Archive for January, 2010

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California Reverse Mortgage Jumbo Loans Becoming Scarce

Jan 2, 2010 Author: Luke P Helm | Filed under: best mortgage

At one point in 2007, there were over 10 California reverse mortgages that were available for “jumbo-sized” loan amounts. Due mainly to the decline in real estate values and the resultant banking industry problems, now the number has dropped to three programs.

A jumbo reverse mortgage in California is typically used when the loan amount exceeds $200,000 to $280,000. When the amount of money needed by the senior applying for the loan is above those amounts, a jumbo loan is required because the FHA program (non-jumbo) has low loan limits. For most densely populated counties in California, FHA only recognizes the first $362,790 of home value, and ignores the rest, in calculating the amount of money available to the senior homeowner.

There are hundreds of thousands of homes in California owned by seniors that could benefit from the jumbo program. Last year, those seniors had many options to choose from. But now most large banks have pulled back their California reverse mortgage programs or cut them entirely. The largest lender in the business, Financial Freedom, is on the ropes as its parent company, Indy Mac Bank has been taken over by Federal Regulators due to its poor financial condition. Many California seniors do not want their loan to be with a failing financial institution, and are looking for other alternatives.

Bank of America cut their California reverse mortgage program by suspending it as an offering through their broker network, allowing it only to be offered by their retail branches. Financial Freedom took this same step too, which indicates that Bank of America’s decision is a possible a sign of poor financial health and an inability to continue to support their California programs. One reason for these developments is that these and other lenders have suffered huge losses due to the subprime mortgages that they offered in our state. With mounting losses, these lenders find it increasingly difficult to borrow money at low rates and lend it out to consumers. As a result, they do not have ample funding to continue to support the demand for home loans, and are forced to make difficult cuts in the programs that they offer.

Fortunately, there are still a couple jumbo California reverse mortgage programs that are offered by lenders who steered clear of the subprime mess. One of them offers a loan with competitive interest rates and a line of credit feature. This lender receives their funding from a European bank that is insulated from our domestic banking problems. Another California lender is providing a fixed rate jumbo program. Seniors will be able to sleep well at night with this product, knowing that their interest rate will not change and they will make no payments for as long as they live in their home. This bank also did not make risky home loans and as a result, will be in business for many years to come.

While the options for California seniors have diminished, there are still several viable lenders. Seniors can move forward confidently with these loans and enjoy a financially secure retirement.

Author: Luke P Helm
Article Source: EzineArticles.com
Provided by: Excise Tax

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General FHA home Loan Underwriting Guidelines

Jan 1, 2010 Author: admin | Filed under: best mortgage

General FHA home Loan Underwriting Guidelines

Disclaimer: These guidelines are to be considered standard or general. FHA will, from time to time, change their guidelines such as loan limits or debt-to-income ratio requirements. In times when guidelines change frequently, we are not able to update the guidelines immediately, therefore, we cannot guarantee that the guidelines outlined here will be in effect at the time of your loan application but is provided to give you the basic idea of the requirements of the FHA mortgage.

Neither the lack of traditional credit history nor the lifestyle of the FHA Mortgage applicant may be used as a basis for rejection
Collections: Based upon the surrounding circumstances, and as determined by our underwriter, these do not necessarily have to be paid.
Judgment: Are required to be paid off before the FHA Mortgage loan is eligible for insurance. However, exceptions can be made if the borrower has been making regular timely documented payments and the creditor is willing to subordinate the judgment to the insured FHA Mortgage.
Foreclosure: An FHA Mortgage applicant whose previous residence or other real property was foreclosed on, or who has given a deed-in-lieu of foreclosure with the previous three years is not generally eligible. Exceptions can be made based upon extenuating documented circumstances.

FHA Mortgage loan Advantages Include:

Minimal Down Payment and Closing Costs.

Down payment less than 3.5% of Sales Price
Gift for down payment and closing costs allowed.
No reserves or required.
FHA regulated closing costs.
Seller can credit up to 6% of sales price towards buyers costs.

Easier Credit Qualifying Guidelines such as:

Minimum FICO credit score of 540.
FHA will allow a home purchase 2 years after a Bankruptcy.
FHA will allow a home purchase 3 years after a Foreclosure.

Easier Debt Ratio & Job Requirement Guidelines such as:

Higher Debt Ratio’s than other home loan programs.
Less than two years on the job is allowed.
Self-Employed individuals o.k.

Apply now at www.FHAmortgageFHALoan.com or all 954-667-9110

Reserves: There are no reserve requirements for one and two-family until residences. Three months reserves are required for three and four-family unit residence’s.
Rental Income: Rental income from relatives residing on the premises is acceptable provided the rental income is shown on the borrower’s tax returns.

Cash Saved at Home: FHA Mortgage applicant who meet the “cash borrower” profile (no traditional credit, no bank accounts, etc.) who have saved cash at home and are able to adequately demonstrate the ability to do so are permitted to have this money included, with satisfactory explanation, as an acceptable source of funds to close a mortgage loan.
Child care expenses are NO LONGER included as debt.
Non Occupant Co FHA Mortgage applicant: When there are two or more borrowers, but one or more will not occupy the property as a principal residence, the maximum mortgage is usually limited to 75% loan to value. However, maximum financing is available for borrowers related by blood or for unrelated individuals that can document evidence of family type, long-standing and substantial relationship not arising out of the loan transaction. Qualifying is determined by the underwriter.
Assumable: All FHA loans are assumable
Electronic/Online Payroll: 1st Continental Mortgage, and the industry as a whole, recognize that some employers use online payroll for pay stubs and W-2′S. These types of documentation are acceptable.
Rate Adjustments: There are no interest rate adjustment “penalties” for higher loan to values with FHA fixed rate loans. The rate, is the rate, is the rate.
Secondary Financing: Secondary financing is not allowed with an FHA loan. The only acceptable second mortgage is with an approved HUD gifting agent such as down payment assistance provided by a gov’t agency in the form of a “silent” second mortgage. Piggie Back seconds/HELOCS are simply not allowed.
Home Inspection: A home inspection may or may not be required on a property based upon various factors. Typically you will find it is not required, but is recommended on any existing residence.
Pest Inspection: A termite inspection is required for all existing properties.
Closing Costs: Closing costs charged to the borrower are restricted and may in fact be less than conventional closing costs dependent upon your lender or broker.
Chapter 7 Bankruptcy: Will not disqualify a FHA Mortgage applicant if at least two years have passed since the bankruptcy was discharged
Chapter 13 Bankruptcy: An FHA Mortgage applicant paying off debt under Chapter 13 may also qualify if at least one year of the pay out period has elapsed with satisfactory payment performance and the court approves the borrower entering into a mortgage transaction.
Aliens: FHA will insure mortgages made to lawful permanent resident aliens under the same terms and conditions as a US citizen.
No Income Restrictions
Multifamily: Three and four family unit residences, regardless of occupancy status, must be self-sufficient. The maximum mortgage is limited so that the ratio of the mortgage payment divided by the monthly net rental income does not exceed 100%. The net rental income is the appraiser’s estimate of fair market rent from all units (including the unit chosen by the borrower for occupancy) less the allowance for vacancies and maintenance which is 15%. 85% of the rental income that is expected from the non-occupied units is added to the borrower’s income for qualifying purposes. Down Payment is calculated the same as single-family units.
Overtime, Bonus and Part-time Income: Overtime and/or bonus income received for a period of less than two years is acceptable where the underwriter determines that there are reasonable expectations of it’s continuance. An earning trend over the period of time of receipt must be established and analyzed. Part-time income means income from jobs taken in addition to the normal regular employment to supplement the FHA Mortgage applicant income. The same rules apply for determining using it as a part of qualifying.
Extended Absence from Workforce: In some cases, the FHA Mortgage applicant may have recently returned to the work force after an extended absence. The borrowers income may be considered effective and stable provided the borrower has been employed in the current job for 6 months or more and the borrower can document a 2 year work history prior to the absence from the work force.
Higher Ratios: HUD’s standard ratio guidelines are 31% (maximum exception of 36%) of your gross income for housing and 43% (maximum exception of 50%) of your gross income for housing plus other creditors. Borrowers may, at the underwriters discretion, be allowed to extend beyond these ratios based upon sufficient compensating factors.
Down Payment: The minimum down payment is approximately 3%. While credit quality can affect this qualifying requirement, the typical borrower only needs the standard HUD guideline of 3% to be approved.
Gifts: 100% gift funds are acceptable. The donor may be a relative of the FHA Mortgage applicant, the employer or labor union, a governmental agency, a not for profit private organization, or close friend with a clearly defined interest in the borrower. No repayment of any gift may be expected or implied. Sellers are allowed to pay all closing costs on behalf of the borrower up to 6% of the purchase price.

http://www.fhamortgageprograms.com/florida/Pompano-Beach/
http://www.fhamortgageprograms.com/florida/Port-St-Lucie/
http://www.fhamortgageprograms.com/florida/Punta-Gorda/
http://www.fhamortgageprograms.com/florida/Homosassa-Springs/

Article Source:http://www.articlesbase.com/mortgage-articles/general-fha-home-loan-underwriting-guidelines-1653538.html

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Getting Away With Low Down Payments

Jan 1, 2010 Author: Martin Lukac | Filed under: best mortgage

Mortgage programs come in all different shapes and sizes and each of them have their own benefits and perks. No matter what your financial situation is you will be able to find plenty of loans that are suitable to your needs. Whether you are a first time buyer or a low income family, you will still be able to find the mortgage that is right for you. These mortgages are a great way for those who need help to get themselves into their own new home. If you are interested in these types of programs talk to your bank about them and see what they have to offer you. Some other groups and agencies to contact about these types of options are the different Consumer Credit Counseling agencies in your area as well as any HUD offices.

Department of Veterans Affairs mortgages are an option that many people do not even know are out there. These mortgage plans have been put into place to help veterans purchase new homes for themselves and their families. These mortgages offer some special treatment for the veterans like not having to have a down payment among many others. These borrowers will also find that lenders tend to let them get away with more, like late payments and such. The only time that a down payment would be necessary at all is if the property that was being purchased was extremely expensive and even then it would not have to be a large one.

Rural Housing mortgages are mortgage plans that farmers can take advantage of. Some borrowers besides lenders may be able to qualify for these loans if they do not have a large income and if they are planning to buy a home in a rural area. In some places these are the common brand of loan. These loans do not usually require a down payment and the interest rates are generally very low.

Federal Housing Administration mortgages are sometimes called FHA loans are an easier type of mortgage for many people to get. Their qualifications are somewhat more lax than some others. These particular loans are provided by the Department of Housing and Urban Development (HUD), and they often have lower down payments than other types of loans. It would not be the lender that collects your payments each month if you had one of these loans but the HUD. They would then pass the payments along to the lender.

Another popular type of mortgage is a government backed mortgage. These can be either local or state backed and they are usually for people who are first time homebuyers. To get one of these loans you would have to meet certain criteria such as have a certain income and be willing to purchase a home in a certain area. These loans are a good choice for people unfamiliar with the responsibilities of owning their own home and they have low down payments and subsidized interest rates.

Down payment assistance programs are something that every one wants to know a little more about. FHA loans do require buyers to have at least a 3 percent down payment but they also allow for certain groups, and non profit agencies to help people out with these down payments when they cannot afford it. These programs have made it possible for many people to get the home that they would not have been able to without this extra help.

In order to be able to get this type of mortgage assistance you will have to have the seller and the lender willing to work with you and it.

Author: Martin Lukac
Article Source: EzineArticles.com
Provided by: Import duty tariff

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Archive for January, 2010

California Reverse Mortgage Jumbo Loans Becoming Scarce

General FHA home Loan Underwriting Guidelines

General FHA home Loan Underwriting Guidelines

Getting Away With Low Down Payments

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