Foreclosure | NC FHA Expert

Bankruptcy and VA Home Loans

April 29, 2011 by Eleanor Leave a Comment

We are talking to folks every week who lost a job in the last several years, lost medical insurance – or had some other tragedy that made it necessary for them to take steps they never thought they would have to. The reality is that in today’s economic conditions, unfortunately, bankruptcy has been the only way a family could get a fresh start. As a Veteran, considering a home purchase in North Carolina, you need to know a few things about how Bankruptcy can effect your ability to buy a home.

So, can you get a VA Guaranteed Home Loan if you have a bankruptcy? The short answer is YES!

The good news is that as of today, the VA underwriting guidelines are far more relaxed than the guidelines for other mortgage loan types (USDA, for instance, makes you wait 3 full years before you are eligible for a mortgage). The rules for applying for a VA Mortgage Loan after Bankruptcy are different based upon what type of Bankruptcy you took and weather you were able to KEEP your home, or if it was included in the bankruptcy.

Chapter 7 Bankruptcy

Chapter 7 bankruptcies are essentially when the borrower is freed of all liability from creditors. VA loan guidelines typically call for a 2 year waiting period after a Chapter 7 bankruptcy before you can receive VA financing again.

There are rare circumstances in which the 2 year waiting period will be reduced to 1 instead. You would have to be able to show that circumstances beyond your control were the driving force behind your financial hardship. For instance, we’ve seen this done when a spouse died… we also had a situation where a couple had a children that were less than 12 months apart in age, and the wife could not afford childcare and had to quit her job. If you can prove the extreme circumstance – then we might be able to make it work after the 12 month waiting period.

As mentioned earlier, USDA Home Loan guidelines call for a 3 year waiting period, and conventional loans require a 4 year waiting period. IF you had a home that was included in the Chapter 7 Bankruptcy, and it was foreclosed upon – then VA Underwriters also require a three year waiting period.

Chapter 13 Bankruptcy

Chapter 13 bankruptcies involve the establishment of a repayment plan instead of being cleared of liability immediately.

Veterans and military personnel can qualify for a VA mortgage loan, based upon current guidelines, even when they are still in Chapter 13 bankruptcy. However, you will have to show that you have made a minimum of 12 payments on-time and be approved by the court trustee for the new mortgage loan. This is VERY, VERY RARE… but again, we saw this happen with a couple who had a restaurant, field Chapter 13, they closed their restaurant and went to manage a National Chain Restaurant. That was approved… it just takes the right circumstances.

Once you complete a Chapter 13 Bankrutpcy, VA Mortgage Loan Guidelines allow you to immediately apply for a mortgage! Yippee! Conventional Loan guidelines, for instance require a 2 year waiting period!

Don’ Forget About Your Credit Score

All of this talk about being able to qualify for a VA mortgage Loan after (or while) you have a Bankruptcy, assumes that you have a credit score that’s recovered from this event, and is high enough for the Underwriters to approve. The Veteran’s Administration does not make these mortgage loans – they only insure them. The VA does not have a minimum credit score that they will insure… however, Underwriters have a minimum Credit Score that they will APPROVE… and these days, that number is a MINIMUM of 620… and some underwriters will only allow loans for those Veterans with scores of at least 640. So, even after you have finished the bankruptcy process, there are still actions you need to take to get your credit scores up and increase your likelihood of qualifying for a VA loan after bankruptcy.

For example:

Re-establish your credit as soon as possible if you do not have any creditors after the bankruptcy process. Remember, approving a potential borrower with no credit is almost impossible! We NEED a credit history that’s Clean For At Least 12 Months, with 3 Tradelines! You can re-establish credit using secured credit cards, apply for credit with FingerHut, or you might be able to be added to a credit card with a family member.

Once you re-establish credit, be sure to always make payments on time... and be sure that the folks who are extending credit to you are reporting those payments to all three credit repositories! If you are paying for a car over time, and making payments to the dealer – he’s probably not reporting those on time payments to the credit bureaus! Credit Unions often will not report to all three repositories either, because each submission costs them money!

Get in the habit of checking your credit at a minimum of once a year. This will give you an idea of where you stand, especially when you begin shopping for a VA mortgage loan.

Upon the discharge of your bankruptcy, send a copy of all your discharge paperwork (including all applicable schedules) to the three credit bureaus: Equifax, Experian, and TransUnion. This is important… it’s also important to KEEP the paperwork for at least 7 years.

We do TONS of VA Mortgage Loans in NC. We have bases at Fort Bragg, Pope Airforce Base and Camp Lejuene… plus, there are TONS of Veterans who live in Johnston County, Wake, Harnett and Pinehurst! If you qualify for a VA mortgage loan in NC call Steve Thorne, 919-649-5058. We have BEST Mortgage Loan Rates Available!

Filed Under: VA Mortgage Loans Tagged With: bankruptcy, bankruptcy and va loans, Best mortgage rates, credit scores, foreclosed property, foreclosure, va home loans, VA Mortgage Loan, va mortgage loans, va mortgages, veterans

USDA Home Loan Credit Qualifications in NC

April 15, 2011 by Eleanor 1 Comment

Good News! You do NOT need perfect credit to qualify for a USDA Home Loan! Whew! This 100% no money down program requires a MINIMUM credit score of 580 – but folks, just because you have a 580 score, doesn’t mean you can purchase. These days – we normally need a score above 620 to get the loan approved by Underwriters.

If you are NEW to the Credit game, meaning you are recently out of school and don’t have any BAD credit, you just don’t have a TON of credit – we can probably get a 620 score approved. In general, you need 3 different trade lines with 12 months of payment history. Equifax will verify your rental payments (assuming the lease was in your name) and calculate that as a trade line, the other 2 credit repositories will not.

Here are some guidelines on what USDA Home Loan Underwriters will NOT take:

Foreclosure within the last 36 months.
Bankruptcy within the last 36 months
More than one 30 day late in the past 12 months
Outstanding Judgments in the past 12 months
Two or More missed rent payments within the last 24 months
Chapter 13 Bankruptcy – Case by Case review
Delinquent tax liens
Delinquent student loans

If you are in the market for a new home, and you want to know if your credit will qualify you for a 100%, no money down mortgage loan with USDA Rural Development Mortgage Loan, call Steve and Eleanor Thorne – 919-694-5058 we are NC’s USDA Home Loan Experts!

Filed Under: USDA Home Loans Tagged With: bankruptcy, credit scores usda, foreclosure, judgements, minimum credit score usda, usda credit requirements, usda guidelines, usda home loan, usda home loan guidelines, usda home loans, USDA Mortgage Loans, usda rd home loans, USDA Rural Development Home Loans

FHA and VA Mortgage Loan Guidelines Waiting Periods

October 25, 2010 by Eleanor 2 Comments

If you’re like millions of American’s the last couple of years have been tough. People who have lost their jobs, or their houses, or their business didn’t just wake up one morning and say, “Oh, instead of making my payments, I think I’ll take a trip to Belize!” They never imagined they would be one of “those people” with bill collectors and “dings” on their credit.

Well, the good news is that your credit score is really just a snap shot of the last 24 months. Yes, missed payments will stay on your credit file for 7 years – but their IMPACT on your credit is greatly diminished after 24 months. (If one person on the loan has good credit, and one person has “poor” credit click here).

So if the bad credit, foreclosure, bankruptcy is behind you… how long do FHA and VA make you wait before you can purchase a home again? Below you will find a chart with the Waiting Period and/or guideline for each Program. Note that there’s another column that says “With Extenuating Circumstances.” That could mean, you were in Florida, lost your job, had to Short Sale, and move to North Carolina to get a new job… you would need to PROVE that the reason you did a Short Sale in Florida was due to the job loss, and you would need to prove that the company that had the Short Sale is not going to come back after you for the deficiency balance (some banks do – some banks do not).

If the chart says “UW Discretion” that means that the UnderWriter needs to make the call… these days, it is our experience that UnderWriting is TOUGH. We MUST make a strong “case” to get any exceptions, we must DOCUMENT the file, and we MUST know what our UnderWriter is looking for.

n these situations – you need a GREAT loan officer who will WORK FOR YOU!

DerogatoryEvent	FHA		VA
	Waiting Period and/or Guideline	*Waiting Period and/or Guidelinew/extenuating circumstances***	Waiting Period and/or Guideline	*Waiting Period and/or Guidelinew/extenuating circumstances***
Bankruptcy Ch 7 or 11	2 years	1 year	2 years	1 year
Bankruptcy Ch 13	1 year with 12 months satisfactory payments to trustee. Must have court permission (not trustee) to incur new debt. If not fully discharged for 2 years loan must be manual UW.	Same	1 year with 12 months satisfactory payments to trustee and trustee permission to incur new debt.	Same
Foreclosure Deed-in-Lieu	3 years	UW discretion	2 years	1-year w/current satisfactory credit.
Short Sale	Borrower current attime of short sale: No wait if all mtg and installment debts pd on time for 12 months preceding short sale. Borrower delinquent at time of short sale: 3 years from date of sale. If previous mortgage was FHA, 3 years from date CAIVRS claim was paid.	Same	No guidance.Typically treated as foreclosure but is at UW discretion.	Same

If you have questions about FHA mortgages or VA mortgage loans, and how your particular situation will be viewed in North Carolina with our Underwriting Guidelines (because the State of North Carolina has it’s own set of Mortgage Underwriting Guidelines ON TOP of what FHA and VA set out) please call Steve and Eleanor Thorne, 919-649-5058.

We are truly FHA Home Loan and VA mortgage Loan Experts, and we will give you solid advice! We offer the best interest rates and fees available.

Filed Under: FHA Mortgage Loans Tagged With: bankruptcy, fha guidelines after bankruptcy, fha guidelines after short sale, FHA Guidelines waiting period, fha home loans cary, FHA LOANS, fha loans cary, fha loans raleigh, FHA mortgage loan, fha mortgage loans, foreclosure, short sale, va guidelines short sale, VA home loan, VA Mortgage Loan, va mortgage loan guidelines waiting period, va mortgage loans

Mortgage Interest Rates September 17, 2010 Update

September 17, 2010 by Eleanor Leave a Comment

If you are considering a home purchase or a refinance, you are probably doing your best to follow the direction of mortgage interest rates. Well, rates on 30-year mortgages climbed for the second straight week, even though they are pretty close to the lowest level in decades.

The average rate for 30-year fixed loans this week was 4.37 percent, mortgage buyer Freddie Mac said Thursday. That’s up from 4.35 percent a week earlier and 4.32 percent the previous week, which was the lowest level on records dating back to 1971.

The average rate on 15-year fixed loans dropped to 3.82 percent. That was the lowest on records dating back to 1991 and was down from 3.83 percent last week.

For mortgage rates to move lower – we need more bad news in regards to the Economy… Rates have been at or near the lowest level in decades since spring as investors worried about the state of the economy and then moved money into safe Treasury bonds. That lowered the bond yields, which mortgage rates tend to track.

But recent economic data have given investors less reason to worry. First-time claims for jobless benefits have fallen in three of the past four weeks. And in August retail sales rose modestly and factory output grew for the 12th time in 14 months. The CPI numbers out today indicate that we have little to any chance of Inflation, generally seen as good news. The “Zero” inflation status allows some room for the Fed to make some slight moves at it’s meeting next week, allowing the Fed Balance Sheet to grow.

Even thought the improving economic outlook may have prompted some investors to pull their money out of the bond market and put it back into stocks.

But it hasn’t helped the housing market, nor have low mortgage rates. Home sales plummeted this summer and economists don’t expect that to change until the unemployment rate falls significantly and credit becomes more accessible to potential buyers. Applications for new home loans fell by nearly 9 percent last week from a week earlier, the Mortgage Bankers Association said Wednesday.

Meanwhile, foreclosures are surging. Lenders took back more homes in August than in any month since the start of the U.S. mortgage crisis, foreclosure listing firm RealtyTrac Inc. said Thursday. In all, banks repossessed 95,364 properties last month, up 3 percent from July and an increase of 25 percent from August 2009, RealtyTrac said.

In all, it’s going to take a Congress and the “new” bank regulators deciding on a course of action that is consistent to – coupled with JOBS to fix the housing problem. One of my competitors said this week in a Rotary Meeting their Economist expect rates to go to 2% by the end of the year. Really? I’m not seeing it. If this is true… we are in a WORLD of trouble!

To calculate average mortgage rates, Freddie Mac collects rates from lenders around the country on Monday through Wednesday of each week. Rates often fluctuate significantly, even within a given day.

Rates on five-year adjustable-rate mortgages averaged 3.55 percent, down from 3.56 percent a week earlier. Rates on one-year adjustable-rate mortgages fell to an average of 3.4 percent from 3.46 percent.

The rates do not include add-on fees known as points. One point is equal to 1 percent of the total loan amount. The nationwide fee for loans in Freddie Mac’s survey averaged 0.7 a point for 30-year and 1-year mortgages. The average fee was 0.6 of a point for 15-year and 5-year mortgages.

If you are considering a purchase or a refinance in NC – call Steve and Eleanor Thorne. We have the best rates and the lowest fees available, and we are WATCHING the economic conditions… not just repeating what someone else is saying!

Filed Under: Housing News Tagged With: bank owned property, best mortgage interest rates, foreclosure, lowest mortgage rates, mortgage interest rates, mortgage rates cary, mortgages, refinance, refinance rates

Buying a Home after Foreclosure

June 20, 2010 by Eleanor 3 Comments

Been there - Done That If you are one of the millions of families that lost their home in the last couple of years to Foreclosure… you might think…

Been There – Done That

You might not want to own a home again!

But if you’re one of those folks who truly does want to purchase again, here’s some potentially good news.

USDA says that they will allow you to purchase a new home to owner occupy, after foreclosure if you’ve done the following things:

Wait 3 years from the date of the Foreclosure.
Re-establish Credit
Have Credit Scores that meet the guidelines (as of the date I am writing this, that means you need a 620 score.)

Here’s the other part… you need to DOCUMENT what happened, and why you ended up in a Foreclosure.

“FHA insured mortgages are generally not available to borrowers whose property was foreclosed on or given a deed-in-lieu of foreclosure within the previous three years. However, if the foreclosure of the borrower’s main residence was the result of extenuating circumstances, an exception may be granted if they have since established good credit…

This does not include the inability to sell a home when transferring from one area to another.” So you MIGHT be able to buy after two years.

My “real life” answer to this question is… in today’s credit environment, it’s going to be HARD to get a Bank to loan you money for a home if you had your home foreclosed upon less than 3 years ago. I know what the guidelines say, but Bank’s do not have to follow guidelines set by FHA.

FHA does not say you have to have a 620 credit score, but there are VERY few lenders who will allow you to purchase a home without at least a 620 score! There are some Banks that will not allow you to purchase with FHA if you have ANY lates on ANY accounts in the last 12 months! That’s not an FHA guideline, that’s a BANK rule, so again – I’d say - you might still be forced to wait 3 years, and have all of your documentation in order!

These guidelines are different from the Fannie Mae / Freddie Mac Conventional Guidelines… And these foreclosure guidelines are changing OFTEN… so I would not rely on information you get from an online site. Call a loan officer.

If you are considering a mortgage loan in NC, call Steve and Eleanor Thorne, Corporate Investors Mortgage Group, 919-649-5058

Filed Under: USDA Home Loans Tagged With: credit scores, FHA Credit Score guidelines, fha home loans cary, FHA LOANS, fha loans cary, fha loans raleigh, FHA mortgage loan, fha mortgage loans, first time home buyer, first time homebuyers, foreclosure, mortgage, nc, purchase, usda home loan, usda home loans, usda mortgage

HUD Makes It Easier To Purchase Foreclosed Property

January 19, 2010 by Eleanor Leave a Comment

HUD announced a change in the way it handles property that has changed ownership in the last 90 days. In an attempt to prevent people from “flipping” property (which is FRAUDULENT), HUD required a 90 day “cooling off” period before property could change hands.

This meant that if an Investor purchased property on January 1 at the Courthouse, had contractors in, did the work that was needed – they couldn’t sell it to a new buyer until the end of March.

Effective February 1, 2010 (and lasting for 12 months there after) HUD is making a change!

In an effort to stabilize home values and improve conditions in communities where foreclosure activity is high, HUD Secretary Shaun Donovan today announced a temporary policy that will expand access to FHA mortgage insurance and allow for the quick resale of foreclosed properties. The announcement is part of the Obama administration commitment to addressing foreclosure. Just yesterday, Secretary Donovan announced $2 billion in Neighborhood Stabilization Program grants to local communities and nonprofit housing developers to combat the effects of vacant and abandoned homes.

“As a result of the tightened credit market, FHA-insured mortgage financing is often the only means of financing available to potential homebuyers,” said Donovan. “FHA has an unprecedented opportunity to fulfill its mission by helping many homebuyers find affordable housing while contributing to neighborhood stabilization.”

To read more about their policy – click here!

Filed Under: FHA Mortgage Loans, Housing News Tagged With: fha cary, fha home loans cary, FHA LOANS, fha loans cary, fha loans raleigh, FHA mortgage loan, fha mortgage loans, foreclosed property, foreclosure

FAQ RE: Obama Loan Modification Program

March 17, 2009 by Eleanor 3 Comments

The Obama Administration announced plans to allow for special considerations in cases for folks who are currently behind on their mortgages, and headed into foreclosure. Those guidelines apply only to mortgages that are currently held by Fannie Mae or Freddie Mac – but could impact a significant number of people in NC.

Here’s a list of Frequently Asked Questions recently published:

The Obama Administration unveiled the final details of its “Making Home Affordable Program,” which is designed to help up to 9 million American families refinance or modify their loans to a payment that is affordable now and into the future.

One of the initiatives in this program is aimed at helping struggling homeowners “modify” their loans to avoid foreclosure. Here are some common Questions and Answers about the Modification Initiative in the program.

MODIFICATION INITIATIVE

Who is eligible?

To apply for a Home Affordable Modification, you must:

Own and currently occupy a one- to four-unit home.

Have an unpaid principal balance that is equal to or less than $729,750 (for one unit properties).

Have a loan that was originated before January 1, 2009.

Have a mortgage payment (including taxes, insurance, and home owners association dues) that is more than 31% of your gross (pre-tax) monthly income.

And, have a mortgage payment that is no longer affordable, perhaps because of a significant change in income or expenses.

If you answered YES to all of these questions, you may be eligible for the Modification Initiative.

Am I eligible if I missed some mortgage payments?

Yes. If you missed two or more mortgage payments and answered “yes” to the Modification Initiative requirements above, you may be eligible for a loan modification.

Do I need to be behind on my mortgage payments to be eligible for a Home Affordable Modification?

No. Responsible borrowers who are struggling to remain current on their mortgage payments are eligible if they are at risk of imminent default. Examples of being “at risk” include facing a significant increase in your mortgage payment or a reduction in your income. Contact me to discuss your specific situation.

I have a second mortgage. Am I still eligible?

Yes, but only the first mortgage is eligible for a modification.

I have an FHA loan. Can it be modified under this program? Are all loans eligible?

Most conventional loans including prime, subprime, and adjustable loans; loans owned by Fannie Mae and Freddie Mac as well as private lenders; and loans in mortgage backed securities are eligible for a modification. Contact me to discuss your specific situation.

I have a mortgage on a duplex. I live in one unit and rent the other. Will I still be eligible?

Yes. Mortgages on two, three and four unit properties are eligible as long as you live in one unit as your primary residence.

What does the Modification Initiative do?

If you are eligible for this plan and are approved, you will be put on a trial modification for three months at a new interest rate and payment.

If you successfully make the payments and are current at the end of the three-month trial period, your servicer will execute a permanent modification agreement that will lower your interest rate to a fixed rate for five years.

What happens after five years?

Beginning in year six, the rate may increase no more than one percentage point per year until it reaches the “rate cap” in your modification agreement, which is basically the market interest rate on the date the modification is finalized.

That means your rate can never be higher than the market rate on the day your loan is modified. This is great news because rates are currently at historic lows… and you can lock in now.

How low can my interest rate go?

Treasury is providing incentives to your investor to write the interest down as low as 2%, if necessary to get to a payment that you can afford based on your income.

What happens if that is not enough to get to an affordable payment?

If a 2% interest rate is not enough to bring your payment down to 31% of your gross monthly income, your servicer can extend your payment term–for example, give you a 40-year loan rather than a 30-year.

If that is still not sufficient your servicer will defer repayment on a portion of the amount you owe until a later time. This is called a principal forbearance. A portion of the debt could also be forgiven. This is optional on the part of the investor. There is no requirement for principal forgiveness.

Are there any other benefits to this program?

Yes. For every month you make a payment on time, Treasury will pay an incentive that reduces the principal balance on your loan. Over five years the total principal reduction could add up to $5,000.

How much will a modification cost me?

There is no cost to borrowers for a Home Affordable Modification. You will not be asked for any money.

If there are costs associated with the modification–such as payment of back taxes–your servicer will add those costs on to the amount you owe. Your servicer will also forgive any late fees.

Is housing counseling required under this program?

Borrowers are strongly encouraged to contact a HUD-approved housing counselor to help them understand all of their financial options and to create a workable budget plan.

However, housing counseling is only required for borrowers whose total monthly debts are very high in relation to their incomes (55% of your gross monthly income).

If you would like to speak to a housing counselor, call 1-888-995-HOPE (4673).

How do I apply for the Modification Initiative?

If you meet the general eligibility criteria for the program, you should gather the following information:

Recent pay stubs to help determine your gross (before tax) household income.

Your most recent income tax return.

Information about your assets.

Information about any second mortgage on your house.

Account balances and minimum monthly payments due on all of your credit cards.

Account balances and monthly payments on all other debts, such as student loans and car loans.

A letter describing the circumstances that caused your income to be reduced or expenses to be increased (for example: job loss, divorce, illness, etc.).

Once you have this information, call your mortgage servicer and ask to be considered for a Home Affordable Modification. The number is on your monthly mortgage bill or coupon book.

My loan is scheduled for foreclosure soon. What should I do?

If your mortgage has been scheduled for foreclosure or if you have missed one or more mortgage payments, you should contact your servicer immediately.

You may also want contact a HUD-approved housing counselor by calling 1-888-995-HOPE (4673).

We do not “normally” suggest that people work with a modification company – however, if you are considering this type of transaction, we can recommend some guys that have a good track record!

Call us. Steve and Eleanor Thorne at Corporate Investors Mortgage Group in Cary, NC 919-649-5058

Filed Under: Housing News Tagged With: $8000 tax credit, fha mortgage loans, foreclosure, loan, mortgage rates cary, mortgages, nc

2% Mortgage Rate on Refinance?

March 4, 2009 by Eleanor Leave a Comment

The Obama Administration outlined today their efforts to help borrowers who need to refinance – and for various reasons can not.

If you’ve made your payments on time, here’s the current plan being floated… REMEMBER! This must be approved by Congress!

A Home Affordable Refinance Program to Provide Access to Low-Cost Refinancing for Responsible Homeowners Suffering From Falling Home Prices:

“Provide the Opportunity for Up to 4 to 5 Million Responsible Homeowners to Refinance: Mortgage rates are currently at historically low levels, providing homeowners with the opportunity to reduce their monthly payments by refinancing. But under current rules, most families who owe more than 80% of the value of their homes have a difficult time securing refinancing. (For example, if a borrower’s home was worth $200,000, he or she would have limited refinancing options if he or she owed more than $160,000.) Yet millions of responsible homeowners who put money down and made their mortgage payments on time have – through no fault of their own – seen the value of their homes drop low enough to make them unable to take advantage of these lower rates. As a result, the Obama Administration’s program will provide the opportunity for up to 4 to 5 million responsible homeowners who took out loans owned or guaranteed by Freddie Mac and Fannie Mae (the GSEs) to refinance through the two institutions over time. Reducing Monthly Payments: For many families, a low-cost refinancing could reduce mortgage payments by thousands of dollars per year. For example, consider a family that took a 30-year fixed rate mortgage of $207,000 with an interest rate of 6.50% on a house worth $260,000 at the time. Today, that family has $200,000 remaining on their mortgage, but the value of that home has fallen 15% to $221,000 – making them ineligible for today’s low interest rates that generally require the borrower to have 20% home equity. Under this refinancing plan, that family could refinance to a rate near 5.16% – reducing their annual payments by over $2,300. “Okay – here are some details! The 5.16% rate mentioned above is the APR (they left that out). There are also COSTS involved in refinancing which means that if your current rate is 6.5%, and the Obama Administration helps push mortgage rates to the mid to low 4% range – this might make sense.

The other BIG thing to notice is that they are talking about people who’s mortgage is currently owned by Fannie Mae and Freddie Mac. There’s a REALLY good chance your mortgage is owned by Wells Fargo, or BB&T or JP Chase Morgan and they don’t have to fall under these guidelines!

But it still doesn’t get us to that 2% mortgage rate on a refinance! THAT rate is only mentioned for folks who are about to lose their house… and that’s a TON more complicated!

For those details, click here.

If you want to find out more about qualifying to refinance in NC, please contact Steve and Eleanor Thorne, Corporate Investors Mortgage Group, 919-649-5058.

Filed Under: FHA Mortgage Loans, Housing News Tagged With: Best mortgage rates, fha streamline refinance, foreclosure, loan modification, lowest mortgage rates, refinance, refinance fha mortgage, refinancing, steve thorne, streamline refinance, va streamline refinance

What Improvements Can You Make with a FHA 203K Loan For?

March 2, 2009 by Eleanor Leave a Comment

renovate homes! FHA has a great program to help with renovating a new home! It’s called the 203K program - and if you’ve been on Craigslist, you’ve definately seen, “this property is eligable for FHA 203k loan!”

It’s a great program for making up to $35,000 of improvements to the home. Many time, foreclosed property has what Realtors refer to as “Deferred Maintenance.” This means that people who could not afford to make their house payment – also could not afford to have the termite / wood rot repaired, or the stove fixed, or the carpet replaced… So this loan is PERFECT for those kinds of updates!

What items can you update – and which ones can you NOT do with this loan? Here are some basic guidelines:

Eligible Improvements/Work

Repair/Replacement of roofs, gutters and downspouts
Repair/Replacement/upgrade of existing HVAC systems
Repair/Replacement/upgrade of plumbing and electrical systems
Repair/Replacement of flooring
Minor Remodeling, such as kitchens, which does not involve structural repairs
Painting, both exterior and interior
Weatherization, including storm windows and doors, insulation, weather
stripping, etc.
Purchase and installation of appliances, including free-standing ranges,
refrigerators, washers/dryers, dishwashers and microwave ovens
Accessibility improvements for persons with disabilities
Repair/Replace/add exterior decks, patios, porches
Basement finishing and remodeling, which does not involve structural repairs
Basement waterproofing, including mold removal
Window and door replacements and exterior wall re-siding
Septic system and/or well repair or replacement
Connection to public water or sewage system

Ineligible Improvements/Work

Major rehabilitation or major remodeling, such as the relocation of a wall
New construction (including room additions)
Repair of structural damage
Repairs requiring detailed drawings, plans or architectural exhibits
Landscaping or similar site amenity improvements, including fence
Lead-based paint stabilization or abatement of lead-based paint hazards
Any repair or improvement requiring a work schedule longer than three (3) months; or Rehabilitation activities that require more than two (2) draws/payments.
Any work requiring a plan reviewer
Result in work not starting within 30 days after loan closing; or cause the borrower to be displaced from the property for more than 30 days during the time the rehabilitation work is being conducted (FHA anticipates that, in a typical case, the borrower would be able to occupy the property after the mortgage closing.

REMEMBER! If you are a First Time HomeBuyer, you might qualify for a $8000 tax credit (that you don’t have to pay back!)! Click Here for more details!

Many loan officers do not offer this program, and are not familiar with the process. Please call Steve and Eleanor Thorne, Corporate Investors Mortgage Group in Cary, NC for details! 919-649-5058

Filed Under: FHA Mortgage Loans, First Time Home Buyer Tagged With: $8000 tax credit, fha 203k loans, fha construction loan, FHA LOANS, fha loans cary, fha loans johnston county, fha loans raleigh, FHA mortgage loan, fha mortgage loans, foreclosed property, foreclosure, garner, mortgage, mortgages, mortgages apex, nc, rehab loans, wake forest

FHA 203K Loans in NC

February 16, 2009 by Eleanor 2 Comments

FHA 203K loans are perfect for those of us who fall in love with a great The Green Shag has to GO! house that has this Gosh Awful Shag Carpet! This carpet would give you a headache! How can you buy the house if you don’t have an extra $5000 to update that 1970′s carpet, green countertops, and linoleum? If the property is under the FHA loan limit in your county, you can purchase it with a FHA 203K loan.

Let’s say you negotiate a sales price of $100,000. With a traditional FHA mortgage loan, you would need to put 3.5% of the $100,000 into the downpayment. With this special FHA mortgage program, designed for REHABS, you can add up to $35,000 for “updates.” This means that if you negotiate a price of $100,000 and you need an additional $5000 for the updates… we base the 3.5% downpayment on $105,000!

It’s a GREAT program for folks who need to update a property! The main things to remember are:

You can add a minimum of $5000 to the purchase price for improvements, including appliances.
You can not change the “footprint” of the house.
You can not borrow more than $35,000 for improvements.
The property must appraise for the improvements plus the purchase price, or “after improvement” value.
Qualifying is the same as with traditional FHA loans, so you need to have at least 2 credit scores above 600.
The after improvement value can not exceed the maximum loan amount for your county.
The checks for improvement will be going directly to the entity doing the work, only in RARE occassions will this be the homebuyer.
Great loans for folks purchasing foreclosed property!
FHA is not a loan for Investors, with the exception of those purchasing a HUD foreclosed property – when HUD allows an FHA mortgage as part of the contract.