FHA Loans Raleigh Cary Apex NC

buy a home in RaleighIn a nutshell, the main reason people move to Raleigh are; the wonderful economy and employment opportunities, great place to start a business and raise a family, the beautiful landscape, world-class education options and overall quality of life.  What was once a mild capitol city mostly made up of government buildings, and College Campuses,  is quickly getting a facelift that is continuing to gain national attention!

For prospective Raleigh homebuyers the “hot spot locations” continue to be North Raleigh, North Hills / Midtown Area and Downtown Raleigh.  First Time Home buyers love the condos and walkability of downtown. Upscale shops and amenity and restaurant laden North Hills also offers up a great walkable area, at a higher price point.  North Raleigh is a mix of price range and styles with neighborhoods ranging from brand new – to decades old homes with Mid-Century Charm.  Because of the affordability factor, many homebuyers in the Raleigh market are considering  FHA Loans Raleigh. [Read more...]

One Borrower Has Income One Borrower Has Credit Score

When one borrower has most of the income… the other borrower has good credit scores… there ARE options for purchasing a home. Look at the question we had yesterday:

“We want to purchase a home, and I want to know if we can get it.  My husband currently has a mid credit score of 538,  and mine is 678.   He makes about 52,000 and I make 25,000.  I’m still in graduate school full time.  We saved  $4,000 for closing cost so far.  We want the house by the end of October 2010 Can we get a loan?”

There are multiple ways to make this work – here’s Option 1:

Purchase a home using FHA, and have a non-owner occupied co-borrower on the loan with the borrower who has good credit scores. If you know that you can make the payments on your own, then having a parent, or other family member, on the loan will not be a burden to them.  After you’ve made 12 months of payments (and by all account mortgage interest rates will still be low a year from now) you can refinance the loan and take the family member(s) off.

This is a GREAT program- because the home still only requires a 3.5% downpayment, and it is NOT considered investment property, so you can still write off the taxes and mortgage interest.

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Is FHA Going to Change the Endorsement Date For Streamlines?

FHA Streamline RefinanceWe’ve gotten tons of questions from folks about the possibility that FHA is going to change the date for their “really really really” low FHA Streamline Program – allowing folks with Endorsement dates after the June 1, 2009 date to qualify for lower FHA PMI rates.

FHA mortgage rates are making new, all-time lows while — at the same time — FHA PMI rates are gearing up for an increase.  This  combination has fueled a spike in FHA refinance applications nationwide.

The Mortgage Bankers Association members reported that in September 2012, more than 54,000 FHA Streamline Refinance applications came in – more than double the number from one year ago.

For homeowners with existing FHA home loans, the timing is right to refinance via the FHA Streamline Refinance. Falling mortgage rates have offset rising FHA PMI rates for many folks…  But that’s where the “rub” comes in for some folks who are wanting to do a streamline refinance – who have an endorsement date after June 1, 2009, and want to take advantage of a lower interest rate. 

UPDATE: There could be good news this summer for folks who want to Streamline Refinance, take advantage of the program with lower FHA PMI rates, but have a FHA loan Endorsed AFTER June 1, 2009.
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FHA PMI Changes Drop Off Period

you can buy a home!With FHA being underwater – they decided to make some changes to the way they allow FHA PMI to drop off of the mortgage.   Frankly, of their options… this is MUCH cheaper, than raise FHA PMI rates by a ton in 2013.  

In their message to Congress, they noted:

Reverse a policy made in a prior Administration to cancel required premium payments (read:  FHA PMI) after a certain period that effectively meant that while FHA’s 100% insurance guarantee remained in effect for the 30-year life of a loan, borrowers were only required to pay premiums for less than ten years.  FHA has been left without premiums to cover losses on loans held beyond the period for which it collects premiums.  This change will apply to new loans.

As it currently stands, if you currently have an FHA mortgage, the FHA PMI  that you pay monthly is still set to drop off (cancel) once your principal balance reaches 78% of the loan to value and a minimum of 60 mortgage payments have been made. (this is important – we have people ask us all the time if they can just pay the mortgage down to 78% – no you have to pay in for the full 5 years). [Read more...]

Private RBMS – The Dawn of New Mortgage Options

stonepasture16A top Mortgage News Agency announced this morning that there are now two different companies working on Residential Mortgage Backed Securities from “private” labels.  ????? 

Most (read 99.99999%) of the mortgages originated today are back by the Government in some form or fashion.  Fannie Mae, Freddie Mac, Ginnie Mae – QE3, the Government is buying mortgages.

The Government is also setting the “terms” of those mortgages – meaning if you are self employed you must meet “these” guidelines, if you have a credit score of “this” then you can get a FHA loan, with “that” you don’t get to buy a house yet.  They are also setting restrictions on how many units in a Condo can be Investment Property or rented to College kids (for instance) in order to get a traditional mortgage. [Read more...]

Good Credit Advice

good credit adviceFirst off… let’s discuss what Secured Credit is.

A Secured Card requires you to make a deposit in order to obtain the credit card.  If you are doing this – you are either a parent with a young child that needs a credit card – or you are re-building.

Because there are other ways to obtain cash for a child- let’s assume you fall into the “other” category.

If you’ve gotten into financial difficulty, and you’ve damaged your credit, a secured credit card can help you build your scores back up because they report your payment history to the credit bureaus… and we all know that payment history makes up the largest portion of your score.

Remember that when you get a Secured Credit Card – you are not having your credit pulled, so it will not pull your credit scores down!

A secured credit card operates just like a regular credit card.  As I said, the major difference is that you, the cardholder, are  making a deposit as security in case you default on the credit card payments. [Read more...]

Medical Collections and FHA Mortgage Change July 1, 2012

cutsMedical Collection Boo-Boo’s are usually the hardest things to remove from a credit report, even though the Fair Credit Reporting Act does have pretty strong language about them.

The final rule of HIPAA (the Health Insurance Protability and Accountability Act) makes sharing personal medical record informations illegal with with the public. Remember all those forms you now sign when you check into the doctor’s office – that’s what it’s about.

The rules of HIPAA specifically includes past, present and future payments of health care.  Meaning, it  is pretty much impossible for Medical Providers to take out Collections and Judgements against people who owe them money.  If they did, I would know, when looking at your credit (for instance) that you owed the Cancer Center money, or a Psychiatrist…  I could make assumptions about you because of that debt, and it could cause you to be viewed differently for jobs.

The way most people get collections is because of co-pay. They go to the doctor, pay their co-pay – and then leave the rest to the insurance company.  When the insurance company does not pay all of the bill, the balance owed to the doctor is assigned to a collection company, and added to your credit report from the Collection Company (thus masking who the medical provider is).

These collections DO pull your credit score down – AND starting on July 1, 2012 – FHA was going to  begin requiring that you settle with your medical creditors in order to get a mortgage loan… that includes your MEDICAL collections too!  This is going to be especially tough for some folks, and is a HUGE change in direction for FHA!

For the past 30 years or more, Medical Collections were not required to be paid (in most cases) to get a FHA Mortgage Approval.  I’m not arguing that people should be allowed to skip bills to their doctors (at all). However, being in this business as long as I have – I’ve seen some pretty egregious situations where people were in an Accident, a doctor made a mistake on the delivery of a child, someone was hurt on the job – and they were in the process of disputing who was responsible for paying what.

With this latest move – there were to be no exceptions.  

This underwriting guidelines was RESCINDED on June 15, 2012 – and will not immediately go into effect on July 1, 2012 as planned.  However, we expect FHA to provide more clarification on this topic, and we will not be surprised if Medical Collections are part of a new round of underwriting “tightening” that happens later this year!  FHA Mortgagee Letter delaying that Medical Collections be paid

If you are considering a mortgage loan, please contact Steve and Eleanor Thorne, 919-649-5058 – or connect with us on Facebook!  We work with people every month who had some credit issues, cleaned them up, and then were able to buy a house!  Don’t give up! We can help you do this!!

Rebate Commissions From The Agent

getting cash back from real estate agentsThere’s been some discussion about Agents rebating commissions back to the buyer… we see ads everyday for a Agent that will refund part of their Commissions back to the Buyer at Closing.

What I want to discuss is once you’ve determined you want to work with an agent who is going rebate part of their income back to you – how do you do it?

You see – FHA does not allow you to receive money back at closing from the Builder, Seller or Agent. It’s considered an “Inducement to Purchase” and it’s just against the law.  In fact, loans that have ANY form of downpayment assistance do not perform as well, and even those “Traditional” Nehemiah type programs left the marketplace on Octover 1, 2008 – leaving only NC Housing Finance Agency (NCFHA) offerings for down payment assistance for a mortgage. [Read more...]

The Pros and Cons of First Time Home Buyer Programs

new homes villages of apexFirst Time Home Buyer Programs are designed to help buyers to get into a home more easily. However, just because you’re a first time homebuyer doesn’t mean you should use a first time home buyer loan. Most of these programs have restrictions and strings attached. While they are a perfect fit for some, first time home buyer loans are the wrong choice for others.

Benefits of the NC Housing Finance Agency  First Time Home Buyer Program

The NCFHA Program is designed to help folks are concerned about buying a house.  Maybe your question is:

How can I raise enough cash to get into the home?  NCHFA offers up to $8000 for down payment assistance to those who qualify!

How am I going to afford the higher payments? NCFHA offers MCC, a credit for your taxes, it can literally mean that you can buy a house, and get a raise in order to afford your higher mortgage payment! [Read more...]

FHA Underwriting Guidelines for NC

fha mortgage loanWe talk to people everyday who have questions about qualifying for a FHA Mortgage Loan in NC.  FHA Underwriting Guidelines, are actually pretty straightforward. 

Unlike qualifying for a VA Mortgage loan (where you must be a qualifying Veteran) or a USDA Home Loan (that requires that you meet income limits for your county and the property must fit within the USDA RD Loan Footprint) – FHA has far fewer restrictions!  They do have Maximum Loan Amounts, which vary per county – but other than that, just about anyone who wants to purchase an Owner Occupied Home can do so!

  • Maximum Loan Amounts:  Maximum FHA Loan Limits Vary per County, and are subject to change each October.  Congress has said that they will be  lowering the High Cost Area FHA loans that are currently available in areas like Washington, DC and San Francisco in October of 2012. It looks like the maximum FHA Loan Limit for Homes in Raleigh will change at that time too. The FHA Maximum Loan limit for Wake County is $295,000 – (and although Congress did lower the the 2012 limit down to $271,050 for a few months… they moved it back to $295,000 shortly thereafter).   [Read more...]