FHA Appraisers Baton Rouge|FHA Appraisers West Baton Rouge|FHA Appraisers Livingston Parish|FHA Appraisers Ascension Parish

Baton Rouge FHA Home Appraisers: Can “Silent Seconds” Help FHA Borrowers With Tiny or Nothing Down?

http://fhaappraiserbatonrouge.info — Wed, 05 Nov 2008 11:20:39 +0000

http://fhaappraiserbatonrouge.info/ - Baton Rouge FHA Appraisers: Can “Silent Seconds” Help FHA Borrowers With Little or Nothing Down?

Source: Peter G. Miller FHA Mortgage Guide Site

I ran across this interesting FHA Financing article, which might be able to be applied to the East Baton Rouge Parish Housing Market.

“With downpayment assistance programs (DPAs) now banned from use with FHA mortgages the question arises as to whether there is any replacement for such help.

One idea which has been suggested is the use of a silent second. In basic terms, the borrower gets a loan for some or all of the down payment. There is no monthly cost for the loan, instead the loan is forgiven if the borrower stays in the property for seven years. Also, if half the second is paid back within 18 months the other half is forgiven.

So far, the only example I have found for such financing is offered as an ITMO or Indian Tribe Mortgage.

The concept, though, is interesting, and could have wider appeal if it passes muster with HUD.

Imagine that an owner cannot market a property. Since seller down payment assistance is banned, the seller gives an amount equal to 3.5 percent of the sale price plus a service fee, say $500, to a non-profit group. The group then loans the money to a borrower with the seven-year and 18-month forgiveness features. If the forgiveness benchmarks are not met the borrower pays 3 percent interest per year.

The real attraction of this program is that if the borrowers save and stay they win because they reduce or eliminate their debt. In a world where too many households have too much debt, savings should be encouraged and so should programs which reduce the inventory of unsold homes.

The original news release is below.

SACRAMENTO, Calif.–(BUSINESS WIRE)–In response to former Federal Reserve Chairman Alan Greenspan’s call today for housing stabilization, AmeriDream president Ann Ashburn cited the need to resurrect down payment assistance programs eliminated by Congress October 1st of this year. Don F. Harris, who created the original seller-funded down payment assistance model on which AmeriDream and others are based, disagrees.

Harris, who revolutionized FHA mortgage financing and caused Realtor Magazine to recognize him as one of the “25 Most Influential People in Real Estate” in 2003, says don’t resurrect the old model, but instead use an alternative solution.

Known as ITMO, Indian Tribe Mortgage is a program offered by the Lower Brule Sioux Indian Tribe of central South Dakota. Unlike the banned seller-funded down payment assistance programs banned by the Housing Recovery Act earlier this month, ITMO is a second mortgage program offered by a government entity, a native American Indian Tribe, and complies with existing regulations.

“ITMO addresses the concerns that resulted in the elimination of seller-funded down payment programs, namely inflated sales prices and poor loan performance,” said ITMO founder Don F. Harris.

“I had hoped that a regulatory framework could have been enacted to preserve it. The elimination of seller-funded down payments necessitated a new solution, though. Simply stated, ITMO is that solution.”

“The Tribe is excited about bringing this product to the nation,” said Shawn LaRoche, a member of the Lower Brule Sioux Tribal Council. “This is an incredible economic development opportunity for the Tribe and a chance to redress historic inequities by creating an unprecedented partnership opportunity. We are grateful to be part of a critical mortgage solution during these challenging financial times.”

ITMO is the bridge between down payment and closing for some homebuyers. The assistance program provides a silent second loan that requires no monthly or amortized payments. The principal amount, plus interest accruing at an annual rate of 3%, becomes due upon sale, refinance or transfer. The loan is forgiven if none of these events occur within the first seven years of ownership. In addition, if 50% of the ITMO loan is repaid within 18 months from the purchase date, then the remaining 50% of the ITMO loan is forgiven.

“ITMO is the financing tool that enables the borrowers, realtors, mortgage brokers, lenders and secondary investors to bridge the gap, solidify transactions, and support the delivery long term performance,” said Sue Frost, President of Alliance Mortgage and Marketing in Sacramento, California, who has already processed a number of ITMO loan applications. “ITMO pinpoints what is needed at all levels of the playing field during this time in our US and world economy,” she said.

The market has adjusted such that those who cannot afford rent can afford a mortgage, but have traditionally had difficulty getting over the hurdle of that initial down payment. “There are a lot of loan programs out there to help with that down payment, but the buyer typically must fit within specific qualifiers,” said Jon Nastro, a Broker Associate with Keller Williams Realty. “Often times it’s a difficult match. ITMO doesn’t have these limitations. It reaches low-to-moderate income buyers and, unlike many loan-assistance programs, applicants do not need to be first-time buyers. That’s really where ITMO comes into play.”

To learn more about ITMO please visit www.itmo.com. “

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Baton Rouge FHA Appraiser News: HPI Says La Gained 2.68% And Is Ranked #13

http://fhaappraiserbatonrouge.info — Wed, 05 Nov 2008 11:01:09 +0000

http://www.fhaappraiserbatonrouge.info/- - FHA Baton Rouge Appraisers: Fed. Government’s Housing Price Index Shows Louisiana Gained 2.68% And Is Ranked #13

Source: http://www.ofheo.gov/newsroom.aspx

The current statistics offered by the Office of Federal Housing Enterprise Oversight (OFHEO) shows that in the most recent 1 year period ended June 30, 2008, Louisiana showed a gain in home values of +2.68%. The chart also shows that Louisiana is ranked 13th in the U.S. for home price appreciation. This is very good news when in the same time period, much of the U.S. housing market has suffered declines.

Louisiana Housing Price Index Through June 30, 2008 Showing +2.68% Gain

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Awesome Baton Rouge Real Estate News: Louisiana 1 of 6 States To Receive Positive Comments From Moody’s Investor Services

http://fhaappraiserbatonrouge.info — Sat, 01 Nov 2008 11:36:58 +0000

http://batonrougerealestateappraisers.com/ - Awesome Baton Rouge Real Estate News: Louisiana 1 of 6 States To Receive Positive Comments From Moody’s Investor Services

Source: Baton Rouge Business Report Daily

On October 29, 2008, The Baton Rouge Business Report Daily News Email Publishes This Awesome News:

“Louisiana is one of only six states faring the best during the current economic crisis, reports Moody’s Investor Services, a provider of independent credit ratings, research and financial information to the capital markets. States with abundant natural resources, that aren’t dependent on the financial services industry and didn’t have home prices escalate wildly are expected to hold up the best. Also in the same category are Alaska, Colorado, New Mexico, Texas and Wyoming. Moody’s gave negative credit outlooks to six states: Florida, Kentucky, Nevada, Ohio, Rhode Island and Wisconsin.”

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Bill Cobb Provides FHA Qualified Appraisals in East Baton Rouge, West Baton Rouge, Livingston & Ascension Counties

http://fhaappraiserbatonrouge.info — Fri, 10 Oct 2008 23:37:34 +0000

http://batonrougerealestateappraisers.com/ - Bill Cobb Provides FHA Qualified Appraisals in East Baton Rouge, West Baton Rouge, Livingston & Ascension Counties

Bill Cobb, CREA
P.O. Box 40515, Baton Rouge, LA 70835
225-293-1500 (Office)
1-888-678-3544 (Toll-Free Phone)
1-866-663-6065 (Toll-Free Fax)
225-953-0638 (Mobile)
http://www.getfastvalue.com (Website)
fastvalue2@cox.net (Email)

Accurate Valuations Group Appraiser, William D. Cobb, has operated as a home appraiser for 16 years now primarily in the Greater Baton Rouge, Louisiana market. For more information on Accurate Valuations Home Appraisal Group

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Baton Rouge FHA Loan Requirements - Baton Rouge FHA Appraisals

http://fhaappraiserbatonrouge.info — Wed, 08 Oct 2008 01:49:16 +0000

http://fhaappraiserbatonrouge.info/ - Baton Rouge FHA Loan Requirements

Source: Maria Mbura

If you are planning on buying a home, then it is to your benefit to look at what FHA offers and what are the FHA loan requirements. Many people in America have benefited by owning their own homes thanks to FHA home loans. They have been instrumental in providing housing especially for middle income and low income families and the elderly.

First of all what is FHA? The Federal Housing Authority (FHA) is a government agency created to provide insurance protection to lenders who provide mortgages to homeowners. Their insurance helps individuals who might not meet the mainstream lenders loan requirements, qualify for a home loan. FHA is designed mostly for first time buyer home loans.

The basic requirements are:

You must have a valid Social Security Number (SSN)

You must be a legal resident of the USA

Must be of legal age to sign the mortgage in your state.

To qualify for this type of loan you will need to fulfill the following FHA loan requirements before you can be considered:

Credit History

Unlike the traditional lenders, under FHA loan the lenders can build a credit history based on utility payments, rental payments, auto insurance payments, and other payments that don’t appear in credit files.

The bottom line is that you may be able to buy your home with a low credit score which currently stands at 580.

They expect you to have at least a good history of timely payments within the last two years and have no arrears in your payments. You will not qualify for a FHA loan if you are in default on your student loan.

Income

The loan amount will depend on your income and the ability to make the installments.

They require that your mortgage, property tax and insurance should not exceed 31% of your monthly income with your total debt payments not exceeding 43%. They are very observant of the ratio of your income and monthly expenses.

Deposit

You will require a minimum of 3% cash on hand for the deposit and closing costs.

Collateral

Your home which will be the collateral should be valued at least 3% more than the loan amount. FHA loan requirements are more generous than conventional loans however you must meet their criteria to qualify for a home loan.

It is important to take note that all lenders are not necessarily FHA approved. They have to be approved to offer the FHA option.

As you interview prospecting lenders ask if they are FHA approved before you start negotiating and discussing the FHA loan requirements.

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FHA Baton Rouge HOPE Relief: HUD Launches HOPE For Baton Rouge Homeowners Mortgage Program

http://fhaappraiserbatonrouge.info — Tue, 07 Oct 2008 03:48:50 +0000

http://fhaappraiserbatonrouge.info/ - Baton Rouge FHA HOPE Relief: HUD Launches HOPE For Baton Rouge Homeowners Mortgage Program

Source: FHA Mortgage Guide/Peter G. Miller

HUD has released the general standards for the newly-minted “Hope for Homeowners” program created under the FHA reform bill passed by Congress during the summer.

For those with an interest in FHA mortgages — and for those who now have toxic loans — the program has great potential, enough funding to underwrite 400,000 borrowers.

That’s the good news. The bad news is this: To participate in the program your lender must be willing to write off part of the loan and pay money to Uncle Sam. You can pretty much guess that a lot of lenders will not be thrilled with this notion, especially holders of second liens who are likely to lose much or all of their investment.

The HUD announcement somehow fails to mention that the Bush Administration threatened to veto the bill or that the measure was passed on a bipartisan basis.

The full HUD announcement is below:

WASHINGTON — The Bush Administration today unveiled additional mortgage assistance for homeowners at risk of foreclosure. The HOPE for Homeowners Program will refinance mortgages for borrowers who are having difficulty making their payments, but can afford a new loan insured by HUD’s Federal Housing Administration (FHA).

“For families struggling to keep up with their mortgage payments, this program will be another resource to refinance into a loan they can afford,” said HUD Secretary Steve Preston. “FHA remains a safe and affordable alternative to the high-priced mortgage loans that threaten homeowners’ ability to retain their homes. We strongly encourage borrowers to work with their lenders to determine if HOPE for Homeowners is the right program for them.”

The HOPE for Homeowners program was authorized by the Economic and Housing Recovery Act of 2008. Since the President signed this vital legislation into law on July 30, 2008, the HOPE for Homeowners Board of Directors has worked diligently to develop and implement the program as directed by Congress. The Board was charged with establishing underwriting standards to ensure borrowers, after any write-down in principal, have a reasonable ability to repay their new FHA-insured mortgage.

The HOPE for Homeowners program begins today and ends September 30, 2011. The program is available only to owner occupants and will offer 30-year fixed rate mortgages - so the borrower’s last payment will be the same as the first payment. In many cases, to avoid what would be an even costlier foreclosure, banks will have to write down the existing mortgage to 90 percent of the new appraised value of the home.

Borrower Eligibility

Borrowers are encouraged to contact their lender to determine eligibility, but may be eligible if, among other factors:

___The home is their primary residence, and they have no ownership interest in any other residential property, such as second homes.

___Their existing mortgage was originated on or before January 1, 2008, and they have made at least six payments.

___They are not able to pay their existing mortgage without help.

___As of March 2008, their total monthly mortgage payments due were more than 31 percent of their gross monthly income.

___They certify they have not been convicted of fraud in the past 10 years, intentionally defaulted on debts, and did not knowingly or willingly provide material false information to obtain their existing mortgage(s).

How the HOPE for Homeowners program works

“HOPE for Homeowners will add to HUD’s existing efforts to make FHA refinancing available to homeowners who need it most,” said FHA Commissioner Brian D. Montgomery. “One year ago, FHA expanded refinancing into its FHASecure program. Since that time, we have helped more than 360,000 families keep their homes by refinancing with FHA, and we will assist a total of 500,000 families by the end of this year.”

The Board expects that the primary way homeowners will participate in the program is by working with their current lender. HOPE for Homeowners will serve as another loss mitigation tool available to distressed borrowers.

HOPE for Homeowners also includes the following provisions:

___The loan amount may not exceed a maximum of $550,440.

___The new mortgage will be no more than 90 percent of the new appraised value including any financed Upfront Mortgage Insurance Premium.

___The Upfront Mortgage Insurance Premium is 3 percent and the Annual Mortgage Insurance Premium is 1.5 percent.

___The holders of existing mortgage liens must waive all prepayment penalties and late payment fees.

___The existing first mortgage must accept the proceeds of the HOPE for Homeowners loan as full settlement of all outstanding indebtedness.

___Existing subordinate lenders must release their outstanding mortgage liens.

Standard FHA policy regarding closing costs applies, and they may be:

___Financed into the new loan provided the value of the mortgage (including the Upfront Mortgage Insurance Premium) does not exceed 90 percent of the new appraised value of the home.

___Paid from the borrowers’ own assets.

___Paid by the servicing lender or third party (e.g., federal, state, or local program).

___Paid by the originating lender through premium pricing.

___The borrower must agree to share with FHA both the equity created at the beginning of this new mortgage and any future appreciation in the value of the home.

___The borrower cannot take out a second mortgage for the first five years of the loan, except under certain circumstances for emergency repairs.

The lender will disclose to the homeowner the benefits of the program including home retention, a new affordable mortgage based on the current appraised value, and 10 percent equity. The lender will also explain the prohibition against new junior liens against the property unless directly related to property maintenance, and a minimum of 50 percent equity and appreciation sharing with the Federal government.

The costs to the homeowner include the upfront and annual insurance premiums, as well as a share of the equity created by the write-down associated with the HOPE for Homeowners mortgage and any future appreciation in the value of the home. At settlement, subordinate lien holders will receive a certificate that evidences their interest as an obligation backed by HUD, with payment conditional on the value of HUD’s appreciation share.

If the home is sold or refinanced, the homeowner will share the equity with FHA on a sliding scale ranging from a 100 percent FHA share after the first year to a minimum of 50 percent after five years. The lien holder that previously held the highest priority will receive payment up to a proportion of its original interest, not to exceed the amount of available appreciation. This type of delayed payoff will take place until all prior lien holders are satisfied or the amount of available appreciation is exhausted. All remaining appreciation is remitted to FHA.

The HOPE for Homeowners Board of Directors includes HUD Secretary Steve Preston, Treasury Secretary Henry Paulson, Federal Reserve Board Chairman Ben Bernanke, and FDIC Chairman Sheila Bair. They have named the following people to serve on the board as their designees: FHA Commissioner and Chairman of the Board Brian Montgomery, Federal Reserve Board Governor Elizabeth Duke, Treasury Assistant Secretary for Economic Policy Phillip Swagel, and Federal Deposit Insurance Corporation Director Tom Curry.

Read more about HOPE for Homeowners at HUD’s website.

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Baton Rouge FHA Reverse Mortgage: FHA Sets National Loan Limit for Reverse Mortgage Program at $417,000

http://fhaappraiserbatonrouge.info — Tue, 07 Oct 2008 03:34:48 +0000

http://fhaappraiserbatonrouge.info/ - Baton Rouge FHA Reverse Mortgage: FHA Sets National Loan Limit for Reverse Mortgage Program at $417,000

Source: FHA Mortgage Guide

If you are 62 or older and have been considering a reverse mortgage, the FHA and HUD just approved a new national limit of $417,000 for HECMs. The new limit is not set in stone yet as there are no set deadlines yet; but their target effective date is November 1^st. There was some debate over this increase, and some interpretations of HR 3221 led some to argue that the limit could have been increased up to $625,000. However, after much debate, the final decision was a national limit set at $417,000.

Want to know more about Reverse Mortgages and the FHA HECM Program? Check out our Introduction to FHA Reverse Mortgages.

Previously, the HECM program limits ranged from $200,160 to $362,790 depending on your specific county. This increase has been a welcomed changed that many have been longing for, since FHA has been a bit slow in terms of keeping up with increasing home values. The higher lending limit for these reverse mortgages are especially helpful as seniors are assured they can rely on more of their homes value. Especially during this tough economic downturn, this increase will help to provide a stronger cushion as many seniors find less stability in their retirement portfolios.

A reverse mortgage is unique loan that gives seniors an ability to tap into their home equity without having to take on new mortgage payments or selling their home. Typically, borrowers can receive these funds in one lump sum payment or through graduated monthly payments. The key element of a reverse mortgage when compared to traditional mortgages is that no payments are made during the life of the loan. Many seniors will turn to reverse mortgages to help with day to day living expenses, medical and health costs, and general supplemental retirement income.

I’ve compiled some links to helpful resources offered by HUD and FHA:

HUD - Reverse Mortgage For Seniors

HUD - Reverse Mortgage and HECM Counseling

AARP - Reverse Mortgage Calculator

For more information, FHA Loan Pros offers an easy to understand basic background of FHA Reverse Mortgages and the HECM program. Click Here to jump to that page.

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Baton Rouge Real Estate: Bad News For Efforts To Save Down Payment Assistance?

http://fhaappraiserbatonrouge.info — Mon, 22 Sep 2008 14:47:30 +0000

http://fhaappraiserbatonrouge.info/ - Baton Rouge Real Estate: Bad News For Efforts To Save Down Payment Assistance?

Source: FHA Loan Advice.com

Word on the street is that the near collapse of the capital markets on Wednesday, and the proposals put forth today in order to bail out Wall Street have quickly shifted HR 6694, the bill reinstating the use of seller paid down payment assistance programs with FHA mortgages, onto a very cold back burner! It now appears very unlikely that the bill will have any chance of being passed soon. What a roller coaster.

Check back for more details later.

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Baton Rouge FHA New Downpayment Guidelines For FHA Loans Announced

http://fhaappraiserbatonrouge.info — Fri, 12 Sep 2008 09:13:26 +0000

http://eastbatonrougefhaappraisers.com/ - Baton Rouge FHA New Downpayment Guidelines For FHA Loans Announced

HUD’s new mortgagee letter (ML) clarifies the new down payment requirements pursuant to the July Housing Bill. All minimum downpayment calcs are now the same, regardless of state. The new maximum FHA loan amount will be 96.5% of the purchase price or appraisal whichever is less. This means our buyers will have to come in with more cash.

The upfront private mortgage insurance can be financed above that but in no cases can the loan exceed 100% of value. This will be effective on case numbers pulled 01/01/09 or after. No rounding is required for your loan amount and 6% seller contributions will still be allowed. Gone are the days of 2.25% down and .75% in allowable costs. For specialty loans like the 203(K) rehab loan and EEM’s (energy efficient mortgages), the guidelines stay the same. EEM’s will have different requirements. That info will be coming out in a subsequent ML, but look for something like energy efficient improvements are added dollar for dollar to the loan amount regardless of loan to value.

When doing a refinance watch out for the 100% maximums. They will apply even to FHASecure and even after applying financed private mortgage insurance your loan to value cannot exceed 100%.

There are more details, such as using government issued “soft” or “hard” seconds to exceed the 100% threshold. For more information review the ML here.

Source: Gerry Suarez, Jr.

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Baton Rouge FHA Down Payment Assistance: Deal Made To Save Down Payment Assistance?

http://fhaappraiserbatonrouge.info — Wed, 10 Sep 2008 23:06:56 +0000

http://fhaappraiserbatonrouge.info/ - Baton Rouge FHA Down Payment Assistance: Deal Made To Save Down Payment Assistance?

Source: Carl Pruitt

It appears that a deal has been made to save FHA down payment assistance programs with seller participation. I have always said we should fight not to throw out the baby with the bath water when it comes to these programs. All we need to do in order to lower the foreclosure claim rates on loans with seller participating down payment assistance is to enforce the rest of the FHA underwriting guidelines.

In an age when Federal Reserve monetary policies specifically penalize people who save money, we can at the very least make sure that potential home buyers who can show the ability to make the payments still have a chance to buy a home.

You can find more details on the deal struck between Barney Frank and HUD in Brian Brady’s post today on Bloodhound Blog.

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FHA Appraisers Baton Rouge|FHA Appraisers West Baton Rouge|FHA Appraisers Livingston Parish|FHA Appraisers Ascension Parish

Baton Rouge FHA Home Appraisers: Can “Silent Seconds” Help FHA Borrowers With Tiny or Nothing Down?

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