Condo’s Getting Spanked by Fannie

January 12, 2009 by 2 Comments

iStock_000061440694_MediumFannie Mae’s latest hits to rate will be implemented by lenders any day.  Condominiums are really getting spanked with a 0.75% add to fee if there is less than 25% home equity in the property.  This will apply to both purchases and refinances for any mortgage except those amortized 15 years or less.

 

If you are considering refinancing your condo, contact your local mortgage professional right away (I can help you if you’re located in Washington state)…if you’re in the process of buying a condo and are “floating” your interest rate, I highly recommend considering locking.

PS:  Cash-out refinances are also getting whammo’d by Fannie.  Don’t wait!

Filed Under: Condos, Fannie, Freddie and FHFA, Mortgage, Refinance, Residential Purchase Tagged With: ,

Fannie Mae: The Hits to Rate Keep Coming

January 9, 2009 by Leave a Comment

Fannie Mae has announced new "hits to rate" that will take place on mortgages they purchase effective April 1, 2009.  This means that lenders will start to implement these increases ANY TIME since loans originated today may be bought by Fannie around the effective date for the new increased pricing.  No lender wants to be an April Fool and in position of having to make up for the difference in price when the loan is sold. 

Below is an example of some of the hits to pricing rates.  You can see why Mortgage Professionals should not rattle off rate quotes without having detailed information of the borrower.  If a couple (or single borrower) has a low-mid credit score of 720-739 and they are putting 20% down (LTV 75.01-80%) they can pay 0.25% more in fee than a borrower with a 740+ mid score or the 0.25% will be factored into the interest rate (currently running about 0.125% to rate).

Agency Products 

LTV
LTV
LTV
LTV
LTV
LTV
LTV
FICO
<=60%
60.01-70%
70.01-75%
75.01-80%
80.01-85%
85.01-95
>95%
>=740
+0.25
0.00
0.00
0.00
0.00
0.00
0.00
720-739
+0.25
0.00
0.00
-0.25
0.00
0.00
0.00
700-719
+0.25
-0.50
-0.50
-0.75
-0.50
-0.50
-0.50
680-699
0.00
-0.50
-1.00
-1.50
-1.00
-0.75
-0.50
660-679
0.00
-1.00
-2.00
-2.50
-2.25
-1.75
-1.25
640-659
-0.50
-1.25
-2.50
-3.00
-2.75
-2.25
-1.75
620-639
-0.50
-1.50
-3.00
-3.00
-3.00
-2.75
-2.50
<620
-0.50
-1.50
-3.00
-3.00
-3.00
-3.00
-3.00

Cash-Out Refinance

LTV
LTV
LTV
LTV
LTV
LTV
LTV
FICO
<=60%
60.01-70%
70.01-75%
75.01-80%
80.01-85%
85.01-90%
>90%
>=740
0.00
-0.25
-0.25
-0.50
-0.625
-0.625
N/A
700-739
0.00
-0.625
-0.625
-0.75
-1.50
-1.00
N/A
680-699
0.00
-0.75
-0.75
-1.375
-2.50
-2.00
N/A
660-679
-0.25
-0.75
-0.75
-1.50
-2.50
-2.00
N/A
640-659
-0.25
-1.25
-1.25
-2.25
-3.00
-2.50
N/A
620-639
-0.25
-1.25
-1.25
-2.75
-3.00
-2.50
N/A
<620
-1.25
-2.25
-2.25
-2.75
-3.00
-3.00
N/A

Condominium and Cooperative Property Types

Adjustment Name
Old Adjustment
New Adjustment
LTV >75%
N/A
-0.75

Here are the current (soon to be former) price adjustments from Fannie.

Filed Under: Fannie, Freddie and FHFA, Interest Rates

Fannie and Freddie Suspend Foreclosures

November 20, 2008 by Leave a Comment

Statement from FHFA James B. Lockhart:

“The foreclosure suspension announced today by Fannie Mae and Freddie Mac will help homeowners and servicers utilize the new streamlined loan modification program (SMP) announced by FHFA, Fannie Mae, Freddie Mac and HOPE Now. With this suspension, seriously delinquent borrowers may have an opportunity to avoid foreclosure and work out terms to stay in their homes.”

According to Fannie Mae’s press release, this suspension will take place from November 26, 2008 – January 9, 2008 for owner occupied, single family dwellings for home owners who have not filed for bankruptcy and who has missed three or more payments.

Related Post: Fannie and Freddie’s New Deal

Filed Under: Fannie, Freddie and FHFA

Fannie and Freddie’s New Deal

November 11, 2008 by Leave a Comment

The Federal Housing Finance Committee in a news release this morning, announced that Fannie Mae, Freddie Mac and the Federal Home Loan Banks will be assisting "at risk" borrowers with loan modifications.

"The program targets the highest risk borrower who has missed three payments or more, owns and occupies the property as a primary residence, and has not filed for bankruptcy.  To be considered for the program, a seriously delinquent borrower should contact his or her servicer and provide the requested income information."

Qualified home owners may have their mortgage payment (including any home owners association dues) modified to be no more than 38% of their gross monthly household income through "a mix of reducing the mortgage interest rate, extending the life of the loan or even deferring payment on part of the principal…the goal is to create a more affordable payment."

Borrowers will need to be able to certify that they have experienced a hardship or change in financial circumstances–this is not a "skip three mortgage payments and get rescued" deal.  According to what I’m reading in the news release, mortgage balances are not forgiven, they will be deferred (which I prefer).

If you are a home owner in trouble, you must start with contacting your mortgage servicer (where you make your mortgage payments).  This is a "new deal" so even if you’ve recently tried negotiating, you should try again.   Not everyone in distress will qualify for this program…but you won’t know until you try.

According to FHFA, Fannie and Freddie own (or guarantee) about 58% of all single family mortgages of which 20% are seriously delinquent.  Private label securities (non-prime) represent less than 20% of single family mortgages with 60% of those being seriously delinquent.

Filed Under: Fannie, Freddie and FHFA
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