Freddie Mac no longer requires a seasoning period after a short sale!!!
Freddie Mac no longer requires a seasoning period after a short sale!!!
I’m writing today to inform everyone of an exciting change in FHA insured mortgage lending. On January 26th, the FHA significantly lowered it monthly mortgage insurance factor from 1.35% to .85%! This .5% drop makes a huge difference in the total monthly payment attached to FHA loans! For example: On a loan amount of $400,000, this translates to a monthly savings $167.00 per month! This not only saves borrowers money, it also increases their purchase power!
If you have taken out an FHA insured mortgage, the decreased mortgage insurance is also available for refinance transactions!
As always, please feel free to call or with questions ANYTIME. I’m always available as a mortgage resource![/vc_column_text][/vc_column][/vc_row][vc_row type=”in_container” bg_position=”left top” bg_repeat=”no-repeat” bg_color=”#33ccff” text_color=”dark” text_align=”center” top_padding=”50″ bottom_padding=”50″][vc_column width=”1/1″][vc_column_text]
Hello and Happy New Year to all of my friends, clients and business partners! With the first week of 2015 in the books, I’d like to take this opportunity to update everyone on what’s new in the mortgage world. There is one exciting announcement in particular that will make home buying far more feasible for First -Time Home Buyers who don’t have much saved for a down payment:
Fannie Mae now offers Conventional financing with a down payment of only 3% of the sales price! Let’s face it, the primary barrier to homeownership for First-Time Homebuyers is saving money for down payment and closing costs. These FTHBs now have an option other than FHA to realize their dream of homeownership! Below are some key facts and benefits of this program:
1. In most cases, mortgage insurance rates will be far less expensive for this program when compared to those required by FHA. Also, FHA borrowers are required pay the mortgage insurance for the ENTIRE LIFE of the loan. With this Conventional product, buyers are only required to pay mortgage insurance until the home reaches 80% loan-to-value, so long as at least 12 months have passed sine the start of the loan.
2. For the buyers who are in the market to purchase a condominium, the hassle of finding an FHA approved complex is eliminated! All of my Realtor partners out there know that FHA approved condos are few and far between. This expands the pool of eligible properties tremendously for the FTHBs with low down payments.
3. This program is NOT ONLY for FTHBs with perfect credit. Fannie Mae will allow an minimum FICO score of 620.
4. The entire 3% down payment can come from a gift from a family member. In the past, at least a portion of the down payment would have to come from the buyer’s own seasoned funds. This is no longer a guideline that could stand in the way of a FTHB who has found the perfect property but has to delay pursuing it until enough money was save.
Please don’t hesitate to call or email ANYTIME for more information on this program OR anything else related to mortgages. I’m always available as a resource VERY happy to help!
Make it a great 2015!!!
Paul & Rachael,
I’m writing today to inform everyone of the recent SIGNIFICANT drop in mortgage interest rates! We are at the best we have been in the last year and a half of ALREADY HISTORIC lows!
If you, or someone you know, is on the fence about buying or refinancing their current home or investment property, now is the time to reach out to me for free written estimate.
For all you refinance candidates: California property values have been on a steep rise for the last 2 1/2- 3 years! Now may be the time to consider making this equity work for you to pay off consumer debt, finance home improvements, pay for college tuition, etc.
To all of my Veterans: We can do a cash-out Refinance up to 100% of the your home’s current value!!!
As always, I’m available 7 days a week for pre-approvals and ask me how we can close your purchase in less than 21 days!!!
I hope everyone out there enjoyed the beautiful Summer that, for me, came and went far too quickly! As we move into the final quarter of 2014, I thought I’d take this opportunity to touch on a specific mortgage guideline change that took place on the August 15th:
As of 8/15, Fannie Mae requires a seasoning period of 4 years after a short sale before a borrower can purchase a new property. Before this guideline change, Fannie Mae allowed a buyer to purchase 2 years after a short sale, provided the down payment was at least 20% of the sales price. This being said, the amount of potential buyers has shrunk significantly and although this news may seem negative, there are still options available for buyers who are affected by this recent change:
1. If a buyer is looking for a Conventional loan, Freddie Mac does not (yet) have this guideline set in stone. They could endorse a loan for a buyer who does not have the 4 years’ seasoning, but the rest of the buyer’s profile MUST be strong (high credit scores, low debt-to-income ratios, LARGE down payment, etc.).
2. FHA insured loans can be done as soon as 1 year after a short sale. FHA has recently initiated their “Back to Work” program. If the circumstances surrounding the short sale were extenuating in that the buyer had to sell short as a result of loss of work due to illness, injury, etc., they will endorse a loan for a buyer after 1 year as opposed to the typical 3 year requirement. There is a laundry list of stipulations that come with this program, so please call for further details.
3. VA purchase loans do not (technically) require any seasoning. However, there are a couple stipulations one must keep in mind:
-If the Veteran has a late payment on a mortgage in the 12 months prior to the
short sale, there is a 1 year seasoning period.
– If the mortgage on the property that was sold short was a VA loan, the Veteran must
restore his full VA entitlement (call for details).
All this being said, I won’t simply put a hard stop on a loan application simply because a borrower has a short sale on their credit in the last 4 years. I will perform a comprehensive analysis of the profile as a whole and exhaust EVERY single option available. If purchasing is not an immediate option, I will advise the borrower as to exactly when a mortgage will be available to them AND make sure they know what they need to do to set them up for success in the future.
Until next time, Rachael and I are ALWAYS available and happy to help…
Let’s be honest, many of our clients or even ourselves have had some hiccups in our credit not too long ago. Foreclosures, short sales, bankruptcies are all things that were all too real 4-5 years ago. Although, most of these circumstances were of no fault of our own it is now time to move forward and get back to looking at purchasing a home. So how long does it take to buy again? That’s what this first newsletter is all about. Based on the relationships we have with the banks we work with, we wanted to create this quick reference guide that outlines how long it would take to finance a home again after certain situations happen. Take a look and please contact us if you have any questions. Like we mentioned before…. We’re here to help!