To all our friends, neighbors, family and clients – we are so proud to have been able to work with you and be a part of your lives! As we end this year and turn our focus to 2013, we just wanted to take a moment to thank you for all that you bring to our lives.
We have some exciting plans in the coming year and hope to bring more success to all your real estate endeavors. With each transaction that makes it to the closing table in the coming months and years ahead – we know that new and exciting things will continue to follow for all of us.
On behalf of the entire group – Happy Holidays, Season’s Greetings, Peace and Joy!
Prior to the Presidential election many homeowners and homebuyers had been waiting to see what would happen to the housing industry depending on the outcome. Now that the dust has settled, we can rest assured that nothing drastic can be expected at least for now.
Interest rates continue to be at all-time industry lows. This is happening because the Fed has kept the base rate at or near zero expected until mid-2015. While we do not anticipate much change during at least the next 12 months or so, that does not mean that rates will stay so low. In fact, as economists will tell you, as banks continue to pump more money into the economy and consumers keep exhibiting stronger confidence through mortgages and other major purchases, rates will begin to climb again.
What does this mean to you as a buyer? It means that if you see a home that you want to buy, now might be the best time to purchase it. When you combine the low home prices with the phenomenal options out there for financing, it’s a clear win-win situation for all parties involved.
Sellers are enjoying the influx of buyers that are coming out of the woodwork with pent up demand also as a result of waiting around for the election to be over. So if you have been on the fence about buying or selling, this is the time to jump off.
As always, we are right here waiting for you, looking forward to helping make your real estate dreams become a reality!
With the past several years of rocky news across the country, it’s finally a pleasure to be reporting some good news. For the first time in quite some time there is widespread improvement in many local real estate markets. The Wall Street Journal recently reported that up to 20 major metropolitan areas across the United States are enjoying increased home prices and a rise in home sales. At long last we can finally see the bottom starting to come back up.
What does mean to consumers?
Strong Buying Market Ahead
Well, for starters these improvements have the most impact on sellers. Those homeowners that have been on the fence for some time now can finally consider jumping off that fence and list their home for sale. The coming fall season going to be a strong buying market as the fall usually is – but things are going to be even better given the upcoming presidential election. As is usually the case, an economic upswing typically comes to be expected during an election year, particularly leading up to the big day.
Inventory Dwindles, Demand Continues to Rise
One of the greatest factors in our changing market is the shift in inventory patterns throughout the country. We are reporting inventory levels consistently dwindling, leading to increased demand as there are fewer homes to choose from. Furthermore, as foreclosures and other distressed sales come off the market, traditional home sales are once again more prevalent in many markets. This is yet another factor that helps increase home prices.
Market Conditions Are Ripe for Buyers and Sellers
Right now, we are seeing the best of both worlds, a rare occurrence in our real estate industry. Sellers are able to receive multiple offers, sometimes ensuing in bidding wars that end up in their getting top dollar for their home. Not only that, homes are not staying on the market for very long. Meanwhile, home prices are still affordable and combined with record setting low interest rates, buyers are eager to lock in low rates.
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If all this makes you want to go ahead and jump off that fence, consider buying or selling and learn more about what mortgage options are out there – contact us today. There are many new programs right now designed to propel the housing market in an even better direction. And everyone knows that when the housing market thrives – so does our economy!
If you are looking for a new construction home in the state of Pennsylvania, then we have some great news for you! On July 16th, the PHFA (Pennsylvania Housing Finance Agency) unveiled a new program which allows for a $6,000 closing-cost assistance. This incentive is just another factor in the make-up of one of the greatest housing markets in decades, in addition to low interest rates and high inventory.
What is this closing-cost credit?
This $6,000 closing-cost assistance is a loan. Amortized over ten years at whatever the new construction loan rate is, which, as of August 1st, is 4.25%. This new incentive follows the same guidelines of any other PHFA new construction loan and is tailored specifically for new construction homes in the state of Pennsylvania.
Why is this closing-cost credit “great news”?
The new $6,000 closing-cost credit is 50% higher than the standard $4,000 closing cost assistance loan offered by the PHFA for buyers of existing homes. The additional closing cost assistance funds will not only ease the financial strain of consumers, but is expected to stimulate the state’s housing industry as well.
In addition to this newest program created by the PHFA, there are many other incentives offered by the Agency. So, if you are looking to buy a new construction home in the Keystone State, or any other property, make sure to contact me to see which incentives will best suit you!
Are you looking for a new home but having a difficult time coming up with a sizable down payment? Have you been faced with a financial hardship forcing you into a refinance situation? Are the current interest rates making you wish you could enjoy the same historic low rates as countless others?
For Pennsylvania residents, there is a new offering provided by the Pennsylvania Housing Finance Agency that is designed to help people in these situations and more. Working in conjunction with Fannie Mae, the PHFA has set up a program that would allow buyers to purchase a home either without any Private Insurance or at a lower monthly payment depending on the situation.
Mortgage Loan Risks Shared Jointly by Fannie Mae and PHFA
The program, announced in late April of this year, will allow consumers to reduce the financial burdens of paying for private mortgage insurance since Fannie Mae and PHFA will be bearing the risks associated with low down payment mortgages. Both agencies have partnered after signing off on an agreement that eliminates PMI entirely from borrowers’ responsibility. They will conduct an evaluation process for each application to ensure good lending decisions are made.
Lower Monthly Payments for Some Customers
The second product offered in this program will be given to customers that will be required to pay PMI each month. The benefit will be in the form of lower monthly payments, reducing financial stress on families looking to tap into today’s historic low interest rates.
Same Low Down Payment as Traditional FHA Loans
Borrowers will be required to pay only 3% down of which some or all of the down payment can be in the form of gifts from family member or the additional PHFA Access Down Payment and Closing Cost Assistance Loan. When combined with no PMI or lower monthly payments this eases the burden significantly for many families and homeowners. The products are ideal for those people that cannot afford large down payments that are typical for a home purchase and it works well for people with little to no equity in their homes when refinancing.
Advantages of the PHFA Program
•Up to 97 percent of home’s value can be financed
•Non first-time buyers also qualify for the program
•Down payment and closing cost assistance available for both products
•Existing homeowners seeking refinancing may also qualify
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This factsheet provides a bird’s eye view of the new products. For more information about this or other loans that may be right for you, visit our website where we share a host of tools, resources and information that will help guide you to the right decision for you. We are also available on Facebook. We look forward to hearing from you if you have any questions of if you would like to learn how you can tap into these fantastic programs.
I'm excited to announce that PHFA has released two brand-new conventional loan programs that will help many buyers and sellers who want to purchase or refinance around our area. As you know, PHFA stands for Pennsylvania Housing Finance Agency. The new programs are the HFA Preferred and HFA Preferred Risk Sharing.
These programs are absolutely fantastic because it allows new homebuyers to only put 3% down and with lower or no mortgage insurance. Another great aspect of these loan options is that it can be used for either purchasing a home or refinancing an existing mortgage. Before, the Pennsylvania Housing Finance Agency didn't have any offerings for refinances. Now, their new loan programs will allow existing homeowners who may not have much equity to still be able to refinance their homes. Specifically, PHFA will allow homeowners to do a rate and term refinance up to a loan-to-value of 97%, e.g. for an appraisal value of $200,000, you can refinance up to $194,000.
Of course, there are a few limitations such as following the PFHA income limitations. Throughout Philadelphia, Montgomery, Delaware, Bucks, and Chester counties the maximum allowable income is $97,800. Keep in mind that the programs only apply to one-unit primary residences – no duplexes or investment properties. The interest rates are slightly higher than regular FHA or conventional loans, but as the chart in the video points out, the total monthly mortgage payment would still be notably lower in most cases.
PHFA announced the release of the new programs this past Friday, April 27th. These two new mortgage programs give prospective homebuyers and current homeowners alike more affordable opportunities to save money whether purchasing your first home or refinancing your forever home.
Make sure to contact me with any questions you have about your real estate financing needs. I am always happy to answer your questions or even run numbers for you to make sure that you have the right kind of financing for your needs.
There is exciting news in the mortgage and housing industry and I couldn’t wait to share it with you! Effective June 11, 2012 all FHA mortgages that were originated prior to June 1, 2009 will be eligible to apply for a FHA streamline refinance with new, low mortgage insurance rates. This comes at a time when mortgage insurance rates have witnessed a hike for newer applications and is welcome relief for the millions of Americans facing underwater properties if they continue to experience financial difficulties.
The changes will make it possible for millions of people to break free from the difficult situations they might be in by reducing monthly mortgage payments as a result of refinancing that will ensue with lower mortgage insurance premiums.
Lower One-Time and Monthly Mortgage Insurance Premiums
Homeowners that fall into this category of eligible mortgage holders will enjoy a reduced one-time mortgage insurance cost. As per the changes, streamline refinance applicants will pay 0.1% of the loan amount in mortgage insurance – an almost insignificant amount. Monthly premiums will be reduced to approximately half the current rate – with the new amount being 0.55%.
No Income, Asset or Employment Verifications
The most popular aspect of this program is that there will be no need for homeowners to endure the long and sometimes grueling process of income, asset and employment verification. Not only will this be comforting for those already facing financial difficulty as a result of things like job loss, but it will also speed the process up for applicants.
Appraisal Not Required for FHA Streamline Refinance
The program also allows a refinance without any appraisal on the home – again, making it a simpler and easier thing to go through for homeowners. This comes as welcome relief to them at a time when often their homes that have seen a significant reduction in value over the past several years.
Faster Application Processing Lead Times
Since very little extra verification and processing are needed on these applications, the FHA streamline refinance process is far quicker and more efficient than standard loan applications – allowing homeowners to focus on more important things rather than worrying about their refinance application.
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The single biggest exciting factor with these changes is that the people that at one time were unable to apply for a refinance because of increased mortgage insurance premiums, will now be able to avail the opportunities that are out there. They will not only be able to obtain a refinance at a lower cost initially and monthly in terms of mortgage insurance but they will also enjoy a lower overall cost of the mortgage with the low interest rates.
To find out if you qualify or to learn more, contact your loan officer today. It is a great time to get a streamline refinance with FHA right now and we’d be happy to assist in this and all of your real estate endeavors!
The benefits of FHA loans are usually having lower down payments, less stringent credit-worthiness guidelines and seemingly fewer hurdles to get through the mortgage process among other things. It seems that the price of these benefits may just have kicked up a notch for consumers with some changes expected soon. Effective April 9th, 2012 all newly acquired FHA mortgages will incur increased up-front mortgage insurance fees as well as a higher monthly premium for mortgage insurance. This comes at a time when the economy has an ever-tightening stronghold on many homeowners across the nation.
Increases Come At a Difficult Time But Are Not Too Harsh
Despite the alarm that may be caused by the mortgage insurance increases, the amounts will not significantly affect homeowners’ pocketbooks. Still an increase like this is not welcome news at a time when homeowners are looking to as many assistance programs as there are out there.
Up-front mortgage insurance rates will go up from the current 1% to 1.75%. On a $100,000 mortgage this translates to an increase of $635 due at settlement ($1,750 from $1,150). Similarly, monthly mortgage premiums will be going up from 1.15% to $1.25% – amounting to $8.34 more each month according to the same $100,000 mortgage example. These figures assume the maximum loan to value if the buyer is putting down 3.5% on the property.
Higher Fees To Create Funds for Mutual Mortgage Insurance Fund
What is the need for these added fees? FHA is required to have at least 2% reserves in their Mutual Mortgage Insurance Fund, for which the newly increased fees are the main resource to replenish the monies. While this may seem a steep price to pay for some homeowners, in the general scheme of things the same funds will ultimately be used to allow the FHA and HUD to continue investing in the housing market and insuring a low down payment mortgage option.
High Balance Loans Will Incur Slightly Greater Fee Increases
Loans that are over the Federal high-balance loan limit will see a higher increase than that on homes below the high-balance limit. Whereas monthly mortgage insurance premiums will be revamped to the tune of 0.1% on most FHA mortgage properties, high-balance properties will incur a monthly mortgage fee of 0.35% higher than the current rate.
Previous FHA Mortgages Will Benefit From Reduced Fees Under New Plan
Though new mortgages will be met with higher mortgage insurance costs, homeowners with prior FHA mortgages are eligible for reduced fees and insurance costs. As an incentive to compel homeowners that are facing foreclosure or distressed situations, millions of homeowners will be eligible for lower fees through streamline refinancing of their homes. The goal is to stimulate the housing industry while easing the hardships somewhat for owners of FHA properties that have mortgages with higher interest rates.
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Though any increase in fees is more than we would like to pay, in the grander scheme of things the new amounts are not that significant. If you would like to learn how this might affect you, visit with your Realtor or mortgage loan consultant today to find out more.
Credit capacity is the most important aspect of the financial lives of millions of Americans. In fact, it is almost as unique as a thumbprint so it should be guarded and carefully protected. Not only does your credit report share detailed information about your most personal financial details, but also it provides those people that are accessing the report an in-depth insight to your financial personality.
So if you are buying a home or automobile, want a credit card, have applied for new phone service or anything else that requires the pulling of your credit report, beware and be aware of what is on your report.
A Credit Report Is a Glimpse Of Your Financial Lifestyle
Though mortgage companies view a different version than you do, bear in mind that the details are very much available and to any creditor that chooses to look over the history of your financial responsibility. The single most determining factor in deciding your mortgage application aside from your income eligibility and a few other aspects, is your FICO score. Lenders take the median of all three scores obtained from the three reporting agencies but when you view your report you will have access to one FICO score rather than the average of all three. You will however be able to view the same detailed information visible to creditors.
The basics will be included on the report but in addition there will also be contact information for each of your creditors, type of credit, the loan and/or credit amount that corresponds with each and the date each line of credit was established. There will also be information about any judgments against you and any settlements you may have made in the past. Any derogatory things such as repossessions, bankruptcy, past due amounts or debts that have gone to collection will be included on the credit report as well. There is a new trend that has become more prevalent with many creditors, where agencies report your rental payment history and other things showing how responsible you are with debt in situations other than just those that appear on a standard credit report. The CoreLogic® CoreScore report is a new report that almost acts as Big Brother, reporting a lot more detail on your spending habits as a consumer.
Things To Look Out For When Reviewing Your Credit Report
One of the best things you can do for your financial health is to pull your credit report at least once every six months. Check your report for any discrepancies and most importantly be aware of your financial situation.
If the balance owed is very close to or equal to the maximum high balance limit on any or all of your lines of credit it raises a red flag to potential creditors. That shows you have reached the maximum credit limit on a number of your responsibilities, and it is a factor that could get in the way of your obtaining new credit. As soon as you see your credit has reached about 80% of the maximum limit it is a good idea to start paying your debt down as soon as possible.
Additionally, if you see any derogatory items that are inaccurate you should work to resolve them by contacting the creditor and setting the record straight.
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The best way to ensure strong financial health is to be aware, stay up to date on your report and maintain accuracy. Using the report as a tool you can guide your financial situation to where you want to be and once there, be sure to stay on top. For assistance in pulling your credit report or any other inquiries you may have, contact your loan officer or Realtor today!
Recentlythere has been an increase in trigger activity when you or your client’s credit report is pulled. Please keep the following information in mind to protect yourself and your clients.
Background-
When you pull a credit report for a "mortgage", Experian and Equifax sell that consumer's data as sales leads to competing lenders, brokers, or marketing firms. Your borrower will get calls from lenders offering competing rates, though many other fees are often hidden. Activity usually increases as mortgage rates get lower.
Triggers are sold by the repositories (only XPN and EFX, not TU), so it does not matter which CRA is used. Education of your staff, referral partners, and clients is the most effective means of preventing confusion and retaining your business.
Prevention-
There is an Opt-Out process whereby a consumer can remove themselves from most marketing programs (888-5-OPTOUT or https://www.optoutprescreen.com). However, this process takes up to 5 days to become effective - so it is of little value in protecting mortgage applicants from trigger leads unless you are able to get your referral sources to Opt Out consumers before they get to you.
If a potential customer hasn’t opted out before credit is pulled, their phone will ring with competing companies attempting to offer "rates". These are often bait-and-switch tactics, and usually very misleading. If you/your customer suspects the person calling isn't from your company, teach them to ask questions, simply stating, "What is the name of my Loan Officer?" If the person cannot answer, they probably aren't with your company.You can also customize and distribute the attached Opt Out card to your new clients to increase their awareness. The ancillary effects of Opting Out are a decrease junk mail and potential ID theft.
We do not participate in the sale of Trigger Leads, nor any data concerning our clients or applicants.
Unless you are a financial analyst or someone with business-savvy, chances are you have not considered the effect the Fed changing interest rates will have on our economy. One of the most frequently asked questions recently after an announcement made by the President in his latest State of the Union address was “does this mean mortgage interest rates will be lower too?” The answer is no.
Still a Great Time to Buy – With Or Without Lower Fed Rates
Mortgage rates are already at their lowest they have been in decades. Similarly, housing prices are also at much lower rates. The positive buying market conditions remain but a zero Federal Reserve rate does not automatically translate to less expensive mortgages.
It does mean, however, that the institutions you borrow from will get better rates. Classic supply and demand principles at work, lower rates facilitate more big ticket purchases like homes and cars for more people, increasing the demand for subsequent items that are related to these purchases. The cycle goes on when consumers are able to pump more money into the economy as a result of having more in their pockets after securing lower interest rates.
Stronger Economy, More Jobs, More Homes Sold, Solid Economic Outlook
So, even though the zero Federal Reserve rate mentioned by Mr. Obama does not directly touch consumers’ mortgages, it really does have a positive impact in myriad ways. Consider this: when businesses are able to borrow easier and at better rates, they know they have more to gain in the future so they tend to invest more while getting such low rates. More investment translates to more jobs, more jobs mean more homes and cars and purchases and so on and so forth.
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So the next time you come across a news piece talking about what the potential impact of lower fed rates could be on our mortgages, remember that however indirectly, the impact is a positive one even though you won’t be seeing anything lower from your lender than you’re already seeing today.
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Calling all Realtors or anyone interested in learning more about the 203k FHA renovation loan program. We’re holding a luncheon and training seminar on February 22nd.
If you’d like to come by, please RSVP to JModerski@gatewayfunding.com and we’ll get you set up with your reservation. It should be a lot of fun!
As we welcome in 2012, I wanted to make you aware of some very important changes to the Pennsylvania Housing Finance Agency homebuyer programs. First of all, it's important to note that this information is only specific to Pennsylvania. So, this doesn't apply to any of my clients in New Jersey or any other surrounding states.
Right now, PHFA allows a $2000-$3000 secured grant towards closing costs. As of January 30, they are rolling out a new program - Keystone Advantage Assistance Loan which will provide up to 2% of the sales price (maximum of $4000) towards closing costs. It will be a 10 year second loan at the same interest rate as the first mortgage.
So how does this work? This program is meant to help people who need to borrow a portion of the funds to cover their closing costs associated with the purchase of the home. Homebuyers can apply for assistance from $500 up to the lesser of 2% of the purchase price or $4000.
There is no prepayment penalty for paying off this loan early. Borrowers can use the KAAL in conjuction with PHFA's Keystone Goverment loan - FHA, VA or USDA. Borrowers must require maximum PHFA financing which is no more than 3.5% for FHA loans and 100% for VA loans. Normal underwriting requirements still apply.
I also want to let you know that a brand new program is coming out in Spring 2012 which is very exciting. We will have access to a 97% LTV program with no mortgage insurance through Fannie Mae's HFA program in conjunction with PHFA. Although PHFA interest rates are a little bit higher than regular conventional and standard FHA loans, this program will be a huge benefit to borrowers.
As always, I will keep you updated on the latest changes in any of the mortgage programs that we offer and any new programs that become available. Feel free to call or e-mail with your questions and referrals.
Editor's Note 1/30/2012: The Pennsylvania Housing Finance Agency today launched several exciting new homeownership programs.
