FHA will continue to loosen up on its house flipping guidelines.

As of last week HUD announced that it will continue to loosen its guidelines in regards to home flipping in order to assist banks in getting rid of their foreclosed inventory.  On the contrary to this many mortgage banks are maintaining their overlays that will prevent this.  I’m curious to see if mortgage banks will follow suite, if they do it may open up the market for investors flipping properties.

Market Update from Bank Rate FHA :

Dec 29, 2011 At 1:00PM (On average my rates are about .2% below the market average for the same period with 0% origination)

30 Yr Fixed	3.96% Up	3.94%
15 Yr Fixed	3.28% Dn	3.29%

Happy Holidays to my Realtors and clients.

Samuel Morales

Residential and Commercial Loan Officer
Office: (210) 257-0642
Mobile: (210) 286-7267
Fax: (210) 257-0510
www.yourloanofficer4life.com
www.streamlinefha.org
www.streamlinefha.net
www.texasjumbomortgage.org  
NMLS: 295626   

Happy Holidays to all my wonderful clients and Realtors (Market Update Below) December 16th, 2011 1:31 PM In case you have not heard, this week we once again hit a “record low” for mortgage rates. This morning I priced out a VA 30 Year fixed at 3.75% and this is with 0 (ZERO) POINTS!!!!! (APR 3.875%) And better yet: Texas Vet VA is at 3.23% for a 30 year fixed (APR 3.35%) I know you’ve heard this before but rates cannot get any lower. Homes values are down in this buyer’s market and interest rates are the lowest they have ever been. Happy Holidays, Samuel Morales Residential and Commercial Loan Officer Office: (210) 257-0642 Mobile: (210) 286-7267 Fax: (210) 257-0510 www.yourloanofficer4life.com www.streamlinefha.org www.streamlinefha.net www.texasjumbomortgage.org NMLS: 295626

What Does the Congressional Super Committee Failure Mean for Mortgage Rates and Real Estate?

              As expected the Congressional Super Committee did not meet its deadline.  What does this mean for mortgage rates in Texas and across the nation?  The Dow has already started down as of yesterday and is continuing the same trend as of today, so far as of 11:00am the DOW is down almost a hundred points.  Typically the 10-year bond drops shortly after the DOW goes down so we should see a dip in mortgage rates shortly.  Being that rates are already rock bottom there is not much room to go down to much further so expect a drop of no more than .25 of point.

                We are in some scary times right now but also exciting times as we are living in a historic moment.  How we handle this fragility in our situation will dictate policy that impacts all Americans for generations to come.

                Much of what we hear in the news about the housing market making a comeback is not correct.  Over the past 12 months I’ve seen stories claiming that many areas have seen housing sales increase and home prices have been inching up.  While this may be true the numbers are being doctored; let me explain.  Last year in the USA there were a total of about 5.5 million foreclosures.  So far this year Bank of America alone has over 5 million foreclosures, this figure does not account for Wells Fargo, Chase, Citibank or any other lending institution.  The banks are holding on to inventory and in some cases are renting homes back to the parties that have been foreclosed on.  Should the banks flood the market with this inventory what do you think will happen to the home prices across Texas and the rest of USA?  You guessed it; the housing market which is the biggest indicator of how an economy is doing would completely collapse and home prices would plummet.  Immediately, this situation is killing the refinance market because banks are going with the most conservative appraisal approach when approving refinances.  Just in the past 6 months I have lost several refinance deals due to appraisals coming in lower than market value.  However; we are not having the same issue with purchases as banks need to get rid of inventory.

                What’s the flip side?  I do see a possibility of recovery.  In a previous blog post I noted that during the mortgage and real estate boom we saw rental rates go down and mortgage rate along with home prices go up.  Which meant it was more expensive per month to purchase a home than it was to rent.  That trend has now reversed, we will be seeing home prices continue to drop and mortgage rates will stay very low (unless hyper-inflation occurs) for at least 2-5 years.  Rental rates are skyrocketing so now it is less expensive per month to purchase a home than it is to rent.  This reversal, in my opinion is what will get us out of our current situation and help in the reset of our economy.  Assuming our congress gets their act together the recovery mentioned above has a high probability; if not, hyper-inflation will happen and we may be screwed for a long time to come.  I don’t know about you but I’m crossing my fingers and hoping for best in this historic moment in time.

 Samuel Morales

Residential and Commercial Loan Officer

Office: (210) 257-0642

Mobile: (210) 286-7267

Fax: (210) 257-0510

www.yourloanofficer4life.com

www.streamlinefha.org

www.streamlinefha.net

www.texasjumbomortgage.org  

NMLS: 295626   

Recommended credit Repair Company: Sky Blue Credit Repair

The House Voted In Favor of Increaseing FHA Loan Limits

As of yesterday the House voted in favor of increasing FHA loan limits back up to their previous limits prior to Oct 1, 2011.  We should be hearing if congress is to OK the legislation in the coming days.  If I had to make an educated guess I would say the legislation will pass considering the amount of inventory the large banks are holding in regards to foreclosures; they need all the help they can get. 

Average Overnight Mortgage Rates Per BankRate.com

Product	Rate FHA	Rate Conventional
30 Yr Fixed	4.03%	4.4%
15 Yr Fixed	3.38%	3.75%

On average I am .02 - .25% lower than the overnight average.

Reminder of new FHA loan limits-Link attached to find your by county in Texas

I have been getting a few calls from clients and my Realtors that are not aware that the FHA loan limit for Bexar County and many counties in Texas have decreased as of October 1, 2012.  The FHA loan limit for Bexar County has moved from $332,500.00 down to $287,500.00.  To find out the new FHA Loan limit for you county you can go to http://www.yourloanofficer4life.com/FHAlimits

If you are trying to refinance your FHA mortgage and you have questions because your loan balance is above the new FHA limits please contact me and I go over your scenario with you.

As always please keep me in mind for your mortgage,

Samuel Morales
Residential and Commercial Loan Officer
Office: (210) 257-0642
Mobile: (210) 286-7267
Fax: (210) 257-0510
www.yourloanofficer4life.com
www.streamlinefha.org
www.streamlinefha.net
www.texasjumbomortgage.org
NMLS: 295626   

Recommended Credit Repair Company - Sky Blue Credit Repair

I know this is not the norm for my blog which I try to keep to a mortgage related topic but...

August 30th, 2011 10:40 AM

I have a trusted friend with years of experience in the service industry that is looking for investors for a business in Burnet, Texas. The establishment that is being taken over has been in existence for over a year and a half (and has been profitable). Details of the transaction, P&L, business plan and supporting documentation will be provided to qualified investors. Interested parties should contact Lewis Smith at biglou29@gmail.com
Once again, I normally keep my blog to lending related topics but I feel this is a strong transaction. I have worked with Lewis Smith in the past and I know he runs a tight ship.

USDA Announces Big Change to go Into Effect October 1st of This Year

Overview – as set in notice (AN 4551) announced that the Single Family Housing Guaranteed Loan Program will implement changes to the USDA Guarantee Fee.  The new annual fee (similar to FHA Annual MIP) will be charged and the current upfront fee will be decreased.

The changes are effective on October 1, 2011 for any loans receiving the USDA conditional commitment on or after this date.  The reduced up-front fee will be still be calculated based on the guaranteed loan amount.  The new annual fee will be paid over the life of the loan and is not removed at 78%.  It is calculated based on the unpaid principal balance and will be collected monthly but paid to the Agency on an annual basis.

This change is driven by the date USDA issues the conditional commitment, and that date is contingent upon:

·         Our ability to get the loan submitted to USDA for underwriting review

·         USDA’s queue and turn time in issuing commitments

There will be no exceptions for the change in fees that will occur if the loan does not receive the conditional commitment before 10/01/11.

                                Current Guarantee Fee                 New Guarantee Fee

Up-front Fee     Purchase 3.5%                                   Purchase 2%

                                Refinance 1%                                     Refinance 1%

Annual Fee         NA                                                          0.3%

Please feel free to call me with any questions, the information above is verbatim per the USDA Release

Samuel Morales

Residential and Commercial Loan Officer

Office: (210) 257-0642

Mobile: (210) 286-7267

Fax: (210) 257-0510

www.yourloanofficer4life.com

www.streamlinefha.org

www.streamlinefha.net

www.newhousingbill.org

NMLS: 295626   

Recommended credit Repair Company: Sky Blue Credit Repair

What to Consider When Shopping For a Loan Officer for Your Mortgage Transaction?

What to Consider When Shopping For a Loan Officer for Your Mortgage Transaction?

I have been in the Texas mortgage industry for over 9 years and I have seen the good, the bad and the ugly of Texas mortgage loan officers and Texas mortgage lending institutions.  I have to say, that while most Loan Officers pretty much offer the same products, not all lenders and not all loan officers are the same.  In this article I am hoping to give you an idea of what to look out for and what questions to ask when selecting both a lender and a Loan Officer for your mortgage transaction.

Questions to ask your Loan Officer:

1.       What are your current underwriting times?

·         If there is one thing I have learned from being in sales it’s that “Time Kills Deals”.  Anytime you have a transaction whether or not you think you are in a rush, you are in a rush.  Extended time frames are probably the biggest deal killers of any transaction not just mortgage transactions.  If a lender has high turn times think twice about sending your mortgage to them especially with a purchase transaction.  I have seen files take months to close because of underwriting turn times.  Most lenders will have turn times posted for Loan Officer on both the Broker and Banker side of the business to view.

2.       How long have you been in the mortgage business for?

·         It’s not always a bad thing to work with a new Loan Officer; however, on complex transactions it will definitely impact you directly.  In the current world of mortgage lending every loan is complicated, it is important that your loan officer knows the ins and outs of the business.  Some knowledge only comes with time in the trenches and when a loan starts to go south experience makes a huge difference.

·         If you can ask a friend or colleague who they used on their mortgage and if they were happy with their loan and the service provided.

3.       If you are doing an atypical mortgage such as a construction loan or FHA rehab make sure to ask your Loan Officer if they have experience with that type of transaction.

·         Construction lending is a whole other beast from a normal mortgage loan especially if it is an FHA 203K government rehab loan.  Many times construction loans can take longer to close than a normal mortgage.  This is important because you don’t want to get caught paying extension fees on a real estate contract which can be up to $150.00 per day.  An experienced Loan Officer will know to communicate with your Realtor and/or sellers agent so that the contract can be amended for a longer period of time before it’s too late.

4.       Last but not least, make sure your Loan Officer is in the same state as your transaction or at least familiar with state law of the subject property.

·         Many states have different state laws that will impact your transaction.  For example, the state of Texas has many laws designed to protect consumers when it comes to home equity loans.  These laws require unique disclosures that are not required in any other state.  There is nothing worse than getting to the closing table and only to find out that your loan can’t fund because a step was skipped or a disclosure was forgotten. 

I have seen many Mortgage transactions fall through because of a bad Loan Officer.  Above anything listed above find someone you trust and don’t trust a Loan Officer that tells you what you want to hear; trust a Loan Officer that tells you how things are, whether or not you like what he is saying. 

I will leave you with one last tip.  It is not a Loan Officers job to approve your mortgage, that duty goes to the mortgage underwriter.  It is the Loan Officer’s duty to structure your file in a manner that it is most likely to be approved.  Do not lie on your loan application be upfront with issues you think could impact your approval because the underwriter will find it regardless.  If the Loan Officer knows about the issue ahead of time he can package the issue so that it may not be as much of an issue as you think.

In a mortgage transaction you must TRUST YOUR LOAN OFFICER, SO FIND A LOAN OFFICER YOU CAN TRUST.

What I am doing in response to the tightening of mortgage underwriting guidelines!

Recent www.yourloanofficer4life.com press release listed below.  I am excited about this partnership and we have already seen results.  Please keep mind I try to keep my loan amounts above $125,000.00 but I will always make exceptions for motivated people.  For my Realtors that have clients who have been denied in the past, please have them give me a call.

August 15, 2011 – Texas Mortgage Expert Samuel Morales owner of YourLoanOfficer4Life.com teams up with Sky Blue Credit Repair .

With guidelines around the nation tightening up due to recent events in the financial sector Loan Officers need to think outside the box. 

Samuel Morales says,

“I’m tired of having to tell people that would have been approved in the past that they can’t buy a home or refinance.  Teaming up with Sky Blue  just makes sense; if a potential client is willing to do what they have to do in order to get approved down the road then I have no problem sticking by their side.  Now when someone calls to get a loan, worst case, I can put them on a plan to get a loan down the road”.

A person’s credit dictates whether or not they can get approved for a mortgage and what kind of interest rate they receive.  Having good credit can save a person thousands of dollars on a mortgage.

Morales says,

“It feels good to help people, I’m looking forward to teaming up with Sky Blue, I really feel I will be able to help more people because of this partnership”.

About Samuel Morales:

He currently holds his National and Texas State Mortgage License at Directions Equity out of San Antonio, Texas.  He has been in the mortgage industry for 9 years and specializes in Government, Jumbo, Super Jumbo and Construct to perm mortgage lending in Texas.

Samuel Morales

NMLS#295626

Samuel@yourloanofficer4life.com

www.yourloanofficer4life.com

www.mortgageratenotifier.com

www.streamlinefha.net

###       

Why The Increase In Rehab and Construction Lending in Texas? What Is The Best Option For You?

I was speaking with one of my referring Realtors the other day and we had a detailed conversation about the current housing market.  I could not help but to be enthralled in this deep conversation as there is so much going on right now with not just real estate but its partner in crime mortgage lending (No pun intended by the use of the word crime).  

Listed below are bullet points of factors affecting the current real estate and mortgage lending market.

·         The mortgage meltdown – Because of the mortgage meltdown guidelines have tightened in order to limit risk to investors and many lending institutions have either gone under or have taken heavy losses.

·         The real-estate bubble popped – Because of the “Bubble” market values were well above where they should have been and now we are in a free fall with home prices plummeting.

·         Foreclosures – There are so many foreclosures out there that the housing market has a surplus of product waiting to be bought.  Too many homes, not enough buyers. 

·         This has caused a buyer’s market and people are looking for deals; many times this means they are buying fixer uppers; many of which are foreclosures that need rehab.

Which brings me to my point; Why the Increase in Construction Lending in Texas????

You guessed it, most foreclosures are in some level of disarray and need at a minimum minor repairs.  I have seen about a 20% increase in rehab and/or construction lending over the past 6 months which I attribute to the many foreclosures on the market.  You have your normal investors that fix up properties and then sell them and then you have your potential owner occupying borrowers that are looking to stay in the property.

The potential borrower that is going to stay in the property is normally going to use a one-time or two-time close construction loan; they both have their Pros and Cons which are listed below.

One time close construction Pros:

• You only have to qualify once and you do not need to worry about closing twice.
• Once you are locked in and approved with a valid appraisal and clear title it's a done deal.
• You will have only one closing.

One time close construction Cons:

• MI companies no longer want to insure One-time construction loans so you will have to come to the table with a 20% down payment.
• You will end up with an interest rate that is about .5% to 1% higher than the market rate.
• One time close construction loans are only available on the conventional side of the business and chances are you will not be approved unless you have a 720 to a 740 credit score and above.

Two time close construction loan Pros:

• You will end up with a better loan than if you were to go with a One-time close construction loan.
• You will have both Conventional and Government options for your final loan.
• Because of the government options for your permanent loan the credit requirements are lower than the One-time construction loan option.
• So long as you have a valid exit strategy for getting out of the actual interim loan you will be approved for the interim loan.

Two time close construction loan Cons:

• you will have 2 closings.
• Should something happen to your credit profile during the construction period your approval for the permanent loan could be impacted. (There are things the client can do to limit this risk)

While a construction loan can get complicated they normally run pretty smoothly, in the current market should an issue arise it is normally with the appraisal.

This is an overall break down of the pros and cons involved in residential owner occupied construction loan for both One-time and Two-time close construction loans. There is obviously quite a bit more to it so please don't be afraid to contact me directly. I limit the number of clientele I take one in order to provide better service so I am currently only taking on clients in Texas with estimated loan amounts of $200K or higher. Regardless of whether I can help you I hope the information I have provided is helpful.

Mortgage Insurance - What's best?

How Does Mortgage Insurance Help Me? How Can I Maximize Its Benefit?   A smart lender or Loan Officer will tell you that Mortgage Insurance (MI) allows you to borrow more than 80% of the market value of a home. What this in fact means is that MI does absolutely nothing for you in terms of insuring you from losses. MI is meant to protect the lender from loss should you, the client, default on your mortgage. The MI Company shares the risk of loss with the lender and compensates the lender should you default on your loan. In short you do not receive any benefit (outside of being able to borrow at a higher ratio on your mortgage) from MI (Mortgage Insurance). During the mortgage meltdown MI companies like AIG where not able to cover the losses of lenders. The result was a mortgage crash and heavy losses (mortgage meltdown). A small handful of lenders and brokers, such as the one for which I hang my own mortgage license with, have found a way for the client to benefit from MI; which makes sense being that the client is the one paying for it. How is this you may ask yourself, it is simple. We have included an 'Employment Insurance' policy in the MI (Mortgage Insurance). Many foreclosures happen when the borrower loses his/her job and foreclosures are expensive for a lender. By protecting the borrower we are actually cutting cost and bettering our default ratio which allows us to get more on our notes in the secondary market. This savings pays for the policy and allows the lender to pass additional savings down to the borrower. How it works: • The benefit is up to $2000.00 per month. • Up to 3 monthly payments per job loss occurrence, with a maximum of 6 payments during the benefit period. • The benefit is paid up to 3 years after the loan closes while the mortgage insurance policy remains in place. How it helps the client: • Helps protect credit by keeping up with your mortgage payments. • Safeguards the investment made in your home. • Makes emergency funds go further. • Provides some peace of mind during the stress of unemployment. The draw back - You can only obtain this type of MI in a new mortgage; refinance or purchase. We are in a time where the mortgage industry has gone through a great amount of change in a fairly short period of time. I have been in the mortgage industry for over 9 years and I am a firm believer that you must make your mortgage work for you. Small changes in your note or terms can have big impacts on your life as time moves on. Some of these changes can be bad and some, like this one, can be very good. Always cover your bases, especially if it is at no cost to you. Samuel Morales Mortgage Expert http://www.yourloanofficer4life.com samuel@yourloanofficer4life.com NMLS: 295626 (Licensed in TX only) Article Source: http://EzineArticles.com/?expert=Samuel_Morales