As we all know FHA has become one of the top programs for home purchasers and has also become a key tool for some who need to refinance in 2010.  Earlier this year we had an increase in the upfront mortgage insurance premium from 1.5% to 2.25%.  This had a slight increase in cost to the borrower.  The increase was part of the FHA Reform Act passed by Congress in order to beef up the capital reserves for HUD’s mortgage program that had been dwindling for several months.

Last week FHA Secretary David Stevens announced that Congress passed another increase to the MI factors to further support the capital reserves of the program.  The upfront mortgage insurance premium will actually be reduced from 2.25% to 1%, but the monthly MI factor (that which has a great impact on a borrower’s payment) will be increased from .55% to .85%-.90%.  This increase is set to take place in less than a month on September 7th.

The truth is that FHA actually has the ability to raise the upfront premium even more in the future, but for the time being are going to reduce it to 1% to help make the adjustment a little less painful.  At this point, FHA case IDs pulled before September 7th will have the current rates.  Anything there after will be subject to the coming change.

If you are thinking about buying you may want to look seriously in the month of August in order to have a contract in place before the change.  If you have questions or want to start a loan application you can email me or call 503.798.9183.

Timing is everything in the real estate market.  Mortgage rates are near a low in 2010 and NOW is a great time to inquire about a possible refinance.  The federal government’s mortgage backed securities purchase program ended on March 31st, but since then we have seen private and foreign investors move into the US bond market as “safe haven” buying takes place.  With so much turmoil in the eurozone countries such as Greece and Germany are moving investments into a “safer” place (i.e. US bond market).  As the bond market benefits, you as a homeowner or potential homeowner can also benefit from the result of lower mortgage rates.

By now I’m sure you have heard rates have been low and may have even heard they have began to take a turn to rise.  Watching mortgage rates on a daily basis can be like riding the California Screamin’ roller coaster at Disneyland.  The volatility makes it even more important for you to have a trusted and educated resource in the mortgage world.  Currently we are in the sub-5% range on a 30 year fixed conforming or FHA loan.  If you have a mortgage in the 5.5%-6% range, it may be worth your time to give me a call (503.585.1105) or shoot me an email to talk about a potential refinance opportunity.

If you did not take advantage of the extremely low rates in 2009 or did not have the ability to, now may be your chance.  The rates change daily (and sometimes 3-4 times a day), so please take the 4-5 minutes it takes to call me and go over your potential opportunity before we see the rates fade away.

We now have two days, yes, 2 days until the home buying tax credit is no longer available for first time buyers and move-up buyers.  It’s been (and still is) a very fun opportunity to work with all those making a move to cash in on what seems to be one of very few tangible benefits (of the government stimulus package) for the American tax payer.  Accepted contracts dated by 4/30 qualify (with an eligible buyer).  Those still hanging around for final signature/dates after Friday will be out of luck.

Early this month we had A Lot of words flying around the real estate and mortgage industry indicating that the USDA Rural Housing funds would be dried up by the end of April.  On April 20th we received an update regarding the remaining funds.  Based on the memo there was still $1,546,902,245.82 available for purchase transactions.  This year’s fiscal allocation started with $13.5 billion.  The 11.45% remaining funds allocated for purchases give us a little room to breathe this month.  Obviously those funds will dwindle rapidly as the tax credit contracts close escrow in the next two months, but it doesn’t fully rule out the possibility of making an offer on a home in the next week or two with the intentions of using the USDA program.  However, please note that it will be very important to have a back up plan in the event that the well runs dry and we have no possibility of obtaining the USDA guarantee (your next best bet will be the FHA program).

I’m here as an advocate for you real estate financing.  As a loan officer at Landmark Mortgage I have the ability to position you into the right program at the right time with the right rate.  Please feel free to give me a call (503.585.1105) or shoot me an email with questions regarding your financing needs.

November 30th (the expiration of the first time homebuyer tax credit) is just around the corner.  Make sure your buyers are making an offer leaving sufficient time to close.  Oh yeah, and these fabulous rates…they won’t be around forever!

FHA lenders are beginning to implement some new guideline overlays.  Watch the video and be prepared to coach your clients accordingly:

Ok, so Taylor, Bean and Whitaker has officially announced the ceasing of all origination operations.  If you are a Realtor, please make sure you’re clients are placed somewhere else quickly.  Again, none of my loans in process are being underwritten by Taylor Bean.

If you have any questions or need help finding a suitable source for your loan or a clients loan, please don’t hesitate to contact me.

TBW Press Release:

PRESS RELEASE

TAYLOR BEAN MUST CEASE ALL ORIGINATION OPERATIONS EFFECTIVE IMMEDIATETLY

Ocala, Florida – Taylor, Bean & Whitaker Mortgage Corp. (“TBW”) received notification on August 4, 2009 from the U.S  Department of Housing and Urban Development,  Freddie Mac and Ginnie Mae (the “Agencies”) that it was being terminated and/or suspended as an approved seller and/or servicer for each of those respective federal agencies.  TBW has unsuccessfully sought to have the termination/suspension decisions of each of those agencies reversed.    As a result of these actions, TBW must cease all origination operations effective immediately.  Regrettably, TBW will not be able to close or fund any mortgage loans currently pending in its pipeline. TBW is cooperating with each of the Agencies with respect to its servicing operations and expects to continue to service mortgage loans as it restructures its business in the wake of these events.  We understand that this could have a significant impact on our valued employees, customers and counterparties, and are very disappointed that a less drastic option is unavailable.

Yesterday FHA announced it’s suspension of Taylor, Bean and Whitaker’s FHA origination.  The action came after Taylor Bean failed to file required annual financial reports.  Although FHA will allow Taylor Bean to appeal it’s action within 30 days, the Government National Mortgage Association (GNMA) has immediately terminated Taylor Bean’s registration with it’s MBS pools. Taylor Bean has been a primary outlet for manufactured homes and HUD’s FHA 203k rehabilitation loan.

If you’re a Realtor or a borrower with a loan currently in process and you’re aware of it being underwritten by Taylor Bean please contact your loan officer immediately to seek a backup plan or to seek an alternative lender immediately.  Please note, that none of my files in process are in Taylor Bean’s pipeline.

Below is HUD’s News Release:

HUD No. 09-145 Brian Sullivan (202) 708-0685 www.hud.gov/news/

For Release Tuesday August 4, 2009

FHA SUSPENDS TAYLOR, BEAN & WHITAKER MORTGAGE CORP. AND PROPOSES TO SANCTION TWO TOP OFFICIALS
Ginnie Mae Issues Default Notice and Transfers Portfolio

WASHINGTON – The Federal Housing Administration (FHA) today suspended Taylor, Bean and Whitaker Mortgage Corporation (TBW) of Ocala, Florida, thereby preventing the Company from originating and underwriting new FHA-insured mortgages. The Government National Mortgage Association (Ginnie Mae) is also defaulting and terminating TBW as an issuer in its Mortgage-Backed Securities (MBS) program and is ending TBW’s ability to continue to service Ginnie Mae securities. This means that, effective immediately, TBW will not be able to issue Ginnie Mae securities, and Ginnie Mae will take control of TBW’s nearly $25 billion Ginnie Mae portfolio.

FHA and Ginnie Mae are imposing these actions because TBW failed to submit a required annual financial report and misrepresented that there were no unresolved issues with its independent auditor even though the auditor ceased its financial examination after discovering certain irregular transactions that raised concerns of fraud. FHA’s suspension is also based on TBW’s failure to disclose, and its false certifications concealing, that it was the subject of two examinations into its business practices in the past year.

“Today, we suspend one company but there is a very clear message that should be heard throughout the FHA lending world – operate within our standards or we won’t do business with you,” said HUD Secretary Shaun Donovan.

FHA Commissioner David Stevens said, “TBW failed to provide FHA with financial records that help us to protect the integrity of our insurance fund and our ability to continue a 75-year track record of promoting, preserving and protecting the American Dream. We were also troubled that the Company not only failed to disclose it was a target of a multi-state examination and a separate action by the Commonwealth of Kentucky, but then falsely certified that it had not been sanctioned by any state. FHA won’t tolerate irresponsible lending practices.”

Ginnie Mae President Joseph Murin said, “I would like to reassure TBW’s customers whose loans serve as collateral for Ginnie Mae securities that, although this action will result in a new servicer, the transition will be seamless for them.”

TBW’s immediate suspension is for a temporary period pending the completion of an investigation by HUD’s Office of Inspector General, an ongoing review by the Department’s Office of Housing, and any legal proceedings that may ensue. TBW is the third largest direct endorsement lender of FHA-insured loans and the eighth largest issuer of Ginnie Mae mortgage-backed securities. FHA decided that TBW’s immediate suspension is in the best interest of the public and is necessary to protect the financial interests of the Department.

TBW may appeal its immediate suspension by submitting a written request for a hearing before an Administrative Law Judge within 30 days. Such a request will not delay the action FHA is announcing today.

In conjunction with TBW’s suspension, HUD sent notices of proposed debarment to TBW’s Chief Executive Officer, Paul R. Allen, and TBW’s President, Ray Bowman. Mr. Allen’s proposed debarment alleges that he submitted false and/or misleading information to Ginnie Mae regarding TBW’s delay in submitting its audited financial reports for fiscal year ending on March 31, 2009. Mr. Bowman’s proposed debarment alleges that he submitted two false certifications to HUD on TBW’s Yearly Verification Report. Mr. Allen and Mr. Bowman have thirty days to contest the proposed debarments.

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HUD is the nation’s housing agency committed to sustaining homeownership; creating affordable housing opportunities for low-income Americans; and supporting the homeless, elderly, people with disabilities and people living with AIDS. The Department also promotes economic and community development and enforces the nation’s fair housing laws.

Ginnie Mae is a wholly-owned government corporation within the U.S. Department of Housing and Urban Development. Ginnie Mae pioneered the mortgage-backed security (MBS), guaranteeing the very first security in 1971. An MBS enables a mortgage lender to aggregate and sell mortgage loans as a security to investors. Ginnie Mae securities carry the full faith and credit of the United States Government, which means that, even in difficult times, an investment in Ginnie Mae is one of the safest an investor can make.

More information about HUD and Ginnie Mae is available on the Internet at www.hud.gov, espanol.hud.gov and www.ginniemae.gov

Have you wanted to buy a home and finance-in some improvements?  Well now is your chance!  For years the department of Housing and Urban Development (HUD) has offered the FHA 203k FHA rehabilitation program.  As the mortgage industry expanded in the early 2000′s FHA simply became less desirable as other lenders offered programs that were more affordable.  However, we now stand in a market heavily saturated with FHA loan applications.

The FHA 203k streamline rehabilitation program allows a borrower who is purchasing or refinance to include cosmetic improvements in the loan.  I’ve heard hundreds of clients say, “this house is perfect, it only needs some cosmetic TLC”.  The problem is the money may not ever be available for them to actually complete the improvements.  The FHA 203k rehabilitation loan can be the answer for many of these buyers looking to put a little money towards improvements during a purchase.

Improvements of the property cannot alter the structure of the home (i.e. moving a doorway or tearing down a wall), but can include many updates that include: appliances, flooring, paint, windows, etc.

The key to this program is being completely educated on the process.  Not only do you need to understand how the financing program works, but you also need what improvements will actually raise the value of your home.  Working with a knowledgeable Realtor will help you in determining the potential for work to be done.

I will soon have a detailed description of this program on my blog.  Please contact me today if you might be the slightest bit interested in learning more – 503.798.9183 – email Conrad.

FHA has increased loan limits yet again.  The 2008 stimulus raised our loan limits in Marion and Polk counties, but when 2009 hit we saw them go down to the previous levels.  It took the passing of the new stimulus to get them back up.  So at this point (and I say that because this industry is ever-changing), the maximum loan limit in Marion and Polk county is $295,000.  With a minimum down payment of 3.5% the maximum purchase price will be $305,699.

It’s great to see that limit come back up since there is such a large supply of new construction listings in that price range.

To see the full list of counties in Oregon download the 2009 FHA Loan Limits.

As we have seen the mortgage industry change in 2008, the FHA home loan has become increasingly popular.  The program offers a great opportunity for purchase with little money down and a refinance with great rates.

HUD (The Department of Housing and Urban Development) announced new loan limits this week.  Surprisingly, HUD decided to reduce the loan limits in many areas including most of Oregon.  The new changes will take affect January 1, 2009. Marion and Polk counties will be reduced to $271,050.  Please see the chart below for specific counties.

If you have questions about the FHA home loan program please don’t hesitate to email me at conrad@landmarkmortgage.com.