Mortgage Loans

Mortgage Loans

Delaware FHA Loans Going to 5% Down Payment?

John Thomas October 21, 2009

Some congressmen are becoming more concerned about the Federal Housing Administration’s financial plight and they want to increase FHA’s downpayment requirement to 5%. Rep. Ed Royce, R-Calif., said FHA is operating at the same dangerous leverage ratios that led to the takeover of Fannie Mae and Freddie Mac. Rep. Scott Garrett, R-N.J., said he has drafted a bill that would increase the FHA downpayment requirement to 5% from the current 3.5% level.

“There are increasing reports of the likely necessity of a taxpayer bailout for the FHA and this legislation aims to implement reforms to try to prevent such a bailout from occurring,” Rep. Garrett said at a House Financial Services Committee hearing. The Garrett bill also calls for a General Accountability Office study to determine the appropriate leverage ratio for FHA. In the early 1990s, Congress mandated that FHA maintain a minimum 2% capital ratio. Keep Reading...

Analysis of Delaware Subprime Loans

John Thomas October 18, 2009

The following analysis was from the Federal Reserve Bank of New York report from January 2009

  • Delaware Borrowers were more likely to have provided full documentation with their loans. 77.1% versus 67.6% nationally.
  • Delaware Borrowers had a lower average FICO score of 608 compared to the national average of 617.
  • 45.1% of subprime borrowers had a FICO score of 600 or less but only 17.4% of them had a score greater than 660.
  • The average loan balance of the active, first-lien subprime loans was $169,496 which is lower than the national average of $182,105 for the same loans.
  • Delaware Subprime borrowers have been paying interest rates (8.23%) below the national average interest rates (8.32%) for their owner-occupied first-lien mortgages
  • Delaware had fewer (2.4%) subprime loans in Real Estate Owned (REO) compared to the 6.7% nationally in 2007.
  • Delaware had an 83.66% average combined Loan-to-Value (CLTV) ratio for subprime loans compared to 84.39% national average.
  • Delaware had an above average foreclosure rate. Delaware ranked 33rd for foreclosure rate.
  • Kent County Delaware had the worst foreclosure experience in the state with 1 in every 716 housing units with a foreclosure action.
    • Keep Reading...

    Delaware Mortgage Rates – Friday October 16, 2009

    John Thomas October 16, 2009

    This is my daily advice on locking or floating your Delaware Mortgage Rate for Friday, October 16, 2009.

    Mortgage rates have steadily increased since hitting a record low last Friday.  The mortgage bond lost some 120 basis points since last Friday causes mortgage rates to increase. Rates are still near historic lows but the pressure is for rates to slowly increase from here. The federal government has slowed its buying of mortgage-backed securities which is causing less of a demand for mortgage-backed securities. The government’s buying program is what has kept rates low so as the program winds down rates will rise. Keep Reading...

    Delaware Michael Castle Announces Run for U.S. Senate

    John Thomas October 6, 2009

    U.S. Representative Michael Castle made his announced to run for U.S. Senate on October 6, 2009, at a press conference. He will be running for Vice President Joe Biden’s former Senate Seat. The current senator Edward Kaufman said he will not run for election when he was appointed by Former Governor Ruth Minter.

    Castle believes his experience will be a great benefit to the State of Delaware in Congress.

    If you would like to apply for a Mortgage Loan, you can APPLY ONLINE HERE, you can call John Thomas at 302-703-0727. Keep Reading...

    Delaware First Time Home Buyer Seminar – October 24, 2009

    John Thomas October 4, 2009

    There will be a Free Delaware First Time Home Buyer Seminar on Saturday, October 24, 2009, at 10:00 AM and again at 1:00 PM. The seminar will last about 2 hours and each participant will be able to receive a free copy of their tri-merge credit report. The seminar will cover all of the basics of buying a new home in Delaware. The seminar will cover Delaware FHA loans, Delaware VA loans, Delaware USDA Rural Housing Loans, First Time Home Buyer Loan Programs, and the Delaware FHA 203k Rehab loans.

    Learn how to get $8,000 tax credit for buying a home in 2009. That is a check for $8,000 from the IRS to you at tax time just for buying a home! The best thing is you don’t have to ever pay the $8,000 back!! Keep Reading...

    Delaware FHA 203k Rehab Loans for Bank Owned Properties

    John Thomas September 24, 2009

    The increase in foreclosures has increased the number of houses listed for sale in Delaware that are owned by banks.  The banks have taken the homes by foreclosing.  The banks list the properties for sale in “as is” condition. This makes it tough for qualified buyers to purchase some of these homes because traditional FHA Loans and conventional loans may require some repairs be completed prior to closing that the bank will not due.

    The solution to this problem is the Delaware FHA 203k loan. For most of these properties, the repairs are not major and are best suited to a streamlined version of the FHA 203k loan. The streamline is much quicker and easier to do than a full 203k. The program allows the buyer to borrow the cost for the repairs and doesn’t require them to be completed before closing. Keep Reading...

    Free Delaware First Time Home Buyer Seminar – October 3, 2009

    John Thomas September 18, 2009

    There will be a Free Delaware First Time Home Buyer Seminar on Saturday, October 3, 2009, at 10:00 AM and again at 1:00 PM. The seminar will last about 2 hours and each participant will be able to receive a free copy of their tri-merge credit report. The seminar will cover all of the basics of buying a new home in Delaware. The seminar will cover Delaware FHA loans, Delaware VA loans, Delaware USDA Rural Housing Loans, First Time Home Buyer Loan Programs, and the Delaware FHA 203k Rehab loans.  \

    Learn how to get $8,000 tax credit for buying a home in 2009. That is a check for $8,000 from the IRS to you at tax time just for buying a home! Keep Reading...

    New Conforming Mortgage Guidelines for Delaware Conventional Loans – September 1, 2009

    John Thomas September 18, 2009

    Fannie Mae has rolled out new lending guidelines on Tuesday, September 1, 2009. Being approved for a Delaware Conventional home loan could be much more difficult. The new rules mark the first major underwriting update since April of this year. The changes are mostly geared at fraud prevention. Among the updates:

    1. Stock options are no longer eligible for “reserves”
    2. Relocating families can’t use the “trailing” spouse’s projected income
    3. “Tip” income must be documented and verified
    4. Lenders must call employers to verify employment
    5. Lenders must verify tax transcripts against IRS records

    But there are other changes, too. As examples:

    1. Owners and buyers of 2-unit homes are subject to new minimum FICOs with larger downpayment and equity requirements.
    2. Only 70% of the stock, bond, and mutual values may be used as reserves
    3. Only 60% of retirement assets may be used as reserves

    For information on the complete guideline changes visit http://www.efanniemae.com/sf/guides/ssg/annltrs/pdf/2009/0919.pdf

    If you need help qualifying for a Delaware Home Loan please call me at 302-588-3665 or you can APPLY ONLINE HERE. Keep Reading...