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December 27, 2011

Government Mortgage Help Programs

Category: Government Loans,Home Loan Market – admin – 5:43 pm

Since the mortgage industry went sideways in 2006, the government lending programs have dominated the financing options for home loan origination across the country. Clearly the government mortgage financing has stimulated the increase in FHA mortgages, VA loans and refinancing help offered for borrowers that have mortgage liens owned by Fannie Mae or Freddie Mac.

The financial crisis hаs led thе Government tо соmе uр wіth а range оf government mortgage help programs, but thеу саn bе а lіttlе difficult tо find. Ads thаt talk аbоut thе nеw legislation seldom lead а person оntо thе rіght path. Home loan guidelines have been trending towards tighter lending requirements but many originators anticipate an easing trend in 2012.  Неrе іs а review оf thе programs аnd places whеrе а person саn gеt government home loan assistance.

Government Mortgage Help Programs

The mоst sensible wау tо оbtаіn genuine advice іs tо talk tо а HUD-approved counselor. Тhе counselor will offer authentic іnfоrmаtіоn аbоut thе help programs аnd hоw dоеs а person qualify. Тhеу’ll knоw еvеrуthіng thаt іs аvаіlаblе аftеr discussing thе loan takers situation.

Home Loan Fees:

A person dоеs nоt hаvе tо pay аnу fee fоr thеsе help programs. Analysis аnd counseling іs absolutely free. Іn fact, thе homeowner must bе wary оf sоmеbоdу whо asks fоr а fee.

Be Careful оf Scams: If а person dоеs а loan modification wіth а lender, hе оr shе will hаvе tо pay sоmе fee. Вut іt іs nоt а раrt оf thе government finance program; іt іs оnlу аn agreement thе borrower соmеs tо wіth thе bank оr thе lender. Ѕоmе genuine government help wіth mortgage programs соntаіn modification.

Loan Modification Basics:

If а person decides tо refinance, hе оr shе mіght аlsо hаvе tо pay sоmе fee аnd costs. Вut, thіs fee іs paid tо thе lender, nоt tо thе counselor.

Loan Eligibility

To mаkе usе оf thе benefits оf thе programs offered bу thе government, а person must ensure thаt hе оr shе іs eligible fоr іt. Ѕоmе conditions fоr eligibility аrе discussed below.

The rules set bу thе government stаtе thаt tо seek help, thе mortgages hаvе tо hаvе originated оn Fіrst оf January 2009 оr prior. Аs реr thе mortgage rules, іt іs оnlу thе fіrst mortgages whісh qualify fоr thе assistance. Іf а person hаs borrowed mоrе cash thаn thе vаluе оf thе house, hе оr shе іs nоt eligible fоr thе government mortgage help. Аlsо, іf thе house іs thе primary residence оf thе borrower, hе оr shе mау nоt bе eligible fоr thе home refinancing option. Тhе program mаkеs usе оf thе money gathered іn tax tо assist thе homeowner. Тhеrеfоrе, аs а real estate investor, а person сеrtаіnlу саn’t mаkе usе оf thе taxpayer’s money tо bail оut hіm оr herself.

Basically, government aid саn оnlу bе usеd іf homeowners meet thе required guidelines.

Online Lending Assistance

To speed uр thе whоlе process оf gеttіng а loan аnd notify thе homeowners, thе stаtе іs making efforts tо offer thе info online. Fоr example, webinar hаs bесоmе а vеrу popular tool tо explain government mortgage help options.

Internet іs а vеrу convenient option, аs it’s аn all-encompassing technology today. Тhеsе sessions thаt аrе designed tо instruct homeowners аbоut thе eligibility criteria fоr vаrіоus dіffеrеnt programs takes аbоut twо hours.

The programs offered bу thе government аrе а ray оf light fоr homeowners. Undеr а rough recessionary time, thе government mortgage help programs аrе а much-required relief. Ву tendering incentives tо banks аnd оthеr financial institutions, thеsе programs aim tо generate аn appropriate environment fоr modifications оf loan. Вut, thеrе аrе сеrtаіn criteria а person nееds tо fulfill tо qualify.


May 5, 2011

New Home Loans

Category: Home Loan Market,Home Purchase Loan Tips – admin – 12:33 am

The housing market continues to struggle with slumping home sales, but for home buyers this has turned into good news, because prices have come down and mortgage rates remain at record lows.  Qualifying for a new home loan has its challenges as banks expect more income, more money for down-payments and higher credit scores. New home financing has evolved in the last few years with tighter loan guidelines to prevent loan defaults and delinquencies.   Fortunately for consumers there is a wide variety of 1st time home buyer loans to choose from:

  • FHA loans – These government home loans only require a 3.5% down-payment and you do not need to be in the military.  FHA financing does require monthly mortgage insurance, but the rates are great and most lenders are more flexible with credit scores than Fannie Mae or Freddie Mac lending.
  • VA home buying – These Veteran loans are for military borrowers and no down-payment is needed.  Buying a home with no money down is easy with the VA loan program. Like FHA, the VA program allows home loans for poor credit.
  • Fannie Mae – These conventional mortgages ensure great rates, but most home loan lenders want 20% down.  Fannie Mae still offers a new home loan for first time home buyers but there is mortgage insurance and in most cases the lenders want credit scores above 720.

April 20, 2011

3 Tips for Getting the Right Home Loan Online

Category: Home Loan Market,Published Articles – admin – 2:01 am

Shopping for a home loan online has suddenly become an important step in getting the best mortgage on the market. Were you aware that consumers spend almost twice as much time researching the purchase of a car than they do a home loan?  Yet in the U.S., the average house costs five times more than the average automobile? A recent Zillow survey revealed that American consumers spend ten hours shopping for a car online, while only researching mortgage loan options for about five hours.  Home loan rates are near record lows, so you stand to save a significant amount of money my choosing the best mortgage for your situation.

As a result, people miss opportunities to get lower mortgage rates and better home loans costing them thousands of dollars over the years. To avoid losing out on your hard-earned dollars, here are a few tips to help you take control of the mortgage shopping process:

1. Get your home finances in order. Before you even start shopping for a home loan assess your finances. Determine what you can afford. As a rule of thumb, the total cost of your mortgage payment — including any taxes and insurance—should not exceed 30 percent of your take-home pay. You’ll also want to get a good ballpark estimate of your credit score. Your credit score impacts your interest rate as well as your eligibility to get a loan. Currently, one-third of Americans cannot get a mortgage because their credit score is below 620.  FHA mortgages

2. Pick the type of home loan that meets your needs. There two main types of home mortgages: Adjustable-rate mortgage (ARM) and the fixed-rate loan. ARMs have fixed rates for a short period (usually 3, 5 or 7 years) and then readjust. These mortgages are generally considered riskier because the interest rate and payments can increase when the loan adjusts. However, if you are only planning on living in your house for a shorter period, these loans may make sense for you, especially because you’re likely to obtain lower rates.

A home loan with a fixed rate is just that—the interest rate is fixed. Many people like this type of loan because the interest rate stays constant throughout the period of the mortgage. With both fixed and adjustable rate loans you can select various repayment periods. The most common term is 30 years, but if you can afford the higher monthly payments of a 20- or 15-year term loan, you will save money with the lower interest rate and quicker payoff period. The most important factors in selecting your mortgage type is the length of time you plan on staying in your home and your risk tolerance.

3. Take advantage of your 30-day window. There is no such thing as too many loan quotes. Borrowers may shy away from getting multiple loan quotes, fearing their credit will be impacted when multiple parties check their credit within a short period of time. However, you have 30 consecutive days in which multiple pulls of your credit score, or “rate shopping,” won’t affect your credit. With that in mind, take advantage of the 30-day window and get as many loan quotes as possible to get the best rates and terms. Note that in order to compare quotes apples-to-apples, it is important to get quotes from lenders around the same time as rates can change daily. It is always wise to double-check the rate you get from a single broker or bank to make sure you really are getting a good rate and that you find a lender that you trust.


January 13, 2011

2011 Home Loan Program Trends

Category: Home Loan Market,Home Loan News – admin – 1:07 pm

The last few years have been pretty stagnant for emerging home loan trends, but many mortgage professionals expect 2011 to present new opportunities for home purchase loans and refinancing.  Congress passed a financial reform law last year that will go into effect in March that is supposed to curb mortgage fraud and reduce the home loan costs for consumers.  The reality is that due to this reform bill, home loan origination costs are expected to arise and unfortunately the increased costs will passed down to the consumers thus nullifying one of the primary goals of the Dodd-Frank bill.

  The question that consumers and loan officers across the country all want to know is “Is the era of the best home loan rates behind us?  No matter what anyone tells you…nobody knows which direction rates are going. Timing the market is very difficult so getting approved for a loan that saves you money, should be a priority for homeowners & first time home-buyers alike.

FHA Home Loans – First time home buyers will continue to flock towards FHA mortgages for the simple fact that they only have to come up with 3.5% for a down-payment compared with 10 to 20% for conventional home loans.  If a borrower needs a bad-credit mortgage, they will need to come up with 5-10% for a down-payment, according to revised FHA guidelines.  There will likely be less FHA refinance transactions in 2011 than 2010 because the trend for higher home loan rates seems to have kicked in.

VA Home Loans – VA home financing will be continue to flourish in 2011 throughout the military community, because as home prices become more affordable, the program for VA home loans will continue to be the most aggressive home loan programs in the industry. VA refinancing will remain popular as the VA streamline programs will help the veterans who didn’t refinance last year uncover some savings with lower monthly payments.

Conventional Home Loans – Conforming loan limits appear safe for 2011, but conventional loan guidelines remain too tight for most Americans to seize the opportunity to realize record low home loan rates.  If rates exceed the 5% barrier in 2011, we anticipate that conventional loan origination to drop dramatically, but if the economy continues to sputter the low rates may c0me back in style.


August 17, 2010

Federal Reserve Cuts Lender Paid Yield Spread Premium

The Federal Reserve was busy Monday eliminating commission opportunities for mortgage brokers across the nation. The Fed announced several new rules like banning YSP loan commissions in an effort to minimize abusive mortgage lending practices.  According to the Lead Planet, a mortgage marketing company in Southern California, the Fed actually said that mortgage lenders paying yield spread premium, also known as YSP led to the collapse of our housing sector.   The truth is that the Fed has had knowledge of broker paid commissions since it began well over a decade ago.

Will Banning Mortgage Rebates Help the Mortgage Industry?

These new home lending regulations are part of the new financial reform legislation mandated by Congress.  The new rules apply to mortgage loan originators, brokers and loan companies, including banks and mortgage firms employing them. Under the new regulations loan originators may no longer be paid a increased commissions for suggesting one home loan over another.

Will this be the end of No Cost Mortgages? The rule change is intended to prevent loan originators from receiving higher compensation at the cost of damaging consumers.  Mortgage lenders can still continue to receive fees that are based on a percentage of the loan amount, however, which is common in the mortgage business.  Many loan originators have been sharing their yield spread premium commissions with their borrowers in an effort to reduce or even eliminate closing costs.  Where do you think no cost mortgage loans originated from?

Loan originators will also be prohibited from receiving compensation from both the consumer and another party such as a bank or mortgage company. Consumers were typically not informed that loan originators and brokers often received payments for their work from both parties. The new rule seeks to protect consumers who agree to pay the loan agents through a higher interest rate or through fees such as points charged up front on a mortgage are not paying more as a result.

Another rule finalized Monday would require borrowers to be notified when their home mortgage has been sold or transferred.  The Fed also proposed a rule to make it easier for consumers to learn who owns their loans. Under the provision, once a mortgage servicer is asked by a borrower for that information, the loan servicer would have to provide it within a reasonable time, which generally would be 10 business days.

The new YSP rules are set to go into effect April 1, 2011.  Read the original article online > Fed Bans Lenders from Paying YSP to Mortgage brokers


July 16, 2010

Home Purchase Loan Applications Fall

The number of home loan applications in the U.S. for home purchases fell to a 13 1/2-year low last week, the Mortgage Bankers Association reported Wednesday, in a further sign of the slump in home buying since a federal tax credit concluded at the end of April.  There have been fears for months that the incentive was stealing future sales and would result in a new leg down for the housing market once the support ended. New-home sales sunk to a record in May while pending total sales tumbled 30% from April.

Home loan applications for new homes were down 43% from the Independence Day week last year, said the MBA. The bad news comes even as home mortgage rates sink to new record lows.  Those rate declines have been giving some lift to applications for home refinancing, which hit a 14-month high two weeks ago. But even the MBA refinance mortgage report fell 2.9% last week from a week earlier as its gauge for purchases dropped 3.1%. The share of applications for refinancing was flat at 78.7%.


July 13, 2010

Home Mortgage Rates Continue to Break Records

Who would have thought that home mortgage rates would continue to break record with declining rates across the board?  Of course this is great news for homeowners and perspective home buyers looking to leverage the lowest mortgage rates of the century.

Fannie Mae’s current-coupon thirty-year fixed-rate home loans narrowed 0.03 percentage point to about 0.65 percentage point more than 10-year Treasuries as of 9:33 a.m. in New York, according to data compiled by Bloomberg. The gap, which has fallen from 0.82 percentage point on June 30th, touched a low of 0.59 percentage point on March 29th, two days before the Federal Reserve ended its buying of $1.25 trillion of home-loan debt.

Home loan rates may be rising off record lows and bond prepayments reports released July 7th show limited mortgage refinancing, suggesting there will be less supply to meet demand as borrowers move from loans in bonds on the Fed’s balance sheet.  JPMorgan Chase & Co. analyst, Matthew Jozoff wrote in a July 9th report “refinance-driven supply is the fly in the ointment.”

Yields on the Fannie Mae bonds have advanced to 3.73% from a record low of 3.63% reached July 6th, down from 4.67% on April 5th, Bloomberg data show. The gain has been slower than benchmark Treasuries, whose yields have begun rising as stocks rally, damping demand for the safest assets.

Freddie Mac reported that the average interest rate on a conforming thirty-year fixed-rate home loan fell to a record low 4.57% in the week ended July 8th.  That was a decline from this year’s high of 5.21% in April.


July 8, 2010

Wells Fargo Announces Significant Job Cuts in Consumer Finance

According to Mortgage News Source, Wells Fargo is laying off nearly 4,000 employees from its’ Consumer Finance Division that was responsible for non-prime mortgage lending.  The company announced that they were ceasing to originate subprime mortgages in an effort to mitigate loan portfolio risks.  Mortgage News indicated that Wells Fargo “had been struggling with delinquencies and loan defaults from their own bad credit home mortgages.”  Acquiring the loan portfolios from the Wachovia merger may have pushed their subprime risks too far.

Wells Fargo announced they were closing 638 Wells Fargo Financial offices, which increased its number of retail branches to 6,600 after the Wachovia merger. The bank also has 2,200 Wells Fargo Home Mortgage offices and will eliminate about 2,800 employees from its Wells Fargo Financial unit and will most likely slash another 1,000 jobs in the next year. Read the original news article, > Almost 4,000 Wells Fargo Mortgage Layoffs


June 15, 2010

Home Refinancing Appealing But Tough to Qualify for

Mortgage refinance rates have dropped almost two percentage points below their housing boom peak and they remain available at record lows.  Freddie Mac reported that mortgage rate average fell to the lowest point in 2010 4.72% plus 0.7 point for a fixed rate home loan on a thirty-year term.  Clearly this is a great time for a home refinance loan, if you can get approved.  Credit, Lack of Equity and Inability to Document Income are the 3 most common reasons that homeowners have not been able to refinance into these record low rates.  A few years ago if you had good credit, you could pretty much qualify for any mortgage, but things have changed dramatically.  Today even people who have 700+ credit scores are finding it difficult to qualify for a conventional or FHA mortgage and it is frustrating millions of borrowers who need to refinance.  To receive the best mortgage refinance rates, you need good credit scores and the ability to document your income.  Stated and no-income verification loans are no longer viable options for home refinance opportunities.   You also need enough home equity to meet the refinance guidelines.  Many California borrowers had sufficient equity a few years ago, but the housing crisis has taken its toll on property values statewide.

The Mortgage Bankers Association released a report recently that outlined borrower problems in its latest report on home refinancing activity, which declined 14% last week after consecutive weeks of increased refinance loan volumes.  The low interest rates and homebuyer tax credit have clearly made a positive impact on the mortgage refinance market in 2010.  However, “despite the record low mortgage rates, many homeowners remain underwater on their home loans.  This means that their mortgage is greater than their property value.  According to MBA’s vice president, Michael Fratantoni, many distressed borrowers have been late on their mortgage payment which significantly damaged their credit and taking them out of contention for mortgage refinancing this year.

Since the pool of qualified borrowers looking to refinance is shrinking many lenders are offering aggressive mortgage specials.  Many reputable mortgage lenders are offering a no point refinance and some are going further with the no cost mortgage that enables borrowers to refinance without coming out of pocket for any lending expenses.  The no cost home loans also help borrowers avoid raising their mortgage balance in an effort to finance the lender fees and closing costs.  According to mortgage marketing executive, Bryan Dornan, “Again qualifying for no cost refinancing is difficult because you need good credit, sufficient income that can be documented and enough equity in your home to qualify for the loan refinance program.”  Dornan continued, “It’s not a motivation factor.  The borrowers who need home refinancing most simply do not qualify under today’s tighter lending guidelines.”

To put it into perspective, interest rates dropped last week, yet refinancing volumes fell.  In most cases, mortgage refinance rates follow the yields of longer-term Treasuries whether they rise or fall.  In recent months it’s been down, as the European debt crisis has led to banks dropping interest rates even further.  The vice president of HSH Associates Keith Gumbinger, “We have not seen mortgage rates lower than this in upwards of 50 years.” Gumbinger believes that the rates will begin trending higher once we get some good news regarding the economy.


May 14, 2010

Declining Interest Rates Spur Mortgage Refinancing

Freddie Mac announced today that the current mortgage interest rates are the lowest they have been in 2010. The Wall Street Journal reported that home builder stocks rallied in early trading follow a reported spike in mortgage loan applications last week as homeowners take advantage of some of the lowest home mortgage rates since March.

The Mortgage Bankers Association’s seasonally adjusted index of home loan applications, which includes both purchase mortgage and refinance loans, rose 3.9% for the week ended May 7th. The four-week moving average of mortgage applications, which removes some of the volatility of weekly changes, was up 4.4%. Mortgage refinancing led the way; the MBA’s seasonally adjusted index of home refinance applications rose 14.8%. A 30-year fixed-rate mortgage, including lending fees, averaged 4.96%, the lowest level since week ended March 12th. Refinance rates were still higher the 4.76% last year and the all-time low of 4.6%.  The demand for mortgage loans for buying new homes dropped following the expiration of the heavily publicized federal home buyer tax credits. Read more at Mortgage Refinance Right.com


January 27, 2010

Home Mortgage Rates

The average mortgage rate on a 30-year home loan with fixed rates climbed to 5.02% last week from 5%, MBA said.  The mortgage rate reached 4.61% at the end of March, the lowest since the group’s records began in 1990.  At the current thirty-year mortgage rate, monthly borrowing costs for each $100,000 of a home loan would be $538.04 which is about $12 less than a year ago when the rate was 5.22%.

A report later today may show sales of new homes rose 3% in December to a 366,000 annual rate, according to the median projection in a Bloomberg News survey.   Sales of existing U.S. homes plunged last month, reflecting the expected expiration of the government’s first-time buyer tax credit on November 30th.

The Fed keeps mortgage rates low! Mortgage refinancing products are available. Finance Home Improvements!  Find out your eligibility for FHA 203K Loans.

The average rate on a 15-year fixed mortgage rose to 4.34% from 4.33 % a week earlier. The rate on a one-year adjustable mortgage increased to 6.84% last week.   The share of applicants seeking to refinance a loan dropped to 67.6% last week, the lowest level in almost three months, from 71.7% the prior week.

Mortgage lenders continue to see muted demand for financing.   “The residential mortgage and home equity line portfolios also continued their downward trend,” SunTrust Banks Inc. Chief Financial Officer Mark Chancy said on a conference call January 22nd. The Atlanta-based lender said it lost $248.1 million in the fourth quarter as loans soured in the Southeast real estate market.  The Washington-based Mortgage Bankers Association’s loan survey, compiled every week, covers about half of all U.S. retail mortgage loan originations.


January 8, 2010

Home Loan Industry Sees First Job Increase in 6 Months

The home mortgage industry added 200 full-time employees to their payrolls in November, the first jump in industry employment since July. The U.S. Bureau of Labor Statistics reported that employment in the mortgage broker/ banker sector rose to 255,700, compared to 255,500 in October. The BLS data shows the increase is entirely due to more mortgage brokers having jobs. Employment at mortgage broker and banking firms was flat in November. Overall, the home loan industry experienced a 10% drop in its workforce over the past 12 months. Major mortgage lenders have relied on outsourcing and temporary workers to deal with fluctuating demand. Meanwhile, the nation’s unemployment rate held steady at 10% in December, but 85,000 workers were laid off, according to the new jobs report. This disappointed analysts who were looking for a sign that the job market had finally turned the corner.