What may impact mortgage rates the week of February 4, 2013

February 4, 2013 by Leave a Comment

As I write this post (8:10 am) the DOW is down 114 points. Political issues in Europe are giving a boost to mortgage backed securities (bonds) this morning. Remember, when the stock market is getting beat up, traders will seek the safety of bonds. 

Here are some of the scheduled economic indicators for this week:

Tuesday, February 5: ISM Services Index

Thursday, February 7: Initial Jobless Claims and Productivity 

Did you watch Superbowl XLVIII? Did you know that in 34 minutes the lights were out, you could have taken the first steps to either reduce your mortgage rate or start the preapproval process to buy a home? It takes about a half hour to fill out the on-line loan application that I have available on line at Mortgage Porter. My commercial’s over!

Seriously, if I can help you with your mortgage needs on a home located anywhere in Washington, please contact me. I have been helping with refinances and purchase mortgages at Mortgage Master Service Corporation since April 2000.

Filed Under: Economy Tagged With: , ,

One reason to buy vs. rent a home

February 2, 2013 by Leave a Comment

 You can remodel your bathroom without having to get permission from the owner. 

2013 02 01 19 07 26 16
2

My husband is in the process of remodeling our basement bathroom. You can see a glimpse of the salvaged “ship’s door” that will be the door to the commode. 

I’ll be sure to share more photos of the progress!

Filed Under: Just for Fun Tagged With: ,

It’s official: HUD issues Mortgagee Letter Confirming Changes to FHA Mortgage Insurance

February 1, 2013 by 2 Comments

I’ve been writing about pending changes to FHA insured mortgage loans regarding the mortgage insurance premiums. Yesterday, HUD issued Mortgagee Letter 2013-04 which makes the proposed changes “official”. 

We’ve been anticipating changes to how long mortgage insurance will remain on an FHA insured loan as well as increases to FHA’s mortgage insurance premiums.

It’s no surprise that FHA will increase annual mortgage insurance premiums (paid monthly). The first increase goes into effect with case numbers issued April 1, 2013 and later.

  • 30 year fixed with loan to values of 95% or lower will increase to 130 bps (from 120)
  • 30 year fixed with loan to values greater than 95% will increase to 135 bps (from 125)
  • 30 year fixed FHA Jumbos with loan to values of 95% or lower will increase to 150 bps (from 145)
  • 30 year fixed FHA Jumbos with loan to values greater than 95% will increase to 155 bps (from 150)
  • 15 year fixed with loan to value of 78.01% – 90% will increase to 45 bps (from 35)
  • 15 year fixed with loan to values greater than 90% will increase to 70 bps (from 60)
  • 15 year fixed FHA Jumbos with loan to values of 78.01% – 90% will increase to 70 bps (from 60)
  • 15 year fixed FHA Jumbos with loan to values greater than 90% will increase to 95 bps (from 85)

NOTE: in the Seattle – King County area, FHA jumbos are loan amounts from $417,001 to $567,500.

But wait… there’s more!! 

Effective on case numbers issued June 3, 2013 and later, 15 year fixed FHA mortgages with a loan to value of 78% or lower will have annual mortgage insurance of 45 bps. Currently these loans have zero annual mortgage insurance. 

Want to save on your FHA mortgage insurance? Act quickly!! Click here for a mortgage rate quote for homes located anywhere in Washington state.

FHA streamlined refi’s where the current FHA mortgage was endorsed prior to June 1, 2009 are exempt from this adjustment. These loans still qualify for reduced mortgage insurance premiums.

Per the mortgagee letter, this will be effective on case numbers issued June 3, 2013 and later, FHA insured mortgages will change when mortgage insurance can be terminated. Most FHA loans will have mortgage insurance for the term of the mortgage for loans with case numbers issued June 3, 2013 and later. 

Here is a chart from HUD comparing “previous” (in effect now until the new regulation) and “new” (in effect with case numbers issued June 3, 2013 and later).

FHA Annual Premium Cancellation
FHA Annual Premium Cancellation

If you are considering an FHA insured mortgage and would like to have mortgage insurance that one day drops from your mortgage payment – you have a couple months left to do so. The FHA Case number is typically (but not always) ordered at application. 

I am happy to help you with your FHA purchase or refinance on your home located anywhere in Washington state. I have been originating mortgages at Mortgage Master Service Corporation since April 2000, including FHA loans.  

Filed Under: FHA, Mortgage Insurance Tagged With: , ,

Buying a 2-4 Unit Home using an FHA Mortgage

January 31, 2013 by 13 Comments

mortgageporter-seattle-duplexEDITORS NOTE: This post was written in 2013. FHA loan limits have changed as well as the interest rates posted below. Please see the bottom of this web page for current FHA loan limits. If I can provide you with a current rate quote for your home in Washington, please click here.

If you are considering buying a duplex, triplex or fourplex and you’re going to live in one of the units, FHA is a possible mortgage option.

[Read more…]

Filed Under: FHA, Investment Property Tagged With: , ,

Heads up! HUD issues Press Release with upcoming changes to FHA Mortgages

January 30, 2013 by Leave a Comment

Today HUD issued a press release confirming pending changes to help bolster FHA’s capital reserves.

“These are essential and appropriate measures to manage and protect FHA’s single-family insurance programs” said Galante.  “In addition to protecting the MMI Fund, these changes will encourage the return of private capital to the housing market, and make sure FHA remains a vital source of affordable and sustainable mortgage financing for future generations of American homebuyers.”

Some of the changes to take place with HUD have already been announced. Here are a few points from today’s press release

  • FHA annual mortgage insurance will remain on the mortgage for the life of the loan. This is the mortgage insurance that is paid monthly. Once this goes into effect, home owners will need to either refinance to a non-FHA loan or pay it off to no longer have mortgage insurance. 
  • Mortgage insurance is set to increase. The annual mortgage insurance (remember, this is the one that is paid monthly) is set to increase by 0.10 basis points. FHA Jumbos will see an increase in the mortgage insurance by 0.05%.
  • FHA Jumbo’s will have a larger down payment requirement. Currently a home buyer can do as little as 3.5% down on all FHA insured mortgages. Once this goes into effect, the minimum down payment for an FHA jumbo will be 5%. In the greater Seattle area, loan amounts over $417,000 and up to $567,500 are currently considered “FHA Jumbos”.
  • Manual underwrites for credit scores below 620 with debt to income ratios over 43%. Currently, I believe the lowest credit score our company can do for an FHA insured mortgage is 640.

We are waiting for HUD to issue Mortgagee Letters before this goes into effect. 

Stay tuned!

Filed Under: FHA Tagged With: , , ,

HARP 3.0 and #MyRefi Update

January 29, 2013 by Leave a Comment

An article published today by Bloomberg Businessweek gives some hope of HARP 3.0 and #MyRefi (aka the Obama Refi) becoming available to underwater home owners.

Many responsible home owners who have not been able to refinance under the current guidelines of HARP 2.0 because either their existing home mortgage was securitized after June 1, 2009 by Fannie Mae or Freddie Mac OR because their existing mortgage is not securitized by either Fannie or Freddie. 

The Home Affordable Refi Program was created to help home owners who have lost equity in their homes and would otherwise qualify to refinance (they have employment, income and good credit).

In today’s article, the Treasury may overstep Congress to help make the expanded program that many have been hoping for a reality. From Bloomberg Businessweek: 

Treasury may act unilaterally to aid borrowers who owe more than their homes are worth if Congress doesn’t pass legislation providing assistance, Stegman, a counselor on housing policy for the agency, said at an American Securitization Forum conference.

“Legislation would facilitate a refinance, whereas under our existing authority, Treasury could only modify the most deeply underwater loans and pay investors for some amount of forgone interest,” Stegman said.

Stay tuned!

Filed Under: HARP - Home Affordable Refi Tagged With: ,

Mortgage rate update for the week of January 28, 2013

January 28, 2013 by Leave a Comment

Mortgage backed securities are in the red this morning. Although rates are still very low, those who have not locked in their mortgage rates may be surprised to see the rate or cost for the rate is now higher.  As the economy continues to show signs of improvement, investors will trade the safety of bonds (like mortgage backed securities) for stocks. 

As of 8:30 am this morning, 3.625% is priced near “par” (with as little rebate credit or discount points) for a 30 year fixed rate-term refinance (apr 3.690).  As you can see, mortgage rates are still very low however, they have been slowly trending higher. Rates change constantly and there are at least 10 factors that impact the pricing of mortgage rates. For your personal mortgage rate quote for your refi or home purchase anywhere in Washington state, click here.

This week is loaded with the FOMC rate decision on Wednesday and Friday’s Jobs Report. Here are some of the scheduled economic indicators and events that may impact mortgage rates this week.

Monday, January 28: Durable Goods Orders and Pending Home Sales

Tuesday, January 29: S&P Case Shiller Home Price Index and Consumer Confidence

Wednesday, January 30: GDP Chain Deflator, ADP National Employment Report, Gross Domestic Product (GDP) and FOMC Meeting

Thursday, January 31: Employment Cost Index (ECI), Personal Consumption Expenditures (PCE), Initial Jobless Claims and Chicago PMI

Friday, February 1: THE JOBS REPORT, ISM Services Index and Consumer Sentiment (UoM)

You can follow me on Twitter for live mortgage rate quotes at @mortgageporter and/or “like me” on Facebook.

If your home is located anywhere in Washington state, where I’m licensed to originate, I’m happy to help you with your mortgage. 

Filed Under: Economy Tagged With: , , ,

Income Limits for USDA Zero Down Rural Loans

January 25, 2013 by Leave a Comment

EDITORS NOTE 2/13/2013: UPDATED USDA INCOME LIMITS ARE PUBLISHED HERE.

USDA offers a government backed program that allows zero down payment on homes that are in a designated rural community for families earning less than a certain income. A majority of Washington State single family residences (homes and condos) qualify…of course if you live in metropolitan areas like Seattle or Bellevue, odds are your home will not. However, if you’re considering areas like Duvall, parts of Maple Valley, Vashon or Bainbridge Island, it may qualify for zero down financing.

To qualify, families must be without “adequate housing” (may not own a home or adequate home), must have reasonable credit history and be able to afford the mortgage (29/41 is the debt to income ratio guidelines).  

Income limits vary by county and the entire household income is considered (not just the primary borrowers or those borrowers on the mortgage) for determining if the income meets the guidelines.  This is separate from income considered for “debt-to-income” ratios.  USDA loans allow incomes up to 115% of the median income for the area.  Income limits vary on household size from 1-4 person or 5-8 person. 

As of the publishing of this article, in Washington, the income limits by county are:

  • King and Snohomish Counties: 1-4 Person $93,450 | 5-8 Person $123,350
  • Pierce County: 1-4 Person $82,450 | 5-8 Person $108,850
  • Island County: 1-4 Person $89,550 | 5-8 Person $118,200
  • Kitsap County:  1-4 Person $86,950 | 5-8 Person $114,750
  • Thurston County: 1-4 Person $86,250 | 5-8 Person $113,850
  • Clark County: 1-4 Person $83,950 | 5-8 Person $110,800
  • San Juan County: 1-4 Person $78,050 | 5-8 Person $103,050
  • Whatcom County: 1-4 Person $78,000 | 5-8 Person $102,950
  • Benton and Franklin Counties: 1-4 Person $76,800 | 5-8 Person $101,450
  • Skagit County: 1-4 Person $75,750 | 5-8 Person $100,000
  • All other Washington counties:  1-4 Person $74,950| 5-8 Person $98,850

You can check current USDA income limits by visiting the USDA site (clicking here)…be sure to click the “guaranteed” option.   Income limits can and do change. You can also use USDA’s income eligibility calculator which will factor in deductions to income, select the “guaranteed” results (not “direct”).

Income used to determine if a family is under the household income limits includes all those (18 years and older) who will be living in the home regardless of whether or not they’re on the mortgage.  Incomes of children over 18 who working AND who are full time students are not factored. Here is more information of how USDA loans calculate household income.

Once you’ve determined that you meet the household income limits, the next step is to see to see what communities in your area are eligible for USDA financing. You don’t have to go too far from Seattle or Bellevue to find homes that do qualify for this type of mortgage.   Using the USDA site, under “Property Eligibility” click “Single Family Dwelling”.  From there you can either enter a specific address or click on the map to narrow down your search. 

Sellers and real estate agents who are working in neighborhoods that qualify should be sure to include this program as an option they’ll consider for financing on their offers.  

This map is as of the publishing of this post. Areas that are outside of the peachy orange shade are eligible for USDA zero down home loans.

USDA Map
 

I’m pleased to offer USDA financing as an option for borrowers who meet the criteria. If you have any questions regarding USDA or other mortgage programs for financing homes located anywhere in Washington State, please contact me, I’m happy to help!

Filed Under: USDA Tagged With: , , ,
« Previous Page
Next Page »