SubscribeFree Mortgage Payment Protection, FHA Standards Easing and Loan Mods at Absolute Mortgage Banking
November 20, 2009
Free mortgage payment insurance, really? Yes! While hosting one of my monthly mortgage market updates, which generally occur every third Wednesday of the month, I learned that CAR actually offers complimentary mortgage protection through their Housing Affordability Program (special thanks to Pam Page and Julia Keady for this information). To be eligible, the following are a few highlights:
- First-time buyers only
- Dwelling must be single-family residential
- Must close escrow by December 31, 2009
- Must be represented by a CA Realtor
- Buyer(s) have not received benefits from HAF in the past
The maximum monthly benefit is $2,250 per month for a total duration of six months, after an initial four-month seasoning period. As such, it may be worth looking in to additional providers to augment the CAR program, should additional peace of mind be desired.
So what else was good information discussed at the update on Wednesday?
- Bridge financing is available for qualified move-up buyers looking to leverage their current home and buy before they sell
- “Jumbo” money is more available today than it has been over the last year, which is primarily due to price stabilization– there are now programs offering rates below 4%, leverage as high as 90% (80% to $2mm loan amount!) and financing for investment properties
- with the elevated conforming loan limits staying in tact, rates below 5% and a total of $18,000 in tax credits available to eligible buyers, first-time buyers are likely much better off owning versus renting provided that the holding period is five years
- Move-up buyers appear to be the most motivated lately, as we are seeing twice the number of applications on “jumbo” mortgages versus conforming mortgages coming in at present
- with qualifications tightening, sellers are wise to consider offering up to 2% of the sales price as a credit toward a buyer’s non-recurring closing costs to yield a lower rate and therefore payment
- Multiple offers are back, so it’s good to know that the 21-day close is also available again
Next update presentation will be on January 20, 9:30 am and posted on the AMB website calendar– hope to see you there!
FHA Standards Easing
If you know of someone looking to puchase a condo in a new development, HUD just made it easier to obtain an FHA loan. HUD is easing up on the requirements that 50% of the units be sold (now down to 30%) and now allows up to 50% of the units to be FHA financed (up from 30%) before funding for FHA is allowed. The rule that no more than 10% of the units can be owned by one owner and that 50% of the project must be owner occupied hasn’t changed, and the developers aren’t very happy about it, but the reality is that the deal is simply not insurable otherwise.
Loan Modifications Available Through AMB
Coming soon, Absolute Mortgage Banking will have an arrangement with a reputable company that can help individuals modify their loans per the HAMP requirements, and we’ll make the process very easy with a link through our website. We are in the final due-diligence stage, and we will have a formal announcement likely before Thanksgiving.
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