Choosing the Cheap Appraiser is Out

Well, there is good news for homeowners in terms of appraisers and no it’s not that appraisals are no longer required! Appraisals will always be required to determine fair market value, but now lenders are required to pay appraisal fees. The reason for this is good; it keeps lenders from using appraisers that aren’t up to par, and it keeps the borrower out of the mix on choosing their own appraiser and paying for it. Even though it might seem that the appraiser would work in favor of the lender, they simply can’t blow out values, and that’s just what we need. 

Why Lenders Have to Pay Appraisers 

Lenders making payment to appraiser’s means that they are now going to look at things more closely when they evaluate the creditworthiness of a borrower. This means that the bank is less likely to handle a borrower’s loan in a non-chalant way. This is probably what should have happened a long time ago, but it used to be that it was viewed in the interest of the lender being able to blow out a loan. There are plenty of things that are not so great, that we can take and use for good; this is one of those things.

First Time Homebuyer Purchases are Best Done FHA

The best way to go when buying a home for the first time is FHA.  FHA purchases are great for many families because they provide low down payments of 3.5%, and up to 6% in seller concessions.  This can work out great for a lot of reasons.  Low down payment is one reason, and the keeping your overall mortgage payments low is another. Those who wish to take advantage of this option need a credit score of a 640 or higher, and those with a lower score may need to put down more but are still considered. 

FHA is also good when you are worried about getting qualified for a new loan.  FHA does not guarantee loans based on all credit, but they do look at your current pay histories.  Paying more than 30 days late on debts isn’t favorable, and those who have failed to re-establish credit after a bankruptcy are frowned upon.  They want to help, but with any good thing there are limitations.  These are simply guidelines and with a little help you can improve your financial picture for the better. 

-Mayer Dallal

www.fhaloansnow.net

The Dilemma for the CEO of Freddie Mac

With talk of shutting down Freddie Mac, there is a lot of pressure on their employees. The CEO has a lot on his plate, and that is not a position that I would want to be in. With 6,000 employees that is a lot of job loss, and the feeling that it gives Americans is one of uneasiness. Why? Because Freddie Mac has been blamed as a big cause of default in the mortgage industry. CEO, Charles Haldeman Jr. says that the true default rate of those mortgages funded by Freddie Mac is only 3.8%, which pales in comparison to the larger numbers flashed out there in the industry. 

Has Freddie Mac Been Profitable? 

Haldeman says that Freddie Mac was profitable in the third quarter, but it did play dividends on the money that it received from the government. This is referring to the bailout money which sent torrents of opinions and critical statements among Americans. So, while there is talk about shutting Freddie Mac down, it goes about its business each day, and everyone waits with anxiety about what is going to happen to their jobs. As always, I am still looking for the positive in all of this. 

For more information on how to get your FHA loan today, you can go to my website at www.fhaloansnow.net, or you can call me at 310-498-2700.

-Mayer Dallal

Recent Drop in FHA Applications

While it was expected that mortgage applications would fall due to an increase in the FHA premiums, it wasn’t expected to drop nearly 30%. This is why I had urged many to get their applications in for their purchase loans rather than waiting. Anytime that you know that it is going to cost you more in the future, you need to make it a point to get busy and move on. It’s important that you heed to your experts that provide you with knowledge, but it is only in your best interest; of course that is if you are ready to do so. 

What’s Next for FHA? 

While the insurance premiums increased, there aren’t any other changes right now which is good. Any changes that would occur I would believe to be for the better, but I can’t predict the future. I can say that an increase was expected in premiums due to the economy, but it could have been worse. I would urge anyone who is on the fence regarding buying a home to get moving before there are any more changes. Rates are going to go up, so I am telling you now to make decisions and get moving. Why pay more than you have to? Don't wait another minute, go to www.fhaloansnow.net to apply for your FHA loan today! 

-Mayer Dallal

What the FHFA Has to Say Now About Housing Prices

Those of you who are not familiar with the FHFA should know that they are not the same as FHA. FHFA stands for Federal Housing Finance Agency, which is close but somewhat different. This agency reports on timely information as it relates to the housing market, and recently released some interesting information. Their most recent observation is that home prices are down 18.6% since April of 2007. This isn’t great news, but it would be untruthful to say that it wasn’t expected. 

What is Next Regarding Housing Prices? 

Housing prices have been on an interesting trend, from good to bad, and then even worse. I won’t tell you that it has all been halos and good times because that just isn’t the truth. The truth is also that we can something bad and make it turn out for the better. There are plenty of homes in inventory that can be purchased when people find the right professionals. I am a professional, and my goal is to get you into a home and have a piece of the American dream. Investors are buying and rehabbing homes, and the market is primed for first time homebuyers, or those that have been renting for years on end.

Mortgage Applications Drop

Mortgage applications did in fact drop again, by 6.7% from the previous week. The refinance index also decreased by more than 7 %, shaking things up a bit and changing our market for a moment. Why does this happen? It could be any number of reasons really. It could be the increase in unemployment, or it could just be that the American people weren’t feeling so confident since the end of February. The challenge with the unemployment number is that it changes when people stop receiving their benefits.


The Change in the Purchase Index

The purchase index dropped nearly 5% just from week to week, but compared to last year it dropped more than 11%. This is no time for people to be afraid to buy, and I will encourage them to buy, especially right now. There isn’t a reason not to buy, and the market is prime for it. Prices are low, rates are still low, and people should jump at the chance before this all changes. Inflation is on the rise, and once it really gets moving, don’t expect it slow down. If you have income, a credit score of 640 or better, and some assets, let’s talk.

-Mayer Dallal

Who Owns Your Loan?

This question has been burning on the ears of many borrowers for years, especially since the time of mortgage backed securities became the way to keep money turning over. These mortgage backed securities have caused many problems for homeowners and are still a growing problem. The problem? These mortgages were transferred so many times, that as foreclosures are being filed the banks discovered that they cannot find the original paperwork.


So, who is to blame for this problem? Many fingers are being pointed at those on Wall Street with absolute disgust for the simple fact that in all the business to make money and turn over profit, paperwork was pushed to the side. No matter what, this paperwork is important and those on Wall Street should treat it that way. The bigger problem is now that these banks relented to forgery, signing these papers now that nothing can be found.

When the chain of title has been lost this can cause problems for the homeowner and banks better figure it out quickly. Not producing the proper paper trail is a problem for those who are self-employed as far as taxes are concerned, but licensing is too. Not to mention that in general, wouldn’t it be smart to keep track of your documentation for everything; just in case?

-Mayer Dallal

New Mortgage Qualifiers Limit Borrowers

While I was hoping for some sort of reform in the way that loans were being done, I wasn’t expecting what we are getting now. The regulators were trying to find a way to tame down the losses going forward on residential mortgages, and of course now we are wondering where their thoughts are headed. I want to see borrowers make more of an investment in the home upfront, but I am not so sure they came up with a good answer.


Qualified Residential Mortgages

The new terms for a qualified residential mortgage are 20% down for a home purchase, but the surprise is in the rest of the terms too that aren’t much better. Borrowers will need to put down 25% of if they are going to refinance the mortgage and 30% if they wish to do cash out refinance. The only loans that won’t be affected by these changes are FHA loans and any other federally funded loans. As you know, I am an FHA specialist so I am pro the FHA loan programs. The FHA programs are structured differently to begin with, and while they offer low down payments to first time homebuyers, they also are designed to keep the borrowers in the home; not on the streets. I am all for reform, but there is such a thing as being so strict that we close off the opportunity to bounce back.

-Mayer Dallal