Deanna Valeo
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Using FHA to buy a short sale? Things change on April 15th. April 6, 2011

On April 18th the annual mortgage insurance premium will rise for new FHA loans from .90 percent to 1.15 percent for most borrowers. This can add more to your client’s monthly payment and can make a difference in their debt/income ratio.
 
This is especially important to those of you who have buyers who are waiting on Short Sale approval.  Typically, as lenders, we do not activate an application that is waiting on Short Sale approval because it takes so long and it is in the buyer’s best interest for us to wait or to process the application as a pre-approval without property. (Then we can move the pre-approval to another property if necessary).
 
If the lender is waiting on a ratified contract and your buyer wants to use FHA financing please mark your calendars to have the contract in and the lender assigned FHA case number by Thursday April 14.  The reason is that the lender can only get the FHA case numbers during business hours and we anticipate a RUSH on Friday 4/15.
 
The reason, for the FHA mortgage insurance going up again so soon is that so many loans have been moved into the FHA product due to the lower down payment requirements and credit scores allowed.  This creates greater risk for the agency – currently FHA holds 38% of all the home loans in the United States.
 
They (whoever they are) want to see more buyers focused on improving their credit and to see a willingness to invest more in the transaction by placement in the conventional array of products.

Please let us know if we can help any of your buyers as they need to lock in their FHA scenarios.
 
Have a Fantastic Week and Remember We Are Here For You.

Sincerely,


The Valeo-Croy Team - Call today:  (704) 488-1421
Todd Croy - NMLO license #91428
Deanna Valeo - NMLO license #91421
Accessible | Program Expertise | On-Time Closings
 
 In line with the new government restrictions on rate quotes** we will be providing a link to http://www.mortgagenewsdaily.com/mortgage_rates/ and their rate guide.

**Please note the rates quoted are at the absolute best loan amount, the highest credit score and lowest LTVs allowed with a 1% origination fee and indicate the absolute lowest rate possible. You should use this list as a guideline and trend indicator and get a specific quote for your project (often it may be slightly higher).
                           
 
Facebook link: http://www.facebook.com/valeocroyteam?v=app_4949752878 
 


12 most common FHA repairs April 11, 2011

"Do not anticipate trouble, or worry about what may never happen. Keep in the sunlight" ~ Benjamin Franklin


Recently we had a Realtor partner that had questions about repairs issues on a listing they had and a potential buyer using a FHA loan.  Since 2005 FHA loans have been less risky to sellers (and listing agents). 

Below is a list of the most common items that still must be repaired on a FHA listing.  

You can also read up more on this at http://www.hud.gov/offices/hsg/sfh/faqs/atl1val.cfm and http://portal.hud.gov/hudportal/documents/huddoc?id=DOC_14650.doc
  and http://homebuying.about.com/od/financingadvice/qt/FHA-Repairs-to-get-an-fha-loan.htm

 
The purpose of a repair is to correct deficiencies, which may affect the health and safety of the occupants or the continued marketability of the property. If possible, I suggest that you make any repairs to your home prior to the appraisal. This will improve the appraisal process as well as the marketability and help the sale or refinance of your home go smoothly.

 
1. If the home was built prior to 1978, chipping, peeling paint must be scraped and painted. This includes interior, exterior, garages, sheds, fences, etc.
 
2. Any useful components (appliances, floor covering, etc.) of the home, especially the roof, should have 2 years of useful life remaining. A roof should have no more than 3 layers of shingles.
 
3. Broken windows and doors should be replaced.
 
4. The cause of negative drainage must be cured (i.e., improve drainage away from house, gutters, french drains, etc.).
 
5. Health and safety hazards (i.e. electric garage door opener won't reverse with resistance; burglar bars). GFIC outlets are not an FHA requirement.
 
6. Abandoned inoperable wells must be capped and sealed by a licensed well sealing contractor.
 
7. Safety handrails should be installed in open stairwells of three or more stairs.
 
8. Infestation of any kind should be exterminated (i.e., insects, mice, bats, etc.).
 
9. Damaged or inoperable plumbing, electric and heating systems should be repaired. The appraiser will check these areas.
 
10. Structural or foundation problems must be repaired.
 
11. Flammable storage tanks must be removed and filler cap sealed from the inside (i.e., buried oil tank). In Charlotte if the tank has been inspected and found not to be leaking it can be foam filled you will need a certified service provider.
 
12. If there is a crawl space, it will be the homeowner's responsibility to make this area accessible so that it can be thoroughly inspected. The same is true of attic spaces.
 
Have a Fantastic Week and Remember We Are Here For You.

Sincerely,


The Valeo-Croy Team - Call today:  (704) 488-1421
Todd Croy - NMLO license #91428
Deanna Valeo - NMLO license #91421
 
Accessible | Program Expertise | On-Time Closings   

 In line with the new government restrictions on rate quotes** we will be providing a link to http://www.mortgagenewsdaily.com/mortgage_rates/ and their rate guide.

**Please note the rates quoted are at the absolute best loan amount, the highest credit score and lowest LTVs allowed with a 1% origination fee and indicate the absolute lowest rate possible. You should use this list as a guideline and trend indicator and get a specific quote for your project (often it may be slightly higher).
  
                         
 Facebook link: http://www.facebook.com/valeocroyteam?v=app_4949752878


How long until I can buy a home after Short Sale or Forclosure? April 18, 2011

"You must look into other people as well as at them." Lord Chesterfield

We are often asked "how long does my client need to wait?" they had a foreclosure. The answer can vary depending on the client and the circumstance.  The following outlines the various rules and will help the next time your client ask the question.  "Which way should I go" or "how long do I need to wait?"

Short sale with FHA Loan

  • Can purchase right away with no mortgage default
  • 3 year wait if in default at the closing
  • Reduced wait if the borrower has re-established good credit and can show extenuating circumstances
Short Sale With Fannie Mae Loan
  • 2 year wait if the borrower puts 20 % down
  • 4 year wait if the borrower puts between 10% to 20% down
  • 7 year wait if the borrower puts less than 10% down
  • 2 year wait if the borrower can show extenuating circumstances and puts more than 10% down
Short Sale with Freddie Mac Loan
  • 4 year wait before being able to get a loan
  • 2 year wait if the borrower can show extenuating circumstances
Foreclosure with an FHA Loan
  • 3 year wait before being able to get a loan
  • Reduced wait if the borrower can show extenuating circumstances and re-establishes good credit
Foreclosure with a Fannie Mae Loan
  • 7 year wait from the completed foreclosure sale date
  • 3 year wait if the borrower can show extenuating circumstances. Additional underwriting requirements apply for 4 years after a 3 year waiting period.
  • 7 year wait for a 2nd home, cash out re-financing, or an investment property
Foreclosure with a Freddie Mac Loan
  • 5 year wait from the completed foreclosure sale date
  • 3 year wait if the borrower can show extenuating circumstances
 
** As a side note a deed in lieu of foreclosure follows the same guidelines as FHA's foreclosure policy, the same as Fannie Mae and Freddie Macs short sale policy.
 
When analyzing the difference between completing a short sale or going through a foreclosure in regards to purchasing another property in the future it boils down to the waiting time which is more favorable in a short sale.
 
Have a Fantastic Week and Remember We Are Here For You.

Sincerely,


The Valeo-Croy Team - Call today:  (704) 488-1421
Todd Croy - NMLO license #91428
Deanna Valeo - NMLO license #91421
Accessible | Program Expertise | On-Time Closings   
 In line with the new government restrictions on rate quotes** we will be providing a link to http://www.mortgagenewsdaily.com/mortgage_rates/ and their rate guide.

**Please note the rates quoted are at the absolute best loan amount, the highest credit score and lowest LTVs allowed with a 1% origination fee and indicate the absolute lowest rate possible. You should use this list as a guideline and trend indicator and get a specific quote for your project (often it may be slightly higher).
                           
 
Facebook link: http://www.facebook.com/valeocroyteam?v=app_4949752878


The Valeo-Croy Team and New American Mortgage Bankers are Equal Housing Lenders.This information is for illustration only. It does not constitute an application for a loan or an offer or commitment for New American Mortgage to make a loan on these terms. Interest rates are subject to change until an application is completed and you lock in your interest rate. The figures noted are estimates and may vary depending on discount points, taxes and insurance. Programs, terms and conditions are subject to change without notice. Mortgage loans are subject to credit qualifications. Normal credit standards apply.   Date: 4/18/2011