I wanted to share this article with you…Let me know if you have any questions!

From Mortgage News Daily…

“While housing is more affordable than ever for most U.S. families, the lack of financing available to them continues to constrain prospective homebuyers according to the most recent National Association of Home Builders (NAHB)/Wells Fargo Housing Opportunity Index (HOI) released on Thursday. The Index indicates that 75.9 percent of all new and existing homes sold in the fourth quarter were within the financial reach of families earning the national median income of $64,200. This is the highest number for the affordability index in its 20 year history.

HOI measures the percentage of homes sold in a given area that could be purchased by households earning that area’s median income at current mortgage interest rates and assuming a 20 percent down payment.

“While today’s report indicates that homeownership is within reach of more households than it has been for more than two decades, overly restrictive lending conditions confronting home buyers and builders remain significant obstacles to many potential homes sales, even with interest rates at historically low levels,” said Barry Rutenberg, chairman of NAHB.

The metropolitan area encompassing Youngstown Ohio and Boardman, Pennsylvania was the most affordable major housing market in the country with 95.1 percent of all homes sold during the quarter affordable under the NAHB definition. The area’s median income is $54,900. Other major MSAs ranking at the top in affordability are Lakeland-Winter Haven, Florida; Modesto, California; Harrisburg-Carlisle, Pennsylvania; and Toledo, Ohio.

The most affordable small housing market was Kokomo, Indiana where 99.2 percent of homes were affordable to families earning the median income of $59,100. Other smaller housing markets at the top of the index included Fairbanks, Alaska; Cumberland, Maryland; Lima, Ohio; and Rockford, Illinois.

Only 29.0 percent of homes in the New York-White Plain area were affordable to those with the area’s median income of $67,400. This was the 15th consecutive quarter that this MSA ranked last in affordability. Other major metro area at the bottom of the affordability index included Honolulu and three California MSAs, San Francisco-San Mateo-Redwood City; Santa Ana-Anaheim-Irvine; and Los Angeles-Long Beach-Glendale.

The least affordable small market was Ocean City, New Jersey where, with a median income of $70,100 only 47.5 percent of homes were deemed affordable. It was followed by Laredo, Texas, San Luis Obispo-Paso Robles, and Santa Cruz-Watsonville, California; and Brownsville-Harlingen, Texas.”

Original Article
http://www.mortgagenewsdaily.com/02162012_home_prices.asp

Direct Link
http://www.youtube.com/watch?v=gTY1UVPRk8g

A lot of people ask this question and it’s a great question.

And the answer is- That depends. You see, guidelines are always changing and will continue to change over the next few years.

In fact they JUST changed!

So here is how it stands today…

CONVENTIONAL

Bankruptcy – You may apply for a Conventional, Fannie Mae loan after your bankruptcy has been discharged for FOUR (4) years.

Foreclosure – Home was given back to the bank – no owner participation.

- 7 years from the date the foreclosure was completed and transferred back to the bank if the borrower had NO extenuating circumstances. Minimum FICO of 680 required.

- 3 years from the date the foreclosure was completed and transferred back to bank with acceptable extenuating circumstances, AND 10% down payment. Primary home purchase and rate/term refinance only. Non‐owner and second homes not allowed

Short Sale / Deed in Lieu of Foreclosure -

Short Sale- Home sold, but sales price didn’t cover amount owed.

Deed‐in‐Lieu- Home returned to lender in exchange for canceling the loan.

- 7 years from date sale closed and transferred to new owner or transferred back to the bank for less than 10% down payment and minimum FICO 680.

- 4 years from date sale closed and transferred to new owner or transferred back to the bank with 10% down payment and minimum FICO 680.

- 2 years from date sale closed and transferred to new owner or transferred back to the bank may be possible with acceptable extenuating circumstances and 10% down payment.

Bankruptcy Chapter 7- Debts are discharged through BK, client does not pay any debts owing.

- 4 years from date of discharge

- 2 years from discharge date may be possible with acceptable extenuating circumstances

Bankruptcy Chapter 13- Debts are paid back on a monthly scheduled payment plan by client.

- 2 years from date of discharge or

- 4 years from dismissal date

FHA (DETERMINED BY DATE OF CREDIT APPROVAL)

Foreclosure, Deed‐in‐Lieu of Foreclosure

Foreclosure: Home was given back to the bank – no owner participation.

Deed in Lieu: Home returned to lender in exchange for canceling loan.

- 3 years from date foreclosure was completed and transferred back to bank.

- Less than 3 years, but not less than 12 months from date foreclosure was completed and transferred back to bank may be acceptable depending on the results of acceptable extenuating circumstances.

Short Sale- Home sold, but sales price didn’t cover amount owed.

- 3 years from date sale closed and transferred to new owner.

- No waiting period if borrower had no late payments on any mortgages and consumer debts within the 12 month period preceding the short sale, AND borrower is not taking advantage of declining market conditions. Subject property may not be in the same geographic region.

Bankruptcy Chapter 7- Debts are discharged through BK, client does not pay any debts owing.

- 2 years from date of discharge with re‐established credit paid as agreed or no new credit obligations incurred.

- Less than 2 years, but not less than 12 months from date of discharge may be acceptable if the bankruptcy was caused by acceptable extenuating circumstances, and the borrower has since exhibited a documented ability to manage financial affairs in a responsible manner.

Bankruptcy Chapter 13- Debts are paid back on a monthly scheduled payment plan by client.

- 1 year payout period under bankruptcy has elapsed and the borrower’s payment performance has been satisfactory; and all required payments made on time.

VA (DETERMINED BY DATE OF CREDIT APPROVAL)

Foreclosure, Deed‐in‐Lieu of Foreclosure

Foreclosure: Home was given back to the bank – no owner participation.

Deed in Lieu: Home returned to lender in exchange for canceling loan.

- 2 years from date foreclosure was completed and transferred back to the bank.

- 12‐23 months from date foreclosure was completed and transferred back to bank; if credit re-established and paid as agreed, and was caused by acceptable extenuating circumstances.

Short Sale: Home sold but sales price didn’t cover amount owed.

- 2 years from date sale closed and transferred to new owner.

- No waiting period if borrower has no late payments on any mortgages and consumer debts within the last 12 month period preceding the short sale, AND the borrower is not taking advantage of a declining market.

Bankruptcy Chapter 7- Debts are discharged through BK, client does not pay any debts owing.

- 2 years from date of discharge.

- 12‐ 23 months from date of discharge if credit is re‐established and paid as agreed; and was caused by acceptable extenuating circumstances.

Bankruptcy Chapter 13- Debts are paid back on a monthly scheduled payment plan by client.

- 1 year payout period under bankruptcy has elapsed and the borrower’s payment performance has been satisfactory and all required payments made on time.

When you are ready to get back into the housing market or for more information please contact me at 510-282-5456 or info@garrick.biz.

Related Articles:

Feds Announce Bay Area Real Estate Mortgage Interest Rates to Stay Low Until 2014

Home Affordable Refinance Program Update HARP 2

Restoring FHA Loan Limits

I receive a lot of questions regarding what fees a Veteran is allowed and not allowed to pay in a real estate transaction in Alameda. Here is a summary of allowable and unallowable costs from one of the lenders I frequently work with.

ALLOWABLE CLOSING COSTS

A Veteran may pay any of the following reasonable closing costs and fees:

• 1% origination fee for purchase and cash-out loans, the origination fee is calculated using the total loan amount, including the financed funding fee
• For IRRRLs, the origination fee is calculated using the payoff minus any cash payments by the veteran, if applicable
• Reasonable discount points: Brokers may charge only those discount points required to buy down the loan’s interest rate – Correspondents/VA Automatic customers are exempt from this requirement, however, the discount points charged must be reasonable and customary
• VA appraisal fee – The veteran may not pay a fee higher than the maximum allowable appraisal fee for the state in which the property is located – See VA Appraisal Fee Schedules
• VA compliance inspector fees – Only if required by the NOV (Notice of Value)
• Recording fees
• Taxes and stamps
• Credit report fees – a $50 credit evaluation fee may be paid in lieu of the credit report fee for automated underwriting approvals
• Pre-paid items
• Insurances (hazard and flood, when required)
• Flood zone determination
• Well and septic inspection fees
• Survey, if required by lender or veteran, except for surveys of condominiums
• Title insurance, title examination, title endorsement, title policy, title search
• Environmental protection lien endorsement
• Express mail fees for refinances if the saved per diem interest cost to the veteran will exceed the cost of the special handling – Anything over $50, provide the invoice to verify fee
• VA funding fee
• Mortgage Electronic Registration System (MERS) fee
• Closing protection letter – Should not exceed $35
• Fraud protection report
• Termite, provided the loan is a cash-out refinance – The borrower may never pay these fees for purchase transactions

If a fee is not listed above, assume VA does NOT permit the veteran to pay it

NON-ALLOWABLE BORROWER-PAID CLOSING COSTS

Generally, the veteran may NOT pay any of the fees listed below, but the seller or lender may pay the non-allowable fees. However, if no origination fee is charged and the fee is not listed in the section below that itemizes fees the Veteran may never pay, the Veteran may pay non-allowable costs up to 1% of the purchase price. The veteran may also pay a combination of non-allowable fees and an origination fee, provided the combination does not exceed 1% of the purchase price.

The non-allowable fees are:

• Attorney fees other than for title commitments
• Lender’s appraisals
• Lender’s inspections, except construction loan inspections and inspections required on the appraisal/NOV
• Loan closing or settlement fees
• Doc prep, underwriting, loan application, admin or processing fees
• Assignment fees
• Photographs
• Interest rate lock-in fees
• E-Mail, fax, copying, postage, stationery, telephone or other overhead charges
• Amortization schedules, Truth-in-Lending fees, etc.
• Notary fees
• Escrow fees or charges
• Commitment fees or marketing fees of secondary purchasers
• Trustee fees
• Fees charged by third parties, regardless of affiliation with lender
• Tax service fees
• Termite inspection fee for a purchase transaction
• Attorney fee that benefits the lender
• Broker fee
• Brokerage fees or commissions charged by real estate agents or real estate brokers in connection with a VA loan
• Prepayment penalties financed through a refinance transaction – When the payoff states a pre-payment penalty is due, veterans may pay pre-payment penalties out-of-pocket only
• FHA/VA inspection fees for builders (Normal new construction inspections of the dwelling are permitted when required by the appraiser)
• Any portion of the seller’s lien(s) or short sale fees
• For purchase transactions, the cost of required repairs and inspections must be paid by the seller. This policy applies to all purchases, including purchases of REO properties. VA does not permit the veteran to pay for repairs other than minor termite damage repairs

For more information about VA financing feel free to call 510-282-5456 or email info@garrick.biz.

Related Articles:

VA Interest Rate Reduction Loan

VA Loan Requirements and Eligibility

Approved Property Types and Loan Limit for VA Loans

How to Purchase a Home with a VA Loan

Direct Link:

http://www.youtube.com/user/RealEstateBuzzz?feature=mhee#p/u/0/8GWw3OWohcI

The Buzzz is growing for the “Home Affordable Refinance Program” revisions, referred to as HARP 2.0. Well HARP 2 is finally coming Spring of 2012!

Related Links:

Feds Announce Bay Area Real Estate Mortgage Interest Rates to Stay Low Until 2014 in Alameda

Harp 2 Guidelines for Refinance Appraisals Waived Alameda,CA

For the past couple weeks mortgage rates have been inching up. That changed today, January 25th 2012 when we saw a huge rally in interest rates largely in part to the FOMC statement that rates are staying low until “late 2014”!!!

Let’s flashback to the December 13th meeting…

“The Committee also decided to keep the target range for the federal funds rate at 0 to 1/4 percent and currently anticipates that economic conditions–including low rates of resource utilization and a subdued outlook for inflation over the medium run–are likely to warrant exceptionally low levels for the federal funds rate at least through mid-2013.”

Now this week, January 25th meeting…

“The Committee expects to maintain a highly accommodative stance for monetary policy. In particular, the Committee decided today to keep the target range for the federal funds rate at 0 to 1/4 percent and currently anticipates that economic conditions–including low rates of resource utilization and a subdued outlook for inflation over the medium run–are likely to warrant exceptionally low levels for the federal funds rate at least through late 2014.”

According to RateAlert’s David Shirmeyer outside of a dramatic failure overseas we shouldn’t see rates go much lower than where they are. That being said we shouldn’t see rates getting much higher either thanks to the fed announcement.

Mortgage rates are once again at all-time lows! While mortgage interest rates certainly don’t seem like they will go higher overnight there is more risk than reward in waiting once rates get below 4%. Lenders get very busy when rates are this low and often times raise rates just to slow down the volume.

To request accurate information including a quick rate quote online visit www.garrick.biz

Related Articles:

Obama Signs Bill Extending FHA and VA Loan Limits

http://the-buzzz.com/2011/11/21/president-obama-signs-bill-extending-fha-va-loan-limits-hitting-gses-with-fee-in-alameda-ca/

Home Affordable Refinance Program HARP 2 to Hit March 2012!

http://the-buzzz.com/2011/11/01/harp-2-guidelines-for-refinances-appraisals-waived-alameda/