Veterans get a Tax Credit Extension, what about the rest of us??

October 22, 2009 by 2 Comments
First Time Homebuyers could use $8000

First Time Homebuyers could use $8000

On October 11, 2009 the Congress agreed to extend the $8000 Tax Credit for First Time Homebuyers for any Veteran who served at least 3 months of “Qualified Overseas Duty”  in 2009 for another 12 months!

The Service Members Home Owners Tax Act also has a provision that waives the “payback” fee to the IRS of the credit if the Veteran is required to deploy to a different station (I guess that makes sense – you shouldn’t have to pay your boss when THEY are requiring you to move!)

Qualifying for a VA Home Loan/Mortgage is easy!  For details on the 100% mortgage program available to Veterans, click here.

This is GREAT for Veterans who are serving overseas, and WELL DESERVED, but many people want to know if it going to be extended for the REST of the Population!  For more details, click here.

If you have questions about qualifying for a Mortgage Loan guaranteed by the Veteran’s Administration call Steve and Eleanor Thorne!  919-649-5058 We have the lowest rates, and offer the best service on the PLANET!

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FHA Downpayment Going to 5% ??

October 5, 2009 by Leave a Comment

The US Congress is busy trying to figure out how to regulate the Mortgage Banking Industry so that another Subprime Meltdown never happens, and that is a good thing.

But, they are the Government, so how do you see this working out?  Yeah, me neither.

US Congressman Scott Garrett (R-NJ) recently introduced the “FHA Taxpayer Protection Act of 2009.” In his bill, borrowers would be required to make a 5% downpayment on FHA loans, as opposed to the 3.5% downpayment in the current guidelines.

In a Press Release Garrett states:

“Homeownership is a noble goal.  However the benefits of Homeownership using government subsidies must be balanced against the potential risk of insuring less creditworthy borrowers and exposing the American taxpayer to that risk. As we have learned repeatedly throughout the mortgage crisis, the amount of equity a homeowner has in their home directly correlates to the credit risk associated to their mortgage.

I know there are those in this area who believe that Congressman Garrett is on the right track with his Bill… I strongly disagree with you. In the Triangle (RDU area) we are sitting in the middle of 21 Universities and Colleges.  We are a mecca for Research and Technology jobs.  We are attracting young, hard working, EDUCATED first time homebuyers.  And this particular segment of the market is helping us keep our home values in place – because they are buying.

ANYTHING we do to disrupt this current, qualified buyer is a mistake – for ALL of us. We have too much inventory, banks are taking homes back everyday (contributing to that Housing Inventory), we should be ENCOURAGING them to purchase homes – especially now!

If you are interested in purchasing a home in Wake County, Durham County, Orange County or Johnston County, and want more information on qualifying for FHA loans - please call Steve and Eleanor Thorne, 919-649-5058.  We are Professional Mortgage Planners with more than 20 years experience and the lowest mortgage interest rates!






Filed Under: FHA Mortgage Loans, First Time Home Buyer, Housing News Tagged With: , , , , , , , , , , , , , ,

Basics to Qualifying for a FHA Mortgage Loan

February 5, 2009 by 1 Comment

Buy Baby A New Home!FHA mortgage loans offers some of the most flexible financing available for today’s home buyers!  With FHA, you can purchase a property that’s located almost anywhere, (unlike USDA that has a “footprint” of where you can purchase) and you don’t have to be a Veteran (a requirement for VA home loans ).  AND you can use a GIFT for your downpayment!  

Here are the Basic Guidelines:

  • You can Own property somewhere else…. meaning if you move to NC from Ohio (for instance) and you own a property there, you can still qualify for a FHA mortgage loan in NC! (but there are some details you need to remember about using rental income so click here to learn more!)
  • You can get a Gift for the Downpayment!
  • We can use income from a Second Job if you’ve had that job for at least 18 months, and/or you have a history of working 2 jobs!
  • Minimum Credit Scores are more difficult to pin down.  In GENERAL – you need at least 12 months of “clean credit,” and no collections or judgements in the last 12 months.  I you are new to the credit “game” it’s going to be tough to get a loan, but we do have some investors that will help with “non-tradtional credit.”
  • Debt To Income Ratios are “loosly” 33/43.  This means that based upon your GROSS income, you can have 33% of your monthly income going to your housing expense (which includes Principal and Interest, Taxes, Insurances and HomeOwner Dues, if you have them!).  Then you take your Gross Monthly Income and only 43% of your income can be gong to TOTAL debt – which includes the Housing expense above, but it also includes the items which report to the credit report (car payments, credit cards, etc.)
  • Downpayment is 3.5%!
  • You do not have to count child care payments!  (WHEW!)
  • You can use a non-occupying co-borrower.  This means that if your parents want to help you by being on the mortgage loan, you can use their income and assets to qualify.  BIG, BIG, B-U-T here… you can not have sorry credit, and overcome that with a co-borrower. 
  • The maximum loan amount for Wake County and Johnston County in NC is $271,050.  The maximum loan amount in Orange and Durham Counties is over $330,000!
  • You can STREAMLINE refinance to a lower rate FHA Mortgage with minimal costs!

If you are considering a purchase or refinance and have questions about FHA mortgage financing – please call us!

Filed Under: FHA Mortgage Loans, First Time Home Buyer Tagged With: , , , , , , , , , , , , , , , , , , ,

Government Loan Update to Guidelines

January 29, 2009 by 1 Comment

Government Underwriting Guidelines are Changing!And in the blink of an eye – while I was checking my Blackberry – there it was. More guideline changes!  Holy Cow Batman!

Many of that Nation’s Banks changed guidelines to show that FHA, VA and USDA minimum credit scores (some people call them FICO scores) are going to 620. What does this mean – since FHA has an underwriting “guideline” that allows for scores even below the traditional 580, and VA doesn’t have a minimum credit score?  Well, just because FHA and VA might accept and insure borrowers with lower scores – Wells Fargo, Suntrust, Countrywide, Security National Mortgage Corporation and OTHERS are not.

We do have companies that we work with that will make Government Loans to folks with scores under 620… that’s the good news.  Here’s the BAD news.  The rates are higher – and because we have a rate spread LAW in North Carolina – not all of those loans will be available!

Additionally – the PMI companies listed Wake County as a “Distressed” area effective February 2, 2009.  This means that the minimum credit score needed for a loan that requires PMI here is now 700.  That’s STIFF!

If you are considering a purchase later this year – go ahead and talk to your lender.  Let us begin the work of getting your scores “tight…” especially if you think you have a low credit score!  We need to  start this process EARLY!  Especially in view of the fact that Government Underwriting Guidelines are changing so quickly!  Call Steve and Eleanor Thorne, Corporate Investors Mortgage Group, 919-649-5058.

Filed Under: FHA Mortgage Loans, USDA Home Loans, VA Mortgage Loans Tagged With: , , , , , , , , , , , , ,

Maximum Income Requirements USDA in Wake County NC

January 25, 2009 by Leave a Comment

The Raleigh / Cary markets are considered an MSA (Major Suburban Area??) by the Government.  So, in Wake County that’s how you will find the maximum income limits specified for Wake County. These numbers changed at the beginning of the year, and the new income limits (which are based upon the number of people in your household) are as follows:

1 to 4 person family $86,100
5 person or higher, the limit is $93,000

If you like the idea of using a USDA Home Loan to purchase a home in Wake County, and you meet the income requirements… then you also need to consider the property location.  If you are considering a property in Apex, look at this map.  If you are looking in Holly Springs, look at this line along Ten Ten – and if you are thinking about Wake Forest, check out the map here.  If you have a specific address you want to check and see if it qualifies, you can always click here!

Remember, USDA Home Loans are 100% loans with no PMI! The Wall Street Journal says, “Created in 1991 as a way to boost homeownership in rural areas, the program is being tapped by home buyers in overbuilt exurbs who are attracted to the no-money-down terms.”  (Click Here to see their interview with our client!)

For questions about purchasing a home using USDA – please call Steve and Eleanor Thorne at Corporate Investors Mortgage Group, 919-649-5058. We’re EXCITED!  It’s truly a great time to purchase a home in the Triangle!

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USDA No Money Down Mortgage

December 16, 2008 by 4 Comments

Not For FarmsWe’ve helped many customers buy homes with an old program offered through the USDA… not farms… HOMES.

The Rurual Economic Development Fund is what it use to be called, now it’s just a part of the USDA, and the goal is to provide mortgages, and incentives for folks to purchase homes in less “densly” populated areas!

So, in Wake County, NC that would be the areas in Apex, Holly Springs and Wake Forest (click the links for maps).  All of Fuquay and Garner qualify for a NO MONEY DOWN, USDA mortgage… parts of Durham qualify (look at the areas around Briar Creek!) and all of Johnston County qualifies.

Again, it’s a NO MONEY DOWN loan, with NO PMI!  One of our customers was just quoted in the WSJ about this program!  He said, “I couldn’t believe it until I got to closing!”  He only paid $1200 out of pocket to get into a very nice $228,000 home!

If you want more information about qualifying for a USDA home loan, please click here!  Remember!  If you are a first time homebuyer, or you have not owned a home in the last three years, you might qualify for a $7500 Tax Credit!

PS!  The program is running out of money.  Please click here for details!

Filed Under: USDA Home Loans Tagged With: , , , , , , , , , , ,

FHA Loan Limits Change 1/1/09

November 10, 2008 by 2 Comments

We're Not KiddingAccording to the Mortgagee Letter Published this week, HUD is changing the Maximum Loan Limit for Wake, Johnston, Franklin and Harnett Counties.  The change is based upon our average sales price, which has dropped a bit per National Association of Realtors, on Page 48 of their 88 page report – the Triangle will be in for this change at the beginning of the year. (access the report here)

Because our median sales price is lower – our FHA loan limit will go to $271,050 on January 1, 2009.  This means that at the end of the year, the maximum loan in Wake County, Franklin, Harnett or Johnston is $271,050 – down from the current maximum loan of $295,000.  These calculations are based on the Housing Bill that passed Congress in August.  Orange, Person and Durham Counties stay at their current limit of over $336,000!

UPDATE:  In February of 2009 – the FHA raised the limits back to the $295,000 limit!  Talk about CONFUSING!

The downpayment requirements for FHA also change at the end of the year, and if you’re buying that means you will be putting 3.5% starting on January 1st.

If you have questions about qualifying for a mortgage loan, or you want to check rates and see if we can beat what your loan officer is quoting you – call us!

Filed Under: FHA Mortgage Loans, Housing News Tagged With: , , , , , , , , , ,

What is a 2-1 Buydown?

November 7, 2008 by 1 Comment

Many lenders are shouting about “Fixed Rate Mortgages starting at 4.5%”

I’ve even gotten calls from Real Estate Agents asking how they are doing this! Some of these offers are NOT good deals.  For more information about MISLEADING Ads involving this program click here.

However, in the right situation, it’s a good loan.  So let’s do some math – and I’ll try to make this as simple as possible.

The 2-1 Buydown is usually used with a FHA loan, although you can also do this with other loan types.  Fixed rate FHA loans, today are around 6.5%  So let’s work on that number… A fixed rate mortgage for 30 years with an interest rate of 6.5%.

If you have a FHA loan of $250,000 (for instance) then your principal and interest payment at 6.5% is $1,580.17 – and that payment, along with your taxes and insurance (and mortgage insurance) will be used when we are qualifying you for a mortgage.

So where did the 4.5% come in?

Well, in an effort to help folks feel more comfortable with homeownership, lenders are offering a FIRST year rate of 4.5% on the loan and a SECOND year rate of 5.5% – and then for the rest of the life of the loan, the payments will be made at 6.5%… this is why it’s called a 2-1 buydown.  The interest rate is “bought down” 2% (from 6.5 to 4.5) the first year, and 1% the next year (from 6.5 to 5.5).

So the next question might be what does “Bought Down” mean – and this is where you might need a calculator.

In basic terms, the difference between the 6.5 rate on the the mortgage – and the payment rate of 4.5 for the first 12 months is put into an escrow account.

So the $250,000 loan at 6.5% has a P&I (Principal and Interest) payment of $1,580.17.  For that same $250,000 loan, the P&I at 4.5% is $1,266.71.  The difference in the payment is $313.46.

On the $250,000 loan at 5.5%, the P&I is $1,419.47.  The difference between the 6.5% payment and the 5.5% payment is $160.70.

To establish the escrow account (and make this program work) a seller must contribute an amount equal to 12 months of $313.46 (or $3,761.52) and 12 months of $160.70 (or $1928.40) – a total of $5,689.92.

Then, when you make your payment for the first year at $1,266.71, and your mortgage is accruing interest at a payment rate of $1580.17, the bank is pulling out $313.46 every month from the escrow account and applying it to the mortgage!

See??  That wasn’t so hard to understand!  My husband and I purchased our house under this program – only we had a 3-2-1 buydown!

And here’s the BEST part… folks who have not owned a home in the last 3 years are already eligable for a $7500 tax credit from Uncle Sam… with this program (I’m not a tax accountant so please check with your professional), as I understand it, even though the Seller is paying this money on your behalf…. you can still WRITE OFF $5689.92 (the amount of the escrow) on your taxes in your first year???  HOW COOL IS THAT!?!

Filed Under: FHA Mortgage Loans, First Time Home Buyer Tagged With: , , , , , , , ,

Who Qualifies for VA Mortgage Loans

October 20, 2008 by 7 Comments

The VA,  has offered 100% mortgage loan financing to Veterans for many years.  It is one of the best benefits a Soldier has. If you are serving in time of War, the length of time in the service, before you are you are eligible for VA home loan is much shorter.

Because there are varying rules applied for soldiers that served in War and Peace times, we wanted to highlight the requirement for veterans who served on active duty in the Army, Navy, Air Force, Marine Corps, or Coast Guard and were discharged under conditions other than dishonorable after either:

  • 90 days or more, any part of which occurred during wartime, OR
  • 181 continuous days or more (peacetime)

Like All Things with the Government – It couldn’t be That Simple… So there’s a TWO YEAR RULE that states:

If you:

  • enlisted (and service began) after September 7, 1980, OR
  • were an officer and service began after October 16, 1981

You must have completed either:

  • 24 continuous months or more, OR
  • the full period for which ordered to active duty, but not less than 90 days (any part during wartime) or 181 continuous days (peacetime)

What Constitutes War Time versus Peace Time?
Wartime and Peacetime, as used in the General Rule for Eligibility, refer to the following periods of time:

Wartime Peacetime
World War II
9/16/40 – 7/25/47		 Post-World War II period
7/26/47 – 6/26/50
Korean conflict
6/27/50 – 1/31/55		 Post-Korean period
2/1/55 – 8/4/64
Vietnam era
8/5/64* – 5/7/75		 Post-Vietnam period
5/8/75 – 8/1/90
Persian Gulf War
8/2/90 – undetermined

  • were discharged for a service-connected disability, or
  • were discharged for the convenience of the government after completing at least 20 months of a 2-year enlistment, or
  • completed not less than 90 days (any part during wartime) or 181 continuous days (peacetime), and
  • were discharged because of a hardship, or
  • were determined to have a service-connected compensable disability, or
  • were discharged or released from active duty for a medical condition which pre-existed service and has not been determined to be service-connected, or
  • received an involuntary discharge or release from active duty for the convenience of the Government as a result of a reduction in force, or
  • were discharged or released from active duty for a physical or mental condition not characterized as a disability and not the result of misconduct but which did interfere with your performance of duty
  • are an unremarried spouse of a veteran who died while in service or from a service connected disability, or
  • are a spouse of a serviceperson missing in action or a prisoner of war.

Active Duty???
If you are currently on active duty, you are eligible after having served on continuous active status for at least 90 days. When an ending date is established for Persian Gulf War service, a minimum of 181 days of continuous active duty will be required for persons who did not have wartime service.

If you are a Member of the Selected Reserves:
“Selected Reserve” means the Selected Reserve of the Ready Reserve of any of the Reserve components which consists of units and individuals who participate actively in paid training periods and serve on paid active duty for training each year.

SIX Year Rule:
A veteran, who is not otherwise eligible, who completes a total of 6 years as a member of the Selected Reserve (need not be ordered to active duty) is eligible if he or she either:

  • received an honorable discharge
  • was placed on the retired list
  • was transferred to the Standby Reserve or an element of the Ready Reserve other than the Selected Reserve after service in the Selected Reserve characterized as honorable
  • continues to serve in the Selected Reserve

The 6 years service need not be continuous nor in the same Reserve or National Guard unit. However, active duty regular military service cannot be combined with Reserve service to reach the 6 year requirement.

  • certain United States citizens who served in the armed forces of a government allied with the United States in World War II.
  • individuals with service as members in certain organizations, such as Public Health Service officers, cadets/midshipmen at service academies, officers of National Oceanic and Atmospheric Administration, merchant seamen with WWII service, and others.

** Please Note: The VA has the final authority on issuing eligibility **

If you are considering a VA home loan – please call us!  Steve and Eleanor Thorne 919-649-5057

Filed Under: First Time Home Buyer, VA Mortgage Loans Tagged With: , , , , ,

Looking for a Home – When Do I Apply?

October 13, 2008 by 2 Comments

This is a question that was posted recently on Trulia Voices…

“Looking for a Home in the Triangle.  I think I’ll be ready to purchase in March of 2009.  When should I apply for a mortgage???”

People who are considering a move to the Triangle need to plan for their home purchase.  If you will be in the market to purchase in 2009 – you should speak with a NC lender as soon as possible.  Why?

We have our own set of unique qualifying guidelines in NC – mandated by the State Legislature.  While we are a “brick and morter” state (meaning if you are a mortgage company doing business in NC you should have an office here and not just be “virtual”), there are always those with fancy footwork trying to figure out a way around the system.  Better to be safe than sorry – and find a “local” to work with.

In some cases, our State Legislature defines how much a lender can contribute toward closing costs, they also dictate WHICH KIND of loan programs are available to consumers.  So again, think local.

But the MAIN REASON you should speak with a lender even six or eight months before you purchase is this:

With the “mortgage MESS” of the last year, credit scores have become one of the MOST IMPORTANT parts to a loan approval… ESPECIALLY in North Carolina.  Because our programs are limited, we rely even more heavily on high credit scores to qualify buyers, and get the best interest rate.  If you have a “good” score of 640 – we could get your FICO score up to 720 if we had 6 to 8 months! This change in your score could mean the difference of over $75 a month in your payment!

Let’s see… $75 a month savings, live in a house for 4 years, that’s a MINIMUM SAVINGS of $3600!  Just for speaking with a loan officer EARLIER in the process!  So if you are considering a purchase, call now!

Steve and Eleanor Thorne, Corporate Investors Mortgage Group, 919-649-5058

Filed Under: First Time Home Buyer Tagged With: , , , , , , , , , , , ,
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