consecutive years out of the past eight years. Under the old rules, move-up home buyers did not qualify. Consider these three examples:
Example 1:
Jane purchased a home in 2002, lived there for 5 years as her primary home, moved out in 2007, and turned that home into a rental property. If Jane decides to buy a new primary residence today, she would qualify for the $6,500 tax credit based on the fact that she lived in the same residence as her primary home for at least five consecutive years out of the past eight.
Example 2:
Harry purchased a home in 2004, and lived there for the past 5 years as his primary home. If Harry decides to buy a new primary residence today, he would qualify for the $6,500 tax credit based on the fact that he lived in the same residence as his primary home for at least five consecutive years out of the past eight.
Example 3:
Nicole purchased a home in 2006, and lived there for the past 3 years as her primary home. If Nicole decides to buy a new primary residence today, she would not qualify for the $6,500 tax credit based on the fact that she did not live in the same residence as her primary home for at least five consecutive years out of the past eight.
The tax credit applies to homes purchased for less than $800,000 before May 1, 2010. In other words If you sign a binding contract to purchase a home before May 1st, you would need to close on the transaction before July 1, 2010. It works kind of like a gift certificate that can be redeemed for cash. You simply file a form with the IRS right after you buy your home, and the IRS will send you a check for the full amount of your credit.
The income limitation for single tax payers went up from $75,000 under the old rules to $125,000 under the new rules. For married tax payers, the income limitation went up from $150,000 to $225,000. This means that more people will qualify for the credit – especially in parts of the country with higher costs of living. This should help stimulate parts of the housing market that may not have been impacted by the old version of the credit.
There are many creative ways of structuring your home purchase transaction in ways that maximize the benefits of the credit. Here are a few examples:
• The credit applies to 1-4 unit homes as long as you live in one of the units as your primary residence – you could live in one unit and rent out the others
• If two unmarried individuals buy a home, and only one of the individuals qualifies for the credit based on their income or past home ownership status, the individual who qualifies for the credit can claim the full credit. (Note: In the case of married couples, both spouses must qualify for the credit.)
• The credit applies even if you have co-signers on your mortgage loan
For more details contact me directly or visit my website at:
www.markmoyes.com/taxcredit.html
Thursday, October 29, 2009
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