"To leave satisfied you must arrive prepared."

 

Consider this your home buyer’s toolkit. Open it up, take a look around, and if you like, start equipping yourself with the tools necessary to make your best purchase. In most businesses, knowledge equals power, and real estate is certainly no exception.

I hope you enjoy the free reports I’ve provided, and I hope you learn a little more about what it takes to make your important purchase a great one.

The real estate market in Chesapeake is certainly volatile, and all of the information about buying a home can be overwhelming. I can help.

When you're ready to act, contact me.

I fight on behalf of my buyers.
I negotiate the absolute best price.
I protect you.
I simplify your transaction for you as much as possible.

I look forward to working with you.

Thanks for stopping by,
Cheralyn

MORTGAGE NEWS YOU CAN USE!

UPDATED!!!

 

http://rismedia.com/2010-05-24/for-your-clients-5-tips-to-save-money-for-first-time-home-buyers/

http://www.realtor.org/home_buyers_and_sellers/2009_first_time_home_buyer_tax_credit

http://finance.yahoo.com/news/10-Rookie-Home-Buyer-Mistakes-usnews-655381171.html?x=0&.v=1

 

 

 

 

 

¨      CREDIT SCORES AND RISK BASED PRICING
¨      VA Loans
¡        No minimum credit score
¡        Pricing is not affected by credit scores
¨      FHA
¡        Minimum credit score is 580
¡        Pricing is not affected by credit scores
¨      Conventional loans have pricing adjustments for Loan to Value (LTV), terms greater than 15 years, and credit scores:
¨      CREDIT SCORES AND RISK BASED PRICING CON’T
¨      If the credit score is greater than or equal to 740, there are no add ons.
¨      If the credit score is between 720 and 739 and the LTV is greater than 75% (less than or equal to 80%), there is a ¼ point add on. The reason for this is that there is no Mortgage Insurance if the loan goes bad, so the risk is higher.
¨      If the credit score is between 700 and 719, there is a minimum point adjustment of ½ point.
¨      If the credit score is between 680 and 699, there is a point adjustment between ½ and 1 ½ points.
¨      CREDIT SCORES AND RISK BASED PRICING CON’T
¨      If the credit score is between 660 and 679, there is a point adjustment between 1 and 2 1/2 points.
¨      If the credit score is between 640 and 659, there is a point adjustment between 1 ¼ and 3 points.
¨      Usually these adjustments cannot be absorbed into the rate.
¨      GUIDELINES ON ALL LOAN TYPES ARE SUBJECT TO CHANGE DAILY.
 

 

Harder to get an Uncle Sam mortgage

 

 

By Tami Luhby, senior writer



NEW YORK (CNNMoney.com) -- It's going to be harder to get a government-backed mortgage from now on.

Looking to shore up its weakening finances, the Federal Housing Administration is set to announce stricter standards on Wednesday.

The agency, which insured nearly a third of new mortgages in 2009, will increase the premium it charges for its mortgage insurance and require those with weaker credit scores to come up with larger downpayments.

The FHA will also reduce the amount of money a seller can provide a homebuyer for closing costs, as well as tighten its enforcement of lenders.

"Striking the right balance between managing the FHA's risk, continuing to provide access to underserved communities, and supporting the nation's economic recovery is critically important," FHA Commissioner David Stevens said in a statement. "Importantly, FHA will remain the largest source of home purchase financing for underserved communities."

FHA loans have skyrocketed in popularity during the mortgage crisis since the agency backstops banks if borrowers stop paying. But housing experts are growing increasingly concerned about the agency's ability to handle rising numbers of defaults. (Cash cushion shrivels for FHA.)

In November, the agency reported that its reserve fund has dropped to .53% of its insurance guarantees, well below the 2% ratio mandated by Congress and the 3% ratio it had last fall. The fund covers losses on the mortgages the agency insures.

Federal housing officials, who took several steps to shore up the agency's finances last year, promised to do more. The new announcement is the latest set of changes to FHA policies.

What the new rules mean

The agency will increase its up-front mortgage insurance premium to 2.25%, from 1.75%. It will also ask Congress for the right to hike its ongoing premium, currently between .5% and .55% monthly.

The FHA will also require borrowers to have at least a credit score of 580 to qualify for the agency's 3.5% downpayment program. Those with lower scores will have to pay at least 10%. However, this rule may have little practical effect since Stevens recently said the average borrower score is 693.

The new policy also will reduce the amount of money sellers can provide to homebuyers at closing to 3%, down from 6%, of the home's price. That change will bring the agency in line with industry standards and remove the incentive to inflate appraisals.

Finally, officials plan to clamp down on lenders offering FHA mortgages. It will more closely monitor their performance and compliance with agency rules, as well as seek legislative authority to require mortgage firms to assume liability for all loans they originate and underwrite.

One thing the agency did not do is to broadly increase the downpayment requirement. Many industry observers said such a step is necessary to reduce the risk the FHA faces.

Agency plays crucial role

As banks have clamped down on mortgage lending, the FHA program has emerged as one of the few ways people can buy a home.

Banks are more willing to make FHA loans because they come with a federal guarantee to cover losses if the borrower defaults. And borrowers can more easily qualify for FHA loans because they only need 3.5% down and can have lower credit scores.

As a result, demand for FHA loans has exploded. The agency guaranteed more than $360 billion in single-family mortgages in fiscal 2009, which ended Sept. 30, more than four times the volume in 2007.

The agency insured about 30% of home purchases and 20% of refinanced mortgages in 2009. Nearly 50% of first-time homebuyers go through the agency.

The agency, however, has also seen a spike in delinquencies amid the mortgage meltdown. Some 14.36% of FHA loans were past due in the third quarter, according to the Mortgage Bankers Association. This compares to 9.64% of all loans. To top of page

 


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