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Fannie Mae New Rules for Delaware Home Buyers January 2014

John Thomas September 8, 2013 Tags: , , , ,
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Fannie Mae New Rules for Delaware Home Buyers Effective January 2014

Fannie Mae released an update to its Selling Guide SEL-2013-06 which will be effective January 10, 2014 with the update to automated underwriting system DU version 9.1. The update makes the following changes to conventional mortgage loans sold to Fannie Mae:

  • No longer accept mortgages with terms greater than 30 years (So no more 40-year mortgages)
  • No longer accept mortgages with an interest only option
  • Adjustable Rate Mortgages (ARMs) that are 7 years fixed or 10 years fixed will need to be qualified at higher of note rate or fully indexed rate whichever is higher
  • No longer allow Loan-to-Value (LTV) over 95% (So no more 97% LTV Loans!!!)
  • Will force Lenders to purchase back loans that can be proved to fail the ATR (Ability to Repay) test

The 97% Loan that is no longer eligible includes the My Community Mortgage programs and the HFA programs. The ATR test is the biggest change that most people will not directly see as it will affect how lenders underwrite loans after January 10, 2014. The new rule says that if a loan defaults at any time during the 30-year term of the loan, Fannie Mae can review the loan and if determines the lender failed to adequately document the borrower’s ability to repay then the lender must indemnify Fannie Mae for the complete loss. The big problem is Fannie Mae has not clearly defined what a lender is supposed to do in order to document the borrower’s Ability to Repay a loan. This means Fannie Mae can subjectively decide if a lender passes the ATR test when a loan goes bad. Keep Reading...

Delaware Mortgage Rates Weekly Mortgage Market Update for September 2, 2013

John Thomas September 3, 2013 Tags: , , , , ,
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Delaware Mortgage Rates weekly market update for the week of September 2, 2013, by John R. Thomas with Primary Residential Mortgage in Newark, Delaware. John Thomas is the Newark, Delaware Mortgage Branch Manager and the author of the book, Your Guide to Buying Your First Home in Delaware. Call 302-703-0727 to get a mortgage planning consultation or APPLY ONLINE for Delaware mortgage loan

Delaware mortgage rates rallied at the beginning of the week and moved lower but the rally faded to end the week as mortgage bonds met tough resistance at the 25-day moving average and a falling trend line.  If you look at the mortgage bond chart below you can see there was a big rally on Monday in the bond market as the threat of military action in Syria loomed. The instability in the Middle East caused money to move out of the stock market into the bond market during the week but a better than expected reading on GDP caused the bond market to lose steam and sell off to end the week.  With the 25 moving average as a tough ceiling of resistance for mortgage bonds, we are recommending LOCKING your Delaware mortgage rate to start the week. If you are not closing for 60 to 180 days then you can FLOAT to see how the market plays out. Keep Reading...

Delaware USDA Rural Housing Loan Eligible Property Areas Changing October 1, 2014

John Thomas August 28, 2013 Tags: , , ,
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Delaware USDA Rural Housing Loans Eligible Property Areas are Changing October 1, 2014

The eligible property areas for Delaware USDA rural housing loans in Delaware were supposed to change on October 1, 2014, when Rural Development was switching from using the 2000 US census data to determine eligibility based on population density to using the 2010 US Census.  The current areas that are eligible which were no longer going to be eligible are Middletown, Delaware and Smyrna, Delaware.  THE CHANGE WAS DELAYED UNTIL 2021!!

The USDA Rural Housing Loan offers 100% financing for borrowers looking to purchase homes in eligible areas that fall under the household income limit.  The income limit is based on the number of people in the household and on which county the property is located in Delaware, Delaware USDA Loan 2013 Income Limits.  The New Eligible Property Areas Map effective October 1, 2013, by county are displayed below: Keep Reading...

Delaware USDA Rural Housing Loan Income Limits for 2013

John Thomas August 28, 2013 Tags: , , ,
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Delaware USDA Rural Housing Loan

Income Limits for 2013 are based on the county and the number of people in the household.  If you have questions about USDA Rural housing Loans or would like to Apply for a USDA Rural Housing Loan, call 302-703-0727 or APPLY ONLINE. The following table shows the income limits for each county in the State of Delaware:

New Castle County Delaware Income Limits for USDA Rural Housing Loans for 2013:

1-4 Person         5-8 Person
$0 – $93,450       $0 – $123,354

Kent County Delaware Income Limits for USDA Rural Housing Loans for 2013: Keep Reading...

Delaware Mortgage Rates Weekly Update for August 26, 2013

John Thomas August 25, 2013 Tags: , , , , , ,

Delaware Mortgage Rates weekly market update for the week of August 26, 2013, by John R. Thomas with Primary Residential Mortgage in Newark, Delaware. John Thomas is the Newark, Delaware Mortgage Branch Manager and the author of the book, Your Guide to Buying Your First Home in Delaware. Call 302-703-0727 to get a mortgage planning consultation or APPLY ONLINE for Delaware mortgage loan

Delaware mortgage rates ended the week about where they ended the previous week after a roller coaster ride. If you look at the Mortgage Bond Chart below you can see mortgage bonds sold off on Monday to start the week which caused home loan rates to jump higher. The bond recovered on Tuesday but then sold off again on Wednesday after the Federal Reserve Minutes were released. Opened again lower on Thursday but was able to recover some after Weekly Initial Jobless Claims were released on Thursday which showed a 13,000 increase in Jobless Claims to 336,000 claims. The mortgage bond followed through on Friday with a Big Rally to end the week back where we ended the previous week. We are recommending FLOATING your Delaware Mortgage Rate to start the week to see if mortgage bond can build on the momentum from Friday’s rally. Keep Reading...

Dover Delaware First Time Home Buyer Seminar September 28, 2013

John Thomas August 25, 2013 Tags: , , ,
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Free Delaware First Time Home Buyer Seminar on Saturday, September 28, 2013, at 10 AM in Dover, Delaware. The seminar will last about 2 hours and each participant will be able to receive a 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. You will be able to get pre-approved at the seminar by a Delaware Mortgage Company. Keep Reading...

FHA Back to Work Program Delaware FHA Loan Update

John Thomas August 21, 2013 Tags: , , ,
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FHA Back to Work Program

Delaware FHA Loan Update Effect August 15, 2013

FHA Back to Work Loan Program – HUD released a new Mortgagee Letter 2013-26 and made it effective August 15, 2013, which was title FHA Back to Work – Extenuating Circumstances.  The new guidelines allow borrowers who have experienced an Economic Event that resulted in a severe reduction in income that lead to a short sale, foreclosure, and/or bankruptcy to shorten the required wait time to a minimum of 12 months.  The normal wait times are from 2 to 3 years from the derogatory event.  If you would like to apply for the Back to Work Program you can call 302-703-0727 or apply online at Delaware FHA Mortgage Application Keep Reading...

Delaware Mortgage Rates Weekly Market Update for August 19, 2013

John Thomas August 18, 2013 Tags: , , , , , ,
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Delaware Mortgage Rates weekly market update for the week of August 19, 2013, by John R. Thomas with Primary Residential Mortgage in Newark, Delaware. John is the Newark, Delaware Mortgage Branch Manager and the author of the book, Your Guide to Buying Your First Home in Delaware. Call 302-703-0727 to get a mortgage planning consultation or APPLY ONLINE for Delaware mortgage loan

Delaware mortgage rates jumped higher to end the week last week after a slew of positive economic reports. If you look at the mortgage bond chart below you can see mortgage bonds dropped lower every day and sold off on Friday to end the week so mortgage rates moved higher all week. Monday started the sell-off in bonds when the bond couldn’t close above the falling blue trend line. The same pattern repeated itself again last week which was bonds hitting the falling blue trend line and then being turned lower in a big sell-off.  Bonds appear to have hit a bottom so we are going to recommend FLOATING your Delaware mortgage rate to see if the bond market can bounce higher but be on guard if selling continues bond could move significantly lower and mortgage rates could continue to move higher. Keep Reading...