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Archive for the ‘Financing’ Category

Refinance Relief for More Borrowers - Freddie Mac

Monday, March 9th, 2009

This is the Freddie Mac version of the Fannie Mae “Making Homes Affordable” (see my previous blog) federal plan…  That may be confusing to a lot of you, please don’t ask me to explain because I’m not sure I can.  Just know this, both Freddie and Fannie have something to do with home mortgages…  If you want more concrete details it is probably best to google it online.

Ok, back to what I was originally talking about - the new Freddie Mac Relief Refinance Mortgage .  This is a plan to help homeowners who are current on their mortgage payments but may need to refinance to be in a better position to keep their homes long-term.  As with the Fannie Mae plan, borrowers must have mortgages that are owned or guaranteed by Freddie Mac.  These Relief Refi loans can:

  • Reduce your current mortgage interest rate
  • Shorten the term of your loan
  • Replace your adjustable rate mortgage or balloon payment
  • Reset your 15, 20 or 30 fixed-rate mortgage.
  • Loan-to-value ratio can be as high as 105%.
  • Your existing liens must continue to be subordinate to the first lien.

In it’s commitment to the Administration’s new initiative, Freddie Mac has directed its servicers to ensure that every possible avenue is uncovered before initiating a foreclosure on a delinquent buyer.   There are other terms and conditions that apply so check with a lender to make sure you get the right info.    If you need some recommendations that support San Luis Obispo County, let me know!

Sooooo…. If you are behind or if you think you may fall behind on your mortgage payments and you want to stay in your home, find out if your loan is serviced by Fannie Mae or Freddie Mac (you can call your current lender -  they should know that answer).   If the answer is yes, then tell them your story and see what they can do to assist you.  If you truly want to sell, call me or your agent and let’s talk about your options.

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“Making Homes Affordable” ???

Monday, March 9th, 2009

Well, it appears that the Federal Government is once again trying to fix the housing market by giving lenders the options of offering new flexibilities on loan refinance and modification.   Since I am a real estate agent/investor and not a mortgage broker, I know just enough to be dangerous so I strongly recommend that you talk directly to your lender or get more information at one of the websites (here is the HUD site  http://www.financialstability.gov/makinghomeaffordable/).  

This is part of President Obama’s plan to help the troubled homeowners.  While this plan may help a few people stay in their homes, it doesn’t address the drop in home values or the loss of employe which in my mind are even bigger issues.  Until these issues can be addressed, my honest opinion is that the shortsales and foreclosure will continue.     But with that said, loan refinance or modification are definitely worth checking out EVEN IF you have not missed any payments.

Please note, that there are two separate components - refinance or modification.   The following are the key features:

Refinance Option:

  • To qualify, your mortgage loan must be owned by Fannie Mae.
  • You can finance up to 105% of the value of the home.
  • You are not required to buy new or additional mortgage insurance if the loan at the time of the refinance is more than 80 percent of your home’s value.
  • You must have a solid payment history on your existing mortgage.
  • The expanded refinance flexibility ends in June 2010.

 

Loan Modification Program:

  • The home must be your primary residence.
  • You do not need to be behind with your payments.
  • You must owe less than or equal to $729,750.
  • You had to have gotten your loan before January 1, 2009.
  • You may need to explain a financial hardship in some cases.
  • The program may reduce interest rates or lengthen the payment time frame or other steps.

    • As I said before, I only know enough to be dangerous but if you think this might help you save your home, please check it out.   Go to the website above and click on the ‘Find out if you are eligible’ to determine how the new programs may or may not apply for you.  As always, I am more than happy to work with you as well in finding a good solution or helping you find a lender in the Morro Bay, Cayucos, or San Luis Obispo County.

     

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    Credit Scores - So What?

    Friday, February 27th, 2009

    Credit scores have a huge impact on the cost of money that is available to you for not only home buying but for just about everything you may want to borrow money for.  The higher your score, the more money and the better interest rate you will get.   For a home mortgage, the median score provided by the three big credit repositories (Esperian, Trans Union, and Equifax) is typically used.

    Items that have a critically negative impact on your credit scores are bankruptcy, foreclosure, high credit card debt, slow or late payment history, tax liens, judgements, and a large number of inquires.  Lenders each have their own requirements in regards to these items.  But in general here are what the various numbers mean to you in your quest to get a home loan:

    • Over 700 - qualifies for most programs including state income, no doc, high loan to value cash out, non-owner occupied, and second homes. 
    • 660-699 - often qualifies for many of the programs above but usually with LTV (loan to value) restrictions.
    • 620-659 - Normally require full income documentation.
    • 585-619 - May need to be underwritten as a sub-prime loans with tighter standards.
    • Under 584 - Sub-prime loan - much more difficult to get or qualify.

    Generally as scores go down, so do the loan-to-value limits and the interest rates go up.  What this means to you is that you will have to have more money for a down payment and your monthly payments will be higher.

    Posted in Financing, First Time Home Buyers | No Comments »

    Show me the money ???

    Friday, February 27th, 2009

    If you are like most people who have been listening/watching the news day in and day out, you are probably under the impression that all the home loans have dried up or that you have to have 30% down and perfect credit to get a loan.  Well, guess what - sometimes you shouldn’t believe everything that you hear.

    Now don’t get me wrong, money is definetly tighter than it has been BUT (notice that is a big but) there is still money out there and it isn’t as hard to get it as the media sometimes makes it sound.   There are still loans available that require very little down, stated income loans, FHA, VA, conventional, adjustable, and jumbo loans.   All with different criteria.   But all that means is that you do need to be prepared. 

    So if you are thinking about buying or upgrading your Central Coast home, I recommend that talk to a lender now.  The lender can help you get all your ducks in a row before you actually borrow money so that you:

    1. Clean up any potential credit issues
    2. Get the best interest rate possible for your circumstance
    3. Know what documentation you will need to provide
    4. Know how much money you will need for a down payment
    5. Know how much money you can qualify for.

    Your lender can be your best friend when buying a home so the earlier you get them engaged, the better the chance you have of getting a great loan at a great rate. 

    In any business there are very good people and some not so good people.  If you want a couple of recommendations for lenders in the Morro Bay, Cayucos, Atascadero, or Los Osos area, shoot me an email.

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    Posted in Financing, First Time Home Buyers | No Comments »