Reverse Mortgages turn 50yrs old. Why no party?

Posted on October 27, 2011 by Neil Sweren

What… no party?

This year the Reverse Mortgage celebrates its 50th birthday, but it is unlikely there will be any public celebrations on its behalf and that’s a real shame.

What is a reverse mortgage?

A reverse mortgage also known as a HECM (Home Equity Conversion Mortgage) plain and simple is a loan that allows senior homeowners 62 or older to borrow or gain access to a portion of the equity in their home.  When the homeowner passes away or moves his/her estate sells the property the loan is repaid.  Any remaining equity goes back to the borrower or his/her estate.  There are no income or credit qualifications and during the term of the loan the borrower is not required to make any monthly payments to principal and interest.  Borrowers can choose to receive funds in a lump sum, monthly payments or they can access funds on an as needed basis through a line of credit. Read more »

Filed under: Mortgage, Reverse Mortgage, Seniors | Leave a Comment »

HUD leaves loan limits unchanged for remainder of 2011

Posted on August 19, 2011 by Neil Sweren

The Department of Housing and Urban Development (HUD) announced today in mortgagee letter 11-29 that current FHA maximum loan limits will remain for the remainder of 2011.

HECM / Reverse mortgage limits will also remain at $625,500 for the remainder of the calendar year.

The full text of the mortgagee letter is available here:  http://portal.hud.gov/hudportal/documents/huddoc?id=11-29ml.pdf

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VA Loan Limits Extended through December 31 2011

Posted on August 9, 2011 by Neil Sweren

VA has extended the loan guaranty limits for VA guaranteed loans through 12/31/2011.

In Maryland the loan limit for the remainder of 2011 will remain $500,000 in Anne Arundel, Baltimore County, Baltimore City, Carroll, Harford, Howard and Queen Anne counties.  The limit in Calvert, Charles, Frederick, Montgomery and Prince Georges counties will remain $818,000.

The announcement from VA can be found here:  http://www.benefits.va.gov/homeloans/docs/2011_Oct_thru_Dec_Max_Guaranty.pdf

The 2011 Loan Limits can be found here:  http://www.benefits.va.gov/homeloans/docs/2011_county_loan_limits.pdf

Filed under: Mortgage, Real Estate, VA | Leave a Comment »

Study Shows Home Owners in Denial About Price

Posted on July 20, 2011 by Neil Sweren

As Mark Twain said… “Denial ain’t just a river in Egypt!”

A recent study by home site Zillow found that homeowners who purchased homes in 2007 or later are on average overpricing their homes by 14%.    Those would be sellers are basing the asking price on what they paid rather than current market.  Other sellers are also overpricing homes but not by as wide a margin.   Read the press release HERE (will open new window).

Filed under: Mortgage, Real Estate | Leave a Comment »

How would a government shutdown impact mortgage and real estate closings?

Posted on July 14, 2011 by Neil Sweren

The last time we went through a government shutdown in 1995, it was a pain, but not a panic. I can assure you my company has prepared all loans in our pipeline and are looking at new contracts not yet acquired for a worst case scenario, so the disruption will be minimal. If a shutdown would occur, these would be the top six areas that can affect us during a government shutdown:

  • FHA Case Numbers: For each FHA loan, we are required to order a FHA case number. This number is generated before an appraisal can even be ordered. With a shutdown, we may not be able to order case numbers. Because of this, it is critical to let us know if there is a contract executed on any loan, so that our office can go ahead and order a case number without risking the loan being on hold during a shutdown. Note: with the new FHA guidelines, a contract must be executed before a case number can be ordered.
    The ability to close FHA loans is questionable, depending if HUD keeps its website running to obtain FHA case numbers and CAIVRS (During the November 1995 shutdown, case numbers could not be obtained, but this was prior to the internet and was a manual process). The shutdown in 1995 mainly caused a delay rather than a drop in FHA loan origination, but if lenders decide to stop accepting FHA applications, it could be a problem. I think we will see delays but not a complete shutdown of the FHA.
  • 4506 IRS Transcripts: Each loan (not including reverse mortgages) requires the verification of at least one tax return by the IRS to verify the numbers that each customer presents us on their tax returns. During a shutdown, this process would be delayed as the IRS wouldn’t be at work to verify the transcripts.
  • Verifying Employment of a Government Employee: We are required to verify the employment of each customer. If the customer is a federal government employee, we would be unable to verify his or her employment during a shutdown.
  • FEMA: Homes in a Flood Zone: Homes that are determined to be in a flood zone would not be able to close as flood insurance could not be obtained.
  • USDA: During a shutdown, the USDA office would be closed because they have government underwriters that insure behind the lender.  With a shutdown, we would see delays with all USDA loans.
  • VA: Like the FHA, the disruption is possible — but not absolute — during a shutdown. This would all depend on if they continued to allow their website to function. A disruption would cause delays in VA appraisals and the issuing of certificates of eligibility.  If the website was closed during a shutdown, we would see delays in all VA loans.

Hopefully, our representatives in Washington will come to terms and a shutdown will be avoided.  In case they don’t, you know what to expect.

Filed under: Mortgage | Leave a Comment »

Emergency Homeowners Loan Program (ELHP) offers aid to struggling homeowners

Posted on June 29, 2011 by Neil Sweren

EHLP spells HELP for nearly four million homeowners behind on their mortgage payments.  The billion dollar program offers loans of up to $50,000 that do not need to be repaid if applicants meet certain qualifications.

Application information is available from the NeighborWorks America website: http://ehlp.nw.org/

Read the SmartMoney.com story here: http://www.smartmoney.com/spend/real-estate/more-money-for-struggling-homeowners-1309312646029/

Filed under: Credit, Financial, Mortgage, Real Estate | Tagged: , , , | 2 Comments »

Fannie Mae offers HomePath Buyers up to 3.5% closing cost assistance

Posted on April 28, 2011 by Neil Sweren

Fannie Mae announced is offering up to 3.5% in closing cost assistance for new contracts closing before June 30, 2011.

The HomePath property buyer must meet the following qualifications to be eligible:

  • Buyers and/or selling agents (the agent representing the buyer) must request the incentive upon submission of initial offer in order to be eligible.
  • The initial offer must be submitted on or after April 11, 2011 and close by June 30, 2011. If an initial offer was made prior to the effective date, the offer is not eligible for the incentive.
  • The sale must close on or before June 30, 2011. No exceptions will be made to this deadline.
  • Only buyers purchasing a HomePath property as their primary residence may receive up to 3.5% in closing cost assistance. Second homes and investment properties are excluded from the incentive.
  • Buyer must sign the Owner Occupant Certification Rider to the Real Estate Purchase Addendum.
  • If a buyer’s total closing costs are under 3.5%, the difference will not be available as a credit to the buyer.
More information about the HomePath program available here:
http://www.lowrateloan.com/homepath_mortgage_financing

Filed under: Mortgage | Leave a Comment »

One billion dollars in 0% interest mortgage help to unemployed

Posted on January 25, 2011 by Neil Sweren

According to Housing Wire, the Department of Housing and Urban Development will release $1 Billion in mortgage assistance this spring to unemployed homeowners at a zero percent (0%) interest rate for up to 24 months.

The full story is here: http://www.housingwire.com/2011/01/25/hud-to-release-1-billion-in-mortgage-help-to-unemployed-this-spring

Filed under: Mortgage, Real Estate | 1 Comment »

Relocating Seniors Worrying About Financing New Home

Posted on January 24, 2011 by Neil Sweren

Financial concerns top the list for homebuyers 55 and older says Origination News.  Housing starts for 55+ communities expected to rise 30% over 2010 levels…

Origination News – Relocating Seniors Worrying About Financing New Home.

Filed under: Mortgage, Real Estate, Reverse Mortgage, Seniors | Leave a Comment »

What I can find out about you for $25… if I pull the trigger.

Posted on November 23, 2010 by Neil Sweren

Did you know that the major credit bureaus sell your personal information? It’s true! Known as “trigger leads”, the files of borrowers applying for a home loan are immediately flagged, packaged, and sold by the credit bureaus to the highest bidders.

For $25 to $100, your name and certain specifics about your credit report, including your address, phone number, mortgage history, and even your FICO score range, are sold to mortgage companies which then blindly solicit your business. This results in numerous unwanted phone calls and junk mail offers which are in no way associated with your real estate agent or loan professional.

Unfortunately, no legislation presently exists to prevent the credit bureaus from profiting at your expense. As a trigger lead, you are simply at the mercy of any number of too-good-to-be-true offers designed specifically to try and discredit the mortgage professionals you know and trust.

Don’t be fooled! Ultimately, there are only a limited number of sources where lenders may turn to obtain mortgage money, and it’s unlikely that you will find an unbelievably low rate without an unbelievably high cost. That’s why, prior to taking an application for any loan program, I always encourage my clients to opt−out of credit bureau solicitations by visiting www.optoutprescreen.com. For new home buyers, this is the simplest way to avoid the problem altogether.

As you embark on what could be the largest financial transaction of your life, it is very important to have a professional mortgage specialist on your team who has your best interests at heart.

Please call me with any questions.

Filed under: Credit, Mortgage, Real Estate | Leave a Comment »

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