To break it down very simply, and this is USUALLY always the case, when a family member sells to ANOTHER family member, FHA looks at that as an Identity-of-Interest Transaction.

I get at least 1-2 calls per month with this scenario, and want to post it on my mortgage blog to educate YOU, the consumer.

So even though FHA has a minimum down payment requirement of 3.5%, in THIS case, you would have to put down 15% percent.

Here is ONE of the exceptions to this rule:

1. The family member has rented the property for at least 6 months predating the contract, in which case a rental agreement will be needed.

If you are in this type of  situation and do not have the 15% to put down, feel free to contact me for more info and some other tips that may help you out!

We have our first African American president, Larry Flynt is asking for a $5 billion PORN bailout , Bernie Madoff got caught with his hand in a $15 billion cookie jar, and of course the Steelers won a very “action packed” SuperBowl.

So where does this leave us and what should you expect in ’09?

Well, for starters, Obama’s proposed $900 billion Stimulus Plan is still being negotiated in Senate, and from the way it looks, it’s going to pass. Many are wanting to know the dynamics of what this plan is, so I wanted to outline a couple of the top points you may be interested in:

1. Instead of $7,500, a $15,000 Tax Credit to First Time Home Buyers. This is still in the works, but looks good on getting approved.

2. Tax relief to those with middle, and low incomes, in order to restore consumer spending and confidence.

3. $1,500+ tax break to car buyers to get them back in the showrooms

4. Specific measures to relieve financial institutions of their troubled assets. (Where did the “The Bailout” money go last year?)

5. Defined tax breaks for businesses, especially those which encourage them to reduce their debt.

Now I slightly recall a $700 billion Wall Street Bailout plan that passed and that did NOT go the way it was supposed to, yet we’re still paying for that tab.

So where you stand on this? Is the US just writing blank checks to solve problems, or is the “Change” we’ve been waiting for?

1. Must be in the plan for at LEAST 12 months

2. Must show history of payments for the 12 months, along with all creditors that are included

3. Must get permission from the counselor to enter into a new mortgage

In a way, this is much like a bankruptcy- and lenders view it as one! In my opinion, I would not enter a program such as this if it was not ABSOLUTELY NECESSARY.

A couple quick updates before I start wrapping presents…

The FHA Secure Program is going away as of next Wednesday, December 31, 2008. If you are a distressed homeowner having trouble making your mortgage payments, then please contact us to find out more information on Hope for Homeowners program. Below is the mortgagee letter from HUD showing the termination of FHA Secure.

http://www.hud.gov/offices/adm/hudclips/letters/mortgagee/files/08-41ml.doc

There will be a new maximum LTV (Loan-to-Value) calculation in regards to FHA refinances. Due to the Housing and Economic Recovery Act of 2008, the new LTV will be 97.75% of the appraised value. Read more about it below:

http://www.hud.gov/offices/adm/hudclips/letters/mortgagee/files/08-40ml.doc

Here is a great breakdown from HUD getting into a little bit more detail if you’re interested:

http://www.hud.gov/offices/adm/hudclips/letters/mortgagee/files/08-40mlattmt.doc

Enjoy your Holidays, and I’ll be back next week.

Cheers,

Tommy

Information and documents are directly from HUD ]]> http://fhamortgagehouston.com/blog/no-more-fha-secure-and-maximum-ltv-for-2009-refinance-fha-loans/feed/ 0 http://fhamortgagehouston.com/blog/updates-to-2009-fha-mortgage-limits/ http://fhamortgagehouston.com/blog/updates-to-2009-fha-mortgage-limits/#comments Wed, 24 Dec 2008 06:12:45 +0000 admin http://fhahouston.wordpress.com/?p=139 As a result of the appeals process outlined in Mortgagee Letter 2008-36, single family mortgage limits for 2009 have been updated for 54 counties. Those counties represent five Metropolitan Statistical Areas and one non-metro county.  A listing of affected counties, with the final median prices and FHA (forward, non-HECM) loan limits for 2009 is posted on HUD’s Website at: http://www.hud.gov/offices/hsg/sfh/fha2009.pdf

FHA accepted appeals for those counties where it did not already have a comprehensive listing of property sale transactions for the look-back period (January – August 2008), and where the median price from the transactions provided by the appellant was higher than the median price used in the preliminary loan-limit calculations completed by FHA last month. There were no changes to the 2009 HECM loan limits from these appeals. The HECM loan limit is the national conforming loan limit of $417,000 for all areas except for certain high-cost counties in the special exception areas listed in the National Housing Act (Alaska, Guam, Hawaii, Virgin Islands).

A complete schedule of FHA mortgage limits for all areas is available through the internet at https://entp.hud.gov/idapp/html/hicostlook.cfm

The mortgage limits described in this notice are effective for those loans which have credit approval on or after January 1, 2009, and apply to mortgages insured under the following Sections of the National Housing Act:  Sections 203(b) (FHA’s basic 1-4 family mortgage insurance program), 203(h) (mortgages for disaster victims), 203(k) (rehabilitation mortgage insurance), Section 255 (Home Equity Conversion Mortgages (HECM)) and 234(c) (condominium units).  There will be no further appeals of FHA loan limits for 2009.

Source: HUD

Here are the conditions:

1. You must be back on the job for at least 6 months
2. You must be able to document a 2 year work history prior to leaving

An example of this is saying a person had to take off several years to raise his/her kids, and then returned working again.

Happy Holidays everyone!

For a 30 year-4.75%.

For a 15 year- 4.5%.

When I was locking in a rate this morning for a home purchase closing this month, I stuttered and had a “WOW” look on my face. Rates haven’t been this low in years, and several of my past clients have been calling to refinance their current mortgage the past couple weeks- even if they AREN’T in an FHA mortgage.

It doesn’t make sense all the time to go from a conventional mortgage to an FHA, but in specific circumstances, it is VERY financially feasible.

So here’s the CONDENSED explanation on why what’s happening is happening.

For the last 6 months the Fed and the Treasury have made unprecedented moves to help the economy, but despite all their efforts, mortgage rates weren’t really effected and they were actually increasing.

That is, until yesterday.  In a matter of minutes yesterday morning, mortgage rates have taken a dive to lows we haven’t seen in years.  Why?  The Federal Reserve announced plans to buy $600 billion in debt and assets from Fannie Mae and Freddie Mac in order to oil the housing finance market and “reduce the cost and increase the availability of credit.”

It will be interesting to see how long this drop will last – given the volatility in the market it could last hours, days or months- there’s NO telling.

What I CAN give you is advice, however. When there’s a SMALL WINDOW OF OPPORTUNITY such as this, you need to capitalize on it and take advantage. You can contact me and we can do a Mortgage Check-Up (revisiting your current mortgage terms) for you at NO COST.

If you can save money, I’ll tell you. If you CAN’T and its not worth it, I’ll tell you as well.

And PLEASE, PLEEEEASE do not get greedy when it comes to these low mortgage rates. What many people do time and time again is say “Oh, let’s see if it’ll go lower.”

My suggestion- DON’T GAMBLE! Do you know any gamblers that still have any money left?

You will end up waiting yourself OUT of the market and looking back WISHING you would have gone the safe route.

Find a rate that’s low enough for you. Determine if you can live with it. Then roll with it!

Straightforward, simple, and educated advice.

2008 Taxes

The FHA Up Front Mortage Insurance Premium must be 100% financed into the mortgage or paid up front in cash at closing. It cannot be partially financed.

If the seller pays any portion of the Up Front MIP (capped at 6%), then the entire amount must be paid up front in cash.

Weekly, and sometimes daily depending on the importance of the matter, I will post market related events that affect your mortgage and your rate. In this industry, you have to keep on the button, or else it can literally cost you THOUSANDS in the long run if you do not have a mortgage planner experienced enough.

Just this week, the Jobless Claims nearly came in at 525,000, which is a pretty scary number as it looks like we may be approaching a 7% unemployment rate.

I’m sure you already know there have been a lot of job cuts this past year, and since the holidays are coming up, I figured I would see if I could send out some useful info to forward on to anyone you may know. Feel free to pass this informational along to anyone you think may need it.

http://careerplanning.about.com/cs/jobloss/ht/job_loss.htm

The bottom line is this: Losing a job is tough during any market, but finding a job doesn’t have to be tough when you are willing to be creative and use strategies that work.

If you’re interested in some of these strategies for you or anyone else, just let me know, and I can post them on here.