What Makes Mortgage Rates Move is a post from: Tucson Mortgages

Looking to purchase or refinance a home?  It’s important to know what moves mortgage rates.  There are normally three major things that impact the direction:

1. Economic News.  Such as reports on the existing home supply, announcements by Federal Chairman Ben Bernanke. Existing-home sales in July plunged to the lowest level in 15 years, creating more concern that the housing market’s tenuous recovery is threatened by buyers’ shaky confidence in the economy.
2. International News. (major events, pending legislation, war related news, etc). Volume often starts to pick back up after Labor Day when traders return from summer vacations. But Brian Peardon, a wealth adviser at Harrison Financial Group, said many investors might continue to stay out of the market even when they get back because of uncertainty about the global economy.
3. Stock Market. (Money flows from equities (stocks) to bonds when it seeks shelter). The combination of the jobs report not posting as poorly as predicted, and light trading volume because of Labor Day, pushed rates higher by as much as a quarter-percent in some markets.

Mortgage rates are only based on one thing, Mortgage Backed Securities.  The only way you have access to these is through live bond quotes. The stunning drop-off when mortgage rates are at historic lows indicates many potential buyers have lost confidence. Markets are in the midst of a 19-week rally and rates can’t fall ceaselessly . Mortgage bonds are likely overbought so when the selling begins, pricing should deteriorate quickly.  This will cause mortgage rates to spike – quickly.

If you’ve been shopping for a mortgage or are just wondering if the time is right to refinance, call us and we will work the numbers together. Refinancing won’t make sense for everyone, but it may make sense for you. If you’re looking for specifically what mortgage rates are doing, contact us today at Academy Mortgage. There are so many factors involved in determining mortgages we’d be happy to help.

Best Three Tricks for Highly Effective Jumbo Loan Search is a post from: Tucson Mortgages

Whatever aim you might have, you will require tips, ideas, advice that can help achieve it. When you know what to do and what to refrain from, it is faster and easier to arrive at your goal. Shown here are 3 essential tips to help you arrive at your goals. Try this advice so you can be assured of having significantly better outcomes.

While getting approved for a jumbo loan may different than some time ago, you’ll find it’s important that you do things right. If you don’t, the outcomes are generally regrettable. You could possibly wind up paying more than necessary, or maybe even be denied. Listed here are 3 strategies for getting the best results.

1. You must have good credit and be able to document your income and assets

You have to have a good credit rating and be able to document your wages and assets because doing so helps prevent being denied financing to get a costlier house. Failing to make this happen can change the price bracket you must shop in. Therefore you shouldn’t make the mistake of ignoring this imperative action!

2. It’s also sensible to have a significant advance payment

Very nearly as essential as having a favorable credit record when handling getting approved for a jumbo loan, it’s also sensible to have a significant deposit. I’m telling you, it’s not something to skip. It can help to make the loan process smoother, and that’s something anybody engaged in looking for a jumbo loan wants.

3. Find an authority in relation to jumbo loans not just someone in the answering services company!

Finally, when looking to setup a jumbo loan you need to be certain and find an expert when it comes to jumbo loans — not just someone in a call center. This can help with getting ideal mortgage, which is a necessary component to shopping for a jumbo loan. Should you not, you might regret it later — and I think we can agree this wouldn’t be the best thing!

As I said from the outset, when it comes to getting approved for the jumbo loan it might be different than in the past, you want to make certain you don’t make blunders which will end up that you’ll pay greater than necessary, and even be denied. What you would like is to purchase the property or investment you need, and you can achieve that by using the recommendations specified.

Find out tips on how to look into an Arizona jumbo loan to finance your house by calling Academy Mortgage or visit the website at http://jumbo-loans.org/.

Ever Considered the VA Loan? is a post from: Tucson Mortgages

When looking at homes to buy, many members of our military community overlook the VA loan. Hopefully this short article will briefly give you the basics on who’s eligible and what to think about when considering a VA home loan.

VA Loan Eligibility

VA loans are open to veterans, active duty service members, reservists and members of the Public Health Service. The service member must be able to prove that they served in the military for 90 days during wartime and 181 days during a time of peace.  He or she must have been honorably discharged. Veterans, active duty personnel, reservists and National Guard members can qualify.  Also, some surviving spouses might be eligible for the VA loan.

With a lending counselor, the process is easy. The applicant must obtain a certificate of eligibility from the VA, which can be done quickly with the counselor.

The certificate verifies service and discharge. It also will determine how much the vet can borrow under the program.

Thinking About It

The VA loan is not for all service members.  Although, not a great amount of emphasis is put on income, the average borrower of the VA loan tends to be middle class first time homebuyers with a salary of $50,000 or more.  Qualified service members will not always be able to get the funds needed for a home in a place such as Palos Verdes due to limits placed on the loan.  So, a good income to debt ratio and a higher salary are needed for basic living and mortgage expenses.

A military member will need to sit down with his or her family and discuss what could truly be financially doable in a place of high cost. When taking that into consideration, members can note that they can save money due to the no down payment and PMI.  Plus, if they were to secure a loan for $417,000, the cost of a $900,000 home would be reduced to what is normally bought by middle class families. The most important thing to do would be to sit down with a VA counselor and set financial goals towards purchasing one’s dream home in a great location.

Arizona Foreclosures Remain In Top Ranks Nationally is a post from: Tucson Mortgages

Arizona remains in the top ranks of U.S. states for foreclosures, according to the Phoenix Business Journal. The statistics come from RealtyTrac’s June report.

June’s online foreclosure market placed Arizona second for the rate of foreclosures during the first half of this year behind Nevada, and then third behind California and Florida for the total number of foreclosures within the six-month period.

One in every 30 homes in Arizona (about 3.4% of the housing market) was impacted by foreclosure during the first half of 2010. All in all, about 91, 484 Arizona homes were impacted by foreclosure in that period.

This number indicates a 1.6% decline from the previous six months, and it is an incrase of 1.9% from January to June of 2009.

On a national level, there were about 1.65 million properties impacted by foreclosure filing during the first half of the year, which accounts for 1.3% of the housing market or roughly one in every 78 homes.

In June, 14,424 properties were added to the pool of foreclosure properties in Arizona, but that number is 10% below May national totals, and it’s 14% below the national number in June.

Arizona was once one of the biggest booming housing markets in the nation before the slump, and it is now considered one of the hardest hit. Arizona has frequently been on the receiving end of government aid to help fight mortgage fraud and to try to help stimulate the housing market by providing the many struggling homeowners with options in an effort to try to reduce the number of foreclosures flooding the market. The HAMP site reviews Arizona’s “Hardest Hit” package:

Arizona ($125.1 million)
• Arizona will provide assistance in the form of principal reduction, interest rate reduction, and/or term extension programs with the goal of allowing borrowers to enter into a permanent modification program.
• In circumstances where a second lien is prohibiting modification of a first lien, the state will provide assistance toward elimination of the second lien.
• The state will also offer assistance to the under-employed while they seek new employment. This assistance may be used to pay monthly mortgage payments or remove second mortgages where that second lien is prohibiting the modification of a first lien.

3 Reasons You Should Apply for a VA Loan is a post from: Tucson Mortgages

Ever day-dream about how exactly you could potentially apply for a VA loan? That thought has occurred to a lot of people. Some have even taken action to help with making that happen. Most just consider it for a while, then dismiss the thought. Sometimes it’s because they don’t know how to go about it. Sometimes it’s because it can be a big unknown. Still other times it’s because they think they cannot get it done.

Well, decelerate here. Let’s explore that a little. That you should consider, here’s three reasons to apply for a VA loan.

To start with, for the “Pro” side, I’d point out that they can provide up to 100% loan financing. Very well, I acknowledge your objection, on the “Con” side, and I agree you have a valid point as you say you can only get the loan if you’re a veteran. But I want to additionally point out that if you’re a veteran with a loan certificate of eligibility, this is the loan for you.

Second, you should think about that there is no pre-pay penalty on VA loans. Also, there is no mortgage insurance requirement. As well as, you can roll closing costs into your VA mortgage.

Lastly, you’ll get a great loan option. And that’s going to allow homeownership. On top of that, you can refinance with a VA streamline in the future if needed.

After you have had an opportunity to review the reasons, and think about them, you’ll see that a great case can be made in favor of applying for a VA loan.

So now look at that for a few minutes. We just made a really good case in favor. Perhaps you really should apply for a VA loan.

Discover tips to Apply for a VA loan by visiting this website at www.tendayclose.com/.

Fannie Mae and Freddie Mac: Is This the End of GSEs? is a post from: Tucson Mortgages

According to Housingwire, the House of Representatives submitted a bill outlining details of a timeline to take government-sponsored enterprises (GSEs) out of conservatorship with the intention of eventually removing the government’s guarantee of both Fannie Mae and Freddie Mac, the largest government-backed mortgage finance lenders in the U.S.

The bill is sponsored by Jeb Hensarling, R-Texas, and if passed in its current form, the GSEs would either be forced to operate as standalone companies or be prepared for an eventual wind down by forcing them into receivership. The bill would take effect two years after it became a law, if it passes.

The bill is called the GSE Bailout Elimination and Taxpayer Protection Act (HR 4889). What the bill stipulates:

• The bill dictates that the director of the Federal Housing Finance Agency (FHFA) has to remove the GSEs from conservatorship in the amount of time proposed in the bill—two years after the bill is signed into law.

• The bill would revoke charters for both entities three years after it takes effect, establishing a 10-year-long wind down of the entities’ abilities to make mortgage purchases for securitization.

• Additionally, during that 10-year period, it would be the responsibility of both the FHFA director and the Treasury Secretary to impose regulations divesting GSEs of their holdings.

A spokesperson for Congressman Hensarling, George Rasley, told Housingwire that his purpose for sponsoring the bill was not necessarily to see GSEs abolished, but to make them standalone as regular companies, operating in the free market, and if they can’t then they should be wound down.

“It remains to be seen how their existing obligations would be greeted by the market, since the government has in essence said ‘we’re guaranteeing those,’” Rasley said. “The government is always a poor player in the market. The word free comes before market for a reason, that’s because it doesn’t involved the government.”

Fannie Mae and Freddie Mac have been a hot topic of discussion this year. In recent weeks, both Fannie Mae and Freddie Mac removed their stock from the NYSE due to low stock values.

The bill was introduced to Congress March 19, 2010 and has currently been sent to a committee for review.

Roth IRA Qualifications and Mortgage Qualifications: Not The Same is a post from: Tucson Mortgages

For some people that I come across who want to buy a house I just flat out tell them to keep renting. Well, I also add some suggestions about a plan they could take, like save some money with a Roth IRA for example, to get themselves into a position of buying a house in the future.

At least with a Roth IRA they can do themselves some good with saving money for their retirement. Heck, if they wait long enough to buy a home (5 years) and contribute to a Roth IRA the whole time they wait then they can access some of that Roth IRA money, if they are a first time buyer, to buy a home.

I tell my clients that don’t quite cut it for a mortgage that Roth IRA eligibility is far easier than mortgage eligibility. To qualify for a Roth IRA, you need to open an account and be making money from a job in the form of wages, a salary, job-related profit sharing, sales commission(s), insurance premiums, tips and bonuses. Of course for tips and any income that you use to qualify – you will need to claim it on your tax return.

Proving your income is about the only similarity between Roth IRA eligibility and mortgage eligibility. In order to qualify for a mortgage you will definitely have to prove that you receive steady and predictable income. The guidelines around income for a mortgage a pretty broad and cover a lot of territory. Essentially a mortgage underwriter is going to look for steady employment over the past two years and be able to safely assume that your income stream has a likelihood of continuing over the next three years. The assumption here is that if you are salaried or work for hourly wages then it is likely that your income can and will continue into the future.

I’ll stop here with my eligibility qualification between the Roth IRA and mortgages since there isn’t more to compare.

All I can offer is that if you want to open a Roth IRA you should talk to a financial planner or tax professional to get some direction. Certainly if you don’t qualify for a mortgage the very next best thing you could do for yourself is to open a Roth IRA account and start working on improving your immediate and future financial picture.

Alternatives to Walking Away from Underwater Mortgages is a post from: Tucson Mortgages

Foreclosures. They’re starting to go down, but there are still quite a lot of them in the market.

It is not uncommon for homeowners who are underwater in their mortgages to feel helpless and contemplate walking away altogether. This may seem a temporary relief from the financial burdens of this situation, but it’s a choice that could potentially cause years worth of frustration and stress in the long run.

Are there alternatives to walking away? Yes.

There are extreme circumstances that would warrant walking away as the only viable option, but that is seldom the case. Walking away should really be a last resort for anyone who has hopes of maintaining a healthy financial future.

What exactly is an underwater mortgage? What does it mean to be upside down?

This refers to a situation where homeowners owe more on their mortgage than their house is worth. This is negative equity, and it is caused by declining property values, increases in mortgage debts, or a combination of both.

Before you walk away, consider your options. Talk to your lender. Seek help from a certified counselor with the U.S. Department of Housing and Urban Affairs (HUD).

Here are some alternatives to walking away:

• Refinancing. It can be a tough feat to accomplish, but essentially you are exchanging your current mortgage loan for a new one, and currently, interest rates are at record lows. There are strict requirements for refis including good credit, a FICO score of 720, documented income, etc. This is the best option to take if you are seeking preventative action and are not yet on your last legs financially. If you can qualify for a new loan, FHA refinance programs are a good option for you to consider.
• Mortgage Modifications. This will take your payment down to a more affordable level by re-negotiating the terms of your existing loan. Lenders generally lower the interest rate, lengthen loan terms or reduce the principal. Sometimes they do a combination of all three. This is an option for both homeowners with good credit and those who are struggling.
• Short Sales. This is an agreement between the lender and the homeowner that allows the homeowner to place their home on the market with the understanding that the sale price will be less than is owed on the mortgage.

Modifications and short sales can both impact your credit negatively, but it is much less severe than a foreclosure.

What a lot of distressed homeowners don’t realize is that foreclosing is not a situation that affects only said homeowner. Foreclosures bring down the value of neighborhoods, they reduce home values, and they further weigh down the entire economy.  For the homeowner, this will account for more expensive mortgages in the future. While it is sometimes unavoidable, every struggling homeowner should take the time to explore the options available.

Recently, the Obama Administration’s Making Home Affordable Program began offering new options for struggling homeowners who are looking for options before walking away.

Buying a Condo? What Are the Pros and Cons? is a post from: Tucson Mortgages

Condos can be a great home option for the right homeowner, from retirement age to college students. There are also some separate loan options for condo purchases. Is a condo right for you? Let’s weigh the pros and cons.

Pros

• Maintenance. Many condominiums require little maintenance from occupants. Monthly dues cover yard maintenance and minor repairs, and someone else does it. Larger repairs are covered by reserve funds saved by the condo association.
• Amenities. In many condo communities there are clubhouses, pools, exercise facilities, security features and others. These also do not cost extra.
• Condo Board. They are there to handle disputes with neighbors you might have otherwise had to handle yourself living in a single-family neighborhood.
• Cost. Many times condos are cheaper than their single-family home equivalent. This is beneficial if you like a certain neighborhood, but don’t want to pay the hefty price of a single-family home in the same area.
• Social Living. Many condo residents find that it is more enjoyable to build friendships with their neighbors who are in much closer proximity. There are also occasional social functions hosted by the condominium community or condo board.

Cons

• Monthly dues. Be careful with these ones. If cost is an issue, ample fees could make them more expensive than nearby single-family homes. Also, once the mortgage is paid off, the fees continue as long as you live in the condo.
• Limited Space. Likely you would have little to no backyard. Most condominiums have small porches or patios if anything. Some condos have garage or storage space, but not many. Factor in the monthly fees of rented storage space if you need it to get an accurate reflection of the costs.
• Less Privacy. You will likely have neighbors you live above or below, and at least one of your walls will be shared with another neighbor, so noise can be an issue.
• Resale. More often than not, most buyers are on the hunt for single-family homes. If this is an investment property, consider the location, too.
• Poor Management. Poor management can be detrimental to the overall value of the community, and you may unexpectedly find yourself paying hefty bills if management fails to keep a reserve fund for massive repairs. Research the community before you decide to buy.
• Condo Board. Like an HOA, they can sometimes get excessive with the rule making. Research the Condo Board in the community you’re interested in to see if you would have issues complying with their regulations. For example: If you are hoping to use the condo for subletting, Condo Boards can make this illegal. You will want to know that before you commit to the sale.

Thinking of buying a condo? We can help with all your financing questions. If you’re considering buying a condo to house your college student, ask us about the Kiddie Condo Loan Program offered through the Federal Housing Administration (FHA) loan programs.

Why Buyers Should Ease Off the Credit Prior to Closing is a post from: Tucson Mortgages

Closing on a home can be a stressful but also exciting time for buyers. However, buyers need to be aware that changes in credit before closing on the house can be detrimental to their ability to buy the home they likely spent countless hours searching for and selecting.

As of June 1, 2010, Fannie Mae’s Loan Quality Initiative requires lenders to refresh a borrower’s credit report just prior to closing. This means that any new line of credit, any increases in credit, any increase in balances, any derogatory item, etc will appear on the report.

Here is a scenario for example:

A couple makes an offer on a home they love. Though they realize they’re stretching a bit, they get pre-qualified to get the loan. They receive formal approval and are elated. They decide to make some new furniture purchases for the new home—and they put it on a credit card.  The lender runs an updated credit report just before closing, as per Fannie Mae’s new guidelines, and they no longer meet the DTI (debt to income) ratio to qualify for the loan because of their balance increase. The loan is pulled. Now there’s no new house, and lots of new furniture.

The idea behind the Loan Quality Initiative was to focus “on capturing critical loan data earlier in the process and validating it before, during, and immediately after loan delivery.”

Borrower qualifications were just one issue of concern. Others were:

• Determining owner occupancy
• Verifying social security numbers
• New exclusions from Fannie Mae loans
• Updated quality-control policies

Fannie Mae guidelines do not technically require updated credit checks for borrowers, but it does offer it as a suggestion to lenders to be in compliance with Fannie Mae’s new initiatives. The suggestions point out that not only might a refreshed credit report show newly-acquired debt, but also new credit inquiries.

New acquirements can be seriously detrimental to your ability to purchase your new home. Keep your credit report as constant from its initial pulling to the last update prior to closing. Once you get the keys to your new home, go ahead and buy the new furniture or the new car, but not until then.