Because of the drop in housing prices and the interest rates still being low, now is a super-great time to buy! I know many have waited for more signs that the market has “bottomed out”, but will you be risking more money in the long run?
I’ve heard it projected that housing prices may continue to fall over the next year, but interest rates are also projected to be rising this year. Over the life of a 30-year loan, you need to weigh the benefits of going ahead and purchasing your home now at the lower rates rather than waiting for a possible “bottoming out” of the housing prices.
There are some terrific deals on the market right now that you could take advantage of. Make sure you are staying on top of the real estate market as well as the mortgage market as you consider the purchase of your first home! Your dream of home-ownership may be closer than you think!
Wednesday, February 23, 2011
Tuesday, February 22, 2011
FHA releases info about premium increase
We received word of this today...
WASHINGTON – Feb. 22, 2011 – Effective April 18, the average FHA-backed mortgage will cost new borrowers about $30 more per month. In a letter sent yesterday, Assistant Secretary for Housing/Federal Housing Commission David H. Stevens explained the change, which will increase the mortgage insurance premium (MIP) on all 30-year and 15-year loans by a quarter of a percentage point (.25).
The increase impacts FHA loans with a case number assigned on or after April 18, 2011.
According to Stevens, FHA must increase its Mutual Mortgage Insurance (MMI) fund reserves – a two percent capital reserve ratio – to comply with current law.
“The MMI fund has been below the two percent threshold in our last two annual actuarial reports to Congress,” Sevens says; and that at the current rate, MMI will not meet its mandated level until at least 2015. “Raising the annual premium will enable FHA to increase revenues … Based on current volume projections, the annual MIP increase would generate an additional $2.5 - $3 billion annually.”
Stevens defended the increase’s unveiling during a down real estate market by calling the quarter-point increase “a responsible step towards meeting the two percent threshold, while allowing FHA to remain the most cost-effective mortgage-insurance option for borrowers with lower incomes and lower downpayments.
“I understand the concerns of those in the industry about this increase,” he says. “While I do not expect all to agree, we have made these moves to protect FHA so that it can continue its vital mission.”
While the monthly payments on the average FHA loan will go up about $30, it shouldn’t impact closing costs. The upfront MIP remains unchanged at one percent.
To read the Department of Housing and Urban Development’s Mortgagee Letter explaining the change (PDF format), visit HUD’s website.
© 2011 Florida Realtors®
WASHINGTON – Feb. 22, 2011 – Effective April 18, the average FHA-backed mortgage will cost new borrowers about $30 more per month. In a letter sent yesterday, Assistant Secretary for Housing/Federal Housing Commission David H. Stevens explained the change, which will increase the mortgage insurance premium (MIP) on all 30-year and 15-year loans by a quarter of a percentage point (.25).
The increase impacts FHA loans with a case number assigned on or after April 18, 2011.
According to Stevens, FHA must increase its Mutual Mortgage Insurance (MMI) fund reserves – a two percent capital reserve ratio – to comply with current law.
“The MMI fund has been below the two percent threshold in our last two annual actuarial reports to Congress,” Sevens says; and that at the current rate, MMI will not meet its mandated level until at least 2015. “Raising the annual premium will enable FHA to increase revenues … Based on current volume projections, the annual MIP increase would generate an additional $2.5 - $3 billion annually.”
Stevens defended the increase’s unveiling during a down real estate market by calling the quarter-point increase “a responsible step towards meeting the two percent threshold, while allowing FHA to remain the most cost-effective mortgage-insurance option for borrowers with lower incomes and lower downpayments.
“I understand the concerns of those in the industry about this increase,” he says. “While I do not expect all to agree, we have made these moves to protect FHA so that it can continue its vital mission.”
While the monthly payments on the average FHA loan will go up about $30, it shouldn’t impact closing costs. The upfront MIP remains unchanged at one percent.
To read the Department of Housing and Urban Development’s Mortgagee Letter explaining the change (PDF format), visit HUD’s website.
© 2011 Florida Realtors®
Tuesday, April 6, 2010
Short Sale...Forclosure...REO...Bank Owned
Where do we start?
Short Sale/Pre-Foreclosure - A home owner who is selling their house for less than what they owe the lender.
Foreclosure - Lender is taking steps to take full possession of the house, usually because of lack of payment.
REO/Bank Owned - The lender has taken possession of the home and is in the process of selling it to get it off their books.
The long and the short of it is if you are trying to buy or sell a distressed property it will require time & patience. Some of the pitfalls you may find in the purchase of distressed properties are a lack of disclosures and important information about the house. The lender is going to tell you it does not know anything about the house and will not be held liable for any problems the house may have.
On the selling side there is a mountain of paper work the lender is going to require you to submit for a short sale/pre-foreclosure. When you are going through this difficult time don't be afraid to ask for help, find someone who is knowledgeable in the short sale process that can help you avoid potential problems.
Live Joyfully!
Short Sale/Pre-Foreclosure - A home owner who is selling their house for less than what they owe the lender.
Foreclosure - Lender is taking steps to take full possession of the house, usually because of lack of payment.
REO/Bank Owned - The lender has taken possession of the home and is in the process of selling it to get it off their books.
The long and the short of it is if you are trying to buy or sell a distressed property it will require time & patience. Some of the pitfalls you may find in the purchase of distressed properties are a lack of disclosures and important information about the house. The lender is going to tell you it does not know anything about the house and will not be held liable for any problems the house may have.
On the selling side there is a mountain of paper work the lender is going to require you to submit for a short sale/pre-foreclosure. When you are going through this difficult time don't be afraid to ask for help, find someone who is knowledgeable in the short sale process that can help you avoid potential problems.
Live Joyfully!
Tuesday, March 16, 2010
Okay, so I guess I'll go ahead and begin this blogging thing! =) There really is so much to share when it comes to real estate, as well as just life in general. My holdup is finding the time and making it a routine to blog. So here it goes. The first of many, I'm sure...
I guess the most urgent information right now is the deadline for the tax credit! We only have 45 days to finalize any contracts for buyers in order to meet the deadline for the tax credit. First-time homebuyers can get up to an $8000 tax credit for contracts written before April 30, 2010, and which close by June 30, 2010. That is a pretty good incentive to go ahead and buy! Great interest rates, along with affordable housing, with a tax credit on top makes it hard to beat finding that perfect home in the next month and a half!
If you are interested in purchasing a home, be sure to be on top of the market for good buys! Many other buyers are looking now as well, and when you find a good buy, don't wait around! Make up your mind and go ahead and get the contract in, so you don't lose it to another savvy buyer!
Just a little advice for today! Hope you all are living joyfully!
I guess the most urgent information right now is the deadline for the tax credit! We only have 45 days to finalize any contracts for buyers in order to meet the deadline for the tax credit. First-time homebuyers can get up to an $8000 tax credit for contracts written before April 30, 2010, and which close by June 30, 2010. That is a pretty good incentive to go ahead and buy! Great interest rates, along with affordable housing, with a tax credit on top makes it hard to beat finding that perfect home in the next month and a half!
If you are interested in purchasing a home, be sure to be on top of the market for good buys! Many other buyers are looking now as well, and when you find a good buy, don't wait around! Make up your mind and go ahead and get the contract in, so you don't lose it to another savvy buyer!
Just a little advice for today! Hope you all are living joyfully!
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