MN FHA

What Is Your Home Worth Today?

I found a cool resource at http://www.FHFA.gov. If you go there, in the middle of the page you will find something called the Home Price Calculator. You input your home purchase information in terms of State, quarter in which you purchased and the quarter in which you’d like to get the valuation. Next, you hit calculate, and it will show you a chart. While it isn’t specific to YOUR exact home, it does give trends for your area. If you want specific information-specific to your home-within the Twin Cities metro-give me a call and we can discuss your situation. I can then give you guidance on what the value might be.

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Did you know-Current & Future Housing Data

Watch this video-then call me to help you buy or sell a new home or investment property.

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8 Tips For Finding Your New Home

A solid game plan can help you narrow your homebuying search to find the best home for you.

House hunting is just like any other shopping expedition. If you identify exactly what you want and do some research, you’ll zoom in on the home you want at the best price. These eight tips will guide you through a smart homebuying process.

1. Know thyself
Understand the type of home that suits your personality. Do you prefer a new or existing home? A ranch or a multistory home? If you’re leaning toward a fixer-upper, are you truly handy, or will you need to budget for contractors?

2. Research before you look
List the features you most want in a home and identify which are necessities and which are extras. Identify three to four neighborhoods you’d like to live in based on commute time, schools, recreation, crime, and price. Then hop onto REALTOR.com to get a feel for the homes available in your price range in your favorite neighborhoods. Use the results to prioritize your wants and needs so you can add in and weed out properties from the inventory you’d like to view.

3. Get your finances in order
Generally, lenders say you can afford a home priced two to three times your gross income. Create a budget so you know how much you’re comfortable spending each month on housing. Don’t wait until you’ve found a home and made an offer to investigate financing.

Gather your financial records and meet with a lender to get a prequalification letter spelling out how much you’re eligible to borrow. The lender won’t necessarily consider the extra fees you’ll pay when you purchase or your plans to begin a family or purchase a new car, so shop in a price range you’re comfortable with. Also, presenting an offer contingent on financing will make your bid less attractive to sellers.

4. Set a moving timeline
Do you have blemishes on your credit that will take time to clear up? If you already own, have you sold your current home? If not, you’ll need to factor in the time needed to sell. If you rent, when is your lease up? Do you expect interest rates to jump anytime soon? All these factors will affect your buying, closing, and moving timelines.

5. Think long term
Your future plans may dictate the type of home you’ll buy. Are you looking for a starter house with plans to move up in a few years, or do you hope to stay in the home for five to 10 years? With a starter, you may need to adjust your expectations. If you plan to nest, be sure your priority list helps you identify a home you’ll still love years from now.

6. Work with a REALTOR®
Ask people you trust for referrals to a real estate professional they trust. Interview agents to determine which have expertise in the neighborhoods and type of homes you’re interested in. Because homebuying triggers many emotions, consider whether an agent’s style meshes with your personality.

Also ask if the agent specializes in buyer representation. Unlike listing agents, whose first duty is to the seller, buyers’ reps work only for you even though they’re typically paid by the seller. Finally, check whether agents are REALTORS®, which means they’re members of the NATIONAL ASSOCIATION OF REALTORS®. NAR has been a champion of homeownership rights for more than a century.

7. Be realistic
It’s OK to be picky about the home and neighborhood you want, but don’t be close-minded, unrealistic, or blinded by minor imperfections. If you insist on living in a cul-de-sac, you may miss out on great homes on streets that are just as quiet and secluded.

On the flip side, don’t be so swayed by a “wow” feature that you forget about other issues—like noise levels—that can have a big impact on your quality of life. Use your priority list to evaluate each property, remembering there’s no such thing as the perfect home.

8. Limit the opinions you solicit
It’s natural to seek reassurance when making a big financial decision. But you know that saying about too many cooks in the kitchen. If you need a second opinion, select one or two people. But remain true to your list of wants and needs so the final decision is based on criteria you’ve identified as important.

G.M. Filisko is an attorney and award-winning writer who has found happiness in a brownstone in a historic Chicago neighborhood. A frequent contributor to many national publications including Bankrate.com, REALTOR® Magazine, and the American Bar Association Journal, she specializes in real estate, business, personal finance, and legal topics.

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4 Tips to Determine How Much Mortgage You Can Afford

By knowing how much mortgage you can handle, you can ensure that home ownership will fit in your budget.

Here are six surefire ways you can get your finances in order before you buy a home.

Homeownership should make you feel safe and secure, and that includes financially. Be sure you can afford your home by calculating how much of a mortgage you can safely fit into your budget.

Instead of just taking out the biggest mortgage a lender qualifies you to borrow, consider how much you want to pay each month for housing based on your financial and personal goals.

Think ahead to major life events and consider how those might influence your budget. Do you want to return to school for an advanced degree? Will a new child add day care to your monthly expenses? Does a relative plan to eventually live with you and contribute to the mortgage?

Still not sure how much you can afford? You can use the same formulas that most lenders use, or try another of these traditional methods for estimating the amount of mortgage you can afford.

1. The general rule of mortgage affordability
As a rule of thumb, you can typically afford a home priced two to three times your gross income. If you earn $100,000, you can typically afford a home between $200,000 and $300,000.

To understand how that rule applies to your particular financial situation, prepare a family budget and list all the costs of homeownership, like property taxes, insurance, maintenance, utilities, and community association fees, if applicable, as well as costs specific to your family, such as day care costs.

2. Factor in your downpayment
How much money do you have for a downpayment? The higher your downpayment, the lower your monthly payments will be. If you put down at least 20% of the home’s cost, you may not have to get private mortgage insurance, which costs hundreds each month. That leaves more money for your mortgage payment.
The lower your downpayment, the higher the loan amount you’ll need to qualify for and the higher your monthly mortgage payment.

3. Consider your overall debt
Lenders generally follow the 28/41 rule. Your monthly mortgage payments covering your home loan principal, interest, taxes, and insurance shouldn’t total more than 28% of your gross annual income. Your overall monthly payments for your mortgage plus all your other bills, like car loans, utilities, and credit cards, shouldn’t exceed 41% of your gross annual income.

Here’s how that works. If your gross annual income is $100,000, multiply by 28% and then divide by 12 months to arrive at a monthly mortgage payment of $2,333 or less. Next, check the total of all your monthly bills including your potential mortgage and make sure they don’t top 41%, or $3,416 in our example.

4. Use your rent as a mortgage guide
The tax benefits of homeownership generally allow you to afford a mortgage payment—including taxes and insurance—of about one-third more than your current rent payment without changing your lifestyle. So you can multiply your current rent by 1.33 to arrive at a rough estimate of a mortgage payment.

Here’s an example. If you currently pay $1,500 per month in rent, you should be able to comfortably afford a $2,000 monthly mortgage payment after factoring in the tax benefits of homeownership.

However, if you’re struggling to keep up with your rent, consider what amount would be comfortable and use that for the calcuation instead.

Also consider whether or not you’ll itemize your deductions. If you take the standard deduction, you can’t also deduct mortgage interest payments. Talking to a tax adviser, or using a tax software program to do a “what if” tax return, can help you see your tax situation more clearly.

G.M. Filisko is an attorney and award-winning writer who’s owned her own home for more than 20 years. A frequent contributor to many national publications including Bankrate.com, REALTOR® Magazine, and the American Bar Association Journal, she specializes in real estate, business, personal finance, and legal topics.

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Who Manages The HUD Homes?

The country is divided into different areas. Each area works with different companies. In addition, some areas have different rules. For example, the $100 down program is not available in all areas of the country. Like everything these days, you need to check on availability. To determine who is the manager, go to this map http://www.hud.gov/offices/hsg/sfh/reo/mm/mm3map.pdf

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Two Special Twin Cities Home Buying Programs

One program is called FPP-Foreclosure Partnership Program, and the other is NSP2 Homebuyer Assistance Program.  Both programs offer incentive money for a purchase.  I can use these financing programs with one of our mortgage investors.  Consider checking them out to see if they’d work for you.

HennipenCounty-Non-forclosedHomes-overview

HennipenCounty-Nsp2-overview

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FHA Extends Flipping Waiver-More Homes Can Be Rehabbed And Sold

This is great news. The waiver has been extended through the end of 2011. See the Mortgagee letter:

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Rebuilding Credit To Get A Mortgage

Often, especially in this market due to the recession, we find potential home buyers who have had a life event or “bump in the road” that affects their ability to obtain a new loan. If you want to buy a home, you will have to have a certain number of reporting trade lines and for certain length of time. MOST mortgage programs require 3-5 trade lines and a minimum of two years of reporting. The other criteria is the actual credit score-which generally has to be 620, 640 or even 660 as it is all lender dependent. A manual underwriting where they use alternative credit such as rent payments, cell phone bill, utility bills, and the cable bill might be able to be used-but only with a few certain programs and lenders. So, the best bet is to re-establish credit as quickly as possible. HOW ABOUT NOW!! Don’t wait-it will only extend the time until you are going to be eligible. I have put together a list of resources that might be helpful. This list is only a starting place for your research. If you find another good resource please post it in the comments below so that the list can be expanded upon.

TOP IDEAS FOR CREDIT RE.doc

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Buying Rental Property In The Twin Cities

Have you ever wanted to own rental property, but were unsure where to start? I teach a class on the topic. I’ve decided to make the outline into a PPT. I cover the information in my class in much more depth and breadth, but this will give you a lot of useful information. If you are interested in discussing purchasing a rental property as an investment, just give me a call and we can set up a time to meet and review how I can help you become a “real estate mogul”.

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Mortgage Insurance May Still Be Deductible For Some Buyers

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December Is The Time To Reflect

Are each of us doing all we can to make the world a better place? Many of us have our favorite charity and organizations we support. RE/MAX is a very large sponsor of Children’s Miracle Network. Many people don’t realize how much has been given. Each time I sell a home, I automatically donate a portion of my commission to this organization. Other RE/MAX agents like myself contribute from their commission checks as well. Together, with RE/MAX we have collectively given over 100M. I would encourage everyone to consider finding an organization they believe in and make giving a part of their life. Just imagine what the world could look like?

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Getting Ready to Sell Your House

While most experts see little good news in 2011’s housing market, economic downturn is no reason to neglect maintenance on a home or lose sight of future plans to relocate.

The critical issue is planning intelligently for what spending you do now to make sure it’s worth your money later. And even if your plan to sell your property is more than a year away, it’s not a bad idea to get your finances in order as well. In the coming months, you’ll be addressing tax issues, so it’s a good time to look at your overall financial picture with a qualified financial planner as well as a trained tax expert.

The October MacroMarkets Home Price Expectations Survey doesn’t see a meaningful increase in home prices until 2012, though appreciation is expected to go up on average more than 14 percent through 2014.

As you wait for your opportunity, here are some ideas to incorporate in your planning:

Check your credit report and score: If you plan to finance a new property once you sell, it makes ample sense to lower your debt and clean up any discrepancies in your credit data well in advance of any move into the market. Remember, you are entitled to one free copy of each of the major credit reports in any given year, and you can obtain them from one resource – www.annualcreditreport.com. Avoid all the services with expensive TV commercials calling themselves “free” – if they ask for a credit card number, you are not getting a free report. Also, so you can spot discrepancies and keep a watchful eye on the possibility of ID theft throughout the year, stagger your receipt of your reports from Equifax, Experian and TransUnion (the major credit ratings agencies) at different points during the year.

Get a home inspection: Go through local channels – lenders, friends, real estate professionals you trust – to find a licensed home inspector who can look over your property and help you develop a list of potential repairs and upgrades that you can do economically given that you’ll have months before you put the property up for sale. Checking your home’s structure – roof, foundation, windows, etc., as well as its mechanical parts – heating/AC, installed appliances, plumbing – can give you an early warning system for expensive repairs that a prospective buyer’s inspector would find anyway. Try now to make sure there are no problems that will kill a deal later.

Ask a trusted broker for advice: Structural experts can determine whether your home is working properly – real estate brokers may or may not be equally expert at spotting these flaws. But generally, they can be trusted on matters of appearance – whether the grounds around the home are well maintained as well as whether the home’s interior is inviting to the eye of potential buyers.

Don’t overinvest in improvements: In the 1990s, spending $40,000 on a kitchen in many neighborhoods could recover that amount of money and more in the final sales price. In today’s market, those payoffs are a distant memory. Experienced brokers generally do a good job steering you away from overpaying for improvements, but there are other resources to doublecheck the spending you’re planning to do. Remodeling Magazine’s latest Cost vs. Value report provides estimates on specific projects by region, including projections on cost recoupment.

Appeal your property taxes: If you’ve never appealed your property taxes before or have not done so in many years, do so when your appeals period is open. Lowering your taxes as much as possible may help make your property more salable.

Declutter and don’t re-clutter: Start making a list of items you might donate – furniture, clothing, household items, etc. Make sure they’re in good condition and if you’re having trouble setting a value, check on eBay or other auction sites to see if you’re being fair to yourself while not drawing the attention of the taxman.

December 2010 — This column is produced by the Financial Planning Association, the membership organization for the financial planning community, and is provided by John Mazzara 952-929-2577  john@johnmazzara.com , a local member of FPA.

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HUD Has A YouTube Channel-Here Is There Vid On Buying A Home

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Google lets you create cool templated websites

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Can Home Ownership Contribute To Your Wealth?

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Minnesota Foreclosure And Distressed Home Fact Sheets PLUS Twin Cities First Time Buyer Special Programs

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Twin Cities Foreclosure Update

Here is our latest newsletter that has updates on foreclosures in the Twin Cities.

Also, watch the video below

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Minnesota First Time Home Buyer Tips

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Top Seven Tips For Home Buyers

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Underwater on your current NON FHA loan

What can you do if you are underwater on your current NON FHA loan, but are current on the loan (I DIDN”T say anything about having been late-just current), and would like to refinance.    There IS a new program–The FHA short refinance.  Before you get too excited, let me cover a couple of the “details’.  First, you must have a non FHA loan to start with.  Then, you can refinance into an FHA loan-up to 97.75% LTV (same as before) and up t0 115% CLTV.  The borrower is subject to maximum DTI-debt to income requirements (generally 31%)- as well as there must be a property valuation issue and current income impairment.

The key is that the first mortgage investor must write off at LEAST 10% of the existing mortgage debt and accept the payment as settlement in full.  The second investor must discount their position as well.  Is this likely???  If the borrower is “current” on the payments, why reduce the loan??  If the loan is insured with mortgage insurance, why take the loss?  If the second lien holder can sell their position to someone else or decides to look at pursuing a deficiency judgement, why would they want to do this.

Here is the HUD letter link

http://www.hud.gov/offices/adm/hudclips/letters/mortgagee/files/10-23ml.pdf

So, while I think the intentions are good, I think the actual application will be small.  What I’ve been seeing in the Twin Cities marketplace is that most lenders are refusing principal reductions and instead opting for foreclosure.

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FHA Mortgage Insurance Change-October 4th

For 30 year mortgages, the upfront is moving down from 2.25% to 1% and the monthly is moving from .55% to .9% for those putting less than 5% down and .85% for those putting more than 5% down payment.  Here is a link to an article discussing the changes:

http://www.washingtonpost.com/wp-dyn/content/article/2010/08/05/AR2010080506663.html

The question you might be asking is “is this a consumer benefit?” Here is one interpretation:

http://www.thinkbigworksmall.com/mypage/archive/1/52542/

On a separate note, doing a short refi with an FHA loan MAY be possible if the servicer agrees.  Here is the FHA rule:

http://www.hud.gov/offices/adm/hudclips/letters/mortgagee/files/10-23ml.pdf

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FHA Loans, What and Why Are They?

By Tom Maneval

Federal Housing Administration (FHA) home loans are a great option for many homebuyers and homeowners looking to purchase or refinance. FHA home loans are specifically useful to borrowers who cannot make a big down payment, who want low monthly payments, whose credit is not great and qualifying for a conventional loan is difficult for them.

Congress created the FHA in 1934 and it became part of the Department of Housing and Urban Development (HUD) in 1965. The FHA is not a lender. The FHA is the largest insurer of mortgages in the world. Lenders are insured by the FHA against losses as a result of a homeowner defaulting on their mortgage loan. It insures single and multifamily homes including manufactured homes and hospitals. The FHA is the only government agency that does not cost the taxpayers anything operating entirely from the proceeds from its mortgage insurance which is initially part of the mortgage payment.

This program allows a first time home buyer, who might otherwise not qualify for a home loan to obtain one because the risk is removed from the lender by FHA who insures the loan. With the recent subprime lending collapse, the FHA home loans have become cool again, as mortgage lenders and brokers are flocking to the latest FHA loan programs. FHA has been around for decades, and there are many innovative programs to help different segments of the population to realize the dream of home ownership. A common misconception is that FHA home loans are for first time homebuyers. The fact is you can only have one FHA loan at a time whether it’s your second home or fifth. The mortgage limits for FHA home loans are set on an area-by-area or county-by-county basis.

This type of insurance is an attractive benefit for FHA approved and authorized lenders. If the homeowner defaults, the lender gets its money from the FHA. The lender or broker works with prospects to qualify their loan application to FHA guidelines for approval for this insurance for the loan.

FHA loan guidelines also provide attractive benefits to home buyers as qualification is usually less stringent than conventional loans. Plus, all FHA home loans are FULLY assumable, adding one more layer of protection for you and your family. Having an assumable loan at a good interest rate would be part of a good plan for selling your house in the future especially if the interest rates have gone up.

If refinancing a home, the current loan DOES NOT have to be an FHA loan. Refinancing an existing FHA home loan is actually called a streamline refinance. FHA loans are for all homeowners that are buying, or refinancing their home. FHA mortgage loans assist existing homeowners to convert their ARM to a reduced rate refinance loan that ensures a set fixed payment every month until the mortgage is paid off. With FHA refinancing, homeowners can count on market-low mortgage rates to pull cash out up to 85%, and in some cases 95% loan to value. FHA loans are for all homeowners that are buying, or refinancing their home.

Each type of FHA loan is unique and must be applied for individually. Attention is given to one’s ability to make payments and handle life’s expenses. Less attention is given to FICO scores when applying for an FHA loan than with a conventional loan. Qualifying for an FHA home loan is done by using a set of debt-to-income ratios that are a bit more in your favor than those used for conventional home loans.

The following two FHA loan requirements are important for qualifying: Housing expenses should not exceed 29% of your gross income; total indebtedness should not exceed 41% of your income. FHA home loans require a smaller down payment as well. Down payments for FHA home loans are low, generally 5% or even as low as 3.5%. The finance package in a nutshell is: FHA insurance + lender financing = FHA loan. Ask your lender for assistance in learning which FHA mortgage is right for you.

FHA home loans are available in rural and urban areas. FHA home loans are not loans granted by the government, but FHA home loans are mortgage loans that are guaranteed by the Federal Government. FHA home loans are generally offered at reasonable interest rates, and guarantee the mortgage company that the loan will be paid. So whether you are refinancing, buying your first home or your fifth, try out FHA.

Got more questions? Contact an FHA Loan Specialist today.

http://www.tmfinancialsolutions.com/?page=services

Article Source: http://EzineArticles.com/?expert=Tom_Maneval
http://EzineArticles.com/?FHA-Loans,-What-and-Why-Are-They?&id=2812903

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FHA Mortgage Loans are Back and Just in Time

By Aaron Gordon

When I first started in the mortgage business, at least one in four of all of my buyers got an FHA loan. The rates were fantastic, the down payment requirements minimal, and the credit requirements were close to meaningless. Most first – time home buyers got an FHA loan.

In the last three years, over 600 families have trusted me with their home loan needs. Of those 600, I did a total of two FHA loans over that time. One in 300.

I wasn’t alone. FHA guaranteed less than 5,000 loans in California last year. In 2003, they did over 100,000. A 95% decrease in demand. Nationally, FHA loans are down 50% from a few years ago.

FHA loans lost their popularity in the past few years for numerous reasons. Loan limits were too low for the fast-appreciating real estate market, income documentation guidelines were too strict, and appraisal restrictions were very difficult.

Subprime lenders, with looser guidelines, capitalized and met this demand.

Home values increased more than FHA lending limits did. The average home in Las Vegas was around $300,000. The FHA loan limit was around $270,000. Subprime lenders would go over $1 million.

FHA requires full documentation of your income and a 3% down payment. Subprime lenders were doing 100% loans with stated income with scores as low as 600.

Although sometimes flexible, FHA guidelines limit your debt-to-income ratio to 41%. Many subprime banks were letting borrowers go to 55%.

With rising sale prices, more borrowers went with stated income loans. FHA wouldn’t allow this. Subprime did.

The FHA appraisal requirements were much more strict and this also turned off many sellers. Subprime lenders had no additional requirements.

The FHA loan was, quite frankly, a last resort. Subprime had taken its place.

Today, that has changed. With all of the recent guideline changes, the subprime loan is nearly dead with anything less than 5-20% down. Many subprime banks have gone out of business. Many more will.

FHA is back!! Once again, borrowers are looking at this as a primary option, especially first time homebuyers.

There are two types of mortgage loans; government loans like FHA and VA, and then there are the rest, which are called conventional loans.

100% financing on conventional loans is not as readily available as it was, particularly for those with marginal credit. FHA has not changed. 97% financing was and is available regardless of credit score. In the last three months, I have closed five FHA loans.

FHA recognized their business was getting hurt by increasing home values so they dramatically increased their loan limits.

In Las Vegas today, the FHA loan limit is $304,000. This is right in line with our average sales price. The timing could not be better and, as a result, FHA loans are back as a very viable loan option.

If you have very little or no money available for a down payment, bad-to-fair credit and feel like you have way too many bills, FHA may be your key to homeownership today.

FHA does not loan money, they insure loans. You don’t go to the FHA to get a loan. You go to a mortgage company that has been approved with the FHA. These companies have special permission to underwrite and close the loan.

You can buy a single family home, a duplex, triplex, or 4-plex. FHA will even insure loans on manufactured/mobile homes.

As an approved FHA lender, when we do an FHA loan, it is insured by FHA. If the loan goes into default, they guarantee it. This means the loan has very little risk to the lender. As a result, the rates are nearly equal to that of a conventional loan, even though the credit scores may be way worse.

Rates on conventional loans are usually based on credit score. The better your score, the better your rate. This is not so with FHA. Everyone, regardless of score, gets a great rate.

FHA was started in the 1930′s to assist first-time homebuyers. The goal was to help families with lower and moderate income get home financing. The program was geared for minorities as well.

Many lenders in today’s subprime mess are pointing the fingers at each other. They believe that countless numbers of the homes going into default today are because of high subprime rates. They believe these homes would not be in jeopardy with an FHA loan with a much lower rate.

For example, last week I closed a borrower on an FHA loan. His credit score is 611 with limited trade lines and 3% down. His interest rate is 6.250% on a 30 year fixed, which he will never have to refinance if he doesn’t want to.

Last year, because of the loan amount, this loan would have probably gone subprime with an interest rate of closer to 8.000% on a 2 year fixed rate, that would have likely forced a refinance in 24 months.

And he doesn’t have a prepayment penalty!! FHA doesn’t have prepayment penalties. As you know, most subprime loans have prepayment penalties and if you want it waived plan on the rate going up by 1-2%.

The program works and provides incredible options for borrowers whose only choices in the last few years have mostly been awful.

There are many advantages to an FHA loan.

You are only required to put down a 3% down payment and the lender can help you get it. It can also be gifted from a close friend, a relative or a non-profit organization that provides financial assistance.

There are many private down payment assistance companies (DAPs) that can help you with the 3% down payment. The FHA allows this and works with these companies. You have likely heard of a Nehemiah. Nehemiah is a DAP. If you do a conventional loan, this is not allowed.

You can have less than perfect credit. In fact, your credit can be pretty bad. FHA is far less concerned about your credit score than they are your history over the last two years in paying your bills on time. They will often ignore previous financial troubles and other blemishes on your credit report.

There are no “set” guidelines about credit. There is much more flexibility at the underwriting level.

For example, I recently had an FHA loan where the borrower was putting down his own 3% and not using a DAP, he was employed for over two years, and he has no late payments for the past two years. He also had four months reserves. His credit score was under 550, his debt to income ratio was 47%, and he only had one current trade line. The loan was approved. The FHA rate at the time was 6.125%.

As opposed to most conventional lenders, which have strict guidelines, FHA underwriters have some discretion to look at the overall strength of the file and make a decision. For example, even though it is commonly thought your debt to income ratio must be 41% or less to qualify; I have seen FHA loans approved with debt to income ratios over 50%.

Some of the FHA guidelines are more strict. You do have to be two years out of bankruptcy from the date of discharge and you must have some good re-established credit to get an FHA loan.

If you had a foreclosure you likely need to wait at least three years for an FHA loan and your credit should be pretty clean after that date.

If you can prove the foreclosure occurred because of extenuating circumstances like the death of a spouse or a serious illness that prevented you from working, they will sometimes make an exception to this as well.

The FHA has many different choices of loan programs like 30-year fixed, 15-year fixed, 1, 3, 5, 7, and 10 year ARM’s too. Interest only is not available.

The rates are excellent as I discussed above. The fees are controlled by FHA so you usually pay less for the mortgage too.

In today’s market, there is a lot of bank-owned on the properties that are in need of pretty substantial repair. The FHA has a program that allows owner-occupied borrowers to finance up to $35,000 in the mortgage to make these repairs.

In a conventional loan, these repairs need to be made before the close of escrow. In many cases, the seller doesn’t want to make these repairs and offers the property “as is.” The buyer can’t afford to make the repairs and certainly doesn’t want to make them before they own the house. This usually kills the deal after the home inspection or appraisal.

The FHA has a plan for this. The program is called a 203(K) and it allows for the appraiser to consider the value of the home after all of the repairs and renovation is made. You get to buy the home, fix it up to be livable, and then you get to include all these costs in one easy loan. And you still only have to put 3% down. No other loan program allows for this.

When the loan is closed, the repair/renovation money is withheld in escrow, as well as additional reserve funds of 10-20%, to pay for these improvements and any overages that may occur that weren’t factored at the time.

The contractors go in, fix the house, and then they get paid through the withhold account and reserves. The biggest catch here is, once again, the home has to be owner-occupied. This program is not available for investors or second home buyers.

In today’s market, the only negatives to an FHA are loan are loan limits, which are $304,000 and that unless you put down 20%, which most people don’t, your FHA loan will require mortgage insurance.

Mortgage insurance (MI) is handled a little differently than you are used to with a conventional loan. For one, it’s usually a bit cheaper. FHA mortgage insurance is not based on credit score like conventional loan MI is. It runs 0.5% of the loan amount and is broken down over your monthly payments.

FHA also has an upfront insurance premium that is 1.5% of the loan amount. That premium is due at the close of escrow and can either be paid in full at close or added to the loan amount. As most FHA borrowers have very little money to put down, this premium is usually financed into the loan.

The good news here is that mortgage insurance, as of January 1, 2007, was made tax-deductible, so that helps as well.

And how about this? FHA loans are assumable!! If you want to sell your home, you can simply transfer it over to your buyer and he doesn’t have to go out and get a new loan. The buyer does have to meet the FHA credit standards, but as I have already touched on, those are very reasonable.

The bottom line is if you are a first-time homebuyer or you are a bit more credit-challenged and your lender suggests a subprime loan you should ask for FHA as an option.

In addition, if you are being quoted more than the “going rate” for a loan, you believe you can support your income with paycheck stubs and W-2′s, and the loan amount is $304,000 or under in Las Vegas, you will also want to ask about an FHA option.

If your preferred lender says FHA is not for you for any other reason other than loan amount or income documentation, and suggests a subprime loan, you may want to get information from a different lender. Not all lenders are permitted to do FHA loans. You want to make sure the reason why you are being steered away is not simply because they can’t do the loan.

Aaron Gordon is a top-producing Senior Mortgage Consultant with Maverick Residential Mortgage in Las Vegas, NV. His monthly newsletter currently goes out to over 10,000 real estate agents and other professionals in the Las Vegas area. He helps over 200 families each year who trust him in their mortgage needs in many states. He can be reached by email at aarongordon@maverickmortgage.com or you can see more newsletters at aarongordon.net

Article Source: http://EzineArticles.com/?expert=Aaron_Gordon
http://EzineArticles.com/?FHA-Mortgage-Loans-are-Back-and-Just-in-Time&id=578900

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Data.gov – A Cool Site With Lots Of Great Info

http://www.Data.gov I just found this site and wanted to share it.  It has a ton of info and reports.  If you have a project or just an “inquiring mind”, this is sure to be a hit.  Check it out and get the data you need.

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Check Out Energy Rebates

EnergyStar.gov –  Check Out Energy Rebates

This is a government site that offers lots of energy saving tips as well as explains what energy saving grants or credits might be available.

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Foreclosure Trends Newsletter

Here is the latest issue of my foreclosure trends newsletter.  As you can see, the trend is not our friend, in the sense that the housing market has not recovered.  Until jobs come back and people are employed and feel safe in their employment, they will tend to avoid making a committment.

ForeclosureTrends.pdf

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Twin Cities Foreclosure Trends-From our MLS & Realty Trac

Besides the board of realtor sites:  http://theThing.mplsrealtor.com and market data posted elsewhere at http://www.MplsRealtor.com I have a subscription to Realty Trac.  My subscription gives me additional data about foreclosures and trends within certain zip codes.  This is in addition to my daily subscription to Finance & Commerce (a business newspaper that prints all the foreclosure information as well as very timely articles regarding the business community).  If you are looking for someone who has experience and access to information about distressed sales, we need to be working together.  Whether buyer or seller-I can help you understand the market we are in and the options and opportunities available to you.  Give me call today.

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Real Estate Information

These are a couple of my newsletters that have a ton of valuable information. Go check them out.

Foreclosure Market Trends Newsletter
http://www.realtytrac.com/MarketTrends/NewsLetter.aspx?guid=131bd355-1b69-4bd1-99cd-2f0c9a936810

Real Estate Cyber Space Tips
http://www.REcyber.com/cybertips/r11627

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Outstanding Video-An Inspiration To All-Be The Best You Can Be!

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Twin Cities Home buyer book

Thinking about buying a home but don’t know where to start? Why not start by reading the home buyer hand book that we have provided below. It is a great place to start to get the information you need. When you’re ready, we would love to help you find and finance a new home.

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Reverse Mortgage Purchase For MN Seniors

Yes IT IS being done!!  A reverse mortgage purchase using the FHA HECM loan.  We’re doing them at Venture Development.  We put together a power point on it for your review.  http://www.slideshare.net/mnguru/reverse-mortgage-purchase-senior-mortgage This is another interesting way that homes can be sold and buyers can achieve a housing payment that works for them.

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FHA 203K–For Remodel or purchase

As a Minnesota mortgage broker, we have investors who will fund the FHA 203k program.  Not every lender will allow for a 203K, as they require more paperwork and have more responsibility associated with them.  That being said, you will want to explore the 203K loan if you want to make some updates or remodel to an existing or new purchase.  I have run across a very knowledgeable 203K consultant.  You will definitely want to check out his site as well at: http://203kloanmn.com/about-203k-loan-minnesota When you are ready, call us and let’s begin your mortgage paperwork (we broker loans throughout Minnesota).

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FHA Short Sales-ALLOWED

Many people mistakenly think short sales can’t or won’t be done on FHA insured loans.  THIS IS NOT TRUE
Here is the link to the HUD pdf which outlines their current program guidelines:  http://www.hud.gov/offices/hsg/sfh/nsc/rep/pfsfact.pdf If you are in Minnesota and your home is within the 7 county metro area around the Twin Cities, we can help you list your home and do a short sale.

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FHA Credit Score Changes

FHA is thinking about changing their minimum credit score requirements for loans.  In the meantime, lenders are adding their overlay on top of FHA.  So, what this means is that although a loan will eligible for FHA insurance with a score of 580, they may impose a minimum of 640.  MOST lenders today are 620.  Many are moving to 640 and even 680!!  This is why it is important to work with a broker that has a number of outlets.  Otherwise, you may be told “NO” by your favorite lender on the street corner, when you could have been told “YES” and taken advantage of the low interest rates, tax credits and other incentives.

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FHA ARM’s are AVAILABLE

Many lenders/brokers are not offering the FHA ARM.  WE DO!!!.   FHA ARM’s adjust 1 percent per year, once per year, with a lifetime maximum adjustment of 5% over the start rate.   Let’s look at a WORST case example.   Lets start a 4% year 1.   Upon adjustment with worst case, we’re looking at yr 2- 5%, yr 3- 6%, yr 4-7%, yr 5-8%, yr 6-9%.   As with all ARM’s there is a formula to make the adjustment based on adding a margin to an index.  The conventional ARMS usually have higher annual and lifetime caps, as well as a larger down payment requirement.

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FHA Upfront MIP Increasing to 2.25%

Due to an increase in foreclosures, FHA finds itself needing to increase the cost of mortgage insurance.  The upfront MIP is increasing from 1.75% to 2.25%.  FHA allows borrowers to purchase a home with 3.5% down.  The borrowers using FHA often don’t have a lot of reserves or ability to put more down.  The lack of financial resources coupled with a shaky economy has led to an increase in foreclosures.  The insurance premiums are used to cover the mortgage losses.  The monthly insurance cost of .55% of the loan will remain the same.

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Open Source Documents-Unbelievable Resources-Find YOUR topic of Interest

If you’ve never visited http://www.Archive.org, you are missing a wonderful site.  From this site, you will find many resources that are out of copyright and you can download and use them as you wish.  You will find all the classics and some fun things as well.  Just for fun, I have the download of a book called “Little Gardens” which is a book about setting up a garden on a city lot.  This is just one of the MANY fun things you’ll find.  You can download and watch old music, movies, and cartoons as well.  Plan to spend some time on the site should you decide to visit, as it is very cool.  Click here to download the book Little Gardens

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FHA 90 Day Rule Suspended

Great news!. Now, a buyer can buy a “fix & flip” property even if it was bought and sold within the past 90 days. This was not always the case. Here is the FHA document explaining the conditions and what they will now allow for.

Click Here waivpropflip2010.pdf

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FHA Loss Mitigation Options For Those With FHA Loans

Here is the latest FHA Mortgagee letter that explains what options are available for people in default with their FHA mortgage.  There are options, you need to explore them if you are in danger of losing your home.

FHA Loss Mitigation

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