Chance Gates' Blog » Loan

FHA Streamline Refinancing Fees Reduced

Chance Gates — Thu, 19 Apr 2012 21:39:45 +0000

A new program could save qualified borrowers $3,000 a year, even those who owe more than their home is worth.

The White House recently announced significant changes that will reduce the fees charged for the Federal Housing Administration’s (FHA) Streamline Refinance Program.

Beginning June 11, 2012, the Streamline Refinance upfront fee of 1%* will be reduced to 0.01% of the total loan amount. And the annual fee will be lowered from 1.15% to 0.55% of the total loan amount.

By refinancing through this streamlined process, the average qualified FHA-insured borrower will save approximately $3,000 a year or $250 per month, on top of any savings from refinancing to a lower mortgage rate.

The “streamline” refers to the minimal amount of documentation and underwriting that needs to be performed. Streamline refinancing can be done without an appraisal or income verification, providing the person(s) on the loan hasn’t changed.

There are no loan-to-value (LTV) restrictions on streamline refinancing. This is significant for underwater borrowers whose loan amount may exceed the current value of their home. However, second liens must subordinate with a maximum combined LTV ratio of 115% based on the original appraised value of the property.

The basic requirements of a streamline refinance are:

The loan must already be FHA insured and endorsed on or before May 31, 2009.
Borrowers must be current on their mortgage payments with no late payment in the previous 12 months.
The refinance must result in a lowering of the borrower’s monthly principal and interest payments.

Currently, 3.4 million households with loans endorsed on or before May 31, 2009, pay more than a 5% annual interest rate on their FHA-insured mortgages.

Thanks to my friends at Prospect Mtg

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As a Reno/Sparks Nevada real estate professional and property manager, I encourage all questions and comments on the Reno/Sparks real estate market or any of the articles posted in this blog. Please feel free to use my back door to the MLS and search the houses available in the Reno/Sparks and most Northwest Nevada neighborhoods. I can be reached by email @ chance@ballard-company.com http://www.myspace.com/chancegates . You can also follow me at http://www.twitter.com/chancegates . To checkout some of my property manager services goto http://chancegates.com/property-management-services/

If you are behind on your house payment and looking for a loan modification, go to making homes affordable

If the modification fails, contact your local real estate professional to help short sale your home. To make sure there is no deficiency judgment a homeowner might find it necessary to hire an attorney.

Nevada Housing Division (NHD) Down Payment & Closing Cost Loan – Storey and Washoe County

Chance Gates — Thu, 05 Apr 2012 20:32:16 +0000

Maximum Assistance or Loan Amount

$4,500

Eligible Properties

Maximum Sales Price

$367,974

Geographic Coverage

Storey County, Washoe County

Eligible Borrowers

Maximum Annual Household Income by Household Size

1-2 = $84,600, 3 or more = $98,700

Limitations

Eligible property types are New Construction or Existing, Single-Family residences. Must attend a 6-8 hour HUD approved approved homebuyer education course. Must be used in conjunction with NHD’s First Time Homebuyer Program first mortgages (FHA or VA financing )

Min Buyers Contribution

N/A

Home Buyer Education

Required

Maximum Assets Test

Not to exceed $5000 excluding retirement or pension accounts.

Purpose/Use of Assistance

Down payment and closing costs

Home Buyer Obligations

Borrower must occupy property as primary residence.

Loan Terms

Product type

Financed 2nd mortgage

Repayment Terms of the Loan or Assistance

20-year amortizing, fixed-rate

Interest Rate of the Loan or Assistance

7.00%

Approved 1st Mortgage Products

FHA and VA only (Conventional first mortgage not eligible for DPA and RHS has suspended loan registrations)

May be combined with the following programs (if they also appear in these search results).

Incentives for Occupation

N/A

Special Needs Assistance

N/A

Special Requirements

N/A

Other Details

Date last updated by agency rep

2012-04-02

If you are behind on your house payment and looking for a loan modification, go to making homes affordable

USDA Single Family Guaranteed Loan Program – Washoe County

Chance Gates — Thu, 22 Mar 2012 17:11:53 +0000

Benefits

Nothing down, flexible underwriting.

Section 502 loans are primarily used to help low-income individuals or households purchase homes in rural areas. Funds can be used to build, repair, renovate or relocate a home, or to purchase and prepare sites, including providing water and sewage facilities.

Eligibility: Applicants for loans may have an income of up to 115% of the median income for the area. Area income limits for this program are here. Families must be without adequate housing, but be able to afford the mortgage payments, including taxes and insurance. In addition, applicants must have reasonable credit histories.

Terms: Loans are for 30 years. The promissory note interest rate is set by the lender.

There is no required down payment. The lender must also determine repayment feasibility, using ratios of repayment (gross) income to PITI and to total family debt.

Standards: Under the Section 502 program, housing must be modest in size, design, and cost. Houses constructed, purchased, or rehabilitated must meet the voluntary national model building code adopted by the state and HCFP thermal and site standards. New Manufactured housing must be permanently installed and meet the HUD Manufactured Housing Construction and Safety Standards and HCFP thermal and site standards. Existing manufactured housing will not be guaranteed unless it is already financed with an HCFP direct or guaranteed loan or it is Real Estate Owned (REO) formerly secured by an HCFP direct or guaranteed loan.

Approval: Rural Development officials have the authority to approve most Section 502 loan guarantee requests.

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If you are behind on your house payment and looking for a loan modification, go to making homes affordable

Nevada Housing Division (NHD) First Time Homebuyer Program

Chance Gates — Fri, 09 Mar 2012 22:18:29 +0000

Eligible Properties

Maximum Sales Price

$449,747

Geographic Coverage

Program Boundaries

Eligible Borrowers

Maximum Annual Household Income by Household Size

1-2 = $84,600, 3 or more = $98,700

Limitations

Property must be located within a specific target area in the county of Washoe. Eligible property types are new Construction or Existing, Single-Family residences Homebuyer must attend a 6-8 hour HUD approved approved homebuyer education course Must be a first time homebuyer but there are HUD exceptions and qualified veterans excepted

Min Buyers Contribution

N/A

Home Buyer Education

Required

Maximum Assets Test

Max is 50% of purchase price, unless disabled or elderly and such assets are primary source of income

Purpose/Use of Assistance

Below-market rate financing

Home Buyer Obligations

Borrower must occupy property as primary residence.

Loan Terms

Product type

1st mortgage

Repayment Terms of the Loan or Assistance

30-year, fixed-rate, fully amortizing

Interest Rate of the Loan or Assistance

See website for current rates

Approved 1st Mortgage Products

FHA 203(b), streamline 203(k), VA, RHS, or Fannie Mae: My Community

Possible Recapture tax if home is sold or refinanced within first 9 years of ownership

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If you are behind on your house payment and looking for a loan modification, go to making homes affordable

Rural Nevada Home at last Advantage 4% Down Payment Assistance

Chance Gates — Fri, 02 Mar 2012 17:23:35 +0000

Innovative and cutting edge … how else can you describe Nevada Rural Housing Authority’s Home at Last Advantage Program?

With 4% down payment assistance, low rates and the ability to use this generous loan program in conjunction with the hugely successful Home at Last Mortgage Credit Certificate Program, first time homebuyers can’t go wrong!

Oh, and did we mention there is no allocation and therefore no limit to the number of hard working Nevadans who can purchase their first home with this program?

What a deal: A family buying a $150,000 home will get a free $6,000 cash down payment at slightly above market rates and save up to $2,000 a year in federal income tax (as much as $150 per month or more back in their pockets). Families can pick a FHA, RHS or VA 30 year fixed mortgage.

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If you are behind on your house payment and looking for a loan modification, go to making homes affordable

Guaranty Fee Increase

Chance Gates — Thu, 19 Jan 2012 20:53:48 +0000

The U.S. Congress recently passed a two-month payroll tax cut extension. The $33 billion package is funded by a 10-year increase in the Guaranty Fees that Fannie Mae (Fannie) and Freddie Mac (Freddie) charge lenders to guarantee home loans.

This change is effective for all loans delivered to Fannie and Freddie at the beginning of the second quarter of 2012. For example, the cost of a $200,000 mortgage will go up about $11 per month. Over the life of the loan, these costs are anticipated to be about $4,000.

These changes will also increase the cost of FHA and VA loans. However, the government has not released information as to the timing of these changes.

All lenders — by law — will be adding this increase to their pricing. Some lenders are adjusting their rates with a one-time increase.

Thanks to my friends at Prospect Mtg

Mark your favorite properties and get instant updates price changes, new pictures and status changes.

If you are behind on your house payment and looking for a loan modification, go to making homes affordable

Law to help Tenants Whose Landlords Goes in Foreclosure

Chance Gates — Sun, 02 Oct 2011 19:54:24 +0000

A new law passed by Congress and signed yesterday by the President provides protections for tenants whose landlords fall into foreclosure. Under the Helping Families Save Their Homes Act, tenants have the right to stay in their homes after foreclosure for 90 days or through the term of their lease. The bill also provides similar protections to housing voucher holders. The protections go into effect immediately and expire at the end of 2012. The new federal protections do not preempt city and state laws which remain in full force.

It is highly advise you consult with an attorney to answer any legal questions.

Mark your favorite properties and get instant updates price changes, new pictures and status changes.

As a Reno/Sparks real estate professional, I encourage all questions and comments on the Reno/Sparks real estate market or any of the articles posted in this blog. Please feel free to use my back door to the MLS and search the houses available in the Reno/Sparks and most Northwest Nevada neighborhoods. I can be reached by email @ chance@ballard-company.com http://www.myspace.com/chancegates . You can also follow me at http://www.twitter.com/chancegates . If you are behind on your house payment and looking for a loan modification, go to making homes affordable For a free copy of my report “5 Steps For Reno/Sparks Homeowners To Prevent Foreclosures” go to my about page http://chancegates.com/about and ask for more information on preventing foreclosures. or to request a modification. If the modification fails, contact your local real estate professional to help short sale your home. To make sure there is no deficiency judgment a homeowner might find it necessary to hire an attorney.

From the Old Farmers Almanac Cut Cost of Cold Snaps

Chance Gates — Tue, 20 Sep 2011 16:23:07 +0000

http://www.almanac.com

During the chilly months of winter, no matter what heat source you use—oil, gas, electricity, or wood—you can cut costs by adopting temporary measures to keep the thermostat turned down. Here are some money-saving tips for cutting the cost of cold snaps.

Temporarily close off heat to some rooms by shutting doors. (This requires a heating system that can be controlled room by room.) Shut the doors to unheated closets, the pantry, and the basement and attic.
Hang blankets over the windows at night. Tape or thumbtack the sides and bottom of blankets to the walls or windowsills to maximize the insulation value. (Press the tacks or tape under the bottom of the sill and over the top of the frame to hide any damage to the finish.) Remove the coverings on the south side of the house during the day.
Cover cracks around doors and windowsills with rugs, newspaper, towels, or other insulation.
Use electric space heaters in living or work areas. These are more efficient than the furnace for localized heating, and they will allow you to set the thermostat lower for the whole house.
Put on a sweater.
Cook a hot meal.

What do you do to save money on heat in your house during the winter? Comment and let us know!

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Escrow Accounts: What’s the Deal?

Chance Gates — Sat, 16 Jul 2011 21:07:48 +0000

http://members.houselogic.com/articles/escrow-accounts-whats-deal/preview/

By: Susan B. Weiner

Published: October 22, 2010

Does your escrow account ever cross your mind? Probably not. But forgetting to monitor it can lead to lost money and a big headache.

Escrow accounts: lenders love them; you might not

As handy as they are, you’ll find some significant hitches:

You lock up your money before your tax and insurance payments are due, since your lender is taking the money out each month, often long before the tax payment is actually due.

Your lender usually doesn’t have to pay you interest on your escrow account—it varies by state.

Your lender may screw up paying taxes or insurance, and even though it has to fix mistakes, you have to make the time and effort to follow up.

There may be tax advantages to timing your property tax expenses—but you can’t do that if you’re paying a flat fee in escrow each month.

But your lender may insist on an escrow account because it:

Helps guarantee your insurance and taxes will be paid.

Ensures your lender will get the first claim on your house if you default, ahead of the local government.

In fact, your lender may do you the honor of charging you a flat fee for opting out of an escrow account, or it will add 0.25% to 0.5% to the loan amount if you decline to use an escrow account.

How to manage your escrow account

Your lender has to give you an annual escrow account statement and refund any available balance when you sell your house or refinance your mortgage. Check your escrow account statement carefully:

Make sure everything adds up. “If I have my escrow statement, my property tax bill, and my homeowner insurance declaration page, and everything matches up, then I’m fine,” says Debbie Siegel, president of Westchester Mortgage in Newton, Mass.

Check the size of the escrow account. Lenders are allowed to keep a reserve of no more than two months in payments in most states, and in some situations it’s even less. Your REALTOR® or lawyer can give you the skinny in your case.

Contact your lender in writing if you find a problem in your escrow account. If your lender missed an insurance payment, it should pay any late fees as long as your mortgage payments are current, according to the U.S. Department of Housing and Urban Development. If your insurance is canceled as result of your lender’s late payment, you can sue your lender.

Know your rights. Your lender must acknowledge your letter within 20 days and try to fix your problem within 60 days. If you’re still not satisfied, file a complaint with HUD.

Don’t worry, however, if your escrow account balance is temporarily negative. It’s probably due to a recent increase in your taxes or insurance. Your lender will pay your taxes and insurance, although you will need to reimburse your lender for the shortfall.

A final word: Usually basic home owners insurance will be paid out of an escrow account. If you have extra coverage for your original Matisses, for example, you may need to pay that premium directly to your insurer.

Susan B. Weiner has written on financial topics for Bottom Line/Personal, Financial Planning, Wealth Manager, and other national publications for more than 15 years. She learned firsthand that when your house combines two lots, your escrow account may initially fail to pay the tax bill on the second lot.

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What Affects Credit Scores? 7 Misconceptions

Chance Gates — Sat, 09 Jul 2011 20:54:42 +0000

http://members.houselogic.com/landing/credit-scores-072011/?nicmp=rcrim&nichn=editorial&niseg=narwr&cid=WR07062011:22837&ed_rid=1698691

By: Gwen Moran

Published: October 22, 2010

If you’re trying to raise your credit score to get a good rate for a refinance or HELOC, you might be surprised by what affects—or doesn’t affect—your score.

More money improves your credit score

False. Your level or sources of income don’t affect your credit score, although lenders may look at it when making loan decisions, according to the Fair Isaac Corp., the company that issues the commonly used FICO credit scores.

Ownership of several credit cards can hurt your credit score

Mostly false. Having many credit lines isn’t necessarily a bad thing, says credit expert Liz Weston, author of Your Credit Score. Multiple lines give you a favorable debt-to-available-credit ratio. But use them correctly: It’s best to keep any balances below 10% or 20% of the total credit line, she says. Anything more will affect the ratio of debt-to-available-credit, which can decrease your credit score.

Opening and closing credit lines can hurt your credit score

True. New credit applications can decrease your credit score, so be careful about applying for new credit cards or personal loans before applying for a HELOC, second mortgage, automobile loan, or other large line of credit.

Surprise: Closing existing credit lines may also hurt your credit score, since it’ll damage your debt-to-available-credit ratio. A good rule is not to make any credit changes in the months leading up to a major credit request, such as for a HELOC.

Consolidating credit lines will help your credit score

Mostly false. Although it may seem like a good idea to move all your balances to one card, that can actually hurt your credit score, since your debt-to-available-credit ratio will spike on that card, says Weston.

However, credit expert Harrine Freeman says such a slight decline isn’t necessarily a deal-breaker for a loan, especially if the card has a lower interest rate and will allow you to pay off the balance sooner. Your score will increase as soon as that ratio goes down.

Changing jobs can hurt your credit score

Partly true. Taking a new job or losing your job doesn’t affect your credit score. However, if you have a spotty employment history, lenders may hold that against you in making a loan. Dips in income may signal that it could be difficult to pay bills in a timely manner.

Co-signing for others can hurt your credit score

Partly true. Simply co-signing on a loan for someone else may not affect your score, but if that person is late on paying the loan, it’s likely to show up on your report, says Freeman. And that’s a nasty surprise if you didn’t know the person was late.

Judgments and liens aren’t considered in your credit score

False. If you’ve had a judgment or lien filed against you, it’s considered in your payment history, which represents 35% of your score.

Similarly, while most utility companies don’t report payment history to credit bureaus, your account will likely be reported if it is seriously delinquent and referred to a collection agency.

Additional details on how to manage your FICO score are available on the FICO site.

Gwen Moran is a freelance business and finance writer from the Jersey shore. She’s the co-author of The Complete Idiot’s Guide to Business Plans and writes frequently about real estate.

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